The central legal point established in the judgment is the violation of principles of natural justice in the renewal dispute and the importance of decisions being based on merit and correct facts.

PRAKASH KRISHNA, J.

( 1 ) BY means of the present writ petition, the petitioners the challenged the order dated 31. 3. 2005 passed by the Collector, Azamgarh, revisional order dated 11. 4. 05 passed by the State of U. P. through its Principal Secretary, Excise Department and the order dated 26. 4. 2005 passed by the additional Excise Commissioner (licensing ).

( 2 ) THE petitioners, eight in number, were granted licenses to vend the country liquor in respect of the shops namely Husainabad-Nizambad, Gola-Chowk, Saraihazi, Khatri-Tola, Ajamatpur kodar, Hafizpur Crossing, Saraimeer and Ramapur respectively for the excise year 2002-03. The licenses of these eight shops were renewed for the excise year 2003-04 and 2004-05 in view of the policy framed by the State Government. The State of U. P. framed Excise Rules namely the u. P. Excise (Settlement of License for Retail Sale of Country Liquor) Rules, 2002. It has been stated in para 8 of the writ petition that the renewal fees for the renewal of license for the Excise year 2005-06 has been deposited in time i. e. 17th of March, 2005 which was the last date fixed for submitting the renewal application.

( 3 ) THE Licensing Authority/district Magistrate, Azamgarh passed an order dated 31st of March, 05 cancelling the renewal of the license for the Excise Year 2005-06 in View of the policy laid down by the Excise Commissioner by his instructions dated 10th of March, 2005. The ground for refusing to renew the license for the year 2005-06 is that the licensees have not lifted the minimum guarantee quota for the month of March 2005 in the Excise Year 2004-05. The licensing Authority/district Magistrate while passing the order dated 31st of March, 2005 refusing to renew the licenses has given the direction that the balance amount towards price of unlifted minimum guarantee quota may be adjusted from the advance security amount of the licensees and these shops may be run on daily basis to safeguard the interest of Revenue.

( 4 ) THIS order was challenged by the petitioners by way of eight appeals before the Additional excise Commissioner (Licensing and Industrial Development ). The Additional Excise commissioner by order dated 6th of April, 05 allowed these appeals and set aside the order dated 31st of March, 2005 cancelling the renewal of the license with the observation that if the licensees deposit the requisite license fee and basic fee, their licenses would be renewed for the year 2005-06. Further in respect of shops of Rampur and Gola Mehnagar Chowk, there remains a sum of Rs. 29,150/- and Rs. 1,15,263/- even after adjusting the advance security amount. The additional Excise Commissioner directed that the Licensing Authority shall reconsider its decision in as much as no notice before refusal of renewal of license was given to these licensees as required under Rule 14 (6) of the U. P. Excise (Settlement of License for Retail of the Country liquor) Rules, 2002.

( 5 ) DURING the pendency of the appeal before the Additional Excise Commissioner it appears that an advertisement inviting application was issued by the department in respect of these shops and 7th of April, 2005 was the date fixed for the settlement proceeding. The respondent Nos. 5 to 12 and other persons expressed their desire to take the shops in the ensuing settlement proceeding which was fixed for 7th of April, 2005 but settlement proceeding could not take place as in the mean time the order of the Additional Commissioner (Excise), restoring the license in respect of six shops and reconsideration of refusal to renew the license in respect of two shops by the licensing Authority, came into existence on 6. 4. 2005.

( 6 ) THE respondent Nos. 5 to 12 (hereinafter referred to as private contesting respondents) could not move ahead for the settlement of these shops in their favour. They challenged the order passed by the Assistant Commissioner (Excise) by way of filing eight revisions before the State government, on 11th of Apri

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