P.V. DIXIT, J.

1. This application under Article 226 of the Constitution for a writ of mandamus and certain directions to the respondents, to be presently stated, has been filed in the following circumstances.

2. The petitioner, M/s United Excise Ujjain, a partnership firm, obtained from the State the privilege for the wholesale supply of country spirit in Ujjain Distillery area. Clause 4 of the deed, by which the privilege was granted to the petitioner, conferred on it the exclusive right to supply country spirit wholesale at the warehouses mentioned in the schedule to the deed. It laid down that the plain spirit supplied by the petitioner shall be a blend of fifty per cent Mahua based spirit and fifty per cent molasses spirit and that the petitioner-licensee shall be paid for such spirit according to the rates sanctioned by the State Government. It was further provided by clause 4 that the licensee shall purchase molasses based spirit from the Ratlam Alcohol Plant, Ratlam, for blending it with Mahua spirit and that the spiced (Masala) shall be manufactured at the Ujjain distillery in accordance with the procedure shown in the annexure to the deed and that the licensee shall be paid according to the rate sanctioned by the State Government. Clause 6 of the deed, which is very material here, is in the following terms:-

"The licensee shall distil Mahua based spirit, within the State at Ujjain distillery. Incase the licensee fails to supply spirit in the proportion of 50 per cent Mahua based and 50 per cent molasses based on account of non-availability of Mahua or any other special circumstances beyond his control and is required to supply pure Mahua spirit or pure molasses spirit or blended spirit not in the prescribed proportion, he shall be entitled to the cost price as may be determined by the Excise Commissioner after approval of the State Government and such price shall be binding on the licensee. In case the licensee fails to supply spirit for any reason beyond his control he may be permitted by the Excise Commissioner to obtain spirit from any other distillery located within the State and in that case the licensee shall be entitled to the price determined by the Excise Commissioner."

The petitioner says that the Ratlam Alcohol Plant is a State undertaking run by the State controlled Corporation constituted by the State Government. The Ratlam Alcohol Plant supplied to the petitioner molasses based spirit at the rate of 45 paise per proof litre in accordance with the tender notice dated the 29th March 1967. According to the rate sanctioned by the Government, the petitioner was paid for the supply of blended spirit at the rate of 79 paise per proof litre and at the rate of Rs.1.45 per proof litre for the supply of spiced spirit. It is common ground that the Ratlam Alcohol Plant was unable to maintain supplies of molasses based spirit to the petitioner. In the return filed by the respondents, it has been stated that this inability on the part of the Ratlam Alcohol Plant was due to a general shortage of molasses and sugar throughout the country. The State Government, therefore, purporting to act under clause 6 of the deed of licence, communicated to the applicant, by a memorandum issued by the Excise Commissioner on 29th August 1967, its decision to supply 100% Mahua or Gur based liquor at the rate of Rs. 1.75 per proof litre.

3. In reply to the memorandum dated the 29th August 1967, the petitioner addressed a letter to the Excise Commissioner on 4th September 1967 protesting against the fixation of the rate of Rs. 1.75 per proof litre for supply of 100% Mahua based liquor and contending that as the failure to supply molasses based spirit was of the State Government, clause 6 of the deed of licence was not attracted to the situation that the rate offered by the petitioner for the supply of plain blended spirit was a composite rate and the State Government was not justified in fixing the new rate by splitting up the composite