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2018 Supreme(MP) 859
IN THE HIGH COURT OF MADHYA PRADESH
G.S. Ahluwalia, J.
Som Distilleries Pvt. Ltd. (M/s) v. Excise Commissioner and others
Writ Petitions No. 60 of 2016, 61 of 2016, 62 of 2016, 63 of 2016, 64 of 2016, 65 of 2016, 66 of 2016, 67 of 2016,
68 of 2016, 71 of 2016, 961 of 2016, 963 of 2016, 1479 of 2016, 1492 of 2016, 7842 of 2016, 214 of 2017, 215 of 2017, 216 of 2017, 217 of 2017, 218 of 2017, 219 of 2017, 220 of 2017, 221 of 2017, 271 of 2017, 22584 of 2017, 22585 of 2017, 22586 of 2017; Decided on 30.11.2018.
S.K. Shrivastava for petitioners in W.P. No. 214/17, 215/17, 216/17, 217/17, 218/17, 219/17, 220/17, 221/17 and 271/17. No for petitioner in W.P. No. 7842/16; V.K. Bhardwaj with Anand Bhardwas for remaining petitioners; Smt. Nidhi Patankar, Government Advocate for respondent/State.
Headnote: ¼1½ vkcdkjh vf/kfu;e] 1915 ¼e-ç-½ & /kkjk 62 & e-iz-ns'kh fLifjV fu;e] 1995 & fu- 2 ¼d½] ¼2½ ¼[k½ rFkk 4 ¼4½ & Hk.Mkj.k esa U;wure LVkWd cuk, j[kuk & iz;kstu & vfrfjä ek¡x dh fLFkfr esa fLifjV iznk; djuk & ek¡ax rFkk iznk; esa larqyu cuk, j[kus ds fy, & vuqKfIr/kkjh ls U;wure LVkWd cuk, j[kuk visf{kr gS & U;wure LVkWd cuk, j[kuk vkKkid gS & vuqKfIrËkkjh bl vk/kkj ij cp ugha ldrk fd U;wure LVkWd ugha cuk, j[kus ls jkT; izfrdwy :i ls izHkkfor ugha gqvkA ¼2002½ 98 ,y Mh Vh 275 fufnZ"VA ¼iSjk 19 ,oa 20
¼2½ ns'kh fLifjV fu;e] 1995 ¼e-ç-½ & fu- 4 ¼4½ & dkj.k crkvks lwpuk esa vfHkdFku & U;wure LVkWd cuk, ugha j[kus ls pkyku yafcr jgs & vuqKfIrËkkjh }kjk ,slk vfHkdFku fookfnr ugha fd;k x;k & ;g n'kkZus esa cqjh rjg ls vlQy jgk fd U;wure LVkWd ds vHkko ds dkj.k pkyku yafcr ugha jgs & mldk vkËkkj fd jkT; dks dksbZ gkfu ugha gqbZ rFkk pkyku fofHkUu dkj.kksa ls yafcr jgs & U;wure LVkWd ugha cuk, j[kus ds vfHkdFku ds laca/k esa fdlh fookn ds vHkko esa & vfHkfu/kkZfjr fd;k x;k fd ;kph U;wure LVkWd cuk, j[kus esa vlQy jgkA ¼iSjk 21 ls 23
¼3½ lafonk vf/kfu;e] 1872 & /kkjk 73 rFkk 74 & e-iz- ns'kh fLifjV fu;e] 1995 & fu- 4 ¼4½ rFkk 12 ¼4½ & U;wure LVkWd cuk, j[kuk vkKkid gS & U;wure LVkd Ukgh cuk, j[kuk & 'kkfLr dk vf/kjksi.k & vuqKfIr/kkjh dk nkf;Ro & og efnjk ds O;kikj dks fofu;fer djus dh fof/k ds mica/kksa ls voxr Fkk vFkok uhyke ds fucaËkuksa ls voxr Fkk & og lafonkRed ck/;rkvksa ls cp ugha ldrkA ¼2004½ 11 ,l lh lh 26] ¼1990½ 1 ,l lh lh 109] ¼1995½ 1 ,l lh lh 754 rFkk ¼2013½ 6 ,l lh lh 573 vuqlfjrA ¼iSjk 20] 24 ls 27 ,oa 34
¼4½ ns'kh fLifjV fu;e] 1995 ¼e-ç-½ & fu- 12 ¼4½ & e-iz- vkcdkjh vfËkfu;e] 1915 & /kkjk 62 & U;wure LVkWd ugha cuk, j[kuk & 'kkfLr vf/kjksi.k dk fook|d & uqdlkuh] okLrfod gkfu ;k vkijkf/kd eu% fLFkfr ds rF; ds gksuk vko';d ugha & fdUgha fu;eksa ;k vf/kfu;e ds fdUgha mica/kksa ds Hkax ;k mYya?ku ij 'kkfLr vf/kjksi.kh; gS & fu;e 12 ds v/khu 'kkfLr vf/kjksi.k voSËk ughaA ¼1984½ 3 ,l lh lh 634] ¼2004½ 11 ,l lh lh 26 rFkk , vkb vkj 1977 ,l lh 2279 vuqlfjrA , vkb vkj 1970 ,l lh 253] , vkb vkj 1981 ,l lh 1680] ¼2012½ 3 ,l lh lh 248] , vkb vkj 1973 ,l lh 1098] 2002¼4½ ,e ih ,p Vh 12] 2010 ¼3½ ,e ih ,y ts 29] , vkb vkj 1987 ,l lh 1345] , vkb vkj 1990 ,l lh 1579 rFkk vkb ,y vkj 2016 ,e ih 371 fufnZ"VA ¼iSjk 28 ls 31
¼5½ Hkkjr dk lafo/kku & vuq- 227 & e-iz- ns'kh fLifjV fu;e] 1995 & fu- 4¼4½ & vuqPNsn 227 ds v/khu 'kfä;ksa dh O;kfIr & 1995 ds fu;eksa ds fu;e 4 dh fof/kekU;rk & vk{ksfir ugha & lkafo/kkfud fof/kekU;rk ij vk{ksi ds vHkko esa & fu;eksa dh fof/kekU;rk ij fopkj ugha fd;k tk ldrk & rFkkfi fjV ;kfpdk Ø- 525 lu~ 2017 fu.khZr fnukad 14-9-2018 eas fu;e 4 ¼4½ dh fofËkekU;rk ekU; dh tk pqdh gSA ¼iSjk 32 ,oa 33
¼6½ Hkw&jktLo lafgrk] 1959 ¼e-ç-½ & /kkjk 9 & jktLo eaMy dh izfØ;k ds fu;e & fu- 4 & jktLo eaMy ds ,dy lnL; dk iwoZrj fu.kZ; & i'pkrorhZ ekeys esa izHkko & D;k ,slk fu.kZ; vkc)dj gS ;k ekeyk [kaM U;k;ihB dks funsZf'kr fd;k tkuk pkfg, & jktLo eaMy dk iwoZrj fu.kZ; mPp U;k;ky; }kjk bl vk/kkj ij ekU; fd;k x;k fd 'kkfLr vf/kjksi.k ls iwoZ & vkcdkjh vk;qä }kjk dksbZ lwpuk i= ugha fn;k x;k Fkk & bl ekeys esa] ;kph dks lwpuk i= fn;k x;k rFkk mlus vkcdkjh vk;qä ds le{k dk;Zokgh esa Hkkx Hkh fy;k & jktLo eaMy dk iwoZrj fu.kZ; mlh fook|d ij ugha & ekeyk [kaM U;k;ky; dks funsZf'kr djus dh vko';drk ughaA ¼iSjk 35 ls 37
¼7½ Hkkjr dk lafo/kku & vuq- 227 & e-iz- Hkw&jktLo lafgrk] 1959 & /kkjk 9 & jktLo eaMy dh izfØ;k ds fu;e & fu- 4 & bl rF; dks fopkj esa yk, fcuk fd ,dy lnL; dks ekeyk jktLo eaMy dh [kaM U;k;ihB dks funsZf'kr djuk pkfg, Fkk ;k ugha & jktLo eaMy dk fu.kZ; mPp U;k;ky; ij vkc)dj ugha & mPp U;k;ky; jktLo eaMy ds vkns'k dh 'kq)rk lnSo ij[k ldrk gSA ¼iSjk 38
¼8½ iwoZ fu.kZ; & jktLo eaMy dk fu.kZ; & mPp U;k;ky; ij vkc)dj ughaA ¼iSjk 38
(1) Excise Act, 1915 (M.P.) -- S. 62 -- M.P. Country Spirit Rules, 1995 -- Rr. 2 (a), 2 (b) and 4 (4) -- maintaining of minimum stock in storage warehouse -- purpose -- to supply spirit in case of additional demand -- for maintaining balance between demand and supply -- licensee is required to maintain minimum stock -- maintaining of minimum stock is mandatory -- licensee cannot get away on ground that non-maintenance of minimum stock had not effected State adversely. (2002) 98 DLT 275 referred to. [Paras 19 & 20
(2) Country Spirit Rules, 1995 (M.P.) -- R. 4(4) -- allegation in show cause notice -- challans remained pending due to non-maintenance of minimum stock -- such allegation not disputed by licensee -- miserably fail to show that challans did not remain pending due to lack of minimum stock -- his stand was that no loss caused to State and challans remained pending due to various reasons -- in absence of any dispute with regard to allegation of non-maintenance of minimum stock -- it is held that petitioner failed to maintain minimum stock. [Paras 21 to 23
(3) Contract Act, 1872 -- Ss. 73 and 74 -- M.P. country Spirit Rules, 1995 -- Rr. 4(4) and 12(4) -- maintaining of minimum stock is mandatory -- non-maintenance of minimum stock -- imposition of penalty -- liability of licensee -- he was aware of provisions of law regulating business of liquor or was aware of terms of auction -- he cannot wriggle out of contractual obligations. (2004) 11 SCC 26, (1990) 1 SCC 109, (1995) 1 SCC 754 and (2013) 6 SCC 573 followed. [Paras 20, 24 to 27 & 34
(4) Country Spirit Rules, 1995 (M.P.) -- R. 12(4) -- M.P. Excise Act, 1915 -- S. 62 -- non-maintenance of minimum stock -- issue of imposition of penalty -- factum of damage, actual loss of mens rea are not necessary -- penalty is imposable on breach or contravention of any rules or any provisions of Act -- imposition of penalty under rule 12 is not illegal. (1984) 3 SCC 634, (2004) 11 SCC 26 and AIR 1977 SC 2279 followed AIR 1970 SC 253, AIR 1981 SC 1980, (2012) 3 SCC 248, AIR 1973 SC 1098, 2002 (4) MPHT 12, 2010 (3) MPLJ 29, AIR 1987 SC 1345, AIR 1990 SC 1579 and ILR 2016 MP 371 referred to. [Paras 28 to 31
(5) Constitution of India -- Art. 227 -- M.P. Country Spirit Rules, 1995 -- R. 4 (4) -- scope of powers under Article 227 -- validity of rule 4 of Rule 1995 -- not challenged -- in absence of challenge as to constitutional validity -- validity of rules cannot be considered -- however, validity of rule 4(4) has already been upheld in W.P. No. 525 of 2017; decided on 14.9.2018. [Paras 32 & 33
(6) Land Revenue Code, 1959 (M.P.) -- S. 9 -- Rules of Procedure of Board of Revenue -- R. 4 -- earlier decision of single member of Board of Revenue -- effect in subsequent matter -- whether such decision is binding or matter should be referred to Division Bench -- earlier decision of Board of Revenue upheld by High Court on ground that before imposing penalty, no notice was given by Excise Commissioner -- in the instant case, notice given to petitioner and he also participated in proceedings before excise Commissioner -- earlier decision of Board of Revenue not on same issue -- no need to refer matter to Division Bench. [Paras 35 to 37
(7) Constitution of India -- Art. 227 -- M.P. Land Revenue Code, 1959 -- S. 9 -- Rules of Procedure of Board of Revenue -- R. 4 -- irrespective of fact that single member should have referred the matter to Division Bench of Board of Revenue or not -- decision of Board of Revenue not binding upon High Court -- High Court can always test correctness of order of Board of Revenue. [Para 38
(8) Precedent -- decision of Board of Revenue -- not binding upon High Court. [Para 38
1. By this common order, Writ Petitions No. 60/16, 61/16, 62/16, 63/16, 64/16, 65/16, 66/16, 67/16, 68/16, 71/16, 961/16, 963/16, 1479/16, 1492/16, 7842/16, 214/17, 215/17, 216/17, 217/17, 218/17, 219/17, 220/17, 221/17, 271/17, 22584/17, 22585/17, 22586/17, are being disposed of as common question of law is involved.
2. Earlier, this Court by order dated 25-4-2017 had directed as under :
"Learned Counsel for the parties are in unison in respect of their submissions that it would be appropriate if present controversy would be decided once the said petition (Writ Petition 525/2017) is decided by the Division Bench of this Court.
Considering the submissions advanced by the parties, let this petition be placed as Sine Die. Parties are directed to renew their prayer for further hearing; once the controversy is decided by the Division Bench of this Court wherein vires of the Rules have been challenged."
3. The Division Bench of this Court, by order dated 2.8.2016 has observed as under :
"These petitions take exception to action of State and its functionaries in imposing the penalty in exercise of powers under rule 4(4) of Madhya Pradesh Country Spirit Rules, 1995 and rule 4(4) of Madhya Pradesh Distillery Rules, 1995. As the validity of these Rules are not challenged in these batch of petitions, office is directed to list the matter before Single Bench."
4. Accordingly, these batch of petitions have been listed before this Court for hearing on merits.
5. The necessary facts for the disposal of these cases are being considered from Writ Petition No. 60/2016.
6. This writ petition has been filed under Article 226/227 of the Constitution of India against the order dated 3.12. 2013 passed by the Excise Commissioner, M.P. as well as also against the order dated 10.9.2015 passed by the Board of Revenue, by which a penalty of Rs. 1,28,500/- has been imposed against the petitioner, for not maintaining the minimum stock under rule 4(4) of the M.P. Country Spirit Rules, 1995 (In Short Spirit Rules, 1995).
7. The petitioner is carrying on the business of sale of Country made liquor. A show cause notice dated 5.12.2011 was issued to the Petitioner, mentioning inter alia that the petitioner was granted license for supply of County liquor in Dewas Region for the year 2011-12. In the Dewas Warehouse, the minimum stock of Rectified Spirit was not maintained in the month of April 2011 and May 2011 as a result of which, challans remained pending for a period of 21 days in the month of April 2011 and 31 days in the month of May 2011. Similarly, in the month of June to September, 2011, the minimum stock was not maintained as a result of which for 30 days in the month of June 2011, for 30 days in the month of July, for 28 days in the month of August 2011 and for 29 days in the month of September, 2011, the challans remained pending. Further it was alleged that in the Sonkatch Warehouse, from April to September 2011, the minimum stock was not maintained as a result of which for 29 days in April 2011, for 31 days in May 2011, for 30 days in the month of June 2011, for 31 days in the month of July 2011 and for 30 days in the month of September, 2011, the challans remained pending Similarly, in Kannod Warehouse, the minimum stock was not maintained during the month of April to September 2011 as a result of which for 16 days in the month of April, for 18 days in the month of May, for 13 days in the month of June, for 11 days in the month of July, for 11 days in the month of August and for 11 days in the month of September 2011, the challans remained pending. Accordingly, the petitioner was called upon to show cause as to why penal action be not taken against it for violating rule 4(4) of Spirit Rules, 1995 as well as the terms and conditions of Tender and agreement, as well as why action be not taken under rule 12(1) of Spirit Rules, 1995.
8. The petitioner filed his reply, and submitted that the Country liquor was supplied as per the requirement an
