JUDGMENT : 

I.P.MUKERJI, CJ.

Three writ petitions were before this Court.

One was by the International Spirits and Wines Association of India [WP (C) No.186 of 2021] Association of Manufacturers, Bottlers and Suppliers of liquor. The second was by the Association of Meghalaya Bonded Warehouses [WP (C) No.234 of 2021]. The third was by the Umpohliew Central Bonded Warehouse [WP (C) No.430 of 2024], which is created by the impugned Meghalaya Bonded Warehouse (Amendment) Rules, 2020, made under the Assam Excise Act, 1910 (“the Act”).

The cause of action in the first two writ petitions is more or less similar. The writ petitioners challenge the validity of the said rules and seek an injunction restraining operation of the Central Bonded Warehouse. The third writ petition called in question the authority of the State government to establish more than one Central Warehouse in the State in implementation of the said rules.

During the final stages of hearing of the writ petitions, Umpohliew Central Bonded Warehouse withdraw its writ.

The trade in liquor is very substantial in this State. There is a large market for both foreign and country liquor. These two types of liquor have been defined in the above Act and rules. It goes without saying that this trade involves manufacturing, supply and distribution of this product.

The Act was enacted to, inter alia, regulate this trade throughout the State of Assam and Eastern Bengal within which now falls the present State of Meghalaya. On creation of this State in 1972, it adopted the said Act and the above rules thereunder amended from time to time till 1965.

Up to then and even thereafter there was no grievance of any person with regard to the regulation of the liquor trade in the State.

Under the said rules, the retail price of a bottle of foreign liquor is fixed by the government. This price till the impugned rules came into force, included the price charged by the manufacturers, bottlers suppliers, all taxes levies thereon, the commission of the bonded warehouse and the retailer’s margin.

A retailer on assessment of the demand would place requisition on a bonded warehouse which would supply the goods to him upon obtaining it from the manufacturers, bottlers suppliers etc.

The recital to the Assam Excise Act, 1910 states that it was enacted to consolidate and amend the excise law in Eastern Bengal and Assam. It has been made applicable to the State of Meghalaya. According to its preamble, it relates to import, export, transport, manufacture, sale and possession of intoxicating liquors and of intoxicating drugs.

“Intoxicant” has been defined in Section 3(12a) of the Act as meaning any liquor or intoxicating drug.

Section 3(14) describes liquor as follows.

“3(14) “Liquor” means intoxicating liquor and includes all liquid consisting of or containing alcohol; also tari and pachwai in any form; and any substance which the State Government may, by notification, declare to be liquor for the purposes of this Act.”

Spirit is defined in Section 3(19) as follows:

“Spirit” means any liquor containing alcohol, obtained by distillation, whether it is denatured or not.”

There is further categorisation in Section 4. The state government is given the power to declare by notification which type of liquor would be branded as “country liquor” and which to be branded as “foreign liquor.”

Section 16 is important. It, inter alia, provides that the Excise Commissioner with the sanction of the Board may establish or allow to be run on licence a warehouse where, inter alia, liquor of any kind could be deposited [see section 16(d)].

Now, we come to the provision which has become very contentious in these writ petitions. It is Section 19 which is in the following terms:

“19. Executive privilege of manufacture and supply. – The State Government may grant to any person on such conditions and for such period as it may think fit, the exclusive privilege of manufacturing or of supplying to licensed vendors any country liquor or intoxicating