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2025 Supreme(Online)(Mad) 66464

IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M. SUBRAMANIAM, G.ARUL MURUGAN, JJ
A.Gopalakrishnan – Appellant
Versus
The Commissioner, Prohibition and Excise Department – Respondent
W.P.(MD)No.21149 of 2025



Advocates:
For the Appellants/Petitioners: Mr.R.Shankar Ganesh
For R1, R2 & R4: Mr.P.Thilak Kumar, Government Pleader
For R3: Mr.T.Senthil Kumar, Additional Public Prosecutor
For R5 & R6: Mr.S.Sivanesan, Standing Counsel
For R7: Mr.R.Krishnamoorthi

Authorities must enforce compliance with licensing laws to prevent illicit liquor sales under the pretense of Recreation Clubs, ensuring public health and safety.

Headnote:(A) Article 226 of the Constitution of India - Writ of Certiorarified Mandamus challenged the legality of FL2 licenses issued to Recreation Clubs for selling liquor. - Numerous complaints regarding Recreation Clubs functioning as liquor shops urged reviews of licencing procedures. The Court emphasized the duty of authorities to enforce compliance with the law and ensure public health and order. (Paras 1, 19)

(B) Tamil Nadu Prohibition Act, 1937 - Objective to prevent sale of intoxicating liquors and illegal activities conducted under the guise of Recreation Clubs. It was directed to inspect and ensure compliance, promoting public health and safety. (Paras 11, 19)

Facts of the case:
The petitioner seeks to challenge the legality of a license granted for a Recreation Club, claiming it operates as a retail liquor shop, thus affecting local residents negatively. The Court highlighted that misuse of licenses has been widely reported and requires urgent attention.

Findings of Court:
The Court ordered comprehensive inspections and strict enforcement of regulations governing the clubs to safeguard public health and ensure legal compliance regarding liquor sale.

Issues: The legitimacy of licenses issued under the guise of Recreation Clubs and the need for proper regulatory oversight were addressed.

Ratio Decidendi: The Court underscored the necessity for authorities to conduct checks on Recreation Clubs to prevent illicit liquor sales and enforce the Tamil Nadu Prohibition Act. The need for clear by-law incorporation regarding liquor sale activities was reiterated.

Result: Writ petition disposed of in line with prior orders, ensuring accountability.

Table of Content
1. challenge to licenses issued to liquor-selling recreation clubs. (Para 1 , 2)
2. required legal provisions and by-law adherence for liquor sale. (Para 4 , 10 , 12 , 19)
3. call for inspections and compliance verification of club activities. (Para 5 , 8 , 9 , 11 , 15)
4. order to dispose of the petition while enforcing compliance. (Para 20)

ORDER

(Order of the Court was made by S.M.SUBRAMANIAM, J.)

The Writ on hand has been instituted challenging the license granted in favour of the 7th respondent dated..

2.The issue raised in this Writ Petition has already been decided by this Court vide order dated 18.08.2025 made in W.P.(MD)Nos.8038 of 2019 etc., batch, which is extracted hereunder:-

“The present batch of writ petitions have been instituted seeking either to close down the Recreation Clubs, which are recently mushrooming in the urban and rural areas or not to grant FL-2 licence to run liquor shops in the name of Recreation Clubs.

2. The large scale complaints placed before this Court show that numerous Recreation Clubs are registered under the Tamil Nadu Societies Registration Act, 1975 , and those Recreation Clubs are running only liquor shops and selling liquors to not only the members, but also to the non-members. In the State of Tamil Nadu, retail vending liquor shops are being run only by the TASMAC, a fully State-owned Corporation and no license has been granted to the private individuals to run retail liquor shops. Since licenses are not granted to run liquor shops, the private individuals are registering Recreation Clubs under the and by obtaining FL2 license, they are running liquor shops alone, which is causing not only inconvenience to the residents residing in that locality, road users etc., but such Recreation Clubs are allowing the persons to involve in certain offenses inside the premises. These clubs are mostly remain unchecked by the officials of the Registration Department as well as by the police officials. The happenings inside these Recreation Clubs are since non- transparent, no actions are taken either by the police officials or by the officials of the Prohibition and Excise Department or by the competent authorities under the . This situation resulted in institution of number of writ petitions before the High Court seeking either to close down the Recreation Clubs or not to grant FL2 license to these Recreation Clubs, who all are running only retail vending liquor shops. 3. This Court has examined the relevant rules in this regard. The Assistant Commissioner (Excise), Pudukkottai, has filed a status affidavit, dated 14.08.2025, in W.P.(MD) No.7409 of 2024. In the said status affidavit, the rules relating to grant of FL2 licence have been stated in Paragraph No.4, which reads as under:

a) Rule 2 (vii):-

“Licence” includes the privileges granted under Section 17-C of the Act for the sale by retail of Indian-made Foreign Spirits and foreign liquor issued under these rules, and “licence holder”, means the holder of such a licence.

b) Rule 17(a):-

17 (a) Kinds of licences — The licences issued under these rules shall be of the following kinds, for the purposes specified in the Act.

(A) Licences for liquor used for consumption The licences issued under this class are for privilege of sale of Indian Made Foreign Spirits in retail under section 17-C of the Act or for sale of foreign liquor.

F.L. 1 – Licence for the grant of privilege of retail sale of bottled Indian – made foreign spirits or sale of foreign liquor.

F.L. 2. – Licence for possession of liquor by a non-proprietary club for supply to members.

c) Rule 19 (B) (2):-

In the case of an application for a licence in Form F.L.2. -

(i) that the club in respect of which the licence has been applied for is of a non-proprietory character functioning for more than 3 years and

(ii) that atleast 50 of the members of the club have signified their willingness to obtain liquor from the said club or that the club should have functioned with a bar in the pre-

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