The court established that licensed manufacturers must be compensated for all supplied inventory under contractual obligations, regardless of prohibition policies affecting sale.

CAV JUDGMENT

(Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD)

Date : 10-12-2025

Heard Mr. Satyabir Bharti, learned Senior Counsel assisted by Ms. Kanupriya, learned counsel for the petitioner(s), Mr. P.K. Shahi, learned Senior Advocate assisted by Mr. Vikash Kumar, learned counsel for the Bihar State Beverage Corporation Limited and Mr. Anuj Kumar, learned AC to GP-24 for the State of Bihar.

2. Since both the writ applications involve common questions for consideration, on the request of learned counsel for the parties, these matters have been heard together and are being disposed of by this common judgment.

3. For sake of clarity, we will briefly take note of the facts of the two writ applications separately hereinafter.

CWJC No. 10011 of 2024

4. In this writ application, the petitioner is a Public Limited Company engaged in manufacturing and supply of country liquor in Polyethylene Terephthalate (in short ‘PET’) bottles. It is the case of the petitioner that the Government of Bihar came with a policy decision whereunder tenders were invited from the eligible person/partnership firms/companies in terms of tender notice dated 31.01.2014 published in the Bihar Gazette (Extraordinary) (Annexure ‘P/1’). For purpose of the allotments, the entire zones were divided into seventeen zones and the contract for manufacture and supply of country liquor was equally divided amongst seventeen contractors. The petitioner was allotted Zone No. 9 (Vaishali Zone). This firm had quoted the rate for supply at Rs. 4.14 per 200 ml. PET bottles and was granted exclusive privilege and consequential licence for supply to the Bihar State Beverage Corporation Limited, a Government of Bihar Undertaking (hereinafter referred to as the ‘Corporation’ or ‘BSBCL’), during the period 01.04.2015 and 31.03.2016. The exclusive privilege order dated 04.03.2014 and licence granted to the petitioner are Annexure ‘P/2’ and ‘P/2/1’ respectively.

5. It is the case of the petitioner that the petitioner was granted licence in Form 27 and under the licence, he was made liable to supply country liquor at the contracted rate to the wholesaler. The wholesaler was granted licence in Form 27(C). The wholesaler had to issue Orders For Supply (in short ‘OFS’) and the petitioner was obliged to supply the country liquor in PET bottles as per the requisition received from the wholesaler. In terms of the licence (Annexure ‘P/2/1’) Clause 8 (£) in case of failure on the part of the petitioner to make supplies, the petitioner would be liable to suffer penalty as per direction of the Excise Commissioner in the manner stated in Clause 8 (£) of the licence. There is a complete bar in selling the country liquor to any other person except the wholesaler.

6. It is the case of the petitioner that from a bare reading of the terms and conditions of tender which form part of the licence (Clause 23 of the tender document), it would appear that the terms of tender are also terms of licence and a joint reading of Annexure ‘P/2’ and Annexure ‘P/2/1’ would clearly show that in fact, the manufacturer having licence in Form 27 was selling the country liquor in PET bottles as per requisition (OFS) received from the Corporation. Once the supply is made to the Corporation and the invoices are drawn showing the Corporation as purchaser, the manufacturer was not liable for further sale of the country liquor in PET bottles to the retailers.

7. Learned Senior Counsel has submitted that on a bare perusal of the invoices, it would appear that the tax invoice is drawn showing the Corpora