THE HON’BLE SRI JUSTICE T. VINOD KUMAR Writ Petition No.39326 of 2013

ORDER

Heard learned counsel for the petitioner, learned Government Pleader for Prohibition and Excise appearing for respondent Nos.1 to 4 and perused the record.

2. By the present Writ Petition, the petitioner has assailed the action of the 1^st respondent authority in ordering the petitioner to pay 10% of additional licence fee i.e. a sum of Rs.3,80,000/- for excise year 2012-13 within seven days from the date of receipt of a copy of the order, failing which, the petitioner was informed that the said additional licence fee will be recovered from the bank guarantee furnished by the petitioner as licensee under the provisions of the Andhra Pradesh Excise Act, 1968 ( for short, ‘the Act’) read with the Andhra Pradesh Excise (Grant of License of selling by Bar and Conditions of Licence ) Rules, 2005 (for short, ‘the Rules’).

3. Briefly stated, the case of the petitioner is that it was granted 2B Bar Licence No.71/2006-07 dt.29.11.2006 for establishment of Bar and Restaurant at premises bearing Door Nos.1-7-637/1 and 1-7-640 situated at Subedari, Hanamkonda, Warangal District, by the respondents, in terms of Rules 5 and 11 of the Rules; that the aforesaid licence was renewed from time to time by collecting the prescribed fee; and that the licence is also renewed for the year 2013-14.

4. It is the further case of the petitioner that the respondents- authorities, while granting 2B licence for establishing bar and restaurant, have approved the plan showing the enclosures, whereat the petitioner was permitted to serve liquor for consumption of its customers, which is clearly identified as liquor serving area.

5. It is the further case of the petitioner that as per Rule 10 of the Rules, the area which is earmarked as liquor serving area in petitioner’s premises is contiguous right from the beginning when licence was granted to it in the year 2006-07 and continued as such; that the 1^st respondent authority basing on the audit objection that it had raised/constructed hut in open place of the licensed premises and as such construction/raising of hut is non-contiguous to the liquor serving area, had booked a case, vide COR No.206/2013-14 on 31.05.2013; that on the aforesaid case being booked by the respondents-authorities, the petitioner had compounded the same, vide proceedings dt.21.06.2013 by paying a fee of Rs.1,00,000/-; and that upon such payment, the case booked against the petitioner was closed.

6. It is the further case of the petitioner that the hut was constructed in the open space of the premises in the month of February, 2013 for serving food and the said hut was removed on 04.06.2013 after the 1^st respondent booked a case vide COR No.206/2013-14 on 31.05.2013 and even during the short period of its existence, the same was not put to use for serving liquor; and that since, the petitioner had compounded the said case booked against it by paying the compounding fee, the respondents-authorities cannot seek to levy 10% of the licence fee as additional licence fee towards non-contiguous enclosure as per Rule 10(2)

of the Rules.

7. Petitioner further contends that on the respondents-authorities issuing a show cause notice dt.14.06.2013 calling upon the petitioner to submit explanation to the aforesaid proposal seeking to levy 10% of the licence fee as additional licence fee, it had submitted its reply dt.18.06.2013; and that in addition to submitting explanation to the aforesaid notice, the petitioner had also approached the 3^rd respondent authority and submitted representation, which has not been considered.

8. Petitioner further contends that while the representation submitted to the 3^rd respondent is pending consideration, the 1^st respondent had issued the impugned proceeding directing the petitioner to pay 10% additional licence fee for the year 2012-13 based on the audit objection without applying its independent mind and thus, the impugned demand of payment of addit