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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 1642 OF 2013

[Arising out of SLP (Civil) No. 9098 of 2009]

State of Kerala and Others

.. Appellants

Versus

Kandath Distilleries

.. Respondent

J U D G M E N T

K. S. RADHAKRISHNAN, J.

1.

Leave granted.

2.

We are, in this appeal, concerned with the question whether

the High Court can issue a Writ of Mandamus under Article 226 of

the Constitution of India, directing the State to part with its

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exclusive privilege, in the matter of granting licence for

establishing distilleries under the Foreign Liquor (Compounding,

Blending and Bottling) Rules, 1975 (for short “1975 Rules”) read

with Section 14 of the Abkari Act (for short “the Act”).

3.

M/s Kandath Distilleries, respondent herein, claimed to have

submitted an application dated 12.1.1987 before the

Commissioner of Excise for a licence to establish a compounding,

blending and bottling unit in the Palakkad District. Few others

had also filed similar applications for licence for setting up

distillery units in the State of Kerala. All of them were directed to

first obtain the approval of the Government of India for the setting

up of new blending and bottling units and, thereafter, to approach

the State Government. This Court, however, vide its judgment

dated 29.1.1997 in Writ Petition No. 322 of 1996 (Bihar

Distillery and Another v. Union of India and Others) took

the view that the power to permit the establishment of any

industry engaged in the manufacture of portable liquors, including

Indian Made Foreign Liquors (IMFLs), beer, country liquor and

other intoxicating drinks is exclusively vested in the respective

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State Governments. Further, it was also held that the power to

prohibit and/or regulate the manufacture, production, sale,

transport of consumption of such intoxicating liquors is equally

that of the States.

4.

We notice, during the year 1998 and prior to that, the

Commissioner of Excise and the State Government had received

large number of applications for setting up of distillery units in

various parts of the State. The Commissioner of Excise or the

State could not have entertained all those applications and

granted the licences for the setting up of large number of

distillery units in the State. The State Government, however,

entertained four applications favourably and accorded its

approval under Section 14 of the Act. The State Government, vide

GO (Rt.) No. 291/98/TD dated 20.5.1998, examined the

application submitted by M/s Amrut Distilleries in detail and

granted approval for issuing a licence by the Excise Commissioner

for the establishment of a distillery unit for the manufacture of

IMFLs at Kanjkode village in the Palakkad District. The

Government also, vide its order dated 6.8.1998, examined the

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application of M/s Empee Distilleries, Madras, and accorded

approval for the grant of licence by the Excise Commissioner for

establishing a distillery unit at Kanjkode village in the Palakad

District. The application submitted by M/s K. S. Distilleries,

Kannur was also considered by the State Government and

granted permission to the Excise Commissioner to issue a licence

for a distillery unit to be established at Kannur, vide order dated

18.8.1998. The application of M/s Elite Group of Companies was

also favourably considered by the Government and accorded

permission to the Excise Commissioner for issuing the necessary

licence for establishing a distillery unit at Trichur.

5.

M/s Kandath Distilleries (respondent) having noticed that its

application submitted in the year 1987 for setting up the unit in

the Palakkad District was not considered, filed a Revision Petition

before the Minister for