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Excise Commissioner Cannot Use Revenue Loss to Relocate Liquor Sub-Shop:
In a significant ruling that curbs the of excise authorities, the has held that the Commissioner, Excise cannot order the relocation of a permitted liquor sub-shop solely because it adversely affects the revenue of another licensee. The court set aside the Commissioner's order, finding it lacked legal foundation and was passed .
The Backdrop: A Sub-Shop at Lolti
The case involves Vivek Shah, who was granted permission to open a liquor sub-shop at Lolti in District Chamoli under the state's Excise Policy via an order dated . The main shop linked to this sub-shop was located at Gwaldam, 24 kilometres away. Respondent No. 5, who operated a liquor shop at Tharali—just six kilometres from Lolti—challenged the sub-shop before the Commissioner, Excise, claiming his business was suffering revenue loss.
The Commissioner, Excise, by an order dated , allowed the appeal and directed that the sub-shop be relocated to a place near Gwaldam, reasoning that the revenue of the Tharali shop was adversely impacted.
Arguments Before the High Court
Shah, through his counsel , raised multiple legal objections. He argued that neither the , nor the Excise Rules or the Excise Policy prescribe any specific distance between a main shop and a sub-shop. Therefore, mere loss of revenue to another licensee could not justify interference. Further, he contended that the appeal under was because there was no "order" being challenged, and in any case, the appeal was as it was filed beyond the 30-day . Shah also complained of a lack of : notice of the hearing was served only after the hearing date.
The State, through District Excise Officer, Chamoli, filed a counter affidavit stating the actual distance between Shah's main shop and his sub-shop was 16 kilometres—not 24 as claimed.
Court's Reasoning: Lack of Legal Basis
Justice Manoj Kumar Tiwari found substantial merit in the petitioner's contentions. The court noted that the permission to open the sub-shop was granted as per the existing policy, and there was no order that could be appealed against. The court observed that the Commissioner relied on Rule 28.4(b) of the Uttarakhand Excise Policy, but a plain reading of that provision shows it empowers only the District Magistrate to relocate a shop within the district—a power the Commissioner did not possess.
" ... enables the District Magistrate to relocate a shop from one place to another within the district. Thus the power under the said provision was not available to Commissioner, Excise."
The court also emphasised that in the absence of any statutory or policy provision prescribing a minimum distance between two liquor shops—whether main or sub-shop—the Commissioner could not interfere solely on the ground of revenue loss.
"in the absence of any provision regarding distance between two liquor shops, main shop or sub-shop, prescribed in the Excise Act, Excise Rules or Excise Policy, Commissioner, Excise could not have interfered with the sub-shop of the petitioner only on the ground that revenue of the shop run by respondent no. 5 is adversely affected."
The court further upheld the petitioner's argument on appeal maintainability and limitation, noting that
"the appeal was
, as there was no order which was challenged in the appeal."
The Verdict and Its Implications
Setting aside the impugned order, the High Court allowed the writ petition. The decision reinforces that excise authorities cannot use economic competition or revenue impact as a pretext to undo a legally granted licence. The ruling clarifies that the Commissioner, Excise does not have to relocate shops, and that any such power, where it exists, lies with the District Magistrate.
For liquor licence holders and the excise department alike, the judgment serves as a reminder that administrative interference must be grounded in clear legal provisions, not in the interests of rival businesses.
