REZZAK HOTELS PRIVATE LIMITED Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) The exercise of jurisdiction under sub-rule (2) of Rule 14 of the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968 (for short, 'Rules'), in many a decision of this Court, it is held, that the Licensing Authority none other than the Deputy Commissioner-Revenue is required to issue a show-cause notice inviting an explanation from the licence holder and thereafter pass orders in the matter of levying penalty for short lifting of liquor during the excise year. The law laid down by this Court is in tandem with the statutory provisions required to be adhered to and complied with by the Authorities. Despite the statutory compulsions and the order of this Court the Deputy Commissioner of Excise issued a show-cause notice dated 17-6-2013 Annexure-D without jurisdiction and competence since such a notice could be issued only by the Licensing Authority, i.e. Deputy Commissioner (Revenue). So also by demand notice dated 7-7-2012 Annexure-C, the Deputy Commissioner (Revenue) directed payment of a certain sum of money towards penalty for not lifting the quantity of liquor for the months of July 2009 and May 2010, without issuing a show-cause notice calling for an explanation.

(2.) The Inspector of Excise is said to have issued the challan Annexure-H calling upon the petitioner to pay Rs. 12,14,005/- as penalty for the purpose of considering the application for renewal of the Excise licence, though neither Rules nor the Karnataka Excise Act, 1965 invest a jurisdiction in the Inspector of Excise to issue a challan.

(3.) In compliance with the order dated 31-7-2014, the Deputy Commissioner of Excise, Deputy Commissioner of Revenue and the Inspector of Excise, Ulsoor range have filed their respective affidavits tendering unconditional apology for their actions called in question in these petitions.