SAHYADRI WINE TRADERS Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) In these writ petitions referred to Division Bench by the learned single Judge, the question for consideration is, whether Sec 43(2) of the Karnataka Excise Act, 1965 (hereinafter referred as 'the Act') is violative of Articles 14 and 19(1) (9) of the Constitution of India.

(2.) Petitioners are liquor merchants possessing licences issued under the provisions of the Act and Rules framed thereunder. It is alleged that, on an 'nspection of the licenced shop premises of the petitioner in WP. 11715/81, the authorities found excess and unaccounted stock of 29.730 litres of IML and consequently seized the entire stock of liquor under Sec. 43(2) of the Act for the alleged offence under Secs. 32 & 36(b) of the Act. The stock of liquor, thus seized, included the liquor which the petitioner had lawful authority to possess. Ultimately an order was made on 9-6 1981 (Annexure-C) permitting compounding of the offence, by levying a compounding fee of Rs. 1,000/-. The seized property was ordered to be released on payment of value the entire stock quantified as Rs. 13,433-95. A similar order was made on 5-6-1981 (Annexure-C) in W P. No. 11392/81, permitting compounding of the offence and release of seized stock on payment of its value.

(3.) The grievance of the petitioners is, that, the provisions of Sec. 43(2) empower the confiscation of an intoxicant lawfully imported, transported or manufactured, and held in possession or sold legally, by a licencee, just because, the said possession or sale was along with or in addition to any intoxicant liable to confiscation under Sec. 43(1) A person may be lawfully in possession of certain quantities of intoxicant and at the same time, he may be in possession of some other quantity illegally. In such a situation, the confiscation of the entire stock will be a harsh and disproportionate penalty and hence, the petitioners contend, the law to be unconstitutional. Sec. 45 provides for compounding of offences. In addition to the fine prescribed as a compounding fine, it provides that in all cases in which any property has been seized as liable to confiscation, the property may be released on payment of the value thereof as estimated by the officer. Therefore, it is argued, that, the law not only punishes for contravening the law in respect of the intoxicants dealt illicitly, but also for possession or selling other intoxicants lawfully, provided the said sale or possession was accompanied by an illicit transaction. The contention of the petitioners is, the confiscation of an article which, a person has lawful authority to possess or sell, is arbitrary and unjust, just because the said person, also committed an illegality in respect of another article.