A VARADHARAJAN Vs. A KRISHNANKUTTY NAIR

JUDGEMENT

(1.) THESE matters relate to retail vending of I. M. F. L. (Indian Made Foreign Liquor) in the State of Tamil Nadu. Block Period licenses introduced by G. O. Ms. Nos. 113, 115 and 120, dated 22. 6. 2001 had been the source of litigation since 2001. Firstly, it was the increase of shops from 6000 to 7000, which was upheld by judgment dated 21. 12. 2001 in R. Selvaraj v. Government of t. N. etc. & Others. , 2002 WLR 586 and nextly it was when the Block Period system was sought to be given a go-by by issuance of G. O. Nos. 128, 129 and 130, dated 8. 7. 2002, whereby the number of shops were further increased and the recategorisation was made for levy of privilege fee along with other changes including the introduction of lot system by cancelling the Block Period licenses, which was the subject matter of litigation in The Secretary to government of Tamil Nadu, Etc. And Another v. K. Vinayakamoorthy and others, 2002 (3) CTC 257 : 2002 (3) L. W. 317. All changes were upheld in the above judgment excepting the introduction of lot system, that too only where the Block Period licensees were sought to be displaced subject to their payment of privilege fee by 31. 7. 2002. The same was appealed against in the Supreme Court. But by order dated 9. 9. 2002 in The Secretary to Government of Tamil Nadu & Another v. K. Vinayagamurthy, 2002 (3) CTC 696 (S. L. P. No. 14735 of 2002 & batch), the appeals were dismissed making a slight modification in the order of this Court that instead of issuing a Mandamus to renew the licenses, it was modified to that of Mandamus to consider the grant of renewals. Then, there was a spate of writ petitions complaining that the renewals were not made in spite of remittance of privilege fee and that even privilege fee was not accepted , to defeat the claims of the Block Period licensees. By order dated 25. 9. 2002 in K. Ramanathan v. The state of Tamil Nadu & Others, (W. P. No. 34090 of 2002 and batch), a direction was issued to renew the licences of 4, 632 applications on receipt of balance of privilege amount if tendered by 30. 9. 2002. That was appealed against in the Supreme Court and by order dated 13. 11. 2002 in State of Tamil Nadu & ors v. K. Ramanathan, 2002 (10) JT 534, (S. L. P. No. 19277 of 2002), the Supreme court held as follows: ?all the existing licensees (the previous licensees)for the block period who had remitted the whole year?s licence fee by 31st of july, 2002, as well as all of them, who were granted licence for a period of six weeks subsequent to the impugned order of the High Court dated 2 5. 9. 2002 and in pursuance of the order of this Court dated 3. 10. 2002 on payment of the proportionate licence fee will be granted licence for the balance period of the excise Year 2002-2003 culminating on 1 5th September, 2003. By way of clarification, we hold that those of licensees who dropped out, even though applied for pursuant to the High Court?s order dated 25. 9. 2002 as well as those of the licensees who had participated in the fresh lot in accordance with the new Excise Policy will not be entitled to get advantage of this order. It is further clarified that all those licensees who might have deposited the whole year?s fee though were granted licence for a period of six weeks pursuant to the order dated 3. 10. 2002 will also be entitled to get the licence for the balance period of the Excise Year. We would also observe that it will be open for any of the existing licensees as well as the new allottees on the basis of the draw of lots to opt out if they find the continuance of the privilege to be onerous in any area where the number of shops exceeds the number of notified shops on account of adjustment required to be made. The appeal stands disposed of on aforesaid terms. ? Pursuant to the above judgment of the Supreme Court, the renewals were made for the Excise Year 2002-2003. For the Excise Year 2003-2004, G. O. Ms. No. 244, dated 4. 10. 2003 was issued introducing a new system of selection basing on the merit while sparing 284 Block Period licensees for entitlement according to the then policy in G. O. Ms. Nos. 113, 115 and 120, dated 22. 6. 2001. Writ Petitions were filed challenging the same and meanwhile, ordinance No. 8 of 2003 was promulgated repealing Tamil Nadu liquor Vending rules introducing sub-section 1-B and Clauses (A), (B) and (C) after sub-Section 1-A in Section 17-C of the Tamil Nadu Prohibition Act granting exclusive privilege for retail vending to TASMAC which was also empowered to appoint cooperative societies as its agent. The same was challenged and meanwhile, the Ordinance was replaced by an Act (Act 31 of 2003) and that Act was challenged in W. P. No. 30158 of 2003 and batch. The licences for 2002-2003 were to expire, according to the said Act, by 28. 11. 2003 and then this Court , by way of an interim Order dated 27/28. 11. 2003 passed the following order: ?3. We are mainly going on the balance of convenience factor. In the event of writs being allowed, then the entire Government staff hav e to be withdrawn and the shops, which are established, have to be taken off. On the other hand, if a modified interim order is passed enabling such of the licensees, who are claiming renewal of licenses as of right, to operate then there should not be any difficulty in restoring the shops to the Government in the event of dismissal of the writ petitions. Such persons shall only include 284 (who had remitted the privilege amount before 31. 7. 2002) and 595 (who had remitted the amount within 30. 9. 2002), and their contentions that they are entitled for the renewal of licenses for the remaining block period have got to be considered and adjudicated upon. The other licensees, prima facie , have no such right to continue, as they were granted licenses only for one year i. e. , 2002-2003. ? But this was challenged by the Government in the Supreme court and the Supreme Court by order dated 3. 12. 2003 in S. L. P. No. 23026 of 2003 passed the following order. ?issu e notice. Notice on the prayer for interim relief also. Shri Venugopal , learned Senior advocate states that only Tamil Nadu State Marketing Corporation Limited would carry on the retail vending of Indian made foreign liquor in the State of Tamil Nadu under the ordinance hereinafter. In view of this statement, we suspend the operation of the order under challenge in this special leave petition. This Order shall cease to have effect as and when any judgment is delivered by the High Court. We further clarify that this order shall not be construed by the High Court as an expression of opinion on merits by this Court. The same shall not come in the way of the High Court to decide the matter on merit in any way. ? Then the writ petitions were finally heard and disposed of on 29. 12. 2003.

(2.) SEVERAL contentions were raised questioning the validity of the Act including the deprivation of the right of the 595 (Page 35 of the Judgment) licenses but this Court, while upholding the Act, only set aside the deprivation of so far as 284 Block Period licensees are concerned and issued directions to renew their licences for the Excise Year 2003-2004 holding that the Amending Act scuttles the vested right of those licensees. The said judgment was challenged by the Government in the Supreme Court and sought for the stay and the stay has not been granted. Thereafter, The Tamil Nadu prohibition (Amendment) Ordinance, 2004 was issued introducing a non-obstante clause with retrospective effect as if no licence has been issued with any right of renewal and that such licences issued shall cease to be valid on the expiry of 28. 11. 2003. This Ordinance was replaced by Tamil Nadu Prohibition (Amendment) Act (Act 2 of 2004 ). This is the subject matter of challenge in these appeals.

(3.) IN Kailash Chand Mahajan?s case (referred supra), the Supreme Court held that while Constitutional Courts may make a scrutiny regarding the validity of the legislation in the context of legislative competence and also Part III of Constitution, no legislation can be scrutinized from the point of view that it came to be passed with mala fide intention and that by long established practice, which has received approbation through authorities of Supreme Court, it has always refrained from attributing mala fides to the legislature. The Supreme Court has in fact held that such a thing is unknown to law.