NAYUDU AUDINARAYANA Vs. SUPERINTENDENT OF EXCISE KHAMMAM

JUDGEMENT

(1.) The auction with respect to the Madhira Taluk group of arrack shops for the excise-year 1983-84 was conducted only on 1-10-1983. The petitioner was the highest bidder, his offer being Rs. 8,23,000/-per month. He made the necessary deposits and obtained the licence on 10-10-1983. He executed a counter-part agreement as contemplated by the Rules, agreeing to pay the rental from 1-10-1983. He lifted the full minimum guaranteed quota of arrack for the month of October 1983. He also lifted the full MGO for the entire excise year. He filed the present writ petition contending that, in as much as licence to him was granted only on 10-10-1983, he is not liable to pay the rental for the period 1-10-1983 to 9-10-1983, notwitstanding the execution of the counterpart lease" by him agreeing to pay 'the rental from 1-10-1983. The contention of the petitioner is that inasmuch as, according to Rules, he cannot carry on the business nor can he lift Or sell the arrack untill a licence is granted, the lease given to him should be deemed to Have come into effect only on 10-10-1983, and hence the Government is net Entitled to Collect the proportionate rental for the previous nine days in October 1983. Reliance is placed upon the decision of a learned single Judge of this Court in Chitayya Vs. Collector. (Excise) 1980-(lI), ALT 216.

(2.) It would be appropriate to consider the relevant provisions of the Act and the Rules. They are the following:

(3.) Normally auctions are conducted well before the commencement of the excise year; (the excise year commences on 1st October, and ends with 30th September of the following year). On the day of auction, the highest bidder has to deposit one month's rental and an amount equivalent to 2% of the annual rental amount. Within ten days therefrom he has to deposit two months' rental in cash, or in the shape of Fixed Deposit Receipts, or in the shape of bank guarantee. Sometimes it does happen that the auction is adjourned from time to time for one or the other reason. Rule 18 says that where the auction is conducted after 20th September in any year, the deposits referred to in Rule 18 shall be made within fifteen days of the auction, or before the expiry of the said month, i.e., before the expiry of the month of September, whichever is earlier. In the case of arrack contracts, a further amount by way of call-deposit has also to be made within ten days of the acceptance of the bid, or tender. But, if the auction takes place after 20th September, then the said call money deposit has to be made within ten days of the auction, or befofe the end Of the same month. (In this Rule, however, the words "same month" are not substituted by the words" said month") Rule 21 says that a counterpart agreement has to ba executed by the highest bidder after making the necessary deposits, before taking out the licence, and that the counterpart agreement shall come into force with effect from 1st October of the year to which the auction relates. The Rule expressly says that, if the licensee executes the counterpart agreement or takes out the licence after the 1st October even in such a case the counterpart agreement shall coma into force on 1st October unless the auctioning authority otherwise directs. The proviso to Rule 21 says that where the auction takes place after the 20th September, the counterpart agreement shall be executed Before the end of the same month, or Within fifteen days of the auction, whichever is earlier.