WELCOME DISTILLERY PVT. LTD. Vs. STATE OF BIHAR

JUDGEMENT

(1.) This writ petition has been filed against the order bearing No. 5359 dated 20.10.2012 (Annexure-10) issued by the respondent Secretary, Excise Department, Government of Bihar, Patna by which the licence of the petitioner bearing No. 2285 dated 21.6.2009 for wholesale supply of country liquor in the district of Jehanabad, Arwal, Nawada and East Champaran (Motihari) for the period from 1.7.2009 to 31.3.2012 (subsequently renewed up to October, 2012) has been cancelled and it has also been blacklisted on the ground of failure in supplying required quantity of country liquor. Learned counsel for the petitioner submitted that under Section 42 of the Bihar Excise Act, 1915 the authority who grants any licence may only cancel or suspend the same. He submitted that in the present case it is the Collector who had the authority to cancel the licence and not the Secretary as has been done by him which is liable to be set aside. He submitted that the law is clear and settled that where a power is conferred by statute upon a particular authority to do a particular act, it is that authority alone who can exercise the power and no one else. He further submitted that the licence of the petitioner was granted for the period from 1.7.2009 to 31.3.2012, vide Annexure-2, and it was renewed time and again and lastly for the period 1.10.2012 to 31.10.2012. He has further submitted that the tender of the petitioner, submitted pursuant to the fresh tender notice dated 18.10.2012, was not being considered due to Clause-2.VI therein which provided for non-consideration of tenders of those tenderers whose licence had been cancelled earlier. Thus, if by the impugned order it was the grant, and not the licence, which was cancelled, the petitioner's fresh tender ought to have been considered without being affected by the said Clause-VI. However the same was not done and its fresh tender was rejected. He submitted that, even assuming (but not accepting) that the order of cancellation was as per provision of Section 22D, and not Section 42 of the Excise Act, yet the impugned order was not sustainable in the eyes of law, for the order has not been passed by the State Government as per the requirement of Article 166 of the Constitution of India. The impugned order is not expressed to be taken in the name of the Governor and thus amounts to violation of Article 166. He submitted that, moreover, the Secretary had no jurisdiction to declare petitioner as a defaulter under the Act and cancel the grant or the licence and therefore he has exceeded his jurisdiction in passing the impugned order.

(2.) Learned counsel for the petitioner further submitted that on 14.9.2012 the respondent Secretary had issued a show cause notice seeking clarification from the petitioner in respect of short supply made by it and after being satisfied with its reply, he had extended the licence of the petitioner from time to time and up to 31.10.2012. Hence, the effect of such extension obviously was that the past conduct of the petitioner stood condoned requiring no further action and as such the authorities was estopped from taking a contrary view later on. However, if after such extension the authorities intended to take any action against the petitioner, it was incumbent upon them to issue a fresh show cause notice disclosing the exact reasons for their such intention to enable the petitioner to defend its case. But the Secretary, without issuance of a fresh show cause notice, by the impugned order cancelled the licence and has blacklisted the petitioner having adverse civil consequences which is violative of Article 14 of the Constitution of India and liable to be set aside.

(3.) Learned counsel for the petitioner further submitted that it has become a rule of law that every administrative, quasi judicial or any order having adverse civil consequences must adhere to the doctrine of audi alteram partem which requires the decision making authority to record its reasons in support of the order it makes. It is the basic principle of natural justice which must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. The authority is bound to deal with the defense of the party and give its reasons for acceptance or non-acceptance of the same. He further submitted that in the present case reply of the petitioner as contained in Annexure-5 had clearly raised legal issues arising in the case which were not dealt with at all in the impugned order and therefore the same is violative of Article 14 and liable to be set aside. He pointed out that in para-18 petitioner has specifically stated about various representations made to the authorities bringing to their notice the failure on their part to issue the required number of transport permits. The representations are annexed as Annexure-12 series with the writ petition. In his show-cause dated 14.9.2012 petitioner had specifically referred to the legal provisions governing the field regarding import, export and transportation of country liquor. He submitted that the same has also been reiterated in paras-8 to 17 of the writ petition which clearly shows that the petitioner had supplied the country liquor exactly as per the quantity mentioned in the transportation permits that were issued to it which becomes evident from Annexure-6 Series and the short supply had been due to less numbers of transport permits issued by the Excise Superintendent. The entire aspect of wholesale manufacture and supply of country liquor is governed by the provisions of the Excise Act, the Rules made thereunder as well as the Bihar Country Liquor Bottling Rule, 2004 (hereinafter referred as the 'Bottling Rule'). Section 9 of the Excise Act puts restrictions on import of intoxicants unless the State Government gives permission for its import. Section 12 provides for export, import or transportation of intoxicants only after issuance of permits for the same. Hence, he submitted that it was the duty of the excise officials and not the petitioner to make sure that adequate number of permits were issued to the petitioner so as enable it to transport required quantity of the country liquor.