Rajasthan High Court – Jodhpur
Rajender Kumar vs State Of Rajasthan on 28 February, 2025
Author: Manindra Mohan Shrivastava
Bench: Manindra Mohan Shrivastava
HIGH COURT OF JUDICATURE FOR RAJASTHAN
JODHPUR
D.B. Spl. Appl. Writ No. 321/2023
Rajendra Kumar Son of Shri Rampat, aged about 47 years,
resident of Ward No.41, Balaji Colony, Hanumangarh Junction,
Tehsil and District Hanumangarh, (Rajasthan).
----Appellant
Versus
1. The State of Rajasthan through the Secretary, Finance
(Revenue) Department, Government of Rajasthan, Jaipur
(Rajasthan).
2. The Excise Commissioner, Office of Excise Commissioner,
Udaipur (Rajasthan).
3. The District Excise Officer, Hanumangarh, (Rajasthan).
----Respondents
Connected With
D.B. Spl. Appl. Writ No. 267/2023
Rajendra Kumar Son of Shri Rampat, aged about 47 years,
resident of Ward No.41, Balaji Colony, Hanumangarh Junction,
Tehsil and District Hanumangarh (Rajasthan)
----Appellant
Versus
1. The State of Rajasthan through the Secretary, Finance
(Revenue) Department, Government of Rajasthan, Jaipur
(Rajasthan).
2. The Excise Commissioner, Office of Excise Commissioner,
Udaipur (Rajasthan).
3. The District Excise Officer, Hanumangarh, (Rajasthan).
----Respondents
For Appellant(s) : Mr. Ankur Mathur
Mr. Vivek Mathur
For Respondent(s) : Mr. Girish Kumar Sankhla
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HON'BLE THE CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA
HON'BLE MR. JUSTICE MUNNURI LAXMAN
Judgment
PRONOUNCED ON: 28/02/2025
(PER HON’BLE THE CHIEF JUSTICE):
This common order shall govern disposal of the aforesaid two
appeals.
2. The Special Appeal Writ No. 267/2023 [Rajendra Kumar Vs.
The State of Rajasthan & Ors.] is directed against the order dated
19.01.2023 passed by the learned Single Judge in S.B. Civil Writ
Petition No. 11550/2022, by which, the learned Single Judge has
dismissed the writ petition in the matter of challenge to
cancellation of the licence for selling country made liquor and in
the matter of challenge to validity of Clause 13 of the Liquor Policy
2022-23 of the State Government promulgated vide order dated
05.02.2022.
3. As the issue raised in both the petitions is one and the same,
on the basis of the order passed in S.B. Civil Writ Petition No.
11550/2022, the second writ petition registered as S.B. Civil Writ
Petition No.11065/2022 between the same parties has also been
dismissed vide order dated 19.01.2023.
4. Since the main order has been passed in S.B. Civil Writ
Petition No. 11550/2022, we shall refer to the impugned order
dated 19.01.2023 passed therein as also the pleadings and
documents in that writ petition.
5. Petitioner-Rajendra Kumar filed petition aggrieved by the
order dated 04.08.2022 passed by the District Excise Officer,
Hanumangarh, whereby, his licence for selling country made
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liquor, issued in his favour, was cancelled. While filing the writ
petition, the petitioner also laid challenge to the validity of Clause
13 of the Liquor Policy 2022-23 promulgated by State Government
vide order dated 05.02.2022.
6. The averments necessary for decision of this appeal are that
the writ petitioner/appellant is a Nagar Parshad (Lok Sevak) in
Hanumangarh. He participated in auction proceedings for
allotment of liquor shop and being a successful bidder, was issued
a liquor licence for a period of one year commencing from
01.04.2022. However, before expiry of the period of licence, a
show cause notice was issued to him on 07.07.2022 proposing to
cancel the licence of liquor shop allotted to him on the allegation
that as per the Liquor Policy for the year 2022-23, promulgated
vide order dated 05.02.2022, on the eligibility conditions
incorporated therein that a person in service of the State
Government or Central Government or Local Bodies or in any
other Government or Semi-Government institution or a public
servant, would not be eligible for grant of licence. It was also
stated in the notice that as per the terms and conditions of e-
auction, if an ineligible person participates in the auction and if
any licence is granted to him, his licence will be liable to be
cancelled upon receipt of information regarding ineligibility and all
deposits made by him shall be liable to be confiscated. The report
dated 04.07.2022 of the Excise Inspector, Circle Hanumangarh
contained information regarding the appellant having been found
to be elected as Parshad of Ward No.57. It was alleged that the
appellant obtained licence by suppressing the fact.
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7. In response to the notice, appellant vide representation
dated 20.07.2022, informed that Parshad (Corporator) does not
fall in the category of public servant nor holds an office of profit
but he is a public representative and he does not derive any profit
or remuneration from the State.
8. However, vide impugned order dated 04.08.2022, the licence
was cancelled holding that the appellant was ineligible for grant of
liquor licence.
9. Aggrieved by the order, the appellant preferred the writ
petition. The writ petition, however, was dismissed giving rise to
this appeal.
10. Learned counsel for the appellant argued that in absence of
there being any ineligibility under the provisions of the Excise Act
or Rules framed thereunder, it is wholly impermissible to lay down
the conditions of ineligibility by way of policy. It is submitted that
the Liquor Policy of 2022-23, promulgated vide order dated
05.02.2022, could not amend the eligibility criteria as prescribed
under the Acts and Rules, inasmuch, the Liquor Policy is merely an
administrative instruction issued by the State Government. It is a
non-statutory policy and that policy, to the extent it adds new
conditions of ineligibility, is inconsistent with the provisions
contained in Rule 74 of the Excise Rules. The provisions contained
in the Rule should neither be restricted nor enlarged by way of
policy. If at all the State was desirous of including a new condition
of ineligibility, the only way was to carry out amendment in the
Act or in the Rules and the same could not be done by
administrative instruction as it is a settled legal position that a
thing which is required to be done in a particular manner should
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be done in that manner only. Unless amendment is carried out in
Section 41 of the Excise Act amending conditions of eligibility, the
existing law could not be amended. Referring to the provisions
contained in Section 41(3) of the Rajasthan Excise Act, it is
argued that the amendment requires previous publication. Without
complying with the provisions contained in Rules, no amendment
in the Rule could be carried out. Therefore, incorporating
conditions of ineligibility to apply and get liquor licence in the non-
statutory administrative policy is dehors the provisions of law,
illegal, inoperative and could not be made a basis to cancel the
licence.
11. In support of his submissions, learned counsel for the
appellant places reliance upon State of Rajasthan Vs. Banwari
Lal Upadhyay [2001 (2) RLW (Raj) 1310], Chandra Kishore
Jha Vs. Mahavir Prasad & Ors. [1999 (8) SCC 266], K.
Kuppusamy & Anr. Vs. State of T.N. & Ors. [1998 (8) SCC
469], G.J. Fernandez Vs. State of Mysore & Ors. [AIR 1967
SC 1753], and order dated 11.02.2022 passed by the High Court
of Gujarat at Ahmedabad in the case of Gujarat Rajya Hotel
Federation & 9 Ors. Vs. State of Gujarat & Ors.
12. On the other hand, per contra, learned counsel for the
respondents relying upon the provisions contained in Section
71(2) of the Excise Act read with Rule 67-KKK(11)(d) of the
Rajasthan Excise Rules, 1956 would submit that the respondent-
State is authorized under the law to impose conditions of
ineligibility. Further relying upon the provisions contained in
Section 72, it is argued that the policy is a legal policy and has
been issued by the State in exercise of statutory powers and has
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the force of law. He would submit that the policy laying the
conditions of eligibility is within the law and that it is for the State
to lay down appropriate conditions of eligibility/ineligibility in the
matter of grant of liquor licence and such policy could not be
challenged merely because it contains provisions of ineligibility
that those who are representatives of the people will not be
granted liquor policy. He would submit that the condition of
ineligibility is based on public interest that those who have been
elected to act as public representative and holding public office
should not be allowed to hold liquor licence. It is also submitted
that not only the policy for 2022-23 but also the policy for 2023-
24 and 2024-25 also contains similar conditions making public
representative or holder of an office under the State Government,
Central Government or any other Government, Semi-Government
institutions, ineligible to hold liquor licence.
13. Lastly, it is submitted by the State counsel that even though
the policy clearly prohibited grant of licence in favour of public
representatives, the writ petitioner applied for grant of licence
suppressing the aforesaid fact and when it was revealed, an
enquiry was made, report was obtained and the licence was
cancelled.
14. In support of his submissions hereinabove, reliance is placed
on the order dated 08.12.2020 passed by this Court in the case of
Satveer Choudhary Vs. State of Rajasthan & Ors. [D.B. Civil
Writ Petition No. 10936/2020], order dated 09.09.2020 in the
case of Mukesh Saini Vs. State of Rajasthan & Ors. [D.B.
Special (Writ) No.513/2022], the order passed by Punjab and
Haryana High Court in the case of International Spirits and
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Wine Association of India Vs. State of Haryana & Ors.
[2017 (3) R.C.R. (Civil) 690] and the order passed by Bombay
High Court in the case of M/s/ Mahalsa Services Vs. State of
Goa & Ors. [2023 (4) AIR Bom. R. 554].
15. Learned Single Judge, vide impugned order, relying upon
Clause 13 of the Excise Policy promulgated vide order dated
05.02.2022, has held that the appellant is not entitled for grant of
licence for retail sale of liquor. Learned Single Judge also relying
upon the provisions contained in Section 34, has repelled the
contention made by learned counsel for the appellant/writ
petitioner by holding that the policy promulgated by the State
cannot be said to be dehors the law.
16. Grant of licences, permits and passes are governed by the
provisions contained in Section 31 of the Rajasthan Excise Act,
1950 (hereinafter referred to as ‘the Act of 1950’). Section 31 of
the Act of 1950, being relevant, is reproduced hereunder:
“31. Form and condition of licences etc.- Every
licence, permit or pass granted under this Act, shall be
granted-
(a) by such authority,
(b) on payment of such fees (if any),
(c) subject to such restrictions and on such conditions,
(d) in such form and containing such particulars, and
(e) for such periods,
as the [State Government] may prescribe by rules
either generally or for any class of licences, permits or
passes or as the [State Government] may direct for any
particular licence, permit or pass.”
17. As provided under Clause (c), licence may be granted subject
to such restrictions and on such conditions as the State
Government may prescribe by rules either generally or in any
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clause of licence, permit or pass or as the State Government may
direct for any particular licence, permit or pass.
18. Section 34 confers power to cancel and suspend licences.
Section 34 does not provide for restrictions as may be imposed by
the State Government in the matter of grant of licence but confers
power on the authority granting any licence, permit or pass under
the Act to cancel or suspend licence under any of the
contingencies enumerated in Clauses (a) to (f). Section 35
provides for residuary power to cancel licence.
Therefore, Sections 34 and 35 do not lay down the
conditions on which licence can be granted but provides for the
circumstances under which licence granted may be cancelled or
suspended.
19. Section 41 confers rule making power of the State
Government. Clause (e) and (f) of Section 41(2), read conjointly,
confer rule making power on the State Government to regulate
the period and locations for which a person to whom licences for
the vend by wholesale or by retail or any excisable article may be
granted as also prescribing the procedure to be followed and the
matters to be ascertained before any licence for vend is granted
for any locality.
20. Section 72 provides that all rules made and notifications
issued under the Act shall be published in the Official Gazette and
shall thereupon have effect as if enacted under the Act from the
date of such publication or from such other date, as may be
specified in that behalf.
21. The statutory scheme grafted under Section 31, 34, 41 and
72 is that licence may be granted subject to such conditions and
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restrictions as may be laid down by rules framed by the State
Government in exercise of its rule making power under Section 41
of the Act, which is required to be published in the Official
Gazette.
22. In exercise of its rule making power, Government has framed
the Rajasthan Excise Rules, 1956. Amongst various provisions
contained therein, it also provides for grant of licences of different
nature. Apart from regulating import and export, Chapter V deals
with licences for foreign liquor and beer. This includes provisions
with regard to licence for retail sale.
Chapter VI deals with grant of licence of country liquor and
intoxicating drugs.
Chapter VII deals with procedure for action in the matter of
grant of licences. Rule 63 provides for persons who are debarred
from bidding in an auction.
Chapter VII-A deals with licences under the guarantee
system whereas, Chapter VII-B deals with licences on payment of
lump sum instead of or in addition to duty.
Rule 67-I(2) provides for grant of licence for exclusive
privilege of selling country liquor at retail shop which could be
granted by any of the modes as contained in Clause (a) to Clause
(e). This includes grant of licence for selling country liquor at retail
shop by inviting sealed tenders. Rule 67KKK(11) provides when an
application for licence shall be liable to be rejected. The same
being relevant, is reproduced hereinabove:
“67-KKK. Procedure for invitation of applications.-
xxxx
(11) An application for licence shall be liable to be
rejected,-
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(a) if it has not been signed by the competent person or
is incomplete;
(b) if there are arrears of excise dues outstanding
against him;
(c) if applicant is below the age of 18 years;
(d) if applicant is in the employment of the Central
Government, State Government, Enterprises of
Government of India or State Government, Corporation
and Companies of Government of India or State
Government; and
(e) if applicant is convicted of any offence punishable
under the Rajasthan Excise Act, 1950 or any other law
for the time being in force relating to revenue or of any
cognizable and non-bailable offence or any offence
punishable under the Narcotic Drugs and psychotropic
Substances Act 1985 or any law relating to merchandise
marks or of any offence punishable under Section 482 to
489 (both inclusive) of the Indian Penal Code, 1860.”
23. Chapter IX makes general provisions with regard to grant of
licences and Rule 74 thereof provides for persons who are
debarred from holding licence, which reads as under:
“74. Persons debarred from holding licences-
Without the previous written sanction of the Excise
Commissioner:-
(i) No person holding or having an interest in a licence
for the manufacturer sale or supply of foreign liquor in a
district may hold or possess any interest in a licence for
the retail sale of country Liquor in the same district.
(ii) No person holding an interest in a licence for the
retail sale of opium [denatured spirit,] or intoxication
drugs in a district may hold or possess any interest in a
licence for the whole sale or retail manufacture or sale
of foreign or country liquor in the same district.
(iii) No person shall hold or have an interest in two or
more shops for the retail sale of the same excisable
articles in the same village, or in the same city or town,
and
(iv) No person holding or having an interest in a licence
for the manufacture of country liquor or supply thereof
from a distillery or retail vendor shall hold or have an
interest in a licence for the retail sale of country liquor
in the area in which the distillery is established in any
area supplied from such distillery.
[(v) No person whose tender or bid at an auction for
grant of licence under the Act or these Rules has been
accepted but who fails to deposit within the time
allowed. The security amount required to be deposited
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according to the conditions of tender or auction
[deleted] shall be entitled to hold any licence under the
Act or these rules for a period of three years from the
last date allowed for deposit of such security].”
24. While grant of licence for foreign liquor and beer is contained
in Chapter V, grant of licence for country liquor and intoxicating
drugs is regulated by the provisions contained in Chapter VI. Rule
58 thereof reads as below:
“58. Licensing Authority- Licences for the retail sale
of excisable articles shall be granted by the [District
Excise Officer] concerned in accordance with the
procedure described in these rules or any other system
as may be sanctioned by Government and shall
authorise the licensee to purchase such articles from the
warehouse to which shop is attached or, with the
permission of the [Excise Commissioner] from any other
warehouse in Rajasthan provided the transport of
excisable article to his shop is covered by an entry in his
pass book signed by the officer-in charge of the
warehouse and is effected with in the period mentioned
in such entry.”
The aforesaid provisions reveal that licences for the retail
sale of excisable articles may be granted by the District Excise
Officer concerned in accordance with the procedure described in
the rules or in other system as may be sanctioned by the
Government.
25. Admittedly, in the present case, the appellant was granted
composite liquor shop for sale of country liquor and other liquor
and beer, the provisions contained in Chapter VI and Chpater VII-
B shall be applicable.
26. Rule 67KKK(11)(d) provides that if applicant is in the
employment of the Central Government, State Government,
Enterprises of Government of India or State Government,
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Corporation and Companies of Government of India or State
Government, his application shall be liable to be rejected. The
provisions contained in Rule 74 are general in nature providing for
persons who are debarred from holding licences.
27. Conjoint reading of Rule 58, 67KKK(11)(d) and 74 delineate
the statutory policy under the rules framed in exercise of powers
under Section 41 of the Excise Act regulating grant of licence for
composite shop for country liquor and other kind of excisable
articles. While certain categories of persons, whose applications
are liable to be rejected or who are debarred from holding licence,
has been specifically provided under Rule 67KKK (11)(d) and Rule
74 thereof, Rule 58 confers powers on the State Government to
provide for other conditions in addition to what has already been
provided in the rules.
28. Under Section 31 of the Act, licence may be granted subject
to such restrictions and on such conditions as the State
Government may prescribe by rules either generally or for any
class of licences, permits or passes. Reading of the aforesaid
provision reveals that it also confers on the State Government the
power to lay down conditions as the State Government may direct
for any particular licence, permit or pass. Thus, on fair and logical
interpretation of the provisions contained in Section 31 of the Act,
the restrictions and conditions may either be provided generally
under the rules or the State Government may direct for any
particular licence, permit or pass.
29. The statutory scheme, as revealed from the provisions of the
Act and the Rules framed thereunder, which have been referred to
hereinabove, reveals that while certain terms and conditions have
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already been laid down under the Act and the Rules made
thereunder, the State Government has been granted authority
under Section 31 of the Act read with Rule 58 of the Rules to lay
down restrictions and conditions under any direction or order
which may be issued by it for any licence, permit or pass,
including grant of licence for retail sale of country liquor.
30. The Excise Policy issued by the Government vide order dated
05.02.2022, is clearly referable to the powers as specified
hereinabove. Amongst various provisions, one of the provision is
that the person who is a public servant, he would not be eligible
for grant of licence. Rule 67KKK(11)(d) also provides that those
who are in employment of the Central Government, State
Government, Enterprises of Government of India or State
Government, Corporation and Companies of Government of India
or State Government, are ineligible for grant of licence. Therefore,
the intention of the rule is that those who are in public
employment are not entitled to grant of licence. The provision is
made in public interest to ensure that those who are holding
public office should not be allowed to hold the licence for sale of
liquor, including sale of country liquor or for that matter, any other
liquor.
31. Rule 74 is limited in nature which does not contain any
absolute bar but only provides that without the previous written
sanction of the Excise Commissioner, persons enumerated in (i) to
(iv) shall be debarred from holding licence. Therefore, the
provisions contained in Rule 67KKK(11)(d) and Rule 74 operate in
different field. While Rule 67KKK(11)(d) is an absolute bar, it is
not so under Rule 74.
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32. As held hereinabove, the provisions contained in Section 31
of the Act read with Rule 58 and keeping in view the spirit of
provisions contained in Rule 67KKK(11)(d) are clear indication
that the State is empowered under the Act as well as under the
Rules to lay down additional restrictions and conditions, which has
been done in the present case by promulgating Excise Policy vide
order dated 05.02.2022.
33. Once we hold that there exists power to prescribe additional
restrictions and conditions subject to which licence can be
granted, it is not necessary for us to deal with other submissions
made by learned counsel for the appellant, with reference to
various decisions cited at the bar. There is one additional feature
in the present case which does not entitle the appellant to seek
indulgence of this Court, that even though the State Government,
vide Excise Policy/order dated 05.02.2022, clearly laid down that a
person holding public office shall not be entitled to grant of liquor
licence, the appellant suppressed this fact and applied for the
same and succeeded in getting liquor licence. It was only when a
complaint was made that an enquiry was held and it was revealed
that the appellant is a Nagar Parshad (Corporator). A Corporator,
undoubtedly, is a public servant and holding a public office. The
policy that a person in public employment or a public servant shall
not be entitled to grant of liquor licence is based on sound public
policy that those who are holding public office should not be
allowed to be engaged in the trade of liquor for personal gains and
profits.
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34. In view of the above consideration and for the reasons
additionally assigned by us, action of the respondents in cancelling
the licence of the appellant does not warrant any interference.
35. Therefore, the appeal is dismissed. Consequently, D.B.
Special Appeal (Writ) No.321/2023 is also dismissed.
(MUNNURI LAXMAN),J (MANINDRA MOHAN SHRIVASTAVA),CJ
Jayesh/-
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