Writ Petition No.1180 of 2004

2nd July, 2004

Petitioner Counsel: VEENA B. THADANI,VISHAL B. THADANI
Respondent Counsel: G. W. MATTOS

Cases Cited:
M/s. Samarth Co-operative Consumers Central Stores Ltd. Vs. State of Maharashtra, W.P.No.4796/2003, Dt:1-10-2003 [Para 5,6]
State of Bihar Vs. Kalika Kuer @ Kalika Singha, AIR 2003 SC 2443 [Para 6]

JUDGMENT

F. I. REBELLO, J.:- Rule.

2. Heard forthwith.

3. The Petitioner was holding an Excise Licence bearing Nos.FL II 163 & CL/FL III 35 in his name and was carrying on business in the name and style of M/s. Pushpa Wines Near Municipal "L" Ward Office, C.S.T. road, Kurla (West), Mumbai 400 070. It is the case of the Petitioner that in the year 2002-2003, licence fees for FL II licences in Mumbai were increased by nearly four times, hence, the Petitioner did not renew his licence since it had become uneconomical to carry on business in Mumbai. With effect from 1-4-2002 the Petitioner closed down his business being carried on near Municipal "L" Ward Office, C.S.T. Road, Kurla (West), Mumbai-400 070. Thereafter the Petitioner made an application to the Hon'ble Minister (State Excise) on 22-19-2002 for shifting his licence out of Mumbai to Thane District. It is the case of the Petitioner that he kept on pursuing his application but no action was taken by the Government and ultimately he was orally informed that his application for shifting to Thane could not be allowed. Petitioner thereafter made an application for shifting of his licence to Mangaon, District Raigad. The Petitioner was informed that his application was under consideration by the Hon'ble Minister. Thus the Petitioner's business remained closed for two years owing to the delay on the part of the Government in allowing his application for shifting his licence from Mumbai to some other District. It is the Petitioner's case that he was surprised to receive a letter dated 25-3-2004 directing him to pay the licence fees for the year 2002-03 and 2003-2004 along with interest at the rate of 2% per month for the entire period if he wanted to have his application for shifting allowed. The Petitioner was called upon to pay a sum of Rs.6,60,000/- for renewing the FL II licence and Rs.1,61,040/- as interest for 366 days hence a total sum of Rs.8,21,040/- for renewing the FL II licence. The Petitioner was further called upon to pay Rs.1,40,000/- for renewing the FL II & CL/FL/TOD III licence for the years 2002-2003 and 2003-2004 although the business was closed.

The Petitioner contended that he immediately approached the office of the 1st Respondent and informed them about a judgment of this court in Writ Petition No.4796 of 2003 wherein this Hon'ble Court has directed that fees for the period when the business was closed can not be demanded. The Petitioner learnt that the demand for licence fees had been made on the directions of the Commissioner State Excise. The Petitioner informed that unless he paid the said amount as licence fees, his application for shifting would not be allowed. Hence,the present petition challenging the demand made for renewal of licence fees for the period, when according to Petitioner they were admittedly closed.

4. On behalf of respondents, an affidavit has been filed by Mr. Shibdayal Baburam Sharma, Deputy Superintendent of State Excise. It is contended that the Petitioner has alternate remedy and therefore, this court ought not to entertain this petition. We are not impressed with the said contention. It is also pointed out that as the Petitioner had not paid licence fees, licence stood terminated. It is pointed out that the licence could not be carried on because the Petitioner have not paid renewal fees and it is on account of that business remained closed. It is then contented that the judgment of this court relied upon by the petitioner would be of no assistance to the petitioner as it is clearly distinguishable. Reliance is placed on the provisions of Section 49 of the Bombay Prohibition Act, 1949 (hereafter referred to as the Act). Our attention is also invited to Rule 26-A of the Bombay Foreign Liquor Rules, 1953. It is therefore, submitted that the Petition should be dismissed.

5. We may gainfully reproduce the relevant rules for the purpose of deciding this issue. The rules read as under :

"26. Duration of licence - No licence under rule 25 (and 25-A) shall be granted for a period beyond the 31st March next following the date of the commencement of the licence.

26-A. Renewal of licence - Any person desiring to renew a licence shall, thirty days before the date of expiry of the licence, apply for the renewal thereof. Even such application shall be accompanied by a challan evidencing payment of (a for of Rs.25.).

(Provided that,the licence in Form FL(rum)/CL.III shall be renewed only after verification of the fact that the holder thereof is in possession of a valid Country Liquor retail sale licence."

26-B. Any licence granted under sub rule (1A) of rule 25 may be renewed by the Collector for a period not exceeding one year at a time on payment of fee.

On the following scale namely :
(1)	Towns with a population up to one lakh	Rs.15,000
(2)	City with population of one lakh and above but below ten lakh	Rs.40,000
(3)	City with population of ten lakhs and above.	Rs.75,000”

The main contention based on which the Petition is filed is the Judgment of this court in the case of M/s. Samarth Co-operative Consumers Central Stores Ltd. Vs. State of Maharashtra & Ors.in Writ Petition No.4796 of 2003 decided on 1st October, 2003. As the facts in the said judgment were not clear, we called upon the learned counsel for the respondents to file a copy of the said petition before us. The learned counsel has since filed a copy of the petition. We may set out few facts as set out in the said petition. The Petitioner therein was granted licence in Form FL II for retail sale of I.M.F.L. on 13-10-1973. The Petitioners licencee surrendered the licence temporarily on 3rd March, 1978 and discontinued the business. On 12-5-1988,the petitioners applied for revalidation of licence which was temporarily surrendered. On 30-6-1999 once again the petitioners applied to the Respondent No.2 for revalidation of the licence. On 13-7-1999 the respondent No.2 directed the Respondent No.4 to renew the licence by charging licence fees for 1999 to 2000. On 7-9-1999 the Respondent No.1 issued a letter and suspended the petitioners licence on the grounds that powers are not vested with the Respondent No.2 for revalidation of licence but the same are vested with Respondent No.1. On 6-7-1989, Government issued directions for revalidation of licence and the procedure to be followed as no new licence was issued. On 1-3-2001, the respondent No.1 passed order and directed to renew the licence by charging licence fee from 31st March, 1978 to 31st March, 2001. Though the order was passed, but as licence was actually (sic - not) issued, the petitioners filed writ petition in this Court being Writ Petition No.4413 of 2001 seeking directions for issuance of licence. That petition was allowed to be withdrawn with observation by the Hon'ble Court on 23-1-2001. On 13-8-2002 the actual order dated 1st March, 2001 was issued to the Respondent No.3 by Respondent No.1 for renewal of licence. On 7-12-2002 the petitioners requested for renewal of licence. On 12-5-2003 the Respondent No.3 directed the Petitioners to pay a sum of Rs.16,91,400/- for renewal of the licence fee from 01-04-1978 to 31-3-2003. It was this order which was subject matter of challenge before this court.

Two things are relevant for consideration from the facts of that case. Firstly the petitioner therein had voluntarily surrendered the licence. Secondly, though the order was passed on 1-3-2001 to renew the licence that order was not served on the petitioner till 12-5-2003. We are not going into the issue as to whether there are any powers in Respondent No.1 to re-validate a licence which has already expired. Prima facie we do not find such power either in the provisions of the Act or the rules framed thereunder. The learned Division Bench of this court, proceeded on the footing that the petitioners therein had voluntarily surrendered the licence and the Respondents themselves had decided to revalidate the licence. If therefore, petitioner had no licence,it being surrendered, there was no question of the petitioner being called upon to pay licence fees for that period. Secondly between the period 2001-2003 also though there was order passed to revalidate the licence, that order was not served on the petitioner. In other words, the petitioner could not have carried on business as there was no licence. It was in these circumstances that the learned Division Bench of this court proceeded to hold that the respondents cannot demand licence fees for the period when the licence was surrendered as also for the period after validation when it was not issued. The judgment therefore, deals with a case of surrender of licence and re-validation by the Government. It is not a case of renewal of license. With that background, we may now consider the issues involved in this petition.

6. We have earlier reproduced the relevant rules. Rule 26 provides that the licence granted shall be valid for the period beyond 31st March, following the date of commencement of the licence. Under Rule 26(A) any person desiring renewal of licence shall 30 days before the date of expiry of the licence apply for renewal thereof. It is therefore, clear that if the licence is not renewed, the licence granted by the respondent State to the licence holder comes to an end. The renewal means renewal of what is in existence. Renewal does not mean to renew something not in existence. The rules themselves require that the application for licence be made before 30 days before the date of expiry of the licence. The State Government however seems to proceed on the footing that there is licence existing that can be renewed provided the respondent pays fees for the order of renewal. We proceed on the footing that as the issue of grant of a liquor licence is a matter of privilege, the Respondent State has proceeded on a footing that even though the licence was not renewed as required, it has powers on payment of the licence fees for the intermittent periods to renew the licence. It is in this background that we must examine the facts of the present case. On the facts of the present case, the petitioner's licence on their own admission expired on 31-3-2002. In other words, petitioner's licence came to an end on that date. Taking the petitioner's own case that the business was closed on 1-4-2002 would mean after that date he was no longer carrying on the business. The Petitioner thereafter applied for transferring the licence to some other place. That licence had already expired. The respondents decided to consider the Petitioner's application, provided the petitioner paid renewal fees for the years 2002-03 in terms of their communication which is dated 25-3-2002. We may also mention that the learned counsel for the petitioners had placed reliance on the judgment in the case of State of Bihar Vs. Kalika Kuer @ Kalika Singha and others, AIR 2003 Supreme Court 2443 to point out that once one Coordinate Bench of this court had pronounced a judgment, that would be binding on another Co-ordinate Bench and if the Co-ordinate Bench sought to differ from the view of the earlier Co-ordinate Bench, then in law it was required that the matter be directed to be referred to a Larger Bench. In our opinion that is not the issue over here. The judgment in the case of M/s. Samarth (supra) would have to be confined to the facts of the case namely the case where the licence holder had surrendered the licence voluntarily and as discussed earlier, it cannot be made applicable to the case of non-renewal of the licence by licence holder. The two situations are entirely different. We therefore, do not find that taking another view on the facts of the present case would conflict with the earlier judgment of this court in the case of Samarth (supra). That contention as raised on behalf of the petitioner has therefore, to be rejected.

The licence once expired, if permissible can only be renewed. Here the petitioner wants to avoid the renewal. In that event, the only other remedy is to apply for fresh licence in which case the issue of renewal would not arise. In the instant case, what the petitioner wants is transfer of his licence. That presupposes that the licence is in existence. If the licence is in existence, it presupposes that it is renewal of existing licence. Considering section 49 of the Act, the petitioner whether has used the licence for the period or not, will have to pay the licence fees for the period of having the licence. If therefore, petitioner seeks transfer, it can only be of the renewed licence and therefore, the respondents were right in calling upon the petitioner in terms of the letter dated 25-3-2004 to pay renewal fees. We do not find that the action of the respondents is without jurisdiction or de hors of the provisions of the Act or rules framed thereunder.

7. We therefore, do not find any merit in this petition, which is accordingly dismissed. Rule discharged.

Personal Secretary/Associate to issue authenticated copy of this order.

Petition Dismissed.