2014 (3) TMI 732 - HC - Indian Laws

Validity of notifications issued by District Collectors, inviting applications for grant of licences for the relocated A-4 excise shops - whether arbitrary, illegal and contrary to the A.P. Excise (Grant of licence of selling by shops and conditions of licence) Rules, 2012 - Jurisdiction of the High Court - Held that - Whether or not the undisposed A-4 shop should be relocated are matters of legislative or executive policy and this Court would not sit in judgment over the policy decisions of the State. The Excise Policy for the year 2014, while permitting the Commissioner to relocate undisposed shops, requires an intensive campaign to be undertaken to educate the public about the evil effects of drinking and for steps to be taken to initiate establishment of de-addiction centres in each district. The manner in which the revenue needs of the State should be balanced with the need to educate the public of the evil effects of drinking are also not for this Court to adjudicate in proceedings under Article 226 of the Constitution of India. This contention urged by the petitioners, who are carrying on trade in the sale of IMFL and FL in retail shops, is akin to the devil quoting the scriptures, and does not merit acceptance. - Writ petition dismissed.

Issues Involved:
1. Scope and application of Rule 4 as amended and notified in G.O.Ms. No.357 dated 22.06.2013.
2. Construction to be placed on amended Rule 4.
3. Factors to be considered while relocating undisposed A-4 shops.
4. Relocation of shops from one district to another.
5. Distinction between the exercise of power under amended Rule 4 and Rule 18.
6. Distinction between shifting of an A-4 shop under Rule 28 and relocation under amended Rule 4.
7. Relocation of shops from scheduled areas to non-scheduled areas.
8. Effective date of amended 2012 Rules.
9. Retrospective application of amended Rule 4.
10. Restrictions on liquor trade through subordinate legislation.
11. Exclusive privilege and its violation through relocation.
12. Constitutional validity of statutory rules.
13. Burden of proof for unconstitutionality.
14. Alleged discrimination in relocation.
15. Reasonableness and arbitrariness of relocation.
16. Compliance with principles of natural justice.
17. Scope of interference in policy decisions.
18. Legitimate expectation.
19. Timing of identifying relocation areas.
20. Abdication of power by the Commissioner.
21. Authority of District Collectors to issue notifications.
22. Encouragement of liquor consumption through relocation.

Detailed Analysis:

I. Scope and Application of Rule 4 as Amended:
The petitioners argued that the 2012 Rules do not empower the Commissioner to transfer A-4 shops from one area/locality to another, and that the "public order" requirement of Rule 4 was not satisfied. The Court held that the Andhra Pradesh Excise Act aims to secure state revenue while regulating the trade in intoxicants. The amended Rule 4 allows the Commissioner to relocate undisposed shops to augment state revenue.

II. Construction to be Placed on Amended Rule 4:
The Court emphasized that every part of a statute or rule has a purpose. The amended Rule 4, which allows the Commissioner to relocate undisposed shops, should be interpreted broadly to fulfill its intended purpose. The Court rejected the petitioners' contention that the rule should be confined to relocating shops within the same district.

III. Factors to be Considered While Relocating Undisposed A-4 Shops:
The petitioners contended that the factors enumerated in Rule 4 should be considered while relocating shops. The Court found that the Commissioner had indeed considered these factors, including public order, health, and safety, before relocating the shops.

IV. Relocation of Shops from One District to Another:
The Court held that the power of the Commissioner to relocate undisposed shops is not restricted to within the same district. The Commissioner can relocate shops to any area/locality within the state for valid reasons.

V. Distinction Between the Exercise of Power Under Amended Rule 4 and Rule 18:
The Court distinguished between the powers conferred under Rule 18(1) and Rule 18(2). While the District Collector's power under Rule 18(1) is confined to the district, the Commissioner's power under Rule 18(2) is not. The amended Rule 4 now confers the power to relocate undisposed shops on the Commissioner.

VI. Distinction Between Shifting of an A-4 Shop Under Rule 28 and Relocation Under Amended Rule 4:
The Court clarified that Rule 28 pertains to shifting licensed premises within the same area, while the amended Rule 4 pertains to relocating undisposed shops without any area restrictions.

VII. Relocation of Shops from Scheduled Areas to Non-Scheduled Areas:
The Court held that while provisions restrict opening shops in scheduled areas, they do not prohibit relocating undisposed shops from scheduled to non-scheduled areas.

VIII. Effective Date of Amended 2012 Rules:
The Court stated that the amended 2012 Rules came into force on 24.06.2013 upon publication in the A.P. Gazette.

IX. Retrospective Application of Amended Rule 4:
The Court found that the amended Rule 4 was not applied retrospectively. The renewed licenses for 2013-14 were granted under the amended rules, which came into force before the commencement of the excise year.

X. Restrictions on Liquor Trade Through Subordinate Legislation:
The Court held that restrictions on liquor trade can be imposed by subordinate legislation or executive orders, as liquor trade is not a fundamental right.

XI. Exclusive Privilege and Its Violation Through Relocation:
The Court found that the exclusive privilege granted to the petitioners is subject to the amended 2012 Rules and the Excise Policy for 2013-14. The state can relocate undisposed shops to augment revenue.

XII. Constitutional Validity of Statutory Rules:
The Court presumed the constitutionality of the amended Rule 4, as its validity was not challenged in the writ petitions.

XIII. Burden of Proof for Unconstitutionality:
The Court held that the burden lies on the petitioners to prove that the rule is unconstitutional, which they failed to do.

XIV. Alleged Discrimination in Relocation:
The Court found that the classification of areas based on turnover for relocating shops is valid and not discriminatory.

XV. Reasonableness and Arbitrariness of Relocation:
The Court held that the Commissioner's decision to relocate undisposed shops to areas with higher turnover is reasonable and not arbitrary.

XVI. Compliance with Principles of Natural Justice:
The Court found that the wide discretion conferred on the Commissioner does not require compliance with principles of natural justice before relocating shops.

XVII. Scope of Interference in Policy Decisions:
The Court stated that it would not interfere with policy decisions unless they are arbitrary, unreasonable, or violate constitutional provisions.

XVIII. Legitimate Expectation:
The Court held that the doctrine of legitimate expectation does not apply as the decision to relocate shops is reasonable and in public interest.

XIX. Timing of Identifying Relocation Areas:
The Court found that the petitioners were aware of the amended rules before seeking renewal of their licenses and cannot now challenge the relocation.

XX. Abdication of Power by the Commissioner:
The Court held that the Commissioner did not abdicate his powers by seeking proposals from his subordinates.

XXI. Authority of District Collectors to Issue Notifications:
The Court found that while the District Collectors were not authorized to issue notifications under Rule 5(1), the petitioners cannot challenge this as they benefitted from similar notifications earlier.

XXII. Encouragement of Liquor Consumption Through Relocation:
The Court held that the decision to relocate undisposed shops is a policy matter and does not amount to encouraging liquor consumption.

Conclusion:
The writ petitions were dismissed, and the Court found no reason to interfere with the relocation of undisposed A-4 shops as it was reasonable, justified, and in accordance with the amended rules and excise policy.

← Previous Next →