2017 (4) TMI 1039 - SC - Indian Laws

Grant of a Beer/Wine Bar FL-11 Licence under the Foreign Liquor Rules - what date should be reckoned as the date of consideration of licence - Held that - Indubitably, the processing of the application for grant of licence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail. In the present case, the learned Single Judge has assumed the date on which recommendation was made by the Excise Commissioner i.e. 28th March, 2012, as the relevant date. That assumption is untenable. For, that was not the date on which the final decision was taken by the competent authority. Whereas, before a final decision could be taken by the competent authority on the application submitted by the Respondent, the Foreign Liquor Rules were amended on 18th April, 2012. The application submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on this date. A priori, no fault can be found with the State Authority for calling upon the Excise Commissioner to examine the proposal and submit his fresh recommendation keeping in mind the amended provisions of the Foreign Liquor Rules. In other words, the application for grant of FL-11 licence submitted by the Respondent was required to be considered by the competent authority keeping in mind the amended provisions which came into force w.e.f. 18th April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his speaking order dated 5th June, 2012, for invoking the restriction of distance of 200 metres from the objectionable site. Since the learned Single Judge of the High Court proceeded to decide the writ petition filed by the Respondent merely by referring to the pronouncement of the Division Bench of the same High Court in the case of Kallada Hotels and Resorts (2012 (2) TMI 611 - KERALA HIGH COURT) coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18th April, 2012 as void to the extent it has introduced the restriction of distance of 200 meters from objectionable institutions for getting FL-11 licence, we deem it appropriate to relegate the parties before the learned Single Judge to decide the writ petition afresh, keeping in mind the settled legal position.

Issues Involved:
1. Validity of the application for FL-11 license under the Foreign Liquor Rules.
2. Applicability of the amended Foreign Liquor Rules regarding the distance restriction.
3. Legal implications of the recommendations made by the Excise Commissioner.
4. Consideration of the date for applying the relevant law.
5. Reliefs sought by the Respondent in the High Court.

Detailed Analysis:

1. Validity of the Application for FL-11 License:
The Respondent constructed a hotel classified as a Heritage (Basic) Category and applied for an FL-11 license under the Foreign Liquor Rules. The application was processed by the Deputy Commissioner of Excise, Palakkad, and recommended by the Excise Commissioner to the Secretary to Government Taxes Department, Kerala. However, during the consideration of the application, the Foreign Liquor Rules were amended on April 18, 2012, introducing a minimum distance requirement of 200 meters from objectionable institutions. The nearest objectionable institution was only 70 meters away from the hotel, leading to the rejection of the application by the Excise Commissioner.

2. Applicability of the Amended Foreign Liquor Rules:
The amendment to the Foreign Liquor Rules mandated a minimum distance of 200 meters from objectionable institutions for granting an FL-11 license. The Respondent's hotel was only 70 meters away from a temple, which led to the rejection of the application based on the new rules. The High Court's Single Judge initially allowed the writ petition, quashing the rejection and directing the issuance of the license based on the rules in force at the time of the initial recommendation by the Excise Commissioner.

3. Legal Implications of the Recommendations Made by the Excise Commissioner:
The Excise Commissioner's recommendation on March 28, 2012, was based on the rules before the amendment. The Single Judge of the High Court ruled that the law applicable should be the one in force when the recommendation was made. However, the Division Bench and ultimately the Supreme Court emphasized that the final decision by the competent authority (State Government) is what matters, not the recommendation date.

4. Consideration of the Date for Applying the Relevant Law:
The Supreme Court clarified that the relevant date for applying the law is the date on which the final decision is taken by the competent authority, not the date of the recommendation by the Excise Commissioner. Since the Foreign Liquor Rules were amended before the final decision was made, the amended rules applied to the Respondent's application.

5. Reliefs Sought by the Respondent in the High Court:
The Respondent sought several reliefs, including quashing the rejection of the application, declaring entitlement to the FL-11 license, and declaring the amendment introducing the 200-meter distance requirement as discriminatory. The High Court's Single Judge allowed the writ petition based on the law in force at the time of the recommendation. However, the Supreme Court remanded the matter back to the High Court for fresh consideration, emphasizing the need to apply the law as of the date of the final decision by the competent authority.

Conclusion:
The Supreme Court set aside the judgments of the Single Judge and the Division Bench of the High Court, remanding the writ petition back to the Single Judge for fresh consideration in light of the settled legal position. The Court highlighted that the relevant date for applying the law is the date of the final decision by the competent authority, not the date of the recommendation by the Excise Commissioner. The appeal was partly allowed with no order as to costs.

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