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2016 (1) TMI 464 - SC - Indian Laws


Issues Involved:
1. Legal correctness of the Kerala High Court's decision on the Abkari Policy 2014-15 and amendments to the Foreign Liquor Rules.
2. Violation of Article 14 (Equality before law) and Article 19 (Right to practice any profession or to carry on any occupation, trade, or business) of the Constitution.
3. Classification and discrimination between different categories of hotels.
4. State's policy on public consumption of alcohol and its implications.

Issue-wise Detailed Analysis:

1. Legal Correctness of the Kerala High Court's Decision:
The appeals questioned the High Court's judgment, which dismissed writ petitions challenging the Abkari Policy 2014-15 and amendments to the Foreign Liquor Rules. The policy restricted FL-3 licenses to Five Star hotels, excluding Two Star, Three Star, Four Star, and Heritage hotels. The Single Judge had found the exclusion of Four Star and Heritage hotels arbitrary and violative of Article 14, but this was reversed by the Division Bench, allowing only Five Star hotels to serve alcohol.

2. Violation of Article 14:
The appellants argued that the policy violated Article 14 by creating unreasonable classifications among hotels. They contended that Four Star and Five Star hotels form a homogenous class and should not be treated differently. The Court, however, upheld the policy, stating that the classification was based on reasonable differentia and had a nexus with the objective of reducing public alcohol consumption. The Court noted that the policy aimed to curb public drinking, which was a social malaise in Kerala, and that the State's steps were in line with Article 47 of the Constitution, which mandates the State to endeavor to bring about prohibition.

3. Classification and Discrimination:
The appellants argued that the classification between Five Star hotels and others was arbitrary and lacked empirical evidence. They claimed that the policy was financially driven, favoring State-owned FL-1 shops. The Court rejected these arguments, stating that the classification was not arbitrary and was justified in the interest of promoting tourism. The Court emphasized that the State had the right to experiment with policies to achieve the best results in reducing alcohol consumption and that the classification had a reasonable nexus with the policy's objective.

4. State's Policy on Public Consumption of Alcohol:
The policy aimed to reduce public alcohol consumption by restricting FL-3 licenses to Five Star hotels. The Court noted that the State had the power to regulate trade in liquor, which is considered res extra commercium (outside commerce). The Court found that the policy was not arbitrary or procedurally unsound and that the State had considered relevant reports and recommendations. The Court also highlighted the State's efforts to reduce the number of FL-1 shops and its commitment to achieving a liquor-free Kerala.

Conclusion:
The Court upheld the Kerala High Court's decision, dismissing the appeals and affirming the policy restricting FL-3 licenses to Five Star hotels. The Court found no violation of Articles 14 and 19, stating that the policy was reasonable, non-arbitrary, and aimed at reducing public alcohol consumption in line with the State's constitutional obligations. The Court also emphasized the importance of giving the State the freedom to experiment with policies to address social issues like alcohol consumption.

 

 

 

 

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