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TMI Blog1993 (3) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... piry of 15 days from the date of the impugned orders. Prior to issue of the impugned notification and the said orders, the petitioners in Writ Petition No. 2116 of 1992 were holding licences to sell country-liquor in Form Cl-III for the retail sale of country-liquor for the period 1st April, 1992 till 31st March, 1993. The basic facts and the basic issues concerning the entire group of writ petitions are almost identical. All the writ petitions forming part of this group of writ petitions are heard together. 2. By the said notification, dated 14th September, 1992, the Government of Maharashtra declared the area of Gadchiroli district of the State as a dry district, with effect from the 2nd day of October, 1992. By the said notification, it was declared that the Government of Maharashtra had decided to do so in the interest of general public in that district and, particularly, as the area of Gadchiroli district of the State consisted mainly of the tribal area . The Gadchiroli district has about 40% of population of tribals in most of the areas and about 51% of such population in some of the areas and is one of the backward districts of the State. As a necessary consequence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st March, 1993. The learned counsel for the petitioners in Writ Petition No. 2210 of 1992, as well as the learned counsel for the petitioners in Writ Petition No. 2249 of 1992, have urged certain additional contentions. I shall deal with all these contentions in the later part of this order. Daru Mukti Sanghatna, an organisation, has filed an application for being impleaded as party-respondent in these petitions. In the alternative, the said organisation has sought permission to intervene. The said application is opposed. I have decided to permit Shri K. H. Deshpande and learned Advocates on record for intervenors to assist the Court at the hearing of the petitions as the Court has ample discretion to hear any Counsel at the hearing as the Court deems fit. Shri K. H. Deshpande, Senior Advocate, shall have the status of an Amicus Curiae in these writ petitions. In this view of the matter, I have decided that no formal order need be passed on the application for joining of the organisation as party-respondent, or for intervention. The learned counsel for the petitioners have made valiant effort to convince the Court that the petitions deserve to be allowed. The learned counsel for re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter referred to as 'the said Act') much prior to the Constitution coming into force. The history of making of the said Act is set out in detail in the First Prohibition case decided by the Apex Court, i.e., the State of Bombay y. F.N. Bahara AIR 1951 SC 318 : 1951 Crl LJ 1361. In several decided cases of the Supreme Court, the Honourable Supreme Court has highlighted the message of Art. 47 of the Constitution of India and also referred to the message of Mahatma Gandhi as projected in the directive principle of the Constitution. If one were to participate in a National Seminar on the legislative wisdom of prohibition policy, one could observe difference of opinion on the subject although evil of consumption of intoxicating liquor is well recognised throughout the world. It is for the State to enact a law imposing total prohibition throughout the State or enforce the same in stages as it deems fit. We, the Justices of India, are bound to implement Art. 47 of the Constitution of India and interpret all statutory instruments made in context of this constitutional commandment in light of this directive principle in context of other various provisions of the Constitution uninflue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bombay Prohibition Act, 1949 or any other Acts specified therein. S. 56 of the said Act reads as under :-- 56. Cancellation for other reasons.-- (1) Whenever the authority granting licence, permits, pass or authorisation considers that it should be cancelled for any cause other than those specified in S. 54, he may cancel it either-- (a) on the expiration of not less than fifteen days' notice in writing of his intention to do so; or (b) forthwith without notice, recording his reason in writing for doing so. (2) Where a licence, permit, pass or authorisation is cancelled under sub-sec. (1), a part of the fee for the licence, permit or authorisation proportionate to the unexpired portion of the term thereof and the deposit made by the holder thereof in respect of such licence, permit, pass or authorisation shall be refunded to him after deducting any amount due from him to the State Government. Section 139(1)(a) of the said Act empowers the State Government, by general or special order, to prohibit the grant of any kind of licences, permits, passes or authorisations throughout the State or in any area. The said section empowers the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcourse throughout the territory of India shall be free. Art. 302 of the Constitution of India confers power on the Parliament to impose restrictions on trade, commerce and intercourse. Arts. 303 and 304 of the Constitution of India deal with the subject-matter of the power of the Legislature and the Union and of the State to regulate 'trade and commerce'. Art. 305 of the Constitution of India provides that the existing laws were not affected by Arts. 301 and 303 of the Constitution of India, except insofar as the President may, by order, otherwise direct. Part XIII of the Constitution is liable to be interpreted and applied in context of constitutional scheme envisaged by Parts III and IV of the Constitution. If Art. 19(1)(g) of the Constitution is not available as a ground of challenge on the footing that the activity in question does not constitute trade properly so-called, it follows that Part XIII of the Constitution also would not be available to the citizen in such a case. Both the provisions are interconnected: 7. Shri S. A. Bobde, the learned counsel for the petitioners, led the main arguments on behalf of the writ petitioners. Shri Bobde requested the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xus with the policy, object and scheme of the Act and the said section could not be impugned merely on the ground that S. 56 of the Act did not particularise the grounds of cancellation. 10. It is necessary to refer to the judgment of the Supreme Court in the first prohibition case, i.e., the State of Bombay v. F. N. Balsara AIR 1951 SC 318 : 1951 Cri LJ 1361. In para 23 of his judgment, Fazal Ali, J., speaking for the Bench, referred to the view taken by the High Court of Bombay declaring Ss. 52, 53 and 139(1)(c) of the above referred Act as invalid on the ground that the said sections constituted delegation of legislative power and the Government was left with the power to exempt persons or classes from the provisions of the Act as it deemed fit. After extracting the passage from the judgment of the Bombay High Court on the subject, the Supreme Court held that the view taken by the High Court of Bombay was not correct in view of the principles laid down by the Supreme Court in Re Delhi Laws Act AIR 1951 SC 332 case. By para 33 of the said judgment, the Honourable Supreme Court declared S. 12(c), S. 12(d), S. 13, S. 23 and S. 24 as unconstitutional on the ground that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it was not at all a case of delegation of essential legislative function by the State Legislature to the State Government as contended on behalf of the petitioners. The ratio and the principles laid down in the case of Kerala State Electricity Board v. Indian Aluminium Company Limited, [1976]1SCR552 were relied on on behalf of the respondents in support of this contention. In this case, S. 3 of the Kerala Essential Articles Control (Temporary Powers) Act, 1961 empowered the Government to notify an articles as an 'essential article' by issue of a notified order. In exercise of the powers conferred under S. 2(a) of the above referred Act, electricity was declared as an essential article. Thereupon, the State Government issued the Kerala State Electricity Board (Kerala State Electricity Board and Licences Areas) Surcharge Order, 1968 in exercise of the power conferred on the Government under S. 3 of the Act obligating the Board to collect surcharges from the non-licensed consumers of electricity. In para 27 of its majority judgment, the Supreme Court held as under :-- We are of opinion that the power conferred by the Kerala Act is a case of conditional legislation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... angalore Woollen, Cotton and Silk Mills Co. Ltd., Bangalore and Mysore Spinning and Manufacturing Co. Ltd., Bangalore v. Corporation of the City of Bangalore by its Commissioner, Bangalore City, [1961]3SCR698 . In this case, the Legislature had authorised municipality to impose tax on articles and goods not specified in the Act. It was held by Kapur, J., speaking for the Bench of the Apex Court that the power conferred on the prescribed authority was of conditional legislation. It does not appear to be necessary to refer to case law on the subject in any more detail. Really speaking the instant case is directly covered by the principles laid down in para 23 of the judgment of Supreme Court in Balsara's case. 13. Assuming that the case is of a delegated legislation and not of conditional legislation, even then there is no merit in the challenge. From this angle, the question to be asked is as whether the impugned Act prescribes the necessary guidelines for exercise of power by the State Government under, S. 139(1)(a) or as to whether the said section is unconstitutional and void on ground of excessive delegation of legislative powers. The necessary guidelines are to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs that the provisions of the Act laid down no criteria as to what would be treated by State Government as 'special occasion' for purpose of declaration of dry-days by the Government or by the Financial Commissioner, as the case may be. It was held in para 65 of the judgment that the occasion must be special from the point of view of the broad considerations of national solemnity, public order, homage to national figures, etc. If the executive action does not promote or effectuate the policy of the Act or the power conferred on the Government is misused for an extraneous purpose or otherwise, the executive action can be impugned before the Constitutional Court. It was held by the Apex Court that the subject-matter of the Act itself was relevant for purposes of judging the validity of the challenge. Ultimately in para 68 of the judgment, the Supreme Court held that S. 59(f)(v) of the Punjab Excise Act, 1914 was perfectly valid and the exercise of power to regulate including to direct closure for some days every week was reasonable and that there was enough guidelines in the scheme and provision of the Act to govern the exercise of the power under Ss. 58 and 59. It is well se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the matter, I have reached the conclusion that S. 139(1)(a) of the Bombay Prohibition Act, 1949 is Constitutional and there is no merit in the challenge of the writ petitioners on the ground of excessive delegation of legislative power on the ground of violation of Art. 14 of the Constitution of India. I am recording this finding in alternative although it does appear to me that the Bombay Prohibition Act, 1949 is already upheld by the Hon'ble Supreme Court in entirety in Balsara's case, save and except the few provisions enumerated in para 33 of that judgment, with which we are not concerned. 16. The next question, which arises for consideration, is as to whether S. 56 of the said Act suffers from vice of excessive delegation or whether the said section is violative of constitutional guarantee contained in Art. 14 of the Constitution of India. To my mind, there is no merit in this challenge also. S. 54 of the Act confers power on the authority granting licence, permit, pass or authorization, to cancel or suspend the licence on stated grounds, like breach of conditions of licence, permit, pass or authorization; or non-payment of fee or duty etc. The Legislature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o cause' and the said section is, therefore, liable to be treated as violative of Art. 14 of the Constitution. It is not the mandate of the Constitution that the grounds on which a licence can be cancelled must always be particularised. The statutory authority can be trusted with power to cancel the licence on a general ground or for the reasons germane to the underlying policy and object of the Act. 17. In the result, I have reached the conclusion that there is no merit in the challenge made on behalf of the petitioners in respect of validity of S. 139(1)(a) or S .56 of the Act. 18. Shri Bobde, the learned counsel for the petitioners, then submitted that the impugned order dated 14th September, 1992 is beyond the scope and ambit of S. 139(1)(a) of the Act itself. The learned counsel submitted that the said section does not confer any power on the State Government to direct cancellation of licences at all. The learned Counsel contended that S. 139(1)(a) of the Act empowers the State Government merely to prohibit to grant of any kind of licences, permits, passes or authorizations throughout the State, or in any area. The learned counsel submitted that the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l plea to the effect that the impugned order dated 14th September, 1992 was violative of Chapter XIII of the Constitution of India. The learned counsel invited the attention of the Court to Arts. 301 to 304 of the Constitution of India and submitted that the impugned order was violative of freedom of trade, commerce and intercourse guaranteed under Art. 301 of the Constitution of India. Since the said plea was not formulated in the petition when filed, the learned counsel applies for leave of the Court to amend the petition. The petitioners in Writ Petition No. 2210 of 1992 were permitted to incorporate this ground of challenge in the petition and the respondents were permitted to file supplementary return. In my opinion, it is well settled by the binding judgments of the Supreme Court that no citizen has a fundamental right to trade in intoxicant liquor and neither Art. 19(1)(g) and Part XIII of the Constitution is applicable to such cases. 20. The petitioners are relying on the view expressed by Shri Durga Das Basu in his Commentary that the series of the judgments of the Supreme Court having bearing on the subject are not correct. I am bound by the law declared by the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exclusive right to deal with the privilege of carrying on business in liquor. From para 51 of the said judgment, it appears that Krishan Kumar Narula's case was cited before the Supreme Court in another case i.e. State of Orissa v. Hari Narayan Jaiswal, [1972]3SCR784 . In this case also Hegde, j., speaking for the Bench, had distinguished Krishan Kumar's case and held that the citizens could not have any fundamental right to trade or business of carry on business in the properties or rights belonging to the Government. Paras48, 51 and 54 of the said judgment are quite clear on the subject. The question to be asked is as to whether Art. 301 of the Constitution is nevertheless available to a citizen to impugn the legislation or an order even though Art. 19(1)(g) of the Constitution is not available. In my opinion, this question is also not an open question. It is observed by the Constitutional Jurist H. M. Seervai in para 10.7 at page 697 of Constitutional Law of India, Fourth Edition, after analysing Krishnan Kumar's case and Chamarbaugwalla's case that a law introducing total prohibition of alcoholic liquor did not violate Art. 19(1)(f) and (g) and a fortiori woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of M/s. Jagadalc Sons, Bangalore v. State of Karnataka, AIR1990Kant251 ., It was held in this case by K. Shivshankar Bhat J., speaking on behalf of the Bench, that the protection under Article 301 was confined to such activity as may be regarded as lawful trading activity and did not extend to an activity which was 'res extra commercium'. It was held that no citizen had a fundamental right to carry on trade or business in liquor and accordingly neither Article 19(1)(g) could be relied upon nor Article 301 could be pressed into service to impugn the action of the State. It has been held in scribes of cases that the principle laid down in Chamarbaugwala's case were directly applicable to the case of trade in liquor also and the said principle cannot be restricted merely to gambling. Shri Gordey was justified in relying on the judgment of the High Court of Allahabad in the case of Sheo Kumar v. State of U.P. AIR 1878 All 386 : 1978 All LJ 581. In this case, Satish Chandra C.J. held that neither Article 10(1)(8) nor Article 301 or 304(b) could be relied upon for purpose of assailing imposition of prohibition in the State or part thereof. This case is of special sig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Maharashtra, [1977]2SCR828 . With all respect to the display of the legal scholarship at the Bar, I am duty bound to follow the ratio of the judgments of the Supreme Court as they are without commencing on the same. I respectfully follow the judgments of the Supreme Court. It is clear from the survey of cases referred to herein above that neither Article 19(1)(g) nor Article 301 of the Constitution can be available to a citizen as a ground of challenge so as to impugn the prohibition law or a statutory order made thereunder. Even as far as the challenge under Article 14 of the Constitution is concerned, the Court must take content of Article 47 of the Constitution into consideration while judging the question as to whether the impugned order is reasonable or manifestly arbitrary. Directive principles are always relevant. 24. In this view of the matter I have not permitted the learned counsel for the petitioners Shri Aney to argue what he would have argued if it was held that Krishan Kumar Narula's case holds the field and if it was held that Part XIII of the Constitution was available to the petitioners to impugn the order dated 14th September 1992 even though no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC) . In this case, it was held by K. Jagannath Shetty, J. that the establishment of Municipal Corporation was a legislative process and the rules of natural justice were not applicable. In this case, the Supreme Court distinguished the ratio of the judgment in the case of Baldev Singh v. State of. Himachal Pradesh, relied on by Shri Bobde. In para 26 of this judgment, the Supreme Court referred to the earlier judgment of the Supreme Court in the case of Tulsipur Sugar Co. Ltd. v. The Notified Area Committee, Tulsipur, [1980]2SCR1111 . In this case, Venkataramiah, J. as His Lordship then was, in terms observed that the power of the State Government to make a declaration under Section 3of the U.P. Town Areas Act was legislative in character and exercise of power was in the nature of conditional legislation. Shri Deshpande also invited the attention of the Court to another leading judgment of the Supreme Court in the case of Union of India v. Cynamide India Ltd., [1987]2SCR841 , In this case, the question before the Court was as to whether the order of price fixation under the Drugs (Price Control) Order, 1979, was legislative in character. After surveying large number of cases alrea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act is the Collector of the district and not the State Government. The learned counsel has submitted that the Collector could not pass an order cancelling the licence at the behest of the State Government. The learned counsel has relied on the judgment of the Supreme Court in the case of Commissioner of Police v. Gowardhan Bhanji [1952]1SCR135 . In our case, the order of cancellation of licence is merely in the nature of follow up action in pursuance of the declaration of the area of Gadchiroli as a dry area. In this case the State Government was entitled to issue the necessary instructions to the Collector to cancel the subsisting licence or make the subsisting licence inoperative as already discussed in the earlier part of this judgment. Accordingly the ratio of the judgment of the Supreme Court in the case of Commissioner of Police v. Gowardhan Bhanji shall have no application. If the Collector of Gadchiroli was required to give hearing to the licence holders, the question to be asked is as to on what aspects the Collector would adjudicate after hearing the licence holder. This question answers itself. In this situation, it is held that the impugned orders dated 15th September ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other districts can also be treated as tribal areas by adopting the same criteria and such districts are not prohibited by issuing the like order dated 14th September, 1992. The petitioners have contended that the prohibition is introduced only in one district i.e. Gadchiroli and not in other districts. I have already observed by referring to the judgment of the Allahabad High Court that the selective application of prohibition law is for the State and such a ground of challenge cannot be entertained. With respect, even factually the averment made is not quite correct. It has been stated in the supplementary affidavit filed on behalf of the State that the prohibition of the liquor trade is in force in several tribal areas. It has been stated that the State has declared the district Wardha as a dry district years ago. It is stated in the said affidavit dated 17th March, 1993 that in the districts of Thane, Nasik, Dhule and Amravati also certain areas are declared as dry areas. The particulars of such dry areas in the said districts, as declared by the State by issuing necessary notification, are as under:-- Tahsils ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bombay Prohibition Act confers powers on the State Government to provide for exemption in appropriate cases. I am satisfied that there is no merit in this challenge also. The petitioners have failed to discharge the onus which lay on them to prove that the impugned orders are unconstitutional. 30. It must be observed that by reason of the interim stay granted by this Court, various writ petitioners have been able to operate their licences which were cancelled by the impugned order dated 14th September, 1992 and the period of such licences, if not cancelled, was to expire on 31st March, 1993. 31. The learned counsel for the petitioners submitted that the petitioners had a vested right to continue the business in liquor at least for the period of the licence and the impugned action of the authority was thus arbitrary. It is well-settled law that the State alone has the exclusive right to deal with the subject-matter and when it parts with some of its privileges in the form of licence to the citizens, no vested right is created. When the citizen obtained licence from the statutory authority for a period, he is aware or is deemed to be aware that the licence could be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment for cancellation of permits held by the petitioners is without authority of law. The learned counsel has pointed out that the permits in question were operative within the State of Maharashtra and were not restricted to Gadchiroli area. By the said permits the petitioners were permitted to purchase, possess, transport or consume foreign liquor and country liquor within the State of Maharashtra. The learned counsel also submitted that the said permits were in the nature of health permits. The learned counsel submitted that even in Wardha district health permits are granted. The State has submitted in its return that the permits in question were not health permits. After careful consideration of the submissions made at the Bar, I hold that the impugned cancellation of permits complained of by the petitioners by the impugned order 15th September, 1992 cannot be faulted inasmuch as the impugned action is ancillary to the declaration of the area as dry area by virtue of operation of the statutory order dated 14th September 1992 having the force of law. It is, however, clarified that the petitioners concerned shall be at liberty to make an application for issue of health permits aft ..... 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