1983 (11) TMI 274 - SC - Central Excise

Supreme Court restores Board of Revenue's decision on liquor licenses, emphasizing authority, jurisdiction, and procedural compliance.

BISHNU RAM BORAH Versus PARAG SAIKIA

The Supreme Court set aside the High Court's judgment, restoring the Board of Revenue's decision denying liquor licenses to respondents. It held the High ... Whether it was proper exercise of jurisdiction by the High Court under Art. 226 of the Constitution to have issued a writ of mandamus ordaining the Deputy Commissioner to grant the licence? Whether it was impermissible for the High Court to have embarked upon an inquiry into the facts and on a reappraisal of the evidence come to a finding contrary to that reached by the Board of Revenue based on appreciation of evidence that one set of rival claimants i.e. Parag Saikia and Prafulla Barua, respondents Nos. 1 and 2 were entitled to grant of such privilege in preference to the appellant under the note beneath r. 223(2) of the Assam Excise Rules, 1945? Held that:- It was impermissible for the High Court to have embarked upon an inquiry into the facts to adjudge the suitability or otherwise of the rival pairs of claimants and upon a reappraisal of the evidence come to a finding contrary to that reached by the Board of Revenue. There was nothing on record to show that the Board had acted in excess of jurisdiction or there was an error apparent on the face of the record which resuited in manifest injustice. That apart, it was not a proper exercise of jurisdiction under Art.226 of the Constitution for the High Court to have issued a writ of mandamus ordaining the Deputy Commissioner to grant the liquor licence to respondents Nos.1 and 2 in preference to the appellants. There was no question of the Board disclosing the contents of the report to respondents Nos. 1 and 2. Further, respondents Nos.1 and 2 never made a demand for a copy of the report, and even if such a request was made the Board would have been fully justified in not furnishing the same. Such a refusal would not amount to denial of natural justice for the obvious reason that the rules of natural justice must necessarily vary with the nature of the right and the attendant circumstances. The grant of a liquor licence was not a matter of right but merely in the nature of privilege, Furthermore, the Board was entitled to call for a report of the Deputy Commissioner in an appeal of this nature We cannot also subscribe to the view expressed by the High Court that respondent No.2 Prafulla Barua who is a student of B.Sc. class still undergoing his studies falls within the description of 'educated unemployed youth' appearing in the note beneath r.223 of the Rules. Also the procedure adopted by the High Court in separately dealing with the writ petition filed by respondents Nos.1 and 2 making a grant of the licence to them for the country spirit shop in question while the earlier writ petition filed by the interveners was still pending was not in consonance with law and rules of fairplay and justice - set aside the judgment and order of the High Court - Appeal remanded. Issues Involved:1. Propriety of the High Court's exercise of jurisdiction under Art. 226 of the Constitution.2. Legitimacy of the High Court's inquiry into the facts and reappraisal of evidence.3. Interpretation and application of Rule 223(2) of the Assam Excise Rules, 1945.4. Validity of the High Court's issuance of a writ of mandamus directing the grant of a liquor license.5. The suitability of the respondents for the grant of a liquor license based on the Board of Revenue's findings.6. Compliance with the High Court's directions by the Board of Revenue.7. The High Court's handling of the writ petitions filed by the interveners and respondents.Detailed Analysis:1. Propriety of the High Court's exercise of jurisdiction under Art. 226 of the Constitution:The Supreme Court examined whether the High Court properly exercised its jurisdiction under Art. 226. The High Court had issued a writ of mandamus directing the Deputy Commissioner to grant the liquor license to respondents Nos. 1 and 2. The Supreme Court found that the High Court's action was not a proper exercise of jurisdiction under Art. 226 as it should have issued a writ of mandamus to hear and redetermine the appeal according to law rather than directing the grant of the license.2. Legitimacy of the High Court's inquiry into the facts and reappraisal of evidence:The Supreme Court held that it was impermissible for the High Court to embark upon an inquiry into the facts and reappraise the evidence to reach a finding contrary to that of the Board of Revenue. The High Court's action of entering into a question of fact and determining the suitability of the respondents was beyond its jurisdiction under Art. 226.3. Interpretation and application of Rule 223(2) of the Assam Excise Rules, 1945:Rule 223(2) provides that preference shall be given to educated unemployed youths or cooperatives formed by such youths. The Supreme Court found that the High Court's interpretation of 'educated unemployed youth' was erroneous. The term denotes a class of citizens who, after completing their education, face unemployment. A student still pursuing studies cannot be regarded as an 'educated unemployed youth.'4. Validity of the High Court's issuance of a writ of mandamus directing the grant of a liquor license:The Supreme Court concluded that the High Court erred in issuing a writ of mandamus directing the Deputy Commissioner to grant the liquor license to respondents Nos. 1 and 2. The proper course would have been to remit the matter to the Board of Revenue for a fresh decision.5. The suitability of the respondents for the grant of a liquor license based on the Board of Revenue's findings:The Board of Revenue had found respondents Nos. 1 and 2 unsuitable for the grant of the license. Respondent No. 1 was deemed a benamidar of a prominent businessman, and respondent No. 2 was still a student. The Supreme Court upheld the Board's findings, emphasizing that the Board had the authority to rely on the Deputy Commissioner's confidential report and that the High Court should not have interfered with these factual determinations.6. Compliance with the High Court's directions by the Board of Revenue:The Supreme Court criticized the Board of Revenue for not complying with the High Court's directions. However, it also noted that the High Court's directions were beyond its jurisdiction. The Board's refusal to carry out the High Court's directions was seen as a denial of justice, but the Supreme Court ultimately supported the Board's findings on the merits.7. The High Court's handling of the writ petitions filed by the interveners and respondents:The Supreme Court found fault with the High Court's procedure of separately dealing with the writ petitions filed by the interveners and respondents. The High Court's action of making a grant of the license subject to the result of an inquiry into whether respondent No. 1 was a benamidar was not in accordance with law and rules of fair play and justice. The Supreme Court directed that the writ petitions be heard and disposed of together.Conclusion:The Supreme Court set aside the judgment and order of the High Court, restoring the order of the Board of Revenue dated December 3, 1982. The High Court was directed to dispose of the writ petitions expeditiously and in accordance with law. The appeal was remanded with no order as to costs.