Liquor licence fee levy upheld where excise law allowed auction pricing plus an assessed sales-based component.

The Supreme Court upheld the levy of an assessed fee on FL-2 wholesale liquor licences in addition to the auction money fixed fee, holding that the post-1976 scheme of the U.P. Excise Act, 1910 and the amended rules authorised licence consideration to be determined by auction and by an additional sales-based component. The phrase "or otherwise" in Section 30(2) was read broadly, and the later amendment was treated as clarificatory rather than conferring a new power. The Court further held that bidders had notice through the amended rules and licence condition, and that the Excise Commissioner's prescribed scales were attributable to the State Government.

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Issues: Whether the State could lawfully levy and recover, in addition to the auction money described as the fixed fee, an assessed fee on sales under FL-2 licences for wholesale vend of liquor; and whether the levy was invalid for want of announcement or because the rate had been prescribed by the Excise Commissioner rather than the Government.

Analysis: The levy was upheld as being authorized by the statutory scheme introduced by the 1976 amendments. The amended provisions of the U.P. Excise Act, 1910, especially Sections 24-A, 24-B, 30(2) and 41(c), read with the amended Rules and the licence condition, showed that the licence fee could be determined by auction and also include an assessed component based on sales. The expression "or otherwise" in Section 30(2) was treated as wide enough to permit a combination of methods, and the later amendment was regarded as clarificatory rather than creating a new power. The Court also held that the bidders had notice of the amended rules and the read-out licence condition, and that the Excise Commissioner acted for and on behalf of the State Government under Section 24-B(c), so the prescribed scales were attributable to the Government.

Conclusion: The levy and recovery of assessed fee over and above the fixed fee was valid and the constitutional challenge failed.

Final Conclusion: The writ petitions were devoid of merit, and the impugned demand for assessed fee under the post-1976 excise regime was sustained.

Ratio Decidendi: Where the governing excise statute and rules authorise determination of licence consideration by auction and other modes, and the licence conditions and published rules disclose the liability, an assessed fee may validly be recovered in addition to auction money as part of the statutory consideration for the privilege.

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