Single wholesale liquor licence policy upheld where rule-making power covered state-wide licensing and the measure was not arbitrary.

Petitioners had locus standi to challenge an excise policy and amended licensing rules because their commercial interests could be affected by a single wholesale licence. The Financial Commissioner's rule-making power was held wide enough to prescribe the number of wholesale licences for the State as a whole, and the statutory scheme did not confine that power to local areas. A policy providing for one L-1BF wholesale licence was not illegal or arbitrary where it served revenue, anti-cartel, and anti-illicit trade objectives, was not shown to be mala fide or discriminatory, and was open to eligible bidders. The single licence policy and amended rule were upheld.

---

---

Issues: (i) whether the petitioners had locus standi to challenge the excise policy and the amended licensing rules, (ii) whether the Financial Commissioner had power to prescribe the number of wholesale licences for the entire State, and (iii) whether the clause and rule providing for a single L-1BF licence in the State were illegal or arbitrary.

Issue (i): whether the petitioners had locus standi to challenge the excise policy and the amended licensing rules.

Analysis: The petitioners were associations whose commercial interests could be affected by the grant of a sole wholesale licence. The challenge was not confined to a mere abstract grievance. Their asserted ability to purchase or market liquor through wholesalers was sufficient to show that the impugned policy and rules could adversely affect them.

Conclusion: The petitioners had locus standi.

Issue (ii): whether the Financial Commissioner had power to prescribe the number of wholesale licences for the entire State.

Analysis: The statutory scheme distinguished between the State Government's power to regulate the number of licences in any local area and the Financial Commissioner's power to make rules regulating the supply and sale of intoxicants. The expression used in the State Government's rule-making power was confined to local areas, whereas the Financial Commissioner's power to regulate sale by licence was wide enough to include the number of licences for the State as a whole. The rule-making exercise therefore did not transgress the Act.

Conclusion: The Financial Commissioner had power to prescribe a single wholesale licence for the State.

Issue (iii): whether the clause and rule providing for a single L-1BF licence in the State were illegal or arbitrary.

Analysis: The excise policy expressly balanced multiple competing objectives, including revenue maximisation, social considerations, curbing cartels, and preventing illicit trade. The choice to adopt a sole wholesale licence was a policy decision taken to protect revenue and was not shown to be mala fide, discriminatory, or otherwise arbitrary. The fact that a sole wholesaler could exercise commercial discretion did not by itself render the policy or rule unlawful, particularly when the bidding process was open to all eligible parties.

Conclusion: The challenge to the policy and rule failed.

Final Conclusion: The impugned policy and amended rule sustaining a single L-1BF wholesale licence in Haryana were upheld, and the writ petitions were dismissed.

Ratio Decidendi: Where the statute permits rule-making to regulate liquor licences and does not bar a sole wholesale licence, a policy choice to grant one licence through an open bidding process will not be struck down merely because it may reduce competition or confer commercial discretion on the selected licensee.

---