2019 (2) TMI 1758 - HC - Central Excise

Court Quashes Liquor Shop Shift Order for Violating Statutory Provisions

The court allowed the writ petitions, quashing the orders permitting the shift of a liquor shop from Mahe Region to Karaikal Region. The court emphasized ... Permission for shifting of the liquor shop - scope of 'local area' as per Pondicherry Excise Act, 1970 - presence of liquor vending on National and State Highways across the Country and the alarming statistics as to the occurrence of roads accidents on account of drunk and driving - HELD THAT:- The interpretation now given by the official respondents is that the definition of the word ''place'' under section 2[22] of the Act, 1970, is an inclusive definition, which definition includes region also. Chapter IX deals with the lease of the right of retail vend of liquors and though the said Chapter has no application to FL-1 license, as per Rule 163, for shifting of the shop, the licensing authority may either on the application of the licensee or otherwise and for the reasons to be recorded in writing, direct shifting of a shop from one place to another and the licensee shall not be entitled to any compensation on account of such shifting - In the Principle of Statutory Interpretation 14th Edition, in Chapter II Synopsis II, while dealing with the natural and grammatical meaning, the learned author observed that, ''natural ordinary meaning of the words should not be departed from, unless it can be shown that the logical context in which words are used requires a different meaning'' and also quoted the observations of the Hon'ble Mr. Justice Gajendra Khatkari in Hyden's case that, ''words used in the material provisions of the Statute must be interpreted in their plain grammatical meaning and it is only such words are capable of true constructions the question of giving effect to the policy or object of the Act legitimately or otherwise.'' The word/phrases/term ''place'' in the Pondicherry Excise Act, 1970 and the Rules framed thereunder is having a restrictive meaning. Sub-rule 2 of Rule 191 of Chapter XIII also says that in case of other shops, i.e., apart from Arrack and Toddy shops, the applicant shall select the site and intimate the licensing authority, who may, after making such enquiry as he thinks fit, approve the site so selected. The word ''site'' is referable to the site in a particular place only and in the case on hand, the liquor shop, in which the 4th respondent has been granted FL-1 License at Mahe Region, wants to shift the same to Karaikal Region which is around 650 Kms away. The area defined under section 2[22] of the Pondicherry Excise Act, 1970, and other Rules of the Pondicherry Excise Rules, 1970, are having restrictive meaning and it is restricted to the area in which, the liquor shop is located, pursuant to the license granted and the order granting shifting of the said shop, can be confined only to that area and not to a totally different region - petition allowed. Issues Involved:1. Legality of shifting liquor shops from Mahe Region to Karaikal Region.2. Interpretation of the term 'place' under the Pondicherry Excise Act, 1970.3. Compliance with statutory formalities and requirements under the Pondicherry Excise Rules, 1970.4. Validity of the orders passed by the Deputy Commissioner [Excise], Karaikal and Puducherry.Detailed Analysis:1. Legality of Shifting Liquor Shops from Mahe Region to Karaikal Region:The petitioner filed writ petitions as Public Interest Litigations to prevent the respondents from establishing or shifting liquor shops from Mahe Region to Karaikal District. The petitioner argued that the provisions of the Pondicherry Excise Act, 1970, restrict shifting within a specified local area and do not allow shifting to a different region, citing the Single Bench order in WP.No.39961/2002 and the Supreme Court's judgment in 2017 [2] SCC 281. The Deputy Commissioner [Excise] granted permission for the shift, which the petitioner challenged on the grounds that it violated the Act and Rules.2. Interpretation of the Term 'Place' under the Pondicherry Excise Act, 1970:The term 'place' defined under Section 2[22] of the Act, 1970, was a central issue. The petitioner argued that 'place' should mean a locality or area within the same region and not extend to different regions. The court examined previous judgments and statutory interpretations, concluding that 'place' has a restrictive meaning and should be confined to the area where the liquor shop is originally located.3. Compliance with Statutory Formalities and Requirements under the Pondicherry Excise Rules, 1970:The petitioner contended that the Deputy Commissioner [Excise] did not objectively consider the objections raised and failed to comply with Rule 122, which mandates determining the maximum number of licenses in an area. The court found that the Deputy Commissioner's disposal of the petitioner's objections was not satisfactory and did not adhere to the directions issued in the common order dated 26.02.2018. However, the court noted that Rule 122 was complied with in letter and spirit.4. Validity of the Orders Passed by the Deputy Commissioner [Excise], Karaikal and Puducherry:The court scrutinized the orders dated 27.03.2018 and 15.06.2018, which permitted the 4th respondent to shift the liquor shop from Mahe Region to Karaikal Region. The court held that these orders were not in consonance with the statutory provisions and the directions issued in the previous common order. Consequently, the court quashed the impugned orders and set aside the permission granted for the shift.Conclusion:The court allowed the writ petitions, quashing the orders dated 15.06.2018 and 27.03.2018 by the Deputy Commissioner [Excise], Karaikal and Puducherry, and set aside the permission accorded to the 4th respondent to shift the liquor shop from Mahe Region to Karaikal Region. The court emphasized that the term 'place' in the Pondicherry Excise Act, 1970, and the Rules should be interpreted restrictively, limiting shifts within the same area. The court also provided the 4th respondent the liberty to seek remedies under the law before the competent forum.