AI Drafter 
TaxTMI 
TaxTMI 
2010 (1) TMI 1204
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....is the respondent in C.A. No. 983 of 2003 and the appellant in C.A. No. 998 of 2003. 3. The applicant constructed a resort hotel at Munnar. The applicant's restaurant therein was classified by the Ministry of Tourism, Government of India, as an approved restaurant. On 11.12.2000, the applicant made an application for a FL-3 licence under the Rules. As the said application was not considered, the applicant approached the High Court. The High Court, disposed of the writ petition (O.P.No.824/2001) by order dated 9.1.2001 with a direction to the excise authorities to consider and dispose of the application within three weeks. The application was considered and rejected by order dated 19.5.2001 on the ground that the Managing Director of the applicant had been convicted in an excise offence. The said rejection was challenged in O.P. No. 17106/2001 contending that the person convicted was not the Managing Director when the application was made. The second writ petition was allowed on 20.6.2001 with a direction to re-consider the application and pass a fresh order, taking note of the fact that the convicted Managing Director was no longer in office and there was new Managing Direct....
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....01. By the said amendment, the last proviso under sub-Rule (3) of Rule 13 was substituted by the following proviso: "Provided that no new licences under this Rule shall be issued." The notification contained the following explanatory note to indicate the purpose of the amendment: "Government have decided as its policy not to grant any new FL-3 Hotel (Restaurant) Licences and also decided not to renew any defunct licences of the above category with effect from 1.7.2001 until further orders. In order to carry out the above decision, necessary amendments have to be made in the relevant rules" On the same date, i.e. 20.2.2002, the Excise Commissioner considered the application of the applicant and again rejected the request for grant of licence in view of proviso to the amended rule, prohibiting grant of new licences. 5. The applicant challenged the amendment to the Rule and the consequential rejection of its application in O.P. No. 7112 of 2002. The said writ petition (along with other writ petitions and writ appeals involving similar issue) were disposed of by the impugned order dated 16.7.2002. The High Court considered the following four grounds of challenge: (a) ....
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....lding the validity of the amendment and non-grant of licence in CA No. 998 of 2003 and CA Nos. 999- 1003 of 2003. 8. Two issues arise for consideration on the contentions urged: (i) Whether an application for grant of FL-3 Licence should be considered with reference to the Rules as they existed when the application was made or in accordance with the Rules in force on the date of consideration? (ii) Whether the amendment to Rule 13(3) of Foreign Liquor Rules substituting the last proviso is valid? Re : Question (i) 9. This question is directly covered by the decision of this Court in Kuldeep Singh v. Govt. of NCT of Delhi (2006) 5 SCC 702 relating to grant of licences for sale of Indian made foreign liquor. This Court held: "It is not in dispute that the State received a large number of applications. It was required to process all the applications. While processing such applications, inspections of the proposed sites were to be carried out and the contents thereof were required to be verified. For the said purpose, the applications were required to be strictly scrutinized. Unless, therefore, an accrued or vested right had been derived by the Appellants, the policy ....
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.... held: "Mere making of an application for registration does not confer any vested right on the applicant. The application has to be decided in accordance with the law applicable on the date on which the authority granting the registration is called upon to apply its mind to the prayer for registration." 11. The applicant contended that it had a vested right because of the several time-bound orders of the High Court and those orders were deliberately floated by the Excise authorities. An identical contention was rejected by this Court while considering the issue with reference to sanction of a licence under the Building Rules, in Howrah Municipal Corporation v. Ganges Rope Co.Ltd. (2004 (1) SCC 663). This Court held: "Neither the provisions of the Act nor general law creates any vested right, as claimed by the applicant company for grant of sanction or for consideration of its application for grant of sanction, on the then existing Building Rules as were applicable on the date of application. Conceding or accepting such a so-called vested right of seeking sanction on the basis of unamended Building Rules, as in force on the date of application for sanction, woul....
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..............................." 12. Where the Rule require grant of a licence subject to fulfillment of certain eligibility criteria either to safeguard public interest or to maintain efficiency in administration, it follows that the application for licence would require consideration and examination as to whether the eligibility conditions have been fulfilled or whether grant of further licences is in public interest. Where the applicant for licence does not have a vested interest for grant of licence and where grant of licence depends on various factors or eligibility criteria and public interest, the consideration should be with reference to the law applicable on the date when the authority considers applications for grant of licences and not with reference to the date of application. 13. The applicant submitted that it had originally filed an application on 11.12.2000 and in pursuance of the decision of the High Court on 14.12.2001, it submitted an application on 19.12.2001 and that application was considered and disposed of on 27.12.2001. The applicant contended that even if the principle laid down in Kuldeep Singh was applied, the application having been considered and dis....
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....no difference in principle. Further the legal position is no different even where the matter is governed by statutory rules, is evident from the decisions in Hind Stone (supra) and Howrah Municipal Corporation (supra). 15. Having regard to the fact that the State has exclusive privilege of manufacture and sale of liquor, and no citizen has a fundamental right to carry on trade or business in liquor, the applicant did not have a vested right to get a licence. Where there is no vested right, the application for licence requires verification, inspection and processing. In such circumstances it has to be held that the consideration of application of FL-3 licence should be only with reference to the rules/law prevailing or in force on the date of consideration of the application by the excise authorities, with reference to the law and not as on the date of application. Consequently the direction by the High Court that the application for licence should be considered with reference to the Rules as they existed on the date of application cannot be sustained. Re: Question (ii) 16. The applicants for licence submitted that Rule 13(3) contemplates FL-3 licences being granted on fulfill....