Appeal No 1063 of 1971
Appeal by special leave from the judgment and order dated June 25 1971 of the Court of Judicial Commissioner for Tripura in Civil Matter No 2 of 1970
A K Sen and D N Mukherjee for the appellant
Govind Das and section P Nayar for the respondents
The Judgment of the Court was delivered by Dua J
This appeal is by special leave
The appellant assails the order of the Judicial Commissioner Tripura dated June 25 1971 dismissing his petition under article 226 of the Constitution challenging the order of the Collector of Excise Tripura dated July 5 1970
The appellant was granted licence for the period April 1 1963 to March 31 1966 for running a warehouse for supply of country liquor to excise vendors in the territory of Tripura
The Bengal Excise Act 1909 hereinafter called the Act had been extended to that territory on August 1 1962
The appellant s licence was subsequently extended for a further period of two years ending March 311968
On November 6 1967 the appellant applied to the Excise Collector praying that he should be permitted to continue the supply of country liquor for a period of five years commencing April 1 1968
The Collector recommended the appellant s case to the Government on November 18 1967 for extension of his licence for a further period of only two years
On 536 December 22 1967 the Collector of Excise Tripura Agartala wrote to the appellant that he had been appointed by the Chief Commissioner a contractor for the supply of country liquor to the excise vendors for the territory of Tripura for five years ie from 1 4 68 to 31 3 73 at the existing rate ie Rs 225 only being the cost of one LP litre of country liquor of 40 UP strength for sale to the excise vendors of that territory from the Central Warehouse at Agartala
On January 13 1963 the appellant was asked by the Collector of Excise to deposit Rs 1000as security and Rs 2500 as licence fee for five years at the rate of Rs 5001 per year
On March 13 1968 the appellant was accordingly granted a licence to establish a warehouse for the storage in bond and wholesale vend of country spirit by import and for supply to the excise vendors in the territory of Tripura for five years commencing April 1 1968 and ending March 31 1973
It was granted by the Excise Collector
The Committee of Estimates in their Fifth Report about the working of Excise Department in the territory of Tripura in general and about the procedure adopted in giving contract to the appellant for a period of five years from 1968 to
1973 in particular made some adverse observations critic sing the method of appointment by means of selection because this method according to the report left loopholes for corruption
As a result of this report the Lt Governor of Tripura on July 2 1970 inserted r 164 A in the Tripura Excise Rules of 1962 in exercise of the power conferred by section 86 of the Act
According to the now rule fees for licence for the wholesale vend of country spirit were required to be fixed by tender cum auction
On July 6 1970 the Excise Collector issued the following order to the appellant  GOVERNMENT OF TRIPURA OFFICE OF THE COLLECTOR OF EXCISE No 810DMEX51970 71 dated Agartala the 6 7 1970 Whereas it has been decided by the Government of Tripura that the licenses for the wholesale of country spirit shall hence forwards be granted by the method of tender cum auction and to different persons for different specified areas as far as practicable instead of the present system of selection of one licensee for the whole territory of Tripura in the interests of excise revenue
And whereas 1 Sri Omesh Saigal Collector of Excise Tripura consider that for the aforesaid reason the license No 1 dated the 13th March 1968 issued to Sri Amar Chandra Chakraborty for the wholesale vend 537 of Country spirit in the Union Territory of Tripura for the period from the 1St April 1968 to 31 St March 1973 should be withdrawn
Now therefore in exercise of the powers conferred on me under Section 43 of the Bengal Excise Act 1909 as extended to the Union Territory of Tripura remit a sum of Rs 2084 equal to the amount of the fees payable in respect of the said license for 15 days and hereby give the licensee 15 days  notice of my intention to withdraw the said license and order that the said license be withdrawn with effect from 1st September 1970
Any fee paid in advance or deposit made by the licensee in respect thereof shall be refunded to him after deducting the amount if any due to the Government
Sd Omesh Saigal 5 7 70 Collector of Excise
 Feeling aggrieved the appellant challenged this order in the court of the Judicial Commissioner by means of a writ petition under article 226 of the Constitution which was dismissed by the impugned order
The order of the Collector dated July 6 1970 was challenged by the appellant on a number of grounds including invalidity of section 43 of the Act and r 164A of the Rules framed thereunder
The learned Judicial Commissioner in an exhaustive order came to the conclusion that the appellant had been given a contract for five years on the basis of his application dated November 6 1967 without issuing a public notice as required by the proviso to section 221 of the Act
This violation of the statutory provision invalidated the contract or the privilege of selling country liquor secured by the appellant
According to the Judicial Commissioner this ground by itself was enough for throwing out of the appellant s writ petition
The contention that section 43 of the Act does not envisage withdrawal by the Collector of the licence pertaining to the privilege granted by the Chief Commissioner of Tripura under section 22 of the Act was also negatived by the Judicial Commissioner as in his opinion the Collector who had issued the licence was fully competent to withdraw the same
Similarly challenge to the cons titutionality of section 43 of the Act was repelled and it was held that this section merely imposes reasonable restrictions in the matter of trade in liquor
The argument that 15 days  notice as contemplated by section 43 of the Act had not been given was also rejected because in the Judicial Commissioner s opinion notice had actually been given to the appellant but he had not cared to avail of it as 538 he never approached against the action withdrawing the licence
Rule 164A was held to be intra vires and within the terms of section 86 of the Act
In this Court the principal contention raised by Shri A K Sen on behalf of the appellant is that section 43 of the Act contemplates a show cause notice which has not been given and that in any event this section clothes the authority granting the licence with unguided and uncanalised power to withdraw the licence and is therefore violative of article 14 and also article 19 of the Constitution as it encroaches on the appellant s fundamental right of carrying on trade or business
Shri Sen further submitted that the authority granting the licence was the Chief Commissioner but the order dated July 6 1970 was issued by the Collector of Excise
The order withdrawing the licence according to the learned counsel could only be made by the authority granting the licence and that too after the expiry of 15 days
The counsel added that withdrawal of licence virtually amounts to its forfeiture with the result that the provisions dealing with such withdrawal calls for a strict construction
The contention that the authority granting the licence was the Chief Commissioner and therefore the notice issued by the Collector of Excise is bad cannot be accepted
The licence dated March 13 1968 was issued from the office of the Collector of Excise Agartala and was signed by that officer
Even in the appellant s writ petition in para 15 there is an express averment that the licence dated March 13 1968 had been issued under the signatures of the Collector of Excise Tripura
No doubt it is added in the same paragraph that the Collector is not the authority to exercise power under section 43 of the Act but this submission has not been substantiated at the bar and is contrary to the statutory provisions
Under section 22 sub section
1 the Chief Commissioner is no doubt given the power of granting the exclusive privilege of manufacturing and selling country liquor or intoxicating drugs as mentioned in cls
a to e but sub section
2 of this section in express terms provides that no grantee of any privilege under sub section
1 shall exercise the same unless or until he has received a licence in that behalf from the Collector or the Excise Commis sioner
In view of this provision it is obvious that it is the Collector who grants the licence within the contemplation of section 43 and therefore it was this very officer who rightly granted the licence to the appellant and is empowered to withdraw the licence under section 43
As sec
43 provides for withdrawal of a licence for any cause other than those specified in section 42 of the Act we consider it proper to reproduce both these sections
They read 539 42
Power to cancel or suspend license permit or pass
1  Subject to such restrictions as the Chief Commissioner may prescribe the authority who granted any license permit or pass under this Act may cancel or suspend it a if it is transferred or sublet by the holder thereof without the permission of the said authority or b if any duty or fee payable by the holder thereof be not duly paid or c in the event of any breach by the holder thereof or by any of his servants or by any one acting on his behalf with his express or implied permission of any of the terms or conditions thereof or d if the holder thereof is convicted of any offence punishable under this Act or any other law for the time being in force relating to revenue or of any cognizable and
non bailable offence or of any offence punishable under the Dangerous Drugs Act 1930 II of 1930 or under the 43 of 1958 or under any section which has been introduced into the Indian Penal Code by Section 3 of that Act Act XLV of 1860 or e if the holder thereof is punished for any offence referred to in clause 8 of section 167 of the VIII of 1878 or f where a licence permit or pass has been granted on the application of the holder of an exclusive privilege granted under section 22 on the requisition in writing of such holder or g if the conditions of the license permit or pass
provide for such cancellation or suspension at Will
2 When a license permit or pass held by any person Is cancelled under clause a clause b clauser c clause  d or clause e of sub section 1 the authority aforesaid may cancel any other licence permit or pass granted to such person by or by the authority of the Chief Commissioner under this Act or under the Opium Act 1878 1 of 1878
1286Sup
Cl72 540 3The holder of a license permit or pass shall not be entitled to any compensation for its cancellation or suspension under this section or to the refund of any fee paid or deposit made in respect thereof
43Power to withdraw licenses 1 Whenever the authority who granted any license under this Act considers that the license should be withdrawn for any cause other than those specified in section 42 it shall remit a sum equal to the amount of the fees payable in respect thereof for fifteen days and may withdraw the license either a on the expiration of fifteen days  notice in writing of its intention to do so or b forthwith without notice
2 If any license be withdrawn under clause b of sub section 1 the said authority shall in addition to remitting such sum as aforesaid pay to the licensee such further sum if any by way of compensation as the Excise Commissioner may direct
3When a license is withdrawn under sub section 1 any fee paid in advance or deposit made by the licensee in respect thereof shall be refunded to him after deducting the amount if any due to the Government
 Before dealing with the contention relating to article 19 we consider it proper to dispose of the argument founded on the ejusdem generis rule and article 14 of the Constitution
It was contended by Shri Sen that the only way in which section 43 can be saved from the challenge of arbitrariness is to construe the expression any cause other than in s 431 ejusdem generis with the causes specified in cll
a to g of section 42 1
We do not agree with this submission
The ejusdem generis rulestrives to reconcile the incompatibility between specific and general words
This doctrine applies when i the statute contains an enumeration of specific words ii the subjects of the enumeration constitute a class or category  iii that class or category is not exhausted by the enumeration iv the general term follows the enumeration and v there is no indication of a different legislative intent
In the present case
it is not easy to construe the various clauses of section 42 as constituting one category or class
But that apart the very language of the two sections and the objects intended respectively to be achieved by them also negative any intention of the legislature to attract the rule of ejusdem generis
Trade or business in country liquor has from its inherent nature been treated by the State and the society as a special category 541 requiring legislative control which has been in force in the whole of India since several decades
In view of the injurious effect of excessive consumption of liquor on health this trade or business must be treated as a class by itself and it cannot be treated on the same basis as other trades while considering article 14
this classification is founded on an intelligible differentia having a rational relation to the object to be achieved by the control imposed on the trade or business in country liquor
article 14 it may be pointed out only forbids class legislation but reasonable classification does not come within the prohibition
Nothing convincing was urged at the bar to attract the prohibition embodied in article 14
The submission that a separate order withdrawing the licence after the expiry of 15 days  period from the order dated July 6 1970 was necessary has also not appealed to us
Section 43 does not provide any such procedure
All that this section contemplates is that whenever the authority concerned considers that the licence should be withdrawn for any cause other than those specified in section 43 it may withdraw the same but to do so it must remit a sum equal to the amount of fees payable in respect of the licence for 15 days
It is not complained that this amount was not remitted as required
Now if the licence is withdrawn under section 43 1  a on the expiration of 15 days  written notice of the authority s intention to do so then nothing further need be done
It is only when the licence is desired to be withdrawn forthwith without notice as contemplated by section 43 1  b that the authority is under a further obligation to pay compensation as may be directed by the Excise Commissioner
Here the licence stood withdrawn on September 1 1970 as stated in the intimation contained in the order dated July 6 1970
That intimation fully complies with the provisions of section 4 3
The argument that no show cause notice was given to the appellant before withdrawing the licence is equally
unacceptable for reasons just stated
The section does not contemplate two separate notices
The order dated July 6 1970 also clearly state that 15 days  notice was being given to the licensee regarding the intention of the Collector of Excise to withdraw his licence and it is also specifically mentioned in the order that the said licence would be withdrawn with effect from September 1 1970
The fact that tinder the notice the licence was to be withdrawn more than 15 days after the date of the notice did not cause the appellant any prejudice and indeed no objection was raised on this score
The contents of this order also quite clearly show that the appellant had ample opportunity of showing cause against the intention of the Collector to withdraw the licence with effect from September 1 1970
Rules of natural justice on which the appellant s counsel relied for his grievance vary with the varying consti 5 4 2 tutions of statutory bodies and the rules prescribed by the legislature under which they have to act and the question whether in a particular case the rules of natural justice have been contravened must be judged not by any preconceived opinion of what they may be but in the light of the relevant statutory provisions  Gullapalli Nageswara Rao vs A P State Road Transport Corporation1
Applying this test to the present case the order dated July 6 1970 cannot be considered to violate any rule of natural justice
According to Shri Sen the business of selling liquor is protected by article 19 of the Constitution as a fundamental right and reliance for this submission has been placed on K K Narula vs The State of J  K2
This fundamental right has been illegally infringed said the counsel
It is no doubt true that this Court in the case cited held that dealing in liquor is business and a citizen has a right to do business in that commodity but it was added that the State can make a law imposing reasonable restrictions on the said right in public interest
In dealing with reasonable restrictions no abstract standard or general pat tern is possible to lay down
In each case regard has to be had to the nature of trade or business the conditions prevailing in such trade or business the nature of the infringement alleged and the underlying purpose of the restrictions the imposition of which is alleged to constitute ant infringement
According to Shri Sen the licence was granted to the appellant for five years and withdrawal of this licence before die expiry of five years has caused him immense financial loss
The licence was withdrawn without any fault on his part
Unreasonableness of  the provision contained in section 43 according to him is manifest because it permits the licensing authority to withdraw the licence for any reason whatsover not falling under section 42
This wide and arbitrary power being unreasonable is violative of the appellant s fundamental right under article 19
Let us see if this submission is well founded
Section 42 empowers the authority granting a licence permit or pass under the Act to cancel or suspend it subject to such restrictions as may be imposed by the Chief Commissioner
The grounds oh which the order of cancellation or suspension may be based are contained in clla to g of sub section
Except for cll
f and g all other clauses suggest  some impropriety or default on the part of the licensee
Clause f speaks of cancellation or suspension on the written
requisition by the holder of the exclusive privilege under section 22 and cancellation or suspension under cl
g is in accordance with the conditions of the licence pen nit or pass in question
Sub section 3 expressly negatives 1 1959 SUPP
1 SCR 319
2 1967 3 SCR 50 5 4 3 the right to compensation and also to refund of fee and depositauthority granting a licence under the Act to withdraw the same for anycause other than those specified in section 42 on remitting a sum equal to the amount of fee payable for 15 days
It is no doubt true that in s 43 there is no express mention of the precise grounds on which the licence can be withdrawn
But in our opinion keeping in view the nature of the trade or business for which the grant of licence under the Act is provided the cause contemplated by section 43 must be such as may have reasonable nexus with the object of regulating this trade or business in the general interest of the public
In the determination of reasonableness of restrictions on trade or business regard must be had to its nature the conditions prevailing in it and its impact on the societ as a whole
These factors must inevitably differ from trade to trade and not general rule governing all trades or businesses is possible to lay down
The right to carry on lawful trade or business is subject to such reasonable conditions as may be considered essentials by the appro priate authority for the safety health peace order and morals of the society
Article 47 of our Constitution directs the State to endeavour to prohibit consumption intoxicating drinks of drugs which are injurious to health except for medicinal purposes
In the case of country liquor therefore the question of determining reasonableness of the restriction may appropriately be considered by giving due weight to the increasing evils of excessive consumption of country liquor in the interests of health and social welfare
Principles applicable to trades which all persons carry on free from regulatory controls do not apply to trade or business in country liquor  this is so because of the impact of this trade on society due to its inherent nature
In the present case according to the counter affidavit after the Committee of Estimates had in their Fifth Report criticised the working of the Excise Department in the territory of Tripura in general and the procedure adopted in granting five years licence to the appellant in particular the Council of Minister as a consequence of this criticism resolved that the exclusive privilege of supplying countery liquor by wholesale should be allowed to three persons and not to one and that also by tender cum auction
Pursuant to this decision r 164A was inserted in the Tripura Excise Rules on July 2 1970
The Union Territory of Tripura was accordingly divided into three districts for the purpose of licence for wholesale supply of country liquor with effect from September 1 1970
It was for implementing this policy decision of the State Government that on july 6 1970 the Collector of Excise informed the appellant by the impugned order that his licence would be withdrawn on september 1 1970 at the same time remitting to him 15 days licence fee as required by statute
544 The Government then took steps to invite tenders and fix a date for auction of
wholesale supply of country liquor
The cause for withdrawing the appellant s licence is in terms of the major policy decision taken by the Tripura Government and this in our opinion is a cause which keeping in view the purpose and object of granting such exclusive privileges and licences cannot be considered to be either irrelevant or collateral to that purpose and object
The appellant had it may be recalled secured his licence for the maximum period of five years as provided by r 224 of the Tripura Excise Rules 1962 for a nominal annual sum
On the withdrawal of the licence fee for 15 days was remitted to him and the fee paid in advance and the deposit made were also directed to be refunded as provided by section 433
But this apart the learned Judicial Commissioner has also held in the judgment under appeal that since the contract for five years had been given to the appellant in complete violation of the statutory provision enacted in the proviso to section 221 of the Act he could not claim to be a holder of any valid contract or of
a valid conclusion
Shri Mukherjee however did make a faint attempt the conclusions of the learned Judicial Commissioner by submitting that the appellant was not aware of non compliance with the proviso to section 22 1  of the Act and that he could not be penalised for any such non compliance
We are not impressed by this submission
Section 22 contemplates the grant of exclusive privilege which amounts to a virtual monopoly for manufacturing supplying and selling at wholesale or retail country liquor or intoxicating drugs within a specified local area
Keeping in view the nature of this trade or business particularly the unhealthy effects of intoxicants on certain important sections of the society it cannot be denied that the residents of the local area concerned would be vitally interested in the matter of grant of exclusive privileges and licences for sale of liquor as unless appropriately regulated such trade or business may prove a source of nuisance and annoyance to the persons presiding in the vicinity
It is apparently in recognition of this vital interest of the residents of the locality that public notice of the intention to grant such exelusive privilege is provided so that objections thereto if any may be preferred before the exclusive privilege is actually granted
The public notice is thus a condition precedent to the grant of exclusive privilege
The underlying policy of section 22 seems to be not to allow such an important matter to be decided in the secrecy of office without giving it proper publicity
All the conditions of the proposed grant including its duration are expected to be notified
Such notification would serve also to eliminate chances of favouritism nepotism and corruption
Section 22 seems also to have its roots in these deeper considera 545 tions
Failure to give such public notice was therefore in our opinion rightly considered by the learned Judicial Commissioner to be fatal to the grant of the exclusive privilege to the appellant
Nothing convincing has been said at the bar against this view
If non compliance with the proviso to section 22  1  is by itself fatal to the grant of exclusive privilege than the impugned order dated July 6 1970 is sustainable on this ground alone and the writ petition was thus rightly dismissed
In any event this ground along with the others already noticed would in our opinion constitute a good cause for withdrawing the licence under section 43 of the Act
On this view the impugned judgment of the learned Judicial Commissioner does not seem to us to be open to challenge particularly under article 136 of the Constitution
This appeal accordingly fails and is dismissed with costs


Summary:
The appellant was granted a licence on March 13 1968 by the Excise Collector to establish a warehouse for  the storage in bond and wholesale vend of country spirit by import and for supply to the excise vendors in the territory of Tripura for five years commencing April 1 1968 and ending March 31 1973
The mode of granting the licence was criticised by the Committee of Estimates
As a result the Governor of Tripura on July 2 1970 inserted r 164 A in the Tripura Excise Rules of 1962 whereby fees for licence for the wholesale vend of country spirit were required to be fixed by tender cum auction
On July 6 1970 the Excise Collector exercising his power under section 43 of the Bengal Excise Act 1909 as extended to the Union Territory of Tripura withdrew the licence granted to the appellant after 15 days  notice and remission of 15 days fee
The appellant challenged the Excise Collector s order in a petition under article 226 of the Constitution
The Judicial Commissioner dismissed the petition
Intr alia the Judicial Commissioner held that the licence granted to the appellant was invalid because it was granted without public notice as required by the proviso to section 221 of the Act
In appeal by special leave it was contended by the appellant that i the Collector had no power to pass the impugned order ii the words any cause other than in section 43 must be read ejusdem generis with the causes in mentioned in section 42 iii section 43 was arbitrary and violative of article 14 of the Constitution ivthe terms of section 43 had not been complied with v the impugned order was passed without a show cause notice and was against natural justice vi section 43 being arbitrary imposed unreasonable restrictions on the appellant s right to carry on business
HELD  i Under section 22 Sub section
1 the Chief Commissioner is no doubt given the power of granting the exclusive privilege of manufacturing and selling country liquor or intoxicating drugs as mentioned in clauses a to e but subs
2 of this section in express terms provides that no grantee of any privilege under sub section
1 shall exercise the same unless or until he has received a licence in that be half from the Collector or the Excise Commissioner
In view of this provision it is obvious that it is the Collector who grants the licence 534 within the contemplation of section 43 and therefore it was this very officer who rightly granted the licence to the appellant and is empowered to withdraw the licence under section 43
538 F G iiThe ejusdem generis rule strives to reconcile the incompatibility between specific and general words
This doctrine applies when 1 the statute contains an enumeration of specific words 2 the subjects of the enumeration constitute a class or category 3 that class or category is not exhausted by the enumeration 4 the general term follows the enumeration and 5 there is no indication of a different legislative intent
In the present case it was not easy to construe the various clauses of section 42 as constituting one category or class
But that  apart the very language of the two sections 42 and 43 and the object intended to be achieved by them also negative any intention of the legislature to attract the rule of ejusdem generis
Therefore the expression any cause other than  in section 431 could not be considered ejusdem generis with the causes specified in clauses a to g of 421
540 F H iiiTrade or business in country liquor has from its inherent nature been treated by the State and the society as a special category requiring legislative control which has been in force in the whole of India since several decades
In view of the injurious effect of excessive consumption of liquor on health this trade or business must be treated as a class by itself and it cannot be treated on the same basis as other trades while considering article 14
541 A B ivThe submission that a separate order withdrawing the licence after the expiry of 15 days period from the order dated July 6 1970 was necessary could not be accepted
Section 43 does not provide for any such procedure
All that this section contemplates is that ever the authority concerned considers that the licence should be withdrawn for any cause other than those specified in section 42 it may withdraw the same but to do so it must remit a sum equal to the amount of fees payable in respect of the licence for 15 days
It was not complained that this amount was not remitted in the present case
541 C D vThe order dated July 6 1970 could not be attacked on the ground that a show cause notice was not given
The contents of this order show that the appellant had ample opportunity of showing cause against the intention of the Collector to withdraw the licence from September 1 1970
Rules of natural justice vary with the varying constitutions of statutory bodies and the rules prescribed by the legislature under which they have to act and the question whether in a particular case the rules of natural justice have been contravened must be judged not by any preconceived opinion of what they may be but in the light of the relevant statutory provisions
Applying this test the impugned order could not be considered to violate any principle of natural justice
Gullapalli Nageswara Rao vs AP State Road Transport Corporation 1959 Supp 1 SCR 319 and K K Narula vs State of J  K  referred to
viIt is no doubt true that in section 43 there is no express mention of the precise grounds on which a licence may be withdrawn
But keeping in view the nature of the trade or business for which the grant of licence under the Act is provided the cause contemplated by section 43 must be such as may have reasonable nexus with the object of regulating this trade or business in the general interest of the Public
In 535 the determination of reasonableness of restrictions on trade or business regard must be had to its nature the conditions prevailing in it and its impact on the society as a Whole
article 47 of our Constitution directs the State to endeavour to prohibit consumption of intoxicating drinks and of drugs which are injurious to health except for medicinal purpose
The cause for withdrawing the appellant s licence was in terms of a major policy decision of the Tripura Government and this was a cause which while keeping in view the purpose and object of granting such
exclusive privileges and licences could not be considered to be either irrelevant or collateral to that purpose and object
543 B E KK Narula vs The State of J  K  referred to
viiThe public notice under section 221 is a condition precedent to the grant of the exclusive privilege of selling liquor
The underlying policy of section 22 seems to be not to allow such an important matter to
be decided in the secrecy of office without giving it publicity
Failure to give such public notice was therefore rightly considered by the Judicial Commissioner to be fatal to the grant of the exclusive privilege to the appellant
544 G 545 A The appeal must accordingly be dismissed