IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOTTATHIL B.RADHAKRISHNAN THURSDAY, THE 23RD JULY 2009 / 1ST SRAVANA 1931 WP(C).No. 20362 of 2009(M) -------------------------------------- PETITIONER(S): ---------------------- BANERJI MEMORIAL CLUB, ROUND NORTH, TRICHUR-680001, REP. BY ITS SECRETARY, T.D.FRANCIS. BY ADVS. SRI.K.P.DANDAPANI, SENIOR ADVOCATE SRI.MILLU DANDAPANI RESPONDENT(S): ------------------------ 1. THE DEPUTY COMMISSIONER OF EXCISE, THRISSUR. 2. THE COMMISSIONER OF EXCISE, THIRUVANANTHAPURAM. 3. STATE OF KERALA, REP. BY LAND REVENUE COMMISSIONER, OFFICE OF THE COMMISSIONER OF REVENUE, PUBLIC OFFICE BUILDINGS, MUSEUM JUNCTION, THIRUVANANTHAPURAM-695 033. BY ADV. SRI.RANJITH THAMPAN, ADDL. ADVOCATE GENERAL FOR R1 TO R3 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23/07/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ami THOTTATHIL B. RADHAKRISHNAN, J ........................................... WP(C).NO. 20362 OF 2009 ............................................ DATED THIS THE 23rd DAY OF JULY, 2009 JUDGMENT “CR” Heard the learned counsel appearing for the petitioner and learned Additional Advocate General on behalf of the respondents. 2. The petitioner is a club. It was issued a license in terms of Rule 13(4A) of the Foreign Liquor Rules. With the passage of time, it appears that controversies arose as to whether the land and building held by the club belongs to it. After statutory proceedings, the parties reached this court. The contentions of the club were repelled by this court in Ext.R1(b) judgment, essentially holding that the club could not claim title or right to be in possession of the land in question. This court therefore refused to interfere with the proceedings initiated under the Land Conservancy Act. That matter is pending, at the instance of the club, in W.A.2423 of 2008. Clarifying Ext.P2 interlocutory order in that appeal, Ext.P3 was issued granting stay of dispossession, Wpc 20362/2009 2 however that continuance in possession should be otherwise in accordance with law. I note those interim orders only to assure that by the force of that protective order, the club continues to be in possession and is not to be dispossessed by the statutory authorities under the Land Conservancy Act as of now. When the Land Conservancy proceedings were pending before the Land Revenue Commissioner, the club filed WP(C)11578 of 2008 and obtained Ext.P7 interlocutory order directing renewal of the foreign liquor license, without reference to ownership of the property. Such an order was issued at that point of time having regard to the fact that proceedings were then pending before the Land Revenue Commissioner. In fact, I had issued Ext.P7 order making it subject to the result of the revision then pending before the Land Revenue Commissioner. It was thereafter that Ext.R1(b) judgment was issued by this court, after Ext.R1(a) order was issued by the Land Revenue Commissioner. 3. The petitioner club is aggrieved by Ext.P4 bearing the date 15.7.2009 and served on them on 17.7.2009. It is pointed out by its learned senior counsel that service of Ext.P4 was itself made a high drama by service of the said notice in the evening of Wpc 20362/2009 3 17.7.2009. While the learned Additional Advocate General disputes this, it is unnecessary for this court to go into that aspect. 4. Ext.P4 is issued as a composite order of suspension and also as a notice for pre-decisional hearing on the question as to whether license granted to the club is liable to be cancelled on a ground referable to the allegation of the official respondents that the club does not satisfy condition (iv) under Rule 13(4A). That provision obliges that the land and buildings should be in the name of the society; that is the club, to hold an FL-4, a club license. In the light of the fact that it is a pre-decisional notice, I do not deem it appropriate for this court to express, either way, at this point of time, as to whether the land and building is in the name of the club though the learned senior counsel for the petitioner says that even Thrissur Corporation has issued certificates showing the club as the owner of the buildings in question. 5. But it needs to be considered whether apart from notice for pre-decisional hearing, an order of suspension should have also been issued. Wpc 20362/2009 4 6. Advertance to Section 26 of the Abkari Act would show that the Commissioner is reposed with the power to cancel or suspend the license. Clauses (a) to (e) provide the different jurisdictional situations in which an order of suspension or cancellation may follow. Jurisprudentially, a distinction has necessarily to be maintained by the repository of power, while it proceeds to exercise such a composite authority. The power to suspend, as that term indicates, is necessarily a power to impose a temporary measure, which would be prohibitory in nature. However, a power to cancel is the power to make the absolute order determining the license. Do the rules envisage suspension of license in all cases enumerated under Section 26? Is that power confined only to any among the situations enumerated under Section 26? Answer to these questions depend, essentially, on the distinction between the need to suspend and the need to cancel. Power to suspend is one envisaged for putting on immediate, but temporary, stoppage of that which is suspended. This means that the power to suspend is to be invoked and enforced when the situation warrants an immediate prohibitory intervention. Section 26(a) provides non payment of fee, duty, Wpc 20362/2009 5 tax, rental etc as the ground for suspension/cancellation. Without payment of such amounts, one may not be permitted to carry on the activity under the license. Similarly under Section 26(bb), if there is sale or storage of liquor in any place other than the licensed premises, that would call for suspension/cancellation of license. Conviction under different statutory provisions of Dangerous Drugs Act, Trade and Merchants Marks Act and the Indian Penal Code invite the consequences of suspension/cancellation under Section 26(c). It immediately needs to be noted that Section 26(e)provides for cancellation or suspension at will, provides there is a term in the license to that effect. These provisions when contrasted with Section 26(b) tend to show that while on grounds referable to any of the aforesaid provisions, viz,(a), (bb), (c) or (e), may provide for immediate suspension, all cases which fall under Section 26(b) would not call for suspension. That may depend from case to case, depending upon the nature of the breach of the terms of license. It would also depend upon that term or condition of license, which is allegedly breached. 7. In the case in hand, the facts would show that the Wpc 20362/2009 6 petitioner club was having the FL4A club license for quite some time and it was being renewed from time to time. The alleged situation that it does not have land and buildings standing in its name is not a matter of its own making, which came out all of a sudden. The issues referable to the title and the right to possession, as claimed by the petitioner club is one on which no conclusion could have been arrived at by the Commissioner of Excise, without looking into the relevant materials. Therefore in such a case, it would be improper to impose an order of suspension and all of a sudden put an end to the activity of the club, utilising the FL4A club license. Situational propriety indicates the legality and jurisdictional content of the authority referable to Section 26. The format in which the petitioner club is placed as of now, does not generate any fact situation warranting an immediate suspension of the license. It could have been proceeded against only by giving a pre-decisional hearing on the proposed cancellation of license. 8. In the aforesaid view of the matter, having regard to the fact that the impugned Ext.P4 is a composite one, amounting to an order of suspension and a notice of pre-decisional hearing on Wpc 20362/2009 7 the question of cancellation of license, it is ordered that while the same would be treated as a pre-decisional notice for hearing on the question of cancellation of license, its effect as an order of suspension of license would stand quashed hereby. Consequently, the petitioner is directed to place objections, if any, to the said pre-decisional notice without fail, within an outer limit of three weeks from now and the second respondent will hear the petitioner and take a decision on the question of cancellation of license. If objections are so placed, no order of suspension of license would be issued against the petitioner until conclusion of such hearing on a ground referable to the contents of Ext.P4. The Commissioner will complete the proceedings within an outer limit of 45 days from the date of receipt of the objections of the petitioner to Ext.P4. All other issues on merits are left open. As a consequence of this judgment, Excise authorities will open up any seals, if any, placed and will make the premises available to the petitioner, for its activity in terms of the license. THOTTATHIL B RADHAKRISHNAN, JUDGE lgk/24/7