IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE TWELFTH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION No.25758 of 2006 Between: 1 D.Rajeshwar S/o.Rajanna R/o.Chinthaloor village, Jakranpally Mandal Nizamabad 2 A.Nara Goud S/o.Bala Goud R/o.Petsangam village, Gandhavi Mandal Nizamabad 3 K.Parvaiah S/o.Venkaiah R/o.Annasagar village, Yellareddy Mandal Nizamabad ..... PETITIONERS AND 1 The Prohibition & Excise Superintendent at Kamareddy Nizamabad District 2 The Inspector, Prohibition & Excise, at Yellareddy Nizamabad District 3 The Govt of Andhra Pradesh, rep.by its Chief Secretary Prohibition & Excise, Secretariat, Hyderabad .....RESPONDENTS Counsel for the Petitioners:MR.KOKA SRINIVAS KUMAR Counsel for the Respondents:AGP FOR PROHIBITION & EXCISE This Court made the following: ORDER: In this writ petition, the Distraint Orders served on the petitioners for recovery of excise dues, are called in question. The facts are not in dispute. The petitioners happened to be arrack contractors, who committed default in payment of rentals. Therefore, after determining their liability, separate Distraint Orders have been passed as the petitioners failed to pay the excise arrears. At the hearing, Sri Koka Srinivas Kumar, learned counsel for the petitioners advanced two contentions, namely, 1) the Prohibition and Excise Superintendent, Kamareddy and the Inspector of Prohibition and Excise, Yella Reddy, Nizamabad, have no authority to issue the Distraint Orders, and 2) the respondents were not justified in continuing the licenses without terminating the same on the petitioners’ committing default in payment of arrack rentals. As regards the first contention, as rightly pointed out by the learned Assistant Government Pleader for Prohibition and Excise, Section 5 of the Andhra Pradesh Revenue Recovery Act, 1864 (for short ‘the Act’) empowers the Collector and the other Officers authorized by him, to recover the arrears by sale of defaulter’s movable and immovable properties or by execution against the person of defaulter in the manner provided by the said Act. In the counter-affidavit, it is specifically stated that the Collector and District Magistrate, Nizamabad vide his proceedings, dated 23.04.2002, delegated the powers of distraining and auctioning of the movable properties of the excise defaulters, to all the concerned Prohibition and Excise Inspectors and Prohibition and Excise Sub- Inspectors of Nizamabad District. This averment is not controverted by the petitioners by filing any reply affidavit. The Division Bench Judgment of this Court in M.Srinivas Goud v. Prohibition and Excise Inspector at Yellareddy Mandal, Nizamabad District (Writ Petition No.26474 of 1996 and batch, dated 12.11.2002), on which reliance is placed by the petitioners does not help them because, that was a case where Distraint Orders were issued under Section 25 of the Act which pertains to attachment of immovable properties. In the instant case, the learned Assistant Government Pleader for Prohibition and Excise submitted that since the petitioners are not possessed of immovable properties, the Distraint Orders are intended to sell their movable properties only. In view of the above-mentioned delegation of power by the District Collector, Nizamabad, to distrain the movable properties, the said judgment has no relevance to the present case. With regard to the second contention, the same can be referred only to be rejected. While the licensing authority has certainly power to cancel the license on the contractor committing default, that does not necessarily mean that in every case of default, such cancellation should be resorted to. The State cannot be prevented from recovering arrears on the ground that the power of cancellation of license is not exercised on the contractor committing default. If such contention is accepted, there is a likelihood of contractors entering into agreement and willfully committing default during the course of the contract in order to wriggle out their contractual obligations. Learned counsel for the petitioners submitted that even according to the averments contained in the counter-affidavit, the petitioners have remitted certain amounts periodically and that they may be permitted to continue to remit the amounts in future also. This aspect is required to be examined by respondent No.1. If the petitioners showed their bona fides in remitting the amounts due periodically, respondent No.1 shall consider their request to defer enforcement of the impugned Distraint Orders for a reasonable period to enable them to clear the arrears. The petitioners are permitted to make a representation in this regard before respondent No.1 within a period of four (4) weeks from the date of receipt of a copy of this order. On receipt of such representation, respondent No.1 shall consider and pass appropriate orders thereon. Till then, the impugned Distraint Orders shall not be given effect to. With the above observations, the writ petition is disposed of. As a sequel to disposal of main petition, WPMP.No.33047 of 2006 filed by the petitioners for interim relief is disposed of as infructuous. C.V.NAGARJUNA REDDY, J 12th JUNE, 2009. kvni