IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY THE THIRTIETH DAY OF DECEMBER TWIO THOUSAND AND EIGHT PRESENT THE HON’BLE Ms. JUSTICE G. ROHINI WRIT PETITIONNO.22202 OF 2006 WRIT PETITION NO.15379 OF 2007 AND WRIT PETITION NO.16583 OF 2008 Between: (W.P.No.22202 of 2006) 1.S.Malleswara Reddy S/o Ramachandra Reddy 2. V.Vengal Reddy S/o Venkata Reddy both are resident of Yerramukkapalli, Kadapa ..PETITIONERS AND The Commissioner of Prohibition & Excise Andhra Pradesh, Hyderabad and Four(4) others. ..RESPONDENTS. Counsel for the petitioners : MR.P.KAMALAKAR Counsel for the Respondents: G.P. for Prohibition & Excise for respondents 1 to 3 Mr. S.I.Newton for R-4 Mr V.R.Reddy Kfovvuri for R-5 The Court made the following: THE HON’BLE Ms. JUSTICE G. ROHINI WRIT PETITIONNO.22202 OF 2006 WRIT PETITION NO.15379 OF 2007 AND WRIT PETITION NO.16583 OF 2008 COMMON ORDER: These three writ petitions which are based on the same set of facts are heard together and decided by this Common Order. The parties to all the writ petitions being common, for the sake of convenience they shall be referred to as they are arrayed in W.P.No.22202 of 2006. The facts, in brief, are as under : The petitioners claim to be the joint owners of House Nos. 2-479, 2-480, 2-481, 2-481/1, 2-481/2, 2-481/3, 2-485, 2-485/1 and 2- 486 of Balajinagar, Near I.T.I. Circle in Cuddapah Municipal Corporation. The 5th respondent herein is in occupation of an adjacent premises bearing D.No.2-484/1 of Balajinagar. He was granted a trade license for the year 2005-06 by the Commissioner of Municipal Corporation of Cuddapah to carry on business in the said premises in the name and style of M/s. Eagle Restaurant and Bar. On an application made by the 5th respondent under the provisions of The Andhra Pradesh Excise (Grant of License of Selling by Bar and Conditions of Licence) Rules, 2005 (for short, ‘the Rules’) made under G.O.Ms.No.997, Revenue (Ex.II), dated 24.05.2005, he was also granted a licence in Form-2B by the Prohibition & Excise Superintendent, Cuddapah for running a Bar in the said premises for the year 2005-06 (from 1.7.2005 to 30.6.2006). However, since the premises bearing No.2-484/1 did not satisfy the distance restriction of 100 meters as provided under Rule 6 (1) (ii) of the Rules, the existing entrance to the Bar and Restaurant at premises No.2-484/1 was closed and a new entrance was provided through the neighbouring premises bearing D.No.2-478. Accordingly, the 5th respondent carried on the business during the year 2005-06. While so, there was an amendment to the Rules by G.O.Ms.No.596, Revenue (Ex.II) Department, dated 26.5.2006 and Rule 5 of the Rules was substituted thereby requiring a person intending to establish a Bar to obtain a prior clearance in Form-2A from the Commissioner. Accordingly, the 5th respondent made an application in Form-1A to the Commissioner of Prohibition & Excise, A.P., Hyderabad, for prior clearance for grant of license of selling by Bar at Door No.2-484/1. Having considered the same, the Commissioner of Prohibition & Excise, by order dated 26.6.2006, granted the prior clearance for 45 days from the date of issue in respect of premises bearing No.2-484/1. Thereafter, the 5th respondent made a request for grant of revised prior clearance by adding the new premises bearing D.No.2-478 also. The said request was rejected by the Commissioner of Prohibition and Excise by order dated 11.08.2006 on the ground that the two houses were not contiguous and they were separated by a drainage canal. The 5th respondent made another representation for prior clearance enclosing NOC granted by the local authority as well as the consent affidavits given by the house owners stating that he had closed the old entrance to premises No.2-484/1 with cement bricks and provided a new entrance through the newly acquired premises bearing D.No.2-478 and thus the distance between the said premises and the Educational Institution was more than 100 meters. By order dated 26.08.2006 the Commissioner of Prohibition & Excise again rejected the request of the 5th respondent observing that the closure of the drainage canal would cause inconvenience to the public. However, on a request made by the 5th respondent to reconsider the issue, the Commissioner of Prohibition & Excise called for a report from the Deputy Commissioner of Prohibition & Excise. Accordingly, the Deputy Commissioner of Prohibition and Excise personally inspected the premises in question on 19.9.2006 and submitted a report dated 25.9.2006 stating that it is necessary to cover the entire drainage channel by a permanent structure without obstructing the flow of drainage water. In the light of the said report dated 25.09.2006 the Commissioner of Prohibition & Excise by order dated 18.10.2006 granted the revised prior clearance as sought by the 5th respondent by adding D.No.2-478 subject to the condition that the entire drainage channel between the two houses is covered by a permanent structure so that the drainage passes beneath the covered structure allowing free passage from one house to other without any inconvenience to the public. Pursuant thereto, the Deputy Commissioner of Prohibition & Excise, Chittoor, by proceedings dated 26.10.2006 accorded permission for grant of Form-2B licence in favour of the 5th respondent and accordingly the Prohibition & Excise Superintendent, Cuddapah, by order dated 27.10.2006 granted Form-2B licence in favour of the respondent fro the year 2006-07. Aggrieved by the same, the petitioners filed W.P.No.22202 of 2006 seeking a declaration that the proceedings of the Commissioner, dated 18.10.2006 as well as the consequential orders of the Deputy Commissioner of Prohibition & Excise and the Prohibition & Excise Superintendent, Cuddapah, dated 26.10.2006 and 27.10.2006 respectively granting Form-2B licence in favour of the 5th respondent for the year 2006-07 are arbitrary and illegal. Though the petitioners sought for interim relief of suspension of the licence granted in favour of the 5th respondent, no such order was passed by this Court and consequently the 5th respondent carried on the business during the year 2006-07. Thereafter, the 5th respondent made an application seeking renewal of his licence for the year 2007-08 and the same was granted by the Prohibition & Excise Superintendent, Cuddapah, by order dated 27.06.2007 subject to the condition that the 5th respondent should obtain NOC from the Municipal Corporation of Cuddapah as required under Rule 6 (1) (v) of the Rules for sale of liquor at the premises in question. Accordingly, the 5th respondent made an application seeking NOC from the Commissioner, Municipal Corporation for running the Bar and Restaurant at premises bearing D.No.2-484/1 and D.No.2-478, Balaji Nagar. However, by order dated 30.06.2007 the application of the petitioner for NOC was rejected on the ground that as per the sanctioned Master Plan in G.O.Ms.No.1078, M.A., dated 19.09.1981 the said premises falls in public and semi-public area. The Commissioner, Municipal Corporation also communicated the said proceedings to the Prohibition & Excise Superintendent, Cuddapah by letter dated 04.07.2007. On the basis of the said communication, the Prohibition & Excise Superintendent issued a show-cause notice dated 7.7.2007 calling upon the 5th respondent to show-cause as to why the Form-2B licence renewed for the year 2007-08 should not be cancelled. Aggrieved by the same, the 5th respondent filed W.P.No.15379 of 2007 seeking a declaration that the proceedings of the Commissioner of Municipal Corporation dated 30.06.2007 as well as the show-cause notice dated 7.7.2007 issued by the Prohibition & Excise Superintendent, Cuddapah, are arbitrary and illegal. The 5th respondent also sought a direction to the Commissioner, Municipal Corporation to issue NOC in respect of his licensed premises bearing D.Nos.2-484/1 and 2-478 for running the Bar and Restaurant. This Court while directing rule nisi, by order dated 19.07.2007 in WPMP.No.19426 of 2007, granted interim stay of all further proceedings pursuant to the show-cause notice dated 07.07.2007 and accordingly the 5th respondent carried on his business during the excise year 2007-08 without any interruption. Before the expiry of the excise year 2007-2008, the 5th respondent made an application dated 23.06.2008 for renewal of his Form-2B licence for the year 2008-09. Since he did not produce NOC from the Municipal Commissioner, Cuddapah, the licensing authority sought for a clarification from the Commissioner of Prohibition & Excise. By proceedings dated 2.7.2008 the Commissioner of Prohibition & Excise directed the Prohibition & Excise Superintendent to follow the interim order of this Court dated 19.7.2007 in WPMP.No19426 of 2007 in W.P.No.15379 of 2007 which is in operation. Pursuant thereto, the Prohibition & Excise Superintendent, Cuddapah, by order dated 7.7.2008 granted renewal of Form-2B licence in favour of the 5th respondent for the year 2008-09 subject to the outcome of final orders in W.P.No.15379 of 2007. Aggrieved by the same, the petitioners filed W.P.No.16583 of 2008 seeking a Certiorari to call for the records relating to the proceedings of the Commissioner dated 2.7.2008 as well as the consequential proceedings of the Prohibition & Excise Superintendent, dated 7.7.2008 and to quash the same. Separate counter-affidavits have been filed by the respondents in the respective writ petitions opposing the reliefs sought for. I have heard the learned counsel for both the parties and perused the material on record. Sri P. Kamalakar, the learned counsel for the petitioners in W.P.No.22202 of 2006 and W.P.No.16583 of 2008 contended that the prior clearance granted on 26.6.2006 for grant of Bar licence at premises bearing No.2-484/1 cannot be revised or reviewed by the Commissioner of Prohibition & Excise since no such power is conferred under the Statute. It is contended that since the building for which prior clearance was granted on 26.6.2006 was hit by the prohibition under Rule 6 of the Rules, the 5th respondent ought to have chosen some other building in conformity with the requirements of the distance rule and mere addition of a separate building to the existing licensed premises by making certain modifications does not cure the illegality. At any rate, since the Commissioner of Prohibition & Excise is not the competent authority to permit the alterations by covering the drainage channel between the two houses, the revised prior clearance dated 18.10.2006 is without jurisdiction and liable to be set aside on that ground alone. So far as W.P.No.16583 of 2008 is concerned, it is contended by Sri P. Kamalakar that the renewal of Form-2B licence in favour of the 5th respondent for the year 2008-09 is wholly illegal and without jurisdiction since the NOC as required under Rule 6(1) (v) was admittedly rejected by the Municipal Corporation, Cuddapah. The learned counsel also contended that the interim stay of all further proceedings pursuant to the show-cause notice dated 7.7.2007 granted by this Court pending W.P.No.15379 of 2007 is in no way relevant for the purpose of renewal of licence for the year 2008-09, and the Prohibition & Excise Superintendent committed a grave error in granting renewal in violation of Rule 6 (1) (v) of the Rules. On the other hand, Sri S.R. Ashok, the learned Senior Counsel appearing for the 5th respondent (petitioner in W.P.No.15379 of 2007), contended that having issued the NOC for the licensing years 2005- 06 and 2006-07 there is absolutely no justifiable reason to deny such NOC for the licensing year 2007-08 in the absence of any changed circumstances. It is also contended that the stand taken by the Municipal Corporation that the area for which NOC was sought by the 5th respondent comes under public and semi-public zone is without any basis and incorrect as is evident from the fact that the petitioners in W.P.No.22202 of 2006 whose business premises is also situated in the very same area are granted trade licenses to carry on the business in IMFL. The learned Government Pleader for Prohibition & Excise, Sri Siva Kumar, submitted that in view of the restrictions on the grant of licence in Form-2B prescribed under Rule 6 (1) (v) of the Rules, no licence can be granted unless the 5th respondent produces the permission or NOC from the concerned local authority for sale of liquor at the premises in question. Sri S.I. Newton, the learned Standing Counsel for the Municipal Corporation, Cuddapah, while explaining that the premises in question falls within the public and semi-public use zone under the Zoning Regulations prescribed under General Town Planning Scheme of Cuddapah and the same is earmarked for Industrial Training Institute, contended that as per the sanctioned Master Plan it is impermissible to establish a Bar and Restaurant in the said area. In view of the above rival submissions, the following two questions arise for consideration by this Court : (1) Whether the revised prior clearance dated 18.10.2006 granted by the Commissioner of Prohibition & Excise in favour of the 5th respondent is contrary to law? (2) Whether the 5th respondent is entitled to renewal of his Form- 2B licence for the year 2008-09? Question No.1: The requirement to obtain a prior clearance was inserted for the first time under G.O.Ms.No.596, dated 26.5.2006 by substituting Rule 5 of the Rules as under : 5. Application for licence:- (1) A person intending to establish a Bar, may submit an application in Form 1-A to the Commissioner enclosing a Challan for Rs.1,000/- to get prior clearance. (2) The Commissioner having due regard to requirement and other factors as he deems fit, may8 grant a prior clearance in Form-2A to such of the applicants covered under sub-rule (1). Provided that the grant of prior clearance shall not confer any right on the applicant for grant of licence in Form-2B. The holder shall not claim for any compensation or loss in case license in Form-2B is not granted. (3) … … .. .. … .. (4) … … .. .. … .. (5) … … .. .. … .. (6) … … .. .. … .. (7) … … .. .. … .. On a reading of the above provision, it is clear that the mere grant of prior clearance does not confer any right on the applicant for grant of licence in Form-2B. In other words, even after a prior clearance is granted, it is open to the licensing authority to enquire into the compliance with the requirements under Rule 6 of the Rules and the Form-2B licence would be granted only after being satisfied that none of the restrictions are attracted. In the case on hand, the 5th respondent was already running a Bar and Restaurant in the premises bearing Door Nos. 2-484/1 and 2- 478 of Balajinagar by the date of amendment to Rule 5 of the Rules by G.O.Ms.No.596, dated 26.6.2006, under which the prior clearance from the Commissioner is made a condition precedent for grant of licence for a Bar. Accordingly, the 5th respondent made an application for prior clearance. However, the application was only for one premises bearing Door No.2-484/1 and the same was accordingly granted by Commissioner by order dated 26.06.2006. Subsequently, the 5th respondent sought for revised prior clearance by adding premises No.2-478. After considering the report submitted by the Deputy Commissioner of Prohibition & Excise who had personally inspected the premises in question, the Commissioner granted the revised prior clearance on 18.10.2006 subject to the condition of constructing a permanent structure covering the entire drainage channel without causing any obstruction to the flow of drainage. By no stretch of imagination, the said order can be treated as granting permission to the 5th respondent to make the said constructions. It goes without saying that before making the said constructions the 5th respondent is bound to obtain the necessary permissions from the competent Municipal Authorities. As a matter of fact, it is not the case of the petitioners that the said permanent structure on the drainage channel was made by the 5th respondent without obtaining the permission from the Municipal Authorities. So far as the further contention that in view of the distance prohibition prescribed under Rule 6 (1) (ii), the Commissioner ought not to have granted prior clearance is concerned, it is relevant to note that the proviso to Rule 5(2) itself made it clear that the grant of prior clearance shall not confer any right on the applicant for grant of licence in Form-2B. There is also no provision extending the restrictions under Rule 6 on the grant of prior clearance in Form-1B. Apparently, the restrictions under Rule 6 are only on the grant of a licence in Form-2B. Therefore, it is not open to the petitioners to challenge the prior clearance dated 18.10.2006 on the ground that the building for which the prior clearance was granted was hit by the distance prohibition under Rule 6 of the Rules. The contention of the petitioners that the order dated 18.10.2006 amounts to revising the earlier order dated 26.6.2006 which is beyond the competence of the Commissioner is also without any substance. The prior clearance granted on 26.6.2006 was only in respect of a portion of the premises in which the 5th respondent was running the Bar and Restaurant. The subsequent order granting the prior clearance in respect of the other portion of the said premises does not amount to revising the earlier order and therefore cannot be held to be illegal. Question No. 2: Rule 6 of the Rules made under G.O.Ms.No.997, Revenue (Ex.II), dated 24.05.2005, to the extent it is relevant for the purpose of controversy involved in this matter may be extracted hereunder : 6. Restrictions on the grant of Licence :- (1) A Licence form-2B shall not be granted. (i) … … … … .. …. … (ii) … … … … .. …. … (iii) … … … … .. …. … (iv) … … … … .. …. … (v) Unless the applicant produces the permission or the no objection certificate from the local authority concerned for sale of liquor at the premises by the applicant. Under Rule 6 (1) (v), it is mandatory to produce the permission or NOC from the concerned local authority for sale of liquor at the premises by the applicant who seeks a licence in Form-2B. As held by this Court in MANDAKINI RESTAURANT AND BAR v. DY. COMMR. OF PROH. & EXCISE[1] the said requirement is also applicable for renewal of the licence under Rule 9-A of the Rules, as inserted by G.O.Ms.No.868, dated 21.06.2007. The request of the 5th respondent for grant of NOC for the year 2007-08 was rejected by the Commissioner, Municipal Corporation, Cuddapah, on the ground that the premises in question (Door No.2-484/1 and 2-478 of Balajinagar) falls in public and semi-public zone as per the Master Plan sanctioned in G.O.Ms.No.1078, M.A., dated 19.09.1981, and therefore establishment of Bar & Restaurant is not permissible. The said order is assailed by the 5th respondent disputing the Corporation’s Claim that the premises in question falls within public and semi-public use zone. It is also contended by the 5th respondent that having issued NOC for the licensing years 2005-06 and 2006-07, it is not open to the Corporation to refuse grant of NOC for the year 2007-08 relying upon the sanctioned Master Plan dated 19.9.1981. It is also the case of the 5th respondent that the Corporation granted trade licenses for different kinds of trades in the locality including the petitioners in W.P.No.22202 of 2006 who are also carrying on business in IMFL in the same locality. Thus, it is contended that the action of the Corporation in rejecting NOC to the 5th respondent amounts to hostile discrimination apart from being arbitrary and illegal. The Commissioner, Municipal Corporation, Cuddapah, filed a counter-affidavit in W.P.No.15379 of 2007 stating that the area where the Bar & Restaurant of the 5th respondent was located was originally within the area of operation of Chemmumiahpet Gram Panchayat and as per the village map of Chemmumiahpet, the particular area was in Sy.No.557 known as Balajinagar. The main road of Balajinagar and the National Highway No.18 were commercially developed under the administration of Gram Panchayat and trade licenses were also issued during the said period. While so, Cuddapah Municipality was upgraded as Cuddapah Municipal Corporation in November, 2004 and thereafter the Chemmumiahpet Gram Panchayat along with four other Gram Panchayats merged with Cuddapah Municipal corporation under G.O.Ms.No.125, M.A., dated 17.03.2005. It is further stated that the Government of A.P. sanctioned a Master Plan for Cuddapah in G.O.Ms.No.1078, HMA & UD (MA), dated 19.09.1981 prescribing the proposed land use as per the Zones specified thereunder. Map No.4 sanctioned by the Government along with G.O.Ms.No.1078, dated 19.09.1981 consists of an Outline Development Plan for Cuddapah under General Town-planning Scheme which included the land covered by the then Cuddapah Municipality as well as the surrounding Gram Panchayats. In the said maps, the proposed land use was specifically mentioned such as residential use zone, commercial use zone, industrial use zone, public and semi-public use zone and agricultural land use zone and etc and the area where the 5th respondent wanted to run a Bar and Restaurant falls under public and semi-public use zone which is earmarked for Industrial Training Institute, and the said area is known as I.T.I. Circle. Hence, the request of the petitioner for issuance of NOC for running a Bar and Restaurant in the said area was rejected. Nothing could be placed before this Court by the 5th respondent to controvert the stand taken by the Corporation that the area wherein he proposed to establish the Bar and Restaurant falls under semi-public and public use zone. In the circumstances, the Commissioner, Municipal Corporation was justified in rejecting NOC since establishment of Bar and Restaurant within public and semi-public use zone is impermissible under Master Plan Zoning Regulations. It is true that for the years 2005-06, 2006-07, the NOCs were granted to the 5th respondent for the very same premises. However, the material on record shows that the said NOC was granted by the Health Officer of the Municipal Corporation only for running a restaurant but not Bar. Therefore the Commissioner was justified in rejecting the NOC for running a Bar for the year 2007-08. So far as the allegation of the 5th respondent that many other traders including the petitioners in W.P.No.22202 of 2006 are allowed to continue their business in Balajinagar in violation of the Zoning Regulations is concerned, in the additional counter-affidavit it is explained by the Corporation that a letter dated 7.9.2006 was addressed to the Superintendent, Prohibition & Excise Department, furnishing a list of 24 Wine shops existing in Cuddapah Town and mentioning the land use as per the sanctioned Master Plan. The list of religious structures and educational institutions located within 100 mts. from the said wine shops was also furnished according to which 11 shops were found objectionable. Accordingly, the Excise Department was requested to take steps to cancel the said licenses. The Corporation is also taking steps to cancel the trade licenses granted to two shops by name Mohan Wines at Door No.2-485 and Madhu Wines at Door No.2/476 of I.T.I. Circle, situated adjacent to the premises in respect of which the 5th respondent sought for NOC since they were found objectionable as per Master Plan and Zoning Regulations. The Corporation issued notices on 25.2.2008 to all the Wine shops and Bars which are located in violation of Zoning Regulations asking them to relocate their shops. The Corporation also informed the Superintendent of Prohibition & Excise not to renew the licenses to the said shops. Thus, it is clear that necessary steps have already been initiated by the Corporation to cancel the trade licenses which were earlier issued in violation of Master Plan Zoning Regulations. At any rate no Mandamus can be issued to perpetuate the illegality and therefore the Municipal Corporation cannot be compelled to act contrary to Zoning Regulations merely on the ground that some of the traders in the locality are allowed to carry on the business. For the aforesaid reasons, the action of the Commissioner, Municipal Corporation in rejecting NOC sought by the 5th respondent does not suffer from any infirmity and warrants no interference by this Court. Consequently, the 5th respondent is not entitled for renewal of his Form-2B licence for the year 2007-08 much less for the year 2008-09. Hence, the