^^•.^•-:^^:^^y"^:^-^t^^-':^ '-^•-^-^•^^^iK^:^^.^'1-^—^^'^ ^F^. ^•^f7 HIGH GOHRT OF GHHA'®BGA]BllliA!lSSIl^SFUR "WS PE'iaTRWeN®.2321 of2002 PETmONER RESPON&ENTS ShekharSahu. VERSUS^--;1^ -:-.'. State ofCaAattisgatfa^€»fl!ers .:••'•^1'. Post-fei- 8fde0n W '-7-2007 Sdl- SatishK.Agnihotri Judge ,N •t: :, .•:.^ a '•^^ ^ HIGH COURT OF GHHATnSGARiETATBIIASPUR r fe- ^ PETITIONER RESPONDENTS aiiiu. WRIT PETITION No. 2321 of2002 Shekhar Sahu, aged about 25 years. S/o Shri Subhash Sahu, Excise Businessman,R/o 1-8/1305, Shiv Bhawan, New Shanti Nagai^Raipur (C.G.) VERSUS : ' . . : 1. State of Chhattisgarh, Through Seeretary, Departmeut ofExcise, Mantralaya, Shastri Chowk, Raipur(CXj.) 2. The Excise Commissioner, Shiv Bhavan, Bairan Bazar, Raipur (C.G.) 3. Collector, Excise, Raipur (C.G.) 4. Assistant Coianussioner, Excise, Collectorate Building, Raipur (C.G.) 5. District Excise OfBcer, Collectorate Building, Raipur; WRTT PETmON UNDERARTICLE226/227 OF THE CONSTmJTION OF INDIA Singl^Bench: Hon'MeJustice ShriSatish K. Agnihotri. Present: Shri Prashatrt;Jayaswal,SemQrAdvocatewith ShnVinayPandey, Advdcatefbrlfaepetitioner. " Shri A-S.Kachhwaha, Govermnent Advoeate forthe State/respondents. ORDER (Passed on ^r)day of July,2007) .^-E By fhis petition, the petitioner impugns fhe order dated 16.10.2002 (Annexure P/16) passed by the Commissioner (Excise) Ghliattisgarh, Raipur and seeks a writ of mandamus directing the respondents to take the shop-in- dispute as surrendered w.e.f 01.08.2002 or 26.07.2002 or 31.07.2002. The petitioner fiirther seeks a direction to the respondents not to levy any penafty or recover any pre-settlement charges and refund Ae amount already paid by the petitioner towards the compulsory Minimum Guarantee Quota (for short 'MGQ'). ' The indisputable faets, in nutshell are that the respondent State iramed ChhattisgaihExciseSettlemeHtofLicenseforRetailSaleofCouBftty/EOreii^l •^ liquor Rules, 2002, mexercise ofpowers vested under section 62 read with section 18 oflfae Excise Aet, 1915 (hereinafter referred to as 'ihe Rules, 2002'). The Rules, 2002 eame into force w.e.f 15.03.2002 on publication in the extraordinary gazette of Chhattisgarh. In accordaace wifh fheprovisions ofRules, 2002, th&Collector, Raipur, issued a notifieation dated 23.03.2002 (Annexure P/l) callmgfor applieations from the persons interested in retail outlet ofUquor shops. The ifetitioner applied for one shop ofGol Bazar group at Raipur and he was granted license bypublie lottery system. The petitioner paid a sum ofRs, 1,03,23,231/- as license fee withpre-detemuned minimum guarantee quota of 64,950 bulk liters of malt and 1,11,000 proof liters of spirit per month (Amiexure P/2). 3. Allthe licenses grairted pursuanttothe notification dated 23.03.2002 wasby public lottbry system prescribed under Ihe Rules, 2002. The aearby shops were allotted onthe basis oftender method whereinthe annual lieense fee and the MGQ were negotiable. Other three shops at Kadir Chowk, Motor Stand and Malviya Road, were allotted under tender mefhod. The Ucense fee for shop at Kadir Chowk was Rs. 35 Lacs, at Motor Staad Rs. 68 Lacs aad Malviya Road, Rs. 54 Lacs and MGQ was also much lower for fhese tfaree shops as epmpared to the Gol Bazar shop allotted to the petitioner. The petitioner made a represeiitation dated 27.3.2002 (Annexure P/3) to 1he Collector, Raipur statmg that since the license fee and Ihe MGQ of otiier nearbyshops are much less, the same formula be appliedto tiie petitioner's shop at Gol Bazar also and accordingly, the same be reduced. Thereafter, vide letter dated 20.7.2002 (Anneiaire P/4), the petitioner made a request to the Excise Commissioner for reduction of MGQ and lieense fee of Ihe petitioner's shop on the ground tiiat tiie license fee ofnearby three shops W&-M ds) t Si i: which are less and the petitioner in not in a positidn to sell the liquor in view of the minimum priee offered by other three shops. On 01.07.2002, the petitioner submitted one month's advance notice to surrender the shop (Annexure P/6) stating that Ifae license fee ofthe petitioner's shpp at Gol Bazar is much higher than the nearby shops. The petitioner is not in a position to sell any Uquor, Ifaerefore, the petitioner wants to surrerider Ifae shop on aecount ofinjustice meted out to him. The Collector (Excise) Raipur, issued a show-cause-notice dated 31.7.2002 (Annexure P/7) to the petitioner stating that the petitioner has failed to lift tiie nunimum quantity of malt and spirit as per licensing conditions. Therefore, the Collector, vide orderdated 06.08.2002 (Annexure P/ll)having noticed that the petitioner has failed to deposit the balance license fee, therefore, the petitioner's license in respect of allotment of;>sh6p at Gol Bazar was cancelled in accordance witfa Rules 23(l)(Ch)(l)(2) and condition No. 8(Kha)(Ga) ofF.L. license. By order dated 27.08.2002 (AnnexuFe P/12) a demand for payment ofRs. 70,59,082/- was raised andthe petitioner was directed to pay the same withia 4 : . • •' -: •'•_•'•' a period of 7 days. Revenue Recovery Certificate was issued fliereafter on 07.09.2002. Being aggrieved, the petitioner filed an appeal brfore the Excise Comnussioner(AnnexureP/13).T1ieExcise Coinmissioner, by order dated 16.10.2002 (Annexure P/16) dismissed the appeal of the petitioner holdmg that the notice dated 01.07.2002 was not a notice in legal sense but it was expectation coupled wifli notice. The Excise Commissibner accordmgly upheldtheorderoftheCoUector^makingpaymetitoflicens&^^^ »,,. ^ ::^h BSl f?r<0) remaming period with loss ofmoney to the Govenuneiit. Being aggrieved, the petitioner has filedthis petitioner forthe prayer as stated hereinabove. 7. Shri Prashant Jayaswal, leamed senior counsel with Shri Vinay Pandey, leamed counsel for fhe petitioner would submit that the grant of license for the shops at Kadir Chowk, Motor Stand andMalviya'Road was grarited by the tender method which was not m eonformity with the Rules, 2002. The grant ofthe Ucense of Gol Bazar shop to the petitioner was in accordance with Rule 8 read with Rule 11 ofthe Rules, 2002,whereby the license fee in case oflfae petitioner, was more than 1 Crore, and the other nearby shops which were allotted bytender method, Ihe lieense fee was much less resulting loss ofbusiness to fhe petitioner as other license holdere were selling liquor at a cheaper rate which was not possible for fhe petitioner in view of the exorbitant license fee with hi^ier MGQ. Thus, notice dated 01.07.2002 for •^.-.' •'-^??'. • • ' ' surrender ofshop was proper, legal andjustified. The petitioner, after having given one month s advance notice on 01.07.2002 surrenderedhi? license on ^.08.2002. Thereafter, cancellation ofthe license after advance surrender notice bythe Collectorvide order dated 06.08.2002 was fflegal, arbitrary and discriminatory. He fiirther eontended thafo the finding of the Excise Commissioner in appeal that it was a conditional notice and was based on expectation, therefore the same was not a notice in fhe eyes of law, is contrary to the settled principles ofnotiee. The petitioner has complied with the provisions of Seetion 33 of the M.P. ExciseAct, 1915 (hereinafter referred to as 'the Act, 1915') read-with Rule 22 ofRules, 2002. Therefore, the, petitioner has proper ri^rt to surrender the Ucense which he did with efifect from 01.08.2002. In view offhe unheaKhy competifion in business ereated by gyant oflicenses to otherthree nearby shops atmuch lesser license fc ! J II """•teiu^' fee by tender method, not known under fhe provisions ofRules, 2002, was sufBcient ground for surrender of license. The respondents ought to have accepted the same. 8. Per contra, Shri AS.Kachhwaha, leamed Govemment Advocate appearmg for the respondents would submit that the petitioaer has accepted the license fee and MGQ. Therefore, he is estopped from raising ffie plea fhathe suffered huge loss on account of grant of license to nearby tfaree shops to oflier persons on lesser license fee. It is axteutted that it is tme that fhere was no provision for grant of license of liquor shops by tendCT metfaod under provisions ofRules, 2002. Section 18 ofthe Excise Act empowers the State Govemment to grant license to any persons under aay method. Thus, fhe State Goyemment was fi'ee to adopt any mode of selection of licensee 1faat tiiay be tender method. The Exeise Commissioner, by executive order dated 01.04.2002 made clear that the shops which could not be allotted till 31 of Mareh, 2002 by public lottery system, the samecould be allotted by inviting tenders. Accordingly, fhetenders were itivited and fhe three shops as stated above were allotted to other licensees wherein the license fee was lesser and -•* ' • ..••'..' MGQ was negotiable. By negotiation, fhe license fee was determined ata lesser prtee and MOQ was also less fhan that ofthe petitioner. The surrender notice dated 01.07.2002 was not proper and the Excise Commissioaer has ri^itlyheldthatfhesame is notunsustamableundeTlhe eyes oflaw. 9. Having heard leamed counsel for the parties, perasmg the'pleadin^, documents and reeords appended thereto. It is evidentthatthe facts are not disputed. 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' .^S- "Notiee is a direct and definite statement of a Aing, as distinguished from supplying materials from wtuch the existence ofsuchthmgmay be inferred. Webster's Universal College Dictionary, 1997 Edn., (p. 543) "Infomiation, waniing or announcement ofsomething impending; notifieation; to give notice ofone's intentions; a written or prmted statement conveying such information or waming; as for renting or employment, that tiie agreement will temiinate on a specified date —'She gaveher employertwo weeks' notice. " Oxford Concise Dictionary "an intimation; inteUigenee,wammg" and has the meaning in the expression like "give notice", "have notice" or 'Yormal intimation of sometfaing or instruction to do something" aad has the eispression like "noticeto quit", "till fiirther notice". Chamber's 20th Caitury Dictionary, 1993 (p. 1154) "mtimatioil; amouneeinetrt; hrformatioti; wanriag; a writing, placard etc. conveying an intimation or waniing; time allowed for preparation, etc." Chamber's Dictionary vide Allied Chambers (India) Ltd., Reprint 1994,1995(p. 1154) "intimation; announcement; a formal announcement made by one ofthe parties to a contract ofhis or her intention to terminate that contract; mformation, especially about a future event; waniing; a \witing; placard, board etc. conveying an mtimation or waming time allowed for preparation; cognizance; observation; heed; mention; a dramatic or artistic review; Wvility or respeetfiil treatment; anotion etc." • Law Lexicon Dictionary —A Legal Dictionary ofLegal Terms and Phrases Judicially Defined, 4th Edn., Vol. ]1,1989(p. 226) "A person is said to have notice of a fact, when he actually knows that fact, or when,but for wilfulabstention from an enquiry or search which he ought to have made, or g-oss negligence,he would have knowa it." The Law Lexicon Dictionary, 2nd Edn., 1997(p. 1322) (1) Iirtimation; a writing; placard, loard etc. conveying an intimation or wamiag [Section 154 IPC aad Article 61(2)( a ), Constitution of India], (2) Knowledge or cognizance (Section 56, Indian Evidence Act). "Notice", in its legal sense, may be defined as information conceming a fact aetuaUy connnunicated to a party by an authorised person, or aetuaUy derived by him from a proper source, or else presumed by law to have been acquired by him, which nrformation is regarded as equivalent to knowledge in its legal -eonsequences. Dictionary fartherstates: Co Ut 309 Tomlin's Law Dictionary "- I Notice is making somefhihg known, ofwhatalman was or mightbeignoraut of befiwe. And it produces diverseiefieets, fbr, by it, tiie party who gives the same shall have liie same benefit, wfaich otherwise heshould not have had; the party titt whom the notice is given is made subjectto some aetion or |charge, thM otherwise he hadnot been liable to; and his estate in danger ofs prejuduse. j -n Bll." KW r "Notice is a direct and definite statement of a thing as distinguished from Supplying materials fi-om which the existence ofsuehthingmaybeinferred."(PerParke, B. Bur^i v. Legge 5 M mdW420:8UEx.258) The Dictionaiy gives some other definitions ofnotice" as: The legal mstrumentality by which fcnowledge is conveyed, or by which one is charged wifh knowledge. The term "notice" in its full legal sense embraces a knowledge of cireumstances that ought to induce suspicion or belief, as well as direet information of fhat fact. In its popular sense "notice" is equivalent to information intelligence, or knowledge." 13. Thus, applyingthe well settted defimtionofnotieetofhefactsofthe case,the letter dated 01.07.2002 is a elear notice of surrender. The word with tiie language employed that in fhe eventjustiee is not meted out to 1fae petitioner does not change tiie nature ofnotice. This was sufScieiit notice ofsurrender. The notice starts with tiie subject "'ftct ^lutR ai^ft ww ^H ^s? ^ ^ TTI? tSf srftm ^EF'TI" The Subject was clear and tiie reasons stated in the contents of fhe letter and at the bottom also it was clearly:written that "^v TO ^ y^w ^-^wfsn ws". It is therefore heldthatthe letter dated 01.07.2002 (Annexure P/6) was proper notice. The reasons stated in tiie letter were necessary tojustify reasons ofnotiee of surrender. 14. Rule 22 ofthe Rules, 2002 reads as under: "22. Surrender pfBcence.- A licensee may surrender his licenee after giving at least one month's notice in writing t6 the Kcensing authority under provisions ofSection 33 oftiie Act. Onreceipt of such application fhe Ucensing authority will takesteps aecordmg to Section 33 of tiie Act. The lieensing authority shall also proeeed for resettlement of the shop wftfaout delay for the remaining period ofthe excise year." 15. Section 33 ofthe M.P. Exeise Act, 1915 deals with surrender ofnotice which readsas under: "33. Surrender oflicences.-(l) Any holder ofa licence granted under tfais Act to sell an mtoxieant may surrender fais Kcence on the expiration of one month's notice in writing yveaby him to the Collector of his intention to surrender thejsame, and on payment offhe fee payable for.the Ucence for Itieremamder of :T-="—^?^P*" •"**-• the period for which it would have been current put for such surrender: Pi-ovided that if the Excise Commissioner is satisfied that there is sufficient reason for surrendering a lieence he may remit the holder fhereofthe sum so payable on surrender or anyportioH Ihereof." 16. Bare reading of section 33 provides that iflfaere are sufficient reasons for surrendering a Ucense, Ifae Excise Commissioner may remit to the holder thereofthe sum so payable cai sun-ender or any portion thereof. 17. In order to give the sufBcient reasons, it was neeessary to write the reasons in Ihe advance surrender notiee. The respondent authorities ou^rt to have accepted the notice in view ofthe faet that due to unhealthy atmosphere created in business by grant of lieense to three nearby shops, i.e. Kadir Chowk, Motor Stand and Malviya Road at a much less license fee and MGQ, it was difBcult for the petitioner to run the business. 18. Eor Ifae reasons stated hereinabove, am} as a result, this petition is allowed. The order dated 6.8.2002 (Annexure P/ll) passed by the Collector, notice dated 8.8.2002 (Annexure P/12) and notiee dated 27.8.2002 (Annexure P/14) and order dated 16.10.2002 (Anaexure P/16) passed by the Commissioner in appeal, are quashed and the petitioner is cnititled to all flie eonsequential benefits flowing from this order. 19. Inthefaetsandcircumstaneesoffhisease,fhereshallbenoorderastocosts. SdA SatishK.AgaihoM Judge lAijsnil: l.AIB. 2003 (SC) 1628 ''^.-^ssv