IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.7757 of 2008 1. VINAY KUMAR CHAUDHARY, S/O- SHRI PRABHU CHAUDHARY, RESIDENT OF JANDAHA, P.S.- JANDAHA, DISTRICT; VAISHALI 2. SANJAY SINGH, S/O- LATE PARASNATH SINGH, RESIDENT OF COMPANYSARAI, P.S.- SASARAM, DISTRICT- ROHTAS 3. VIJAY KUMAR SINGH, S/O- SHRI NAGENDRA SINGH, RESIDENT OF RAM BARIYARPUR, P.S.- RAJAPAKAR, DISTRICT; VAISHALI 4. PREM NATH SINGH, S/O- LATE JAGDISH SINGH, RESIDENT OF VILLAGE SALHA, P.S.- JANDAHA, DISTRICT- VAISHALI ….. Petitioners Versus 1. THE STATE OF BIHAR THROUGH THE EXCISE COMMISSIONER, BIHAR, PATNA. 2. THE MEMBER, BOARD OF REVENUE, BIHAR 3. THE COLLECTOR, DISTRICT- VAISHALI 4. THE EXCISE SUPERINTENDENT, DISTRICT- VAISHALI …… Respondents ----------- 8 06.01.2010 Heard Mr. Abhinav Shrivastava for the petitioners, and Mr. P.K. Shahi, learned Advocate General for the State. This writ petition is directed against the order dated 07.12..2007/04.04.2008, passed by respondent no. 1, whereby he has declined to issue licenses to wholesellers and retailers of Ayurvedic preparations for the reasons/observations recorded therein. 2. A brief statement of facts essential for the disposal of the writ petition may be indicated. By notification no. 2/23-3/88, dated 3.8.1988, rule 2(a), rule 93A and Rule 114 were inserted in the Rules framed under Section 19 of Bihar Excise Act, 1915. These insertions have had a bearing on the grant of licence to intending manufacturers, wholesellers, and retailers with respect to manufacture, distribution and sale of products covered by the 2 1915 Act. The vires of these insertions were challenged before the Patna High Court, and the same were declared to be ultra vires. The State of Bihar challenged the judgment of this Court by preferring Civil Appeal no. 1543-1547 of 1999 (State of Bihar & Ors versus Shree Baidyanath Ayurved Bhawan Pvt. Ltd & Ors), which were allowed by the Supreme Court by judgment dated 11.1.2005, reported in 2005 (2) P.L.J.R. 48(S.C.), whereby the Supreme Court disagreed with the judgment of this Court, and declared the said insertions to be intra vires. 3. The petitioners applied for licence as manufacturers and/or retailers with respect to Ayurvedic products. The same were with respect to products which have alcohol content. Their applications for such licences were rejected by the authorities by order dated 20.1.2006 (Annexure- 12). This was followed by government circular dated 30.1.2006 (Annexure-13). It also provided that such medicinal products which have Ayurvedic content shall be sold on production of prescription of a registered medical practitioner. The aggrieved person challenged the validity of Annexures- 12 and 13 by preferring C.W.J.C. No. 4518 of 2006. The same was disposed of by a Division Bench of this Court by judgment dated 10.1.2007 (Annexure-16), whereby those petitioners were directed to submit fresh applications before respondent no. 1, who shall consider the same in accordance with law, and the observations made therein. It may be stated for the sake of clarity that the said 3 judgment dated 10.1.2007, also disposed of C.W.J.C. No. 4289 of 2006, with respect to grant of licence in Form-L-I, issued under the Medicinal and Toilet preparations (Excise Duty) Act, 1955, to manufacturers. No grievance is being raised before us with respect to that part of the judgment which dealt with the issues arising in C.W.J.C. No. 4289 of 2006. The application of the present petitioners for the licences as wholesellers and retailers had been rejected by the impugned order for the reasons and observations recorded therein leading to the writ petition. 4. We have perused the materials on record, and considered the submissions of learned counsel for the parties. Before we deal with the reasons assigned in the impugned order, we wish to clarify that the licences in question are with respect to sale of Ayurvedic preparations which have alcohol content. We are in this connection reminded of the judgment of the Supreme Court in the case of Har Shankar versus Dy. E. & T. Comm., reported in A.I.R. 1975 S.C. 1121. That case dealt with grant of licence under Punjab Excise Act. Paragraph 53, 54 and 55 of the judgment are relevant in the present context, guide the disposal of the present writ petition, and are reproduced hereinbelow for the facility of quick reference: “53. In our opinion, the true position governing dealings in intoxicants is as stated and reflected in the Constitution Bench decisions of this Court in Balsara’s case 1951 SCR 682 = (AIR 1951 SC 318); Cooverjee’s case 1954 SCR 873 = (AIR 1954 SC 220); Kidwai’s case 1957 SCR 295 = (AIR 1957 SC 414); Nagendra Nath’s case 1958 SCR 1240 = (AIR 1958 SC 398); Amar Chakraborty’s case (1973) 1 SCR 533 = (AIR 4 1972 SC 1863) and the R.M.D.C. case 1957 SCR 874 = (AIR 1957 SC 699) as interpreted in Harinarayan Jaiswal’s case (1972) 3 SCR 784 = (AIR 1972 SC 1816) and Nashirwar’s case AIR 1975 SC 360. There is no fundamental right to do trade or business in intoxicants. The State, under its regulatory powers, has the right to prohibit absolutely every form of activity in relation to intoxicants – its manufacture, storage, export, import, sale and possession. In all their manifestations, these rights are vested in the State and indeed without such vesting there can be no effective regulation of various forms of activities in relation to intoxicants. In “American Jurisprudence”, Volume 30 it is stated that while engaging in liquor traffic is not inherently unlawful, nevertheless it is a privilege and not a right, subject to governmental control. (page 538). This power of control is an incident of the society’s right to self protection and it rests upon the right of the State to care for the Health, morals and welfare of the people. Liquor traffic is a source of pauperism and crime. (pp. 539, 540, 541). 54. ……It is significant that the judgment in Krishna Kumar Narula’s case does not negate the right of the State to prohibit absolutely all forms of activities in relation to intoxicants. The wider right to prohibit absolutely would include the narrower right to permit dealings in intoxicants on such terms of general application as the State deems expedient. 55. Since rights in regard to intoxicants belong to the State, it is open to the Government to part with those rights for a consideration. By Article 298 of the Constitution, the executive power of the State extends to the carrying on of any trade or business and to the making of contracts for any purpose. As observed in Harinarayan Jaiswal’s case, “if the Government is the exclusive owner of those privileges, reliance on Article 19(1) (g) or Article 14 becomes irrelevant. Citizens cannot have any fundamental right to trade or carry on business in the properties or rights belonging to the Government, or can there be any infringement of Article 14, if the Government tries to get the best available price for its valuable rights.” Section 27 of the Act recognizes the right of the Government to grant a lease of its right to manufacture, supply or sell intoxicants. Section 34 of the Act read with 5 Section 59 (d) empowers the Financial Commissioner to direct that a licence; permit or pass be granted under the Act on payment of such fees and subject to such restrictions and on such conditions as he may prescribe. In such a scheme, it is not of the essence whether the amount charged to the licensees is pre-determined as in the appeals of Northern India Caterers and of Green Hotel or whether it is left to be determined by bids offered in auctions held for granting those rights to licensees. The power of the Government to charge a price for parting with its rights and not the mode of fixing that price is what constitutes the essence of the matter. Nor indeed does the label affixed to the price determine either the true nature of the charge levied by the Government or its right to levy the same.” 5. The first objection raised in the impugned order is that there shall be one wholeseller in one division, and one retailer in each Sub-Division. Rule 93 A of the aforesaid Rules is reproduced hereinbelow for the facility of quick reference:- 1 [93A (1) Ayurvedic preparations manufactured under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 and capable of being used as ordinary alcoholic beverages shall be sole by wholesale to the licensed retailers only under a licence granted by the Collector of the district with the previous approval of the Commissioner of Excise. (2) The license for the wholesale sale of such preparations shall be granted by the Collector of the district on such fee as may be prescribed from time to time. (3) The license for the retail sale of such preparations shall be granted by the Collector of the district for such places and in such numbers as may be considered necessary by the Commissioner of Excise, and on such fees as may be prescribed from time to, time. (4) Such preparations shall be transported from the manufactory to the premises of the wholesale licensee or from the manufactory/premises of the wholesale licensee to the licensed premises of the retailers only under a pass granted in that behalf by the Collector of the district in which the licensed premises of the wholeseller/retailer are 6 situated. (5) No person shall possess such preparations in quantities in excess of the limit of retail sale of such preparations without a permit granted by the Collector in that behalf.] It is evident on a plain reading of this provision that the licensing authority has the requisite authority to restrict the number of wholesellers and retailers for each region. We, therefore, uphold this part of the reasoning assigned in the impugned order. 6. The next objection is that such products can be sold only on production of prescription of a registered medical practitioner. Paragraph 8 of the impugned order is reproduced hereinbelow: “vYdksgy ;qDr vk;qosZfnd fufeZfr;ksa dk pqafd cM+s iSekus ij lk/kkj.k eknd is; ds :i esa nq:i;ksx laHkkfor gS] ftldk dqizHkko lk/kkj.k “kjkc dh [kir ds jktLo ij iM+rk gSA vr% bu fufeZfr;ksa dh [kir vkS’kf/k ds :i esa gh lqfuf”pr djus ds fy, [kqnjk foØsrk dk MªfxLV gksuk ,oa foØh vk;qosZfnd fpfdRld@vk;qosZfnd vLirky ds izslfØilu ds vkyksd esa djus dk izko/kku yk;k x;k gS tks lgh gSA” As stated hereinabove, the judgment of the Supreme Court in Har Shankar (Supra), guides disposal of the present matter. The restrictions have been imposed in a situation where the product has alcohol content, and has the potential of gross misuse. The restriction of production of prescription by a registered medical practitioner is, therefore, preeminently reasonable, just and proper. We uphold the objection. 7. The impugned order also perhaps contains the restriction that such licensees should have the assistance of 7 chemists and druggists. In view of this position that the wholesellers and retailers do not dispense with medicines, are selling only branded products, such condition of having chemist and druggist would apply only to persons obtaining licence in Form-L-I which is manifest from a plain reading of the impugned order. In other words, the conditions of chemist and druggist do not apply to wholesellers and retailers. 8. Learned counsel for the petitioners has during the course of his submissions submitted that the licensing committee comprises of the District Magistrate, the Civil Surgeon, and Others, which is a cumbersome procedure. The contention is stated only to be rejected. It is not given to the petitioners to normally interfere with the constitution of administrative committees, which are really within the ambit of the Rules of Executive Business. 9. In the result, we do not find any merit in the writ application. It is accordingly dismissed. It goes without saying that it will be open to the petitioners to apply afresh for their licences after taking care of the objections. pkj (S.K. Katriar, J.) ( Kishore K. Mandal, J. )