Case: State Of Kerala  Vs. M/S Palakkad Heritage Hotels

Resorts (supra) has been affirmed by this Court by dismissal of SLP(C) No.18392 of 2012 on 20th June, 2012 in the following terms:“ORDERHeard Mr. Ramesh Babu M.R., learned counsel for the petitioners.In the facts and circumstances of the case, we are not inclined to interfere with the impugned judgment.The Special Leave Petition is, accordingly, dismissed.Question of law is kept open.”Even the review petition filed by the State against the said decision, being Review Petition(C) No.1409 of 2012, came to be dismissed on 14th August, 2012.10. What is relevant to note is that, in the case of Kallada Hotels & Resorts (supra), the Division Bench of the High Court had adverted to the decision of this Court in the case of State of Kerala & Anr. v. B.6 Holidays Resorts Pvt. Ltd. (2010 (5) SCC 186 ), wherein it has been held that an application for grant of liquor licence has to be considered with reference to the rules/law prevailing or in force on the date of consideration of application by the Excise Authorities and not with reference to the law as on the date of the application. After noticing the decision of this Court, the Division Bench on the facts of the case before it allowed the Writ Appeal. It will be useful to advert to the relevant portion of the Division Bench decision:“4. ………………………………………………………Going by the judgment of the Hon’ble Supreme Court the law applicable is the law that is in force when the Excise authorities at various levels consider an application for FL3 licence, as is evidenced by the records produced in this case, the application submitted before the Excise Commissioner goes for enquiry to the Deputy Commissioner who make his recommendations which in turn is endorsed by the Joint Commissioner of Excise. Thereafter the application goes to Government and with the permission of the Government the Excise Commissioner issues the licence. In this case the initial denial of licence to the appellant was on account of the mistake about the distance from the temple which was wrongly reported as within the prohibited distance. It is seen that within one month of issuance of the first report namely Ext. P6 dated 25/08/2011 the Joint Excise Commissioner corrected the mistake on 22/09/2011 vide Ext. P9 recommending appellant’s case for issuance of licence. If Ext. P6 was issued with correct distance without committing a mistake and at least if the correct report namely Ext. P9 dated 22/09/2011 was acted upon in time the appellant would have got licence even before the new policy was introduced. Respondent has not brought to the notice of this Court any other objection against entitlement of the appellant for licence. We feel appellant cannot be declined licence on account of the mistake committed by the Excise authorities in Ext. P6 report. In any case since by 22/09/2011, correct report was submitted vide Ext. P9 we feel the amended rule which came into force on 09/12/2011 cannot be applied to appellant. So much so, we hold that appellant is entitled to have their application finally considered and disposed of by the Government and Excise Commissioner with reference to Rule 13 (3) as it stood prior to the amendment introduced to it with effect from 09/12/2011. Accordingly the Writ Appeal is allowed vacating the observation of the learned Single Judge in this regard and with a direction to the respondent to consider and pass orders on appellant’s application at the earliest.”11. In our view, the question as to what date should be reckoned as the date of consideration of licence has not been squarely dealt with in this decision. Indubitably, the processing of the application for grant of licence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail.12. In the present case, the learned Single Judge has assumed the date on which recommendation was made by the Excise Commissioner i.e. 28th March, 2012, as the relevant date. That assumption is untenable. For, that was not the date on which the final decision was taken by the competent authority. Whereas, before a final decision could be taken by the competent authority on the application submitted by the Respondent, the Foreign Liquor Rules were amended on 18th April, 2012. The application submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on this date.13. A priori, no fault can be found with the State Authority for calling upon the Excise Commissioner to examine the proposal and submit his fresh recommendation keeping in mind the amended provisions of the Foreign Liquor Rules. In other words, the application for grant of FL-11 licence submitted by the Respondent was required to be considered by the competent authority keeping in mind the amended provisions which came into force w.e.f. 18th April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his speaking order dated 5th June, 2012, for invoking the restriction of distance of 200 metres from the objectionable site.14. Since the learned Single Judge of the High Court proceeded to decide the writ petition filed by the Respondent merely by referring to the pronouncement of the Division Bench of the same High Court in the case of Kallada Hotels and Resorts (supra), coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18th April, 2012 as void to the extent it has introduced the restriction of distance of 200 meters from objectionable institutions for getting FL-11 licence, we deem it appropriate to relegate the parties before the learned Single Judge to decide the writ petition afresh, keeping in mind the settled legal position.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]7. Since the said relied upon decision in M Pcase has been affirmed by this Court, even this appeal must follow the same suit. However, the said SLP has been disposed of by this court on the basis of concession made by the counsel for the parties - that it had become infructuous in view of the judgment of this Court in the case of The Kerala Bar Hotels Association & Anr. V. State of Kerala & Ors (AIR 2016 SC 163  ).8. On a bare perusal of the decision in the Kerala Bar Hotels Association (supra), it is seen that the question examined by this Court was whether the policy to ban the consumption of alcohol in public or exception carved out to the policy in favour of Five Star Hotels violates the rights of the Hotels of Four Star and below classification under Articles 14 and 19. The other decision considered by the High Court for allowing the writ petition filed by the Respondent is the case of Kallada Hotels & Resorts (supra). The correctness of the decision of the Division Bench of the High Court was not in issue before this Court in the case of Kerala Bar Hotels Association (supra).What is relevant to note is that, in the case of Kallada Hotels & Resorts (supra), the Division Bench of the High Court had adverted to the decision of this Court in the case of State of Kerala & Anr. v. B.6 Holidays Resorts Pvt. Ltd. (2010 (5) SCC 186  ), wherein it has been held that an application for grant of liquor licence has to be considered with reference to the rules/law prevailing or in force on the date of consideration of application by the Excise Authorities and not with reference to the law as on the date of the application. After noticing the decision of this Court, the Division Bench on the facts of the case before it allowed the WritIn our view, the question as to whatdate should be reckoned as the date of consideration oflicence has not been squarely dealt with in this decision. Indubitably, the processing of the application for grant of licence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail.12. In the present case, the learned Single Judge has assumed the date on which recommendation was made by the Excise Commissioner i.e. 28th March, 2012, as the relevant date. That assumption is untenable. For, that was not the date on which the final decision was taken by the competent authority. Whereas, before a final decision could be taken by the competent authority on the application submitted by the Respondent, the Foreign Liquor Rules were amended on 18th April, 2012. The application submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on this date.13. A priori, no fault can be found with the State Authority for calling upon the Excise Commissioner to examine the proposal and submit his fresh recommendation keeping in mind the amended provisions of the Foreign Liquor Rules. In other words, the application for grant of FL-11 licence submitted by the Respondent was required to be considered by the competent authority keeping in mind the amended provisions which came into force w.e.f. 18th April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his speaking order dated 5th June, 2012, for invoking the restriction of distance of 200 metres from the objectionable site.14. Since the learned Single Judge of the High Court proceeded to decide the writ petition filed by the Respondent merely by referring to the pronouncement of the Division Bench of the same High Court in the case of Kallada Hotels and Resorts (supra), coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18th April, 2012 as void to the extent it has introduced the restriction of distance of 200 meters from objectionable institutions for getting FL-11 licence, we deem it appropriate to relegate the parties before the learned Single Judge to decide the writ petition afresh, keeping in mind the settled legal position.