Andhra HC (Pre-Telangana)
Toddy Co-Operative Society, Lalapet ... vs The Assistant Commissioner Of ... on 28 December, 1995
Equivalent citations: 1996(2)ALT314
ORDER B. Sri Atchutanand Swamy, J.
1. This is yet another case where the provisions of the Excise Act and the Rules made thereunder for the benefit of the tappers, were made a mockery by the officials of the Excise Department and they tried to squeaze monies without authority of law or any basis more so without following any procedure for the sin of taking the toddy shops on lease as per the policy enunciated by the Commissioner of Excise with the approval of the Government said to have been beneficial to the tappers.
2. The facts leading to filing of this case are: During the Excise year 1993-94, auction of toddy shops was dispensed with and all the shops were given on lease to Tappers Co-operative Societies as per the policy approved by the Government. In that year, the toddy shops situated at Tukararagate, Addagutta, Lalapet, Mettuguda and Tarnaka were grouped together and the group was given on lease to Co-operative Society on an annual rental of Rs. 26,50, 155-00. The ration for each of the shop was fixed individually and the total number of trees earmarked for the group came to 6500 and the rental worked out at Rs. 407.71 ps. per each tree. Now, it is on record that during the Excise Year 1993-94, the Society could not tap the entire ration due to non-availability of the excise trees. That being the state of affairs for the Excise Year 1994-95, the respondents seemed to have moved a proposal to bifurcate the group into two, one Lalapet group consisting of Lalapet. Mettugudda and Tarnaka and the other Tukaram gate. Having come to know of the proposals, the members of the society made a representation not to bifurcate the group and continue the group as it is. Without heeding to the request of the tappers, the Collector seemed to have passed orders in the Note File effecting bifurcation as stated above. But at the same time, no written orders were communicated to the societies either by the Collector or the Excise Supreintendent. Likewise they did not inform the licencees about the yearly rental! fixed for each group. The members of the petitioner Tappers Co-operative Society, to whom Lalapet group of toddy shops were allotted, seemed to have run for trees between the 1st respondent office and to the offices of the Excise Superintendents in the -neighboring districts seeking allotment of the trees for tapping. But, where ever they have gone as per the directions of the 1st respondent, the stock answer they received was trees are not available in the range. With great difficulty they could tap 4760 trees during the Excise Year 1994-95. The members of the society having realised that the Department is collecting excess rentals, made repeated representations from 4th May, 1995 to the 1st respondent to settle the account of the society for the year 1994-95. When their representations did not yield fruitful results, they seemed to have approached this Honourable Court and this Honourable Court while disposing the writ petition No. 10578/95 at the admission stage on 30-5-1995 passed the following order:-
"The grievance of the petitioner in this writ petition is that the representation dated 4-5-1995 and 25-5-1995 for adjustment of the excess rental collected from the petitioner society for the Excise Year 1994-95 have not been disposed of by the respondents so far. In the circumstances, the respondents are directed to dispose of the same in accordance with law as expeditionsly as possible not later than four weeks from the date of receipt of this".
Pending disposal of the representation, the petitioner society seemed to have not paid the monthly rentals for April and May 1995. It is not known whether the order passed by this Court was received by the 1st respondent or not. In proceedings Dated 13-6-1995, the 1strespondentinCr.No. C5/3075/95/ESH/ Ex., gave notice to show cause why the licence of the petitioner society cannot be cancelled for default in payment of rental due to the Government during the Excise Year 1994-95 to a tune of Rs. 3,38,847.00 within 7 days from the date of the receipt of the notice. After receipt of the said notice, the petitioner society filed a detailed representation. But without considering the same, the 1st respondent passed a final order in his proceedings Cr. D2/2167/95/ASH/Ex., dated 17-7-1995 wherein for the first time he disclosed that ration for Lalapet Group of shops was increased and the rental was worked out on the basis of Rs. 407.71 per tree as was done during the previous Excise year. Accordingly due to increase in the ration, petitioner Society was asked to pay higher rentals for the excess trees allotted by the Department to this group. Questioning the said action, the present writ petition is filed seeking various reliefs, which I need not advert to in this judgment.
3. From the narration of the facts it is seen that the petitioner Society was asked to pay excess rentals for their group than the rental paid during the Excise Year 1993-94 solely on the basis of allotment of extra trees to the group and the issue to be adjudicated in this writ petition is whether the action of the respondents is sustainable in law or not.
4. The lease of right to sell liquor in retail is governed by the A.P. Excise (Lease of Right to Sell Liquor in Retail) Rules, 1969, (hereinafter called as "Lease Rules'). Under Rule 3 of the said Rules, normally the lease of liquor in retail shall be granted by public auction duly notified and the lease shall be ordinarily for a period of one Excise Year. But, under proviso to Rule 3, the Commissioner is given the option to lease the right to sell liquor in retail in any other manner with the prior approval of the Government. Under this proviso, having obtained prior approval of the Government, the toddy shops situated in places other than Municipal Corporations, first class and second class Municipalities and other areas notified from time to time are being given on lease to Toddy Tapers Cooperative Societies for block period of five years or three years. But during the Excise Year 1993-94 there is a change in the policy of the Government and the auction system of toddy shops were completely dispensed with and all the shops situated in the State of Andhra Pradesh were given on lease to the Tappers Co-operative Societies. But the period of licence is reduced to one year. The same policy was continued for 94-95 also. As per the above policy Lalapet Group of Shops were allotted to petitioner-Society.
5. Before considering the validity of the action of the Commissioner, it will be better to extract two important Rules governing the allotment of excise trees to Toddy Shops as specified in the A.P.Excise (Tapping of Trees and Toddy Shops Special Conditions of Licence) Rules, 1969, Rule 14(1) "14. Allotment of Excise Trees:
(1) Every licensee who sells toddy shall be allotted a specified number of excise trees for tapping and drawing of toddy, therefrom, for supply to his shop, subject to payment of tree tax and tree owner's rent:
Provided that it shall be the duty of the licensee to ascertain before participating in the auction as to the availability of trees allotted to the shop and where any shortage in the number of trees available for tapping out of the trees allotted to the shop, is noticed by the Excise Superintendent or the Deputy Commissioner as the case may be, he shall allot excise trees to make up the shortage on being pointed out by the licensee, but no remission of rentals shall be entertained in lieu thereof."
6. From this it is evident that a duty is cast on the licensee to ascertain the number of trees allotted to the shop which he intends to take on lease and if there is any shortfall in the numbers earmarked for that shop is noticed, the Excise Superintendent or the Dy. Commissioner as the case may be shall allot excise trees to make up shortage on being pointed out by the licensee, but no remission shall be granted for the number of trees that fell short of the ration. This rule is mainly intended for the auction purchaser of the leasehold rights of toddy in an auction. There is yet another rule governing the cases of Tappers Cooperative Societies:
"15. Allotment of excise trees in excess of quota:
(1) Excise trees in excess of the quota shall not ordinarily be allotted during the course of the year. The Collector within the concerned District and Deputy Commissioner of Excise within the Division, subject to availability of trees may, in special circumstances, allot extra trees after collecting proportionate rental in addition to the tree tax and tree owner's rent:
Provided that proportionate rentals in addition to the tree tax and tree owner's rent, shall not be collected on the extra trees allotted to the Tapper's Co-operative Society and tree for Tappers Scheme subject to a maximum of 160 sendhi trees or 48 toddy trees per member who is actually engaged in tapping:
Provided further than in case of allotment of both sendhi and toddy trees to a tapper, conversion formula of 3 toddy trees as being equal to 10 sendhi trees and one coconut tree as being equal to 2 toddy trees shall be followed for the purpose of this rule;
Provided also that this rule shall not apply to the category of trees mentioned in Sub-rule (3) of Rule 11."
From this, it is evident that a right is given to the Tappers' Co-operative Society to seek for allotment of additional excess trees over and above the ration fixed by the Commissioner without paying proportionate rental till the ration works out to maximum number of trees to each member i.e., 160 sendhi trees or 48 toddy trees without paying any excess rental as in the case of an auction. From this, it is seen that without reference to the allotment of the trees by the Commissioner in the exercise of his power under Rule 3 (2) of Lease Rules, a right is conferred on the members of the Tappers Co-operative Society to claim any number of trees till the ration for each tapper workout to maximum number of trees as specified in proviso to 15(1) of the A.P. Excise (Tapping of Trees and Toddy Shops Special Conditions of Licence) Rules, 1969, without paying the proportionate rental. Giving a go-bye to this rule, the Excise Authorities conducted themselves to deprive the legitimate right that was given to a tapper under the statutory rules and made the life of the tapper miserable. In fact, having noticed this, I have not only summoned the 1st respondent to the Court, but also gave sufficient time to justify their illegal action in trying to collect excess rentals for the trees which are not physically in existence, more so, without bringing to the notice of the licensee at any point of time during the currency of the lease period about the enhancement of the trees. The question to be considered is whether the Commissioner can fix up the trees for each shop at his whims and fancies without reference to the availability of the trees on the land and whether the enhancement of the ration is intended to meet the needs of the drinking public and the licensee or only to collect excess rentals by enhancing the ration for the toddy shops merely on the ground the Commissioner is having such power. In my view, the answer is emphatically no. Every action of the Commissioner should be based on reason and it can not result in arbitrary exercise of power to the detriment of the licensees. In the instant case, the Commissioner is fully aware of the fact that the trees shown as the ration for the old Tukaram gate group of toddy shops for the Excise year 1993-1994 are not in existence. When that is the factual position, for what reason the commissioner tried to increase the ration on the shops in Lalapet group is not forthcoming from the counter filed by him. In fact, in this case, apart from the counter filed by the Assistant Commissioner of Excise, the Government as well as the Commissioner filed their counters in response to the queries raised by this Court. But all the three counters are as vague as possible they are and no reasons were given for the enhancement of the ration of the trees on this group. The 1st respondent tried to justify the illegal action by contending that the ration was enhanced after conducting a survey and the commissioner having satisfied about the existence of the trees, enahanced the ration. In support of his contention, the 1st respondent produced 'Statement-A' with regard to establishment of toddy shops for the year 1993-94. At page 13 of the statement, for toddy group of Tukaram Gate 1500 trees were shown at Khajipur, 1870 at Arur, Medak District -1870 and 63 trees at Aipoor, Nalgonda district. Likewise, to Mettuguda. trees were shown at pillaipally -150 trees, Gokaram - 300 trees in Nalgonda District, and 800 trees in each tope at Dommat and Akaram in Medak District. For Tarnaka shop, again 1463 trees were shown at Khajipur in Medak District, 173 trees at Aipur, and 50 trees, Oookondi in Nalgonda district. The above statement shows the non application of the mind of the authorities concerned. For each shop, they went on allotting trees at various places without reference to the convenience of the tappers. For instance, for Lalapet Toddy shop 63 trees and for Tarnaka shop -173 trees were allotted in Aipur, Nalgonda District. Whereas the trees earmarked for Lalapet was 3520 trees. If really trees are available in this tope I am really astonished to know why the tope was divided between two shops instead of allotting all the trees in the tope to one shop which would have been more convenient to tappers to draw toddy. The first respondent submits that the ration was fixed by the Commissioner before orders were passed for bifurcation of Tukaram Gate, but at the same time, it is not the case of the respondents that they ever put the licensee on the notice about the increase in the ration. As the auction system was dispensed with, the Commissioner seemed to have not issued the gazette notification as required under Rule 4 of the A.P. Excise (Lease of Right to sell Arrack in Retail) Rules, 1969 with the result, both for want of notice to the petitioner society as well as public notification, there is no opportunity for the members of the Petitioner Society to know the fact of increase in the ration. Had Gazette notification been issued with all the particulars mentioned in Rule 4 of the Lease Rules, the licensee would have taken the earliest opportunity to know the increase in the ration and also made efforts to find out whether the trees are in existence or not. The question can be viewed from another angle also. As observed supra, the question of increase in the ration would arise only when there is a demand for production of more toddy, more so, when excise trees are available. In the instant case, the facts reveal that the department could not show the trees that were allotted to Tukaramgate for the Excise Year 1993-94 and in any case the Society after bifurcation did not seek excess allotment of trees. But, the Commissioner for the reasons best known to him, seemed to have increased the ration of trees on the these shops. On this ground alone the action of the Commissioner in increasing the ration can be set aside. But the 1st respondent started contending that the members of the Society having executed counterpart agreement, cannot refuse to pay the rental as demanded by the Government. But the correspondence produced before me between the Excise Superientendents of Hyderabad, Nalgonda and Medak, clinchingly prove that the trees shown in "A-Statement" prepared for the year Excise Year 1994-95 are not physically available on the earth. In the light of the facts cited above, even assuming for a moment without admitting that the members of the petitioner society are liable to pay rentals, the Officials of the Excise Department themselves admitted in writing that the trees earmarked at various topes on the shops are not available. From this, it is evident that "A-Statement" for the Excise Year 1994-95 was prepared by the Officer concerned sitting at home without physical verification and for the fault of the Officer concerned, the members of the poor tappers' Co-operative Society cannot be penalised. I feel that it is high time that the Commissioner, should at least, initiate action for dereliction of duty on the Officer concerned, who has submitted a false report the availability of the trees when trees are not, infact, available for tapping. Hence, the State being a welfare state, cannot act like a shy-lock. Having failed in its duty to provide trees, the Department can not suck the blood of the tapper for the fault of taking lease of toddy shops from it. The respondents cannot relay on Rule 14 of the Licence Rules as they have failed to notify the fact of increase in the ration in advance before giving the shops on lease to the petitioner society. Nextly I am of the firm opinion that the Tappers Co-operative Societies stand on a different and distinct footing from that of a licensee, who has taken the lease of right to sell the toddy in an auction. The case of the Tapper's Society falls under proviso to Rule 15 whether the ration is increased either at the beginning of the lease year or in the middle of the Excise Year. From a reading of Proviso to Rule 15 of Licence Rules, it is seen that a concession was given to the tappers with regard, to payment of proportionate rentals in case of allotment of excess trees even in the middle of the excise year till each tapper gets a particular number of trees for tapping to make a reasonable living. As such the excise authorities went wrong in demanding rentals on the allotment of excise trees before commencement of the excise year which are not in existence and are far less than the trees, the members of the petitioner society are entitled to tap without payment of excess rentals.
7. Even according to the respondents they have categorically admitted that the rental worked out for each tree during the year 1993-94 was not altered but the demand notice was issued asking higher rental only on the basis of excess ration allotted, which is not in physical existence. As observed supra, a member of Tappers Co-operative Society is entitled to get excess number of trees over and above the quota fixed till the ration worked out to 160 sendhi trees or 48 toddy trees without paying even a single paise towards proportionate rental that was contemplated under the Rule 15 of the Licence Rules: Ignoring all these Rules, the officials of the Excise Department conducted themselves in the nature of Shy Lock than as servants of the people in the welfare state. For all these reasons, the demand notice issued in Proc.Cr.D2/2167/95/ASH/Ex, dated 17-7-1995 is quashed and a Writ of Mandamus will issue to the respondents to collect the rental on the ration fixed for each of the shops for the Excise year 1993-94 but not during the Excise year 1994-95 which has no legs to stand and the same amounts to gross abuse of power vested in the Commissioner. The respondents are further directed, that if any excess rental were collected from the petitioner society, they shall refund the same with 18% interest from the date of expiry of the Excise Year 1994-95. At this stage, the learned counsel contends that the petitioner society is liable to pay the rental only for the trees actually tapped, i.e., 4760 trees, but not on the ration fixed for these shops during the Excise Year 1993-1994. I have no hesitation to reject contention as the ration continues to be the same for the Excise year 1993-1994 and 1994-1995. The members of the Petitioner society knowing fully well that the excise trees are not actually available, they did not make any attempt to get the ration reduced by making proper representation to the Commissioner. At this stage, no relief can be granted to the petitioner society on the ground that the society could not secure the allotted number of trees to be tapped.
8. The Writ Petition is, accordingly, allowed with costs. Advocate fee Rs. 2,000/-. Advocate fee shall be collected from the salary of the officer, who conducted the survey and misled the Commissioner about the availability of the trees.