Madhya Pradesh High Court
M/S Associated Alcohol And Breweries ... vs The State Of Madhya Pradesh on 28 March, 2019
1
THE HIGH COURT OF MADHYA PRADESH
M/s Som Distilleries Pvt. Ltd. Vs. Excise Commissioner
[W.A. No. 361/2019, W.A. No. 362/2019, W.A. No. 363/2019,
W.A. No. 364/2019, W.A. No. 365/2019, W.A. No. 366/2019,
W.A. No. 367/2019, W.A. No. 368/2019, W.A. No. 369/2019,
W.A. No. 370/2019, W.A. No. 371/2019, W.A. No. 372/2019,
W.A. No. 373/2019, W.A. No. 374/2019, W.A. No. 375/2019]
M/s Som Distilleries Pvt. Ltd. Vs. State of M.P. and others
[W.A. No. 391/2019, W.A. No. 392/2019, W.A. No. 393/2019,
W.A. No. 394/2019, W.A. No. 395/2019, W.A. No. 396/2019,
W.A. No. 397/2019, W.A. No. 398/2019, W.A. No. 399/2019]
M/s Associated Alcohol & Breweries Ltd. Vs. State of M.P. and others
[W.A. No. 400/2019]
Gwalior, Dated:-28/03/2019
Shri V.K. Bhardwaj, learned Senior Counsel with Shri Rohit
Batham, learned counsel for the appellant.
Shri Pratip Visoriya, learned Government Advocate for the
respondents/State.
This order shall govern the disposal of W.A. No. 361/2019, W.A. No. 362/2019, W.A. No. 363/2019, W.A. No. 364/2019, W.A. No. 365/2019, W.A. No. 366/2019, W.A. No. 367/2019, W.A. No. 368/2019, W.A. No. 369/2019, W.A. No. 370/2019, W.A. No. 371/2019, W.A. No. 372/2019, W.A. No. 373/2019, W.A. No. 374/2019, W.A. No. 375/2019, W.A. No. 391/2019, W.A. No. 392/2019, W.A. No. 393/2019, W.A. No. 394/2019, W.A. No. 395/2019, W.A. No. 396/2019, W.A. No. 397/2019, W.A. No. 398/2019, W.A. No. 399/2019, W.A. No. 400/2019.
These appeals under Section 2(1) of the Madhya Pradesh Uchcha Nyayalaya (Khand Nyayapeeth Ko Appeal) Adhiniyam, 2005, 2 THE HIGH COURT OF MADHYA PRADESH are directed against the order dated 30.11.2018 passed in W.P. No. 963/2016, W.P. No.65/2016, W.P. No.68/2016, W.P. No.22584/2017, W.P. No. 961/2016, W.P. No.60/2016, W.P. No.61/2016, W.P. No. 62/2016, W.P. No.71/2016, W.P. No.22585/2017, W.P. No.63/2016, W.P. No.66/2016, W.P. No.67/2016, W.P. No.64/2016, W.P. No. 22586/2017, W.P. No.295/2018, W.P. No.287/2018, W.P. No. 290/2018, W.P. No.292/2018, W.P. No.285/2018, W.P. No.296/2018, W.P. No.1178/2018, W.P. No.286/2018, W.P. No.1177/2018, W.P. No. 1492/2016.
In Writ Petitions, the challenge was to the order passed under Rule 12(1) of Madhya Pradesh Country Spirit Rules, 1995 imposing penalty for breach of Rule 4(4) of the Rules of 1995 for not maintaining minimum stock of bottled liquor and rectified spirit in Chhindwara, Dewas and Vidisha Region, wherefor the appellant holds manufacturing and bottling license under Madhya Pradesh Country Spirit Rules, 1995.
Sub-rule (4) of Rule 4 of 1995 Rules envisages:-
"(4) (a) The licensee shall maintain at each "bottling unit" a minimum stock of bottled liquor and rectified spirit equivalent to average issues of five and seven days respectively of the preceding month. In addition, he shall maintain at each "storage warehouse" a minimum stock of bottled liquor equivalent to average issue of five days of the preceding month ;
Provided that in special circumstances, the Excise Commissioner may reduce the above requirement of maintenance of minimum stock of rectified spirit and/or sealed bottles in respect of any "bottling unit" or "storage warehouse".
3THE HIGH COURT OF MADHYA PRADESH
(b) The C.S. 1 licensee shall maintain at each bottling unit such minimum stock of empty-bottles as may be fixed by the District Excise Officer of the concerned district."
That the breach of sub-rule (4) of Rule 4 invites penalty under sub-rule (1) of Rule 12 of 1995 Rules, which stipulates:-
"12. Penalties :- (1) Without prejudice to the provision of the conditions of the C.S.1 licence and save where provisions is expressly made for any other penalty in these rules, the Excise Commissioner may impose upon C.S. 1 licensee a penalty not exceeding Rs. 2,00,000 for any breach or contravention of any of these rules or the provisions of Madhya Pradesh Excise Act, 1915 or rules made thereunder or orders of the Excise Commissioner and may further impose in the case of continued contravention an additional penalty not exceeding Rs.1,00,000 for every day during with the breach or contravention is continued."
The appellant was subjected to show cause notice for not maintaining the minimum stock of bottled liquor and rectified spirit as required under Rule 4(4) of 1995 Rules.
The record reveals, and also as noticed by learned Single Judge that, the factum of not maintaining the minimum stock of bottled liquor and rectified spirit was not specifically denied.
The reasons assigned by the appellant for non clearance of challan were non responsiveness of the retailers. It was also stated that there was no complaint from any retailers, nor was there any loss occasioned to the revenue.
The reply did not find favour with the Competent Authority who issued order imposing penalty in consonance with respective 4 THE HIGH COURT OF MADHYA PRADESH shortage at warehouses at Chhindwara, Vidisha and Dewas.
Appeals preferred against respective orders before the Commissioner, Excise resulted in dismissal which led the appellant file Writ Petitions wherein the grounds raised were that the penalty under Rule 12 (1) of 1995 Rules can be imposed only when any loss is caused to the State or the retail vendor. In absence whereof, no penalty can be levied because there was no mens rea on the part of the appellant. The petitioner had also raise the ground under Section 73 and 74 of the Contract Act that unless the loss is quantified, the penalty cannot be imposed. It was also stated that the action has been taken without verification of record. These contentions were denied by the State and its functionaries. It was stated that the penalty under Rule 12 is not for any loss sustained by the State but is a deterrant measure, so that the stipulations in the rule and the terms of licence, including maintaining minimum stock is adhered to. That one of the reason for maintaining the minimum stock was to prevent any chance of spurious liquor.
Learned Single Judge after considering rival contentions upheld the imposition of penalty.
Learned Single Judge observed that under Rule 4(4) of the Rules, 1995, imperative it is for the petitioner to maintain the minimum stock of bottled liquor and rectified spirit. And having not maintained the same, exposited itself to the penalty. 5
THE HIGH COURT OF MADHYA PRADESH Dwelling on the contention that the concern Authorities did not physically verified the stock, learned Single Judge found from the reply filed by the appellant to show cause notice that there was no denial of the fact that the minimum stock was not maintained. After analyzing paragraphs No. 5 and 6 of the reply, learned Single Judge observed.
"Thus, it is clear that it has not been disputed by the petitioner himself, that it had not maintained the minimum stock as required under Rule 4(4) of the Rules, but its stand was that due to non-maintenance of minimum stock, no financial loss was caused to the State. In absence of any dispute with regard to the allegation of non-maintenance of minimum stock by the petitioner, it is held that the petitioner had failed to maintain the minimum stock as required under Rule 4(4) of the Spirit Rules, 1995."
We are not commended to any cogent material as would establish that the appellant categorically denied the non-maintenance of minimum stock. The cogent material on record otherwise reveals that the Challans were pending, the non-clearance whereof indicated that there was no bottled liquor and rectified spirit in stock.
Dwelling on the aspect of Section 73 and Section 74 of the Contract Act, learned Single Judge, in our considered opinion, rightly adjudged that the trade in liquor being not a fundamental right, the appellant was bound by the stipulations in the Rules of 1995 and the terms and conditions of license, the non-adherence whereof attracted penalty under Rule 12 of 1995 Rules.
Furthermore, learned Single Judge distinguished the decision in 6 THE HIGH COURT OF MADHYA PRADESH Writ Petition No. 10997/2013 decided on 01/07/2013, on the findings:-
"I have gone through the order dated 1-7-2013 passed by this Court in W.P. No. 10997/2013. The High Court had upheld the order of the Board of Revenue, on the ground that before imposing the penalty, the Excise Commissioner had not given any notice to the licensee, whereas in the present case, admittedly, not only the notice was given to the petitioner, but the petitioner had also participated in the proceedings before the Excise Commissioner. Accordingly, the submission made by the Counsel for the Petitioner is of no assistance to him.
Secondly, the Board of Revenue might be governed by its Rules of Procedure, but the High Court, can always test the correctness of the reasons assigned by the Member, Board of Revenue. Thus, the High Court cannot be asked to interfere with the order of the Member of Board of Revenue only on the ground that since, the single member had not made a recommendation to the President of the Board of Revenue, for referring the matter to the Division Bench of the Board of Revenue, therefore, the order of Single Member, Board of Revenue is bad. Rule 4 of the Rules of procedure of Board of Revenue is meant to regulate the working of the Board of Revenue but the order of the Board of Revenue is not binding on the High Court, therefore, irrespective of the fact that whether the single member should have referred the matter to the Division Bench of the Board of Revenue or not, the High Court, can always test the correctness of the order of the Single Member of Board of Revenue. Hence, this contention of the Counsel for the Petitioner is rejected."
Though it is contended by the appellant that learned Single Judge grossly erred in adjudging the matter. However, on a careful consideration of the decision rendered by learned Single Judge and the fact that there was no denial that the minimum stock of bottled liquor and the rectified spirit was not maintained which is evident from the pending Challans evincing non lifting of bottled liquor and rectified 7 THE HIGH COURT OF MADHYA PRADESH spirit resulting in loss to revenue, we do not perceive any illegality in the imposition of penalty and of its being upheld by learned Single Judge.
Appeals being bereft of merit deserve to be and are hereby dismissed. No Costs.
(Sanjay Yadav) (Vivek Agarwal)
Judge Judge
Shubhankar*
SHUBHANKAR
MISHRA
2019.04.02
17:01:24 +05'30'