Rajasthan High Court - Jaipur
Shyam Lal And Party vs The State Of Rajasthan And Anr. on 8 April, 1992
Equivalent citations: 1992(2)WLC292, 1992WLN(UC)87A
JUDGMENT K.C. Agarwal, C.J.
1. This writ petition under Article 226 of the Constitution has been filed challenging the recovery of interest of two years i.e. 1982-83 and 83-84. The amount of the previous year was Rs. 17,567.70p. whereas that of the subsequent year was Rs. 7436.15p. Having offered highest bid, the petitioner was given a licence of vending country liquor for Jodhpur City-Group, Jodhpur, for the years 1982-83 and 83-84. A photostat copy of the licence given to the petitioner has been filed as Annex. 1A. This describes the various amounts which has to be deposited by the petitioner in those years. A copy of the licence of the petitioner is annexed as Annex. IB. The relevant clauses of this Licence are being reproduced below:
2¼d½ ;fn ykbZlsUl/kkjh fdlh ekg dh fdLr 'krZ la[;k&1 ds vuqlkj fu/kkZfjr le; esa tek ugha djkrk gS rks ykbZlsal nsus okyk vf/kdkjh mDr fdLr dh jde ykbZlsUl/kkjh dh flD;ksfjVh jkf'k ls ,oa mldh py o vpy lEifRr ls rFkk mlds okfjlksa ;k tkfeu ls olwy dj ldsxkA blds vfrfjDr mldks ;g Hkh vf/kdkj gksxk fd og ykbZlsUl/kkjh dk ykbZlsUl jn~n dj nsA ¼[k½ ykbZlsUl dh fdlh 'krZ ds vUrxZr dksbZ jde iznk;xh ls 'ks"k jgus dh n'kk esa bldh olwyh Hkw&jktLo dh cdk;k dh Hkkafr jktLFkku Hkw&jktLo vf/kfu;e lu~ 1956 ds vUrxZr dh tk ldsxh! cdk;k jkf'k ij izFke rhu ekg rd 12 izfr'kr rFkk mlds ckn 18 izfr'kr dh nj ls C;kt ykxw gksxh rFkk blds fy, fdlh Hkh izdkj ls vyx ls uksfVl nsus dh vko';drk ugha gksxhA
2. The petitioner under the licence was required to make monthly deposits in the manner laid down in the contract. It, however, defaulted in making payment for the year 1982-83. Hence recovery was started against it for the interest through the notice dated 24.10.83 Annex.2 for the amount of Rs. 17,567.70p. The petitioner committed default in making the payment of amount due with respect to the year 1983-84 also. The Department issued the notice dt. 4.1.84 for recovering Rs. 7436.15 as interest.
3. The petitioner has challenged the recovery on the grounds that as no determination of the amount actually due from the petitioner had taken place and no opportunity of hearing had been given to him before either determing the amount or issuing a notice for recovering the interest, hence the recovery was illegal and bad in law.
4. It is settled that the principles of natural justice do not apply to a matter of contract. In the instant case, a contract In the shape of licence had been entered into which does not provide for any opportunity being given to a defaulter. The petitioner was in the capacity of a defaulter and in that capacity, the proceedings for recovery of the amount mentioned above for the two years 1982-83 and 1983-84 were started. It is also undlsputable that the principles of natural justice can expressly or impliedly be excluded by a Statute. In the instant case, the Clause '2 kha' quoted above makes it abundantly clear that the money, not paid in accordance with agreement, could be recovered by the Excise Department. It does not lay down any requirement of any opportunity being given to the petitioner. Similarly, since the amount as and when fell due, was known to the petitioner, there was no question of its determination as well as the recovery, therefore, it is not illegal on the two grounds mentioned.
5. At this place, reference may be made to a decision of the Supreme Court 1984 (3) S.C.C. p.634 wherein the Supreme Court laid down that after making bid for grant of exclusive privilege with a full knowledge of the terms that no writ lies under Article 226 of the Constitution to enforce a contract which Is an agreement between two, creating a legal relation. In other words, as such, in Black's Dictionary,--'It is agreement creating obligation, legal consideration, mutuality of agreement and mutuality of obligation and agreement must not be so vague or uncertain that terms are not ascertainable."
6. Looking to the histoiy of the case, our view is that a contract had come into existence in between the State and the petitioner, the rights and liabilities of which are governed with the terms and conditions mentioned therein. By means of a petition under Article 226 of the Constitution, no contract is enforceable. The petitioner had obliged himself to recovery proceedings of the amount due as arrears of rent. Hence interest could be recovered as such. There was no provision in the licence for either giving an opportunity of healing to the petitioner before initiation of proceedings for its recovery or for determining the amount due by way of interest.
7. The petitioners' grievance, therefore, that he was entitled to reasonable notice of the case he has to meet, has no substance to stand upon.
8. The. principles of natural justice cannot be attracted where there is no decision making process, involving adverse civil consequences to the petitioner. In connection with the right of a person to be heard in the matter of liquor licence, the Supreme Court held in Bishnu v. Parag that he has no legal right and this was a matter of privilege. The principle for recovery of interest can be usefully applied to the present case as the petitioner had undertaken to pay the same in case of default. Default had been admittedly committed.
9. At this place, reference may be made to a decision of the Supreme Court wherein the Supreme Court laid down that after making bid for grant of exclusive privilege with a full knowledge of the terms and conditions attaching to the auction, one cannot be permitted to wringle out of the contractual obligations arising out of its acceptance of bid by filing a writ petition.
10. In the instant case, we have mentioned above that the terms and conditions were known to the petitioner and under these terms he was required to pay amounts mentioned month by month or in the manner prescribed in the contract. It was also made clear that incase of becoming defaulter, he would have to pay interest at the rates, in the respective contracts.
11. Apart from the licence, reference was also made to Section 30A of the Excise Act, which entitled the Department to recover the amount of interest. Section 30A has been amended from time to time. Previously there was a requirement of notice being given to the defaulter but subsequently that part of S.30A was deleted. Counsel for the petitioner alleged that despite deletion requirement of notice must be fulfilled and no money could be recovered by way of interest. Though no notice being served on the petitioner, the amended provision does not support the petitioner's contention inasmuch as we have to see the law as it stands on the date of recovery. On that date, the amended provision did not require any notice. However, much emphasis cannot be laid down on Section 30A when Clause '2 Kha' of the licence is operative and governs the right of the parties. Under Clause 12 Kha', we have already mentioned neither any notice for determination of the amount as interest, was required. Counsel alleged that petitioner had deposited a sufficient huge amount with the Excise Department at the time of being declared the highest bidder and, therefore, the Excise Department should have deducted the amount due to it from that security and that it cannot lay any claim for interest from the petitioner. A reading of the licence would indicate that security had a different function and not the one which was suggested by the petitioner. It has to stand good through out the period of the licence. The licence mentions that in case any amount was to be deducted out of the money deposited by way of security, the necessary result would be that petitioner would be ceased to be a highest bidder on the basis of which he got the licence. Consequently, no reliance can be placed on the deposit of this amount until ultimate obligations are settled. This will be kept into account by the Excise department but now at this juncture the reliance on the deposit of the money by way of security is misplaced. An attempt was made by the Counsel, although half heartedly that Section 30A is ultravires to the Constitution. To which provisions of the Constitution is it ultravires, was not. referred. The main emphasis of the Excise Department was on Clause '2 Kha' of the agreement which was a contract.
12. The contract does not hit any of the provisions of the Constitution. If the contract would have been resorted to Section 30A, the recovery could be made. Moreover the invalidity of Section 30A cannot stand inasmuch as for the amount which the petitioner failed to deposit as his liability, the State was entitled to recover interest. This is. not a provision unknown to the learned Counsel in the Income Tax and Sales Tax. We are aware that such provisions of imposing liability to pay interest are there in the Income Tax and Sales Tax. This provision is in line with those Acts. Neither does it infringe Article 14 nor any other provision of the Constitution. A contract cannot be challenged by means of a writ petition under Article 226 of the Constitution.
13. In the result, this writ petition is dismissed with costs.