Calcutta High Court
Bengal Club Ltd. vs Deputy Commissioner Of Police And Ors. on 4 April, 1988
Equivalent citations: 1989CRILJ535
ORDER Baboo Lall Jain, J.
1. This application has been made by Bengal Club Limited under Art 226 of the Constitution of India against the Deputy Commissioner of Police and the State of West Bengal inter alia praying that a writ in the nature of Certiorari be issued requiring the respondents to certify and transmit the records of the case against the petitioner under the Calcutta Police Act 1866, as amended by West Bengal Act XLVIII of 1978 as also the Memo bearing No. 1611/P.S.
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P.S./110/Fees/Non-Payment/84 dated 6th Feb., 1985 and the letter bearing No. 2552 P.S. dated 4th March, 1985, to this Court so that the same may be set aside and quashed. The petitioner is also praying for other appropriate writs to challenge the said notice. By the Notice dated 6-2-85, written by the Deputy Commissioner, (sic) being a place of public entertainment, as defined in Section 3 of the Calcutta Police Act, 1866/Calcutta Suburban Police Act, 1866, as amended by West Bengal Act XLVIII of 1978, comes within the purview of Police Licence to be issued by the Commissioner of Police in terms of Section 39 of the Calcutta Police Act 22 of the Suburban Police Act, read with Section 41 of the Calcutta Police Act/24 of the Suburban Police Act. The petitioner was also requested to obtain such license from the pass Department of the Calcutta Police Directorate on deposit of requisite fees within 15 days. The petitioner was warned that in case of failure the petitioner's establishment will be considered as a place of public entertainment running without any valid Police license and prosecution therefore will follow. The amount of the annual fees was communicated to be Rs. 22,500/-.
2. It is further stated in the said letter that such fees remained unpaid since 1979-80 and the outstanding dues were also demanded. Thereafter by a letter dated 4th March, 1985 a further reminder was sent by the Deputy Commissioner of Police stating that in case of default of payment, legal steps will be taken against the petitioner. By the letter dated 6th March, 1986 the petitioner's advocate wrote a letter to the respondent inter alia stating that the object of the club is to afford, to its members alone, the usual privileges, advantages, conveniences and accommodation of the club. It was further stated that Article 90, of the Article of Association of the club provides as hereunder.
90. No member shall bring any one not a member into the club except under the articles and Bye-laws for the admission of guests.
3. It was stated that the club is meant exclusively for its members and no outsiders are entitled to enter into the club premises or to use the facilities offered by the club, unless such a person is a" member of the club, or it introduced to the club by a member as his guest It was further stated that in view of the aforesaid facts the club is not and cannot be a place of public entertainment within the meaning of Section 3 of the Calcutta Police Act, 1866, or of the Calcutta Suburban Police Act 1866, as mentioned by the West Bengal Act, XLVIII of 1978. According to the case of the petitioner the club does not come within the purview of the police licences required to be issued by the Commissioner of Police in terms of either Section 39 of the Calcutta Police Act, 1866 .or of Section 22 of the Suburban Police Act read with Section 41 of the Calcutta Police Act 1866/S. 24 of the Suburban Police Act, 1866. It was further stated that the club has therefore never been and still is not under any obligation to either obtain any licence from the Pass Department of the Calcutta Police Directorate or to deposit any fees in this connection. This application was thereafter moved by the petitioner on 27th June, 1986 on practically the same grounds as stated in the aforesaid letter written on behalf of the petitioner. Further the case of the petitioner is that this club has been in existence since very long time and it was incorporated in 1-9-1907. Even prior to that it was in existence but not as a limited liability company. No such licence, has ever been asked for, during the entire period of its existence, because, accordingly the petitioner it cannot be said that the petitioner has any place of public entertainment. Section 39 of the Calcutta Police Act provides as hereunder:
39. Commissioner of Police may grant licenses for places for which no licenses are required under the Bengal Excise Act.
(1) The Commissioner of Police may, at his discretion, from time to time, grant licenses to the keepers of such house or places or public resort and entertainment as aforesaid for which no license as is specified in (the Bengal Excise Act, 1909) (Bengal Act V of 1909) is required upon such conditions, to be inserted in every such license, as he, with the sanction of the said (State Government) from time to time shall order, for securing the good behaviour of the keepers of the said nouses or places of public resort, or entertainment, and the prevention of drunkenness and disorder among the persons frequenting or using the same; and the said licenses may be granted by the said Commissioner for any time not exceeding one year:
Provided that the said Commissioner may, by order, refuse to grant any licence under this sub-section, if, for reasons to be recorded in writing he is of the opinion that-
(i) the character or antecedents of the applicant for such licence or the nature of the trade or calling pursued by him make him, unsuitable for the grant of such licence or
(ii) the location of the house or place of public resort had entertainment in respect of which such licence is required is unsuitable for the grant of such licence on the ground of congestion of traffic want of adequate space for parking vehicles or difficulty in maintaining public peace, order or safety or on any other similar grounds.
(2) Any person aggrieved by an order refusing to grant a licence under the proviso to Sub-section (1) may, within thirty days from the date of such order, prefer an appeal against such order to the State Government and the State Government may, after giving the appellant an opportunity of being heard, confirm, modify or set aside such order.
4. Section 3 of the Calcutta Police Act defines a place of public entertainment as hereunder:
place of public entertainment' shall mean any place whether enclosed or open, to which the public are admitted, and where any kind of food, drink, drug, betel or tobacco is supplied for consumption on or off the premises for the profit or gain of any person owning or haying an interest in or managing such place; and shall include a lodging house where any kind of food, drink, drug, betel or tobacco is supplied for consumption therein or not and a refreshment room, eating house, coffee house, tea-shop, snack bar, sweet-meat shop, liquor house, boarding house, hotel, restaurant, tavern, wine-shop, beer-shop, spirit-shop, arrack-shop, today show, ganja-shop, bhang shop, opium-shop, tobacco-shop, bidishop, cigarette-shop, zarda-shop, betel-shop and betel-leaf massalla shop.
5. The point that the petitioner intends to urge, is, that in a place of public entertainment, the public, are admitted whereas in so far as this club is concerned, only the members or members' guests, are allowed to use the facilities of the club. The petitioner relied on a judgment J. C. Tax Officer, Madras v. Y. M. A., Madras where the Supreme Court held as hereunder:
11. The essential question, in the present case is whether the supply of the various preparations by each club to its members involved a transaction of sale within the meaning of the Sale of Goods Act 1930. The State Legislature being competent to legislate only under entry 54, List II of the 7th Schedule to the Constitution the expression "sale of goods" bears the same meaning which it has" in the aforesaid Act. Thus in spite of the definition contained in Section 2(n) read with Explanation I of the Act if there is no transfer of property from one to another there is no sale which would be exigible to tax. If the club even though a distinct legal entity is only acting as an agent for its members in the matter of supply of various preparations to them no sale would be involved as the element of transfer would be completely absent. This. position had been rightly accepted even in the previous decision of this Court.
12. The final conclusion of the High Court in the judgment under appeal was that the case of each club was analogous to that of an agent of mandatory investing his own monies for preparing things for consumption of the principal, and later recouping himself for the expenses incurred Once this conclusion of the facts relating to each club was reached, it was unnecessary for the High Court to have. expressed any view with regard to the vires of the Explanations to Sections 2(g) and 2(n) of the Act. As no transaction of sale was involved there could be no levy of tax under the provisions of the Act on the supply of refreshments and preparations by each one of the clubs to its members.
In the above referred case the Supreme Court held that even if the club was a limited company, it was really acting as an agent or mandatory, investing its own monies for preparing things for consumption of the principal, and later recouping himself for the expenses incurred. Therefore, even if the club supplies the goods to its members, at a fixed price, that does not mean that there is any sale by the club to the members. It is really the members who are supplying to themselves as members.
6. Therefore, in my opinion, a club cannot be held to be a place of public entertainment. In that view of the matter the aforesaid notices issued by the Deputy Commissioner of Police are liable to and are hereby quashed and set; aside. The rule is therefore made absolute. There will be no order as to costs.