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P.KANDASWAMI versus COMMISSIONER OF PROHIBITION

High Court of Madras

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P.Kandaswami v. Commissioner of Prohibition - Writ Appeal No.793 of 2003 [2007] RD-TN 1839 (8 June 2007)

IN THE HIGH COURT OF JUDICATURE AT MADRAS



DATED: 08.06.2007

CORAM:

THE HONOURABLE MR.JUSTICE P.D.DINAKARAN

and

THE HONOURABLE MR.JUSTICE P.P.S.JANARTHANA RAJA

Writ Appeal Nos.793 and 794 of 2003

P.Kandaswami ..Appellant in WA. No.793 of 2003 Sundarammal ..Appellant in WA. No.794 of 2003 Vs

1. The Commissioner of Prohibition and Excise

Chepauk

Chennai 600 005.

2. The Collector of Chennai

Chennai 600 001.

3. The Deputy Commissioner of Excise

Chennai 600 001. ..Respondents in both W.As. PRAYER:

Writ Appeal under Clause 15 of Letters Patent against the order dated 12.12.2002 made in Writ Petition Nos.3727 and 3729 of 2000 respectively. For Appellants : Mr.AR.L.Sundaresan, Senior Counsel for M/s.A.L.Gandhimathi For Respondents : Mr.G.Sankaran, Special Government Pleader J U D G M E N T



(Delivered by P.D.DINAKARAN, J.)

The correctness of the cancellation of the licenses issued to the appellants under the provisions of the Tamil Nadu Liquor (Retail Vending) Rules, 1989 (for brevity, "the Rules"), on the ground that the liquor bottles, which were not supplied by the TASMAC, were smuggled into the shop and sold through the licensed outlets, by orders of the Original Authority/third respondent herein even dated 15.11.1999, the confirmation of the same by the Appellate Authority/second respondent herein by orders even dated 8.12.1999, the Revisional Authority/first respondent herein by orders even dated 2.2.2000, and by the learned Single Judge of this Court, by common order dated 16.3.2000 in W.P.Nos.3727 and 3729 of 2000 respectively, is the lis in the above appeals. 2.1. In brief, the appellants were granted licenses for selling liquor that would be supplied by the TASMAC under the provisions of the Rules. As per Rule 27 of the Rules, every licensee shall obtain his requirement of liquor for retail vending on an indent placed by him from the TASMAC and the licensee shall not bring to or store in the shop or sell stock of liquor from any other source. Rule 27 of the Rules reads as under: "Rule 27. Stock of Liquor.- Every licensee shall obtain his requirement of liquor, for retail vending on an indent placed by him, from the Tamil Nadu State Marketing Corporation and the licensee shall not bring to or store in the shop or sell stock of liquor from any other source. The liquor supplied by the Tamil Nadu State Marketing Corporation shall be sold in sealed bottles in the same condition as is received. Provided that if any stock in the shop is found to be unfit for human consumption such stocks shall not be sold." (emphasis supplied)

2.2. Condition 6 of the license granted to the appellants herein contemplates that the licensee shall not deal in any stock of liquor other than supplied by TASMAC. 2.3. Condition 23 of the license granted to the appellants further provides that infraction of any of the conditions of the license or the rules or orders relating to the IMFL either by the licensee or by person in his employment shall entail the forfeiture of the security deposit and/or cancellation or suspension of the license. 2.4. The third respondent issued show cause notices even dated 4.10.1999 to the appellants to the effect that during the surprise inspection of the licensed premises on 29.9.1999, it was found that the appellants were smuggling liquor bottles, not supplied by the TASMAC, and are selling them through the licensed outlets by violating the terms and conditions 7 and 23 of the license, and that the appellants have also violated Rule 27 of the Rules. The appellants were, thus, directed to show cause within 15 days as to why the security deposit of Rs.25,000/- remitted by each of them should not be forfeited and the license granted to the appellants should not be cancelled for the alleged irregularities. An opportunity of being heard was given to the appellants on 18.10.1999 at 3.00 pm by the Deputy Commissioner. 2.5. The appellants baldly denied the alleged irregularities attributed against them during the enquiry. Therefore, the third respondent, after going through the relevant records, found that the conditions No.6 and 23 of the license and Rule 27 of the Rules were violated and therefore, by independent proceedings even dated 15.11.1999 cancelled the licenses of the appellants. 2.6. Against the cancellation of licenses by the third respondent by proceedings even dated 15.11.1999, the appellant preferred appeals before the second respondent, who by independent orders even dated 8.12.1999 confirmed the cancellation of licenses. 2.7. The appellants, against the said orders of the second respondent even dated 8.12.1999, preferred revisions before the first respondent. Before the first respondent, it was reiterated that the appellants were not furnished with the proof of documentary evidence relied on by the authorities below to arrive at the conclusion that the appellants smuggled liquor, not supplied by the TASMAC and sold the same through the retail shops. The first respondent, therefore, perused the relevant records that weighed the original and appellate authorities, viz., third and second respondent respectively, and satisfied that there was an inspection of the respective premises of the licensees on 29.9.1999 and smuggled liquor bottles, not supplied by TASMAC, were seized from the respective premises of the licensees. It was also found from the seizure mahazars, which forms part and parcel of the records relating to the respective FIRs, that the liquor bottles had no proper Government excise labels. Accordingly, the first respondent confirmed the cancellation of the licenses, by independent orders even dated 2.2.2000, which were challenged in W.P.Nos.3727 and 3729 of 2000 respectively. 2.8.1. Before the learned Single Judge, it was vehemently contended that the documentary evidence relied on by the respondents to show that the Prohibition and Excise Wing Police and the Taluk Excise Officer, Fort Tondiarpet have seized smuggled or spurious liquor bottles, which were not supplied by TASMAC, were sold by the appellants, were not furnished to the appellants and therefore, the finding of the respondents authorities that the appellants smuggled liquor bottles not supplied by TASMAC and were selling the same in the licensed premises is not sustainable as the entire proceedings cancelling the license suffers for non compliance of the substantive rules, which forms part and parcel of natural justice, namely non-furnishing of the copies of documents relied on by the respondents, who cancelled the license. 2.8.3. Meeting the above contention, the respondents, submitted that when such a serious contention was projected before the first respondent, the first respondent examined the entire matter afresh referring to the original records and also the material documents that form part and parcel of the entire records and only thereafter, confirmed the orders of cancellation of the licenses issued to the appellants. 2.8.4. Since the first respondent also confirmed the cancellation of the license and the appellants reiterated their submission that the entire cancellation proceedings vitiate for non compliance of the principles of natural justice, particularly, when the first respondent has not chosen to furnish the documents relied upon by them to the appellants, the learned Single Judge, to satisfy himself whether the authorities below have exercised the decision making power conferred on them correctly, particularly when it was suggested that there was no search or seizure at all on 29.9.1999, called for the entire original files relating to the impugned proceedings and satisfied himself that the files would show the registration of the Crime, numbers and the recovery of spurious liquor bottles from the appellants shops on 29.9.1999 and that the appellants were also engaged in transaction of manufacturing illicit liquor bottles, printing labels and pasting them on the bottles filled up with spurious liquor. Thus, the learned Single Judge, by common order dated 12.12.2002 dismissed the writ petitions. Hence, these appeals.

3. Concededly, the appellants, except by way of formal bald denial, have not specifically denied the search or seizure on 29.9.1999 and the alleged irregularities. It is true that substantive rules of evidence based on principles of natural justice cannot even be ignored in the quasi judicial proceedings. There cannot be any quarrel as to the above proposition of law.

4. In the instant case, when show cause notices were issued to the appellants, specifically mentioning the violation of conditions 7 and 23 of the license and Rule 27 of the Rules, the appellants failed to submit their explanation specifically as to the alleged violation of the conditions of the license and the Rules. A bald denial would not justify the contention of the appellants that there was no search or seizure on 29.9.1999 by the authorities at all. At this stage, it is relevant to note that appellants did not demand copy of the FIRs or Mahazar reports when they submitted their explanation to the show cause notices.

5. On the other hand, when the appellants were given an opportunity of being heard by the third respondent, the entire records were available before him, but the appellants failed to avail the opportunity to peruse the same and raise their objections to the same. The appellants neither availed such opportunity before the Appellate Authority or the Revisional Authority.

6. When the revisional authority/first respondent, thus, examined the entire original records and came to the conclusion that the search and seizure on 29.9.1999 on the respective premises of the appellants is true and the same conforms with the entries in the FIRs and the Mahazar reports to arrive at the finding that the appellants were smuggling spurious liquor bottles, which were not supplied by TASMAC, and were selling the same in the licensed premises contrary to Conditions 7 and 23 of the license and Rule 27 of the Rules, the non availing of such opportunity of perusing the relevant materials relied on by the respondents by the appellants canot be now complained of.

7. It is a settled law that while exercising the power of judicial review the Court has jurisdiction to call for the records and satisfy itself whether the Tribunal has arrived at a finding based on no evidence or where the finding is inconsistent with the evidence or contradictory to it, has acted on material partly relevant and partly irrelevant or where the Tribunal draws upon its own imagination, imports facts and circumstances not apparent from record, or based its conclusion on mere conjectures or surmises, or where no person judicially acting and properly instructed as to the relevant law would have come to the determination reached and that in all such cases the findings arrived at are vitiated, vide CIT v. SHEKHAWATI RAJPUTANA TRADING CO. (P) LTD., [1999] 236 ITR 950.

8. In the instant case, the learned Single Judge rightly exercised such power of judicial review while confirming the orders of the respondents cancelling the license of the appellants and thus found that there was a search and seizure as claimed by the respondents on 29.9.1999 and that FIRs and the Mahazar reports disclosed that the appellants were smuggling spurious liquor bottles, which were not supplied by TASMAC, and were selling the same in the licensed premises.

9. Under such facts and circumstances, it may not be proper to hold that the impugned orders vitiate for violation of the substantive rules which form part of the principles of natural justice and as such, we do not see any violation of the principles of natural justice and the contention of the appellants in this regard is nothing but hyper-technical and therefore, we are unable to appreciate the same. Hence, finding no reasons to interfere with the order of the learned Single Judge, we dismiss these appeals. No costs.

sasi

To:

1. The Commissioner of Prohibition and Excise

Chepauk

Chennai 600 005.

2. The Collector of Chennai

Chennai 600 001.

3. The Deputy Commissioner of Excise

Chennai 600 001.

[PRV/10567]


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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