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Excise Superintendent Warangal And Others v. Deluxe Bar And Others

Excise Superintendent Warangal And Others
v.
Deluxe Bar And Others

(Supreme Court Of India)

Civil Appeal Nos. 5993 of 1997 - 6068 of 1997 | 06-12-2000


This order will dispose of the batch of appeals filed by the State impugning the judgment of the Division Bench of the High Court of Andhra Pradesh dated 6th March, 1992.

Respondents are amongst holders of wholesale licence (FL 15), retail licence (FL 24), bar licence (FL 17), storage licence for godows (FL 19) as well as distributors licence (FL 27). These licences have been issued to the respondents under the Andhra Pradesh Excise Act, 1969 (hereinafter referred to as the "Act"). During the currency of the block of 5 years for which the licence was valid, the State Government issued G.O.M.S. 160. Revenue (Ex. III) dated 3rd March, 1990 amending Schedule to the Andhra Pradesh Foreign Liquor Indian Liquor Rules, 1970 (hereinafter referred to as the Rules) framed under the Act, whereby licence fee in respect of wholesale licence for the sale of all kinds of Indian liquor, including those which were not consumed on the premises, bar licences, storage licences, club licences and retail licences were enhanced. The enhancement was directed to come into force w.e.f. 1st April, 1990 in the G.O.M.S. itself. An Excise Year has been defined under the Act as an year commencing 1st October and ending 30th September. In the G.O.M.S., enhancement was not made retrospectively commencing with the current Excise Year. However, on demand being raised for enhanced licence fee for the period 1.4.1990 to 30.9.1990, G.O.M.S. No. 160 dated 3rd March, 1990 was put in issue by the respondents through several writ petitions. A Division Bench of the High Court upheld the contention of the respondents that the State Government could not collect increased licence fee during the middle of Excise Year as also the contention that the enhancement was arbitrary. The Division Bench, however, rejecting the contention of the State held that the enhanced licence fee which was made effective from 1st April, 1990 could only apply from the beginning of the next Excise Year, i.e. 1st October, 1990 irrespective of the fact that it was still within the block of 5 years. It is this finding, which has been put in issue by the State Government, before us through this batch of appeals.

The argument of learned senior counsel for the appellant-State raised before us which was also canvassed before the High Court is that in view of Clause (iv) of the counterpart agreement which was required to be entered into under Section 29 of the Act read with Rule 30(3) of the Rules, the licensees fee, gallonage fee, excise duty and security deposit or any enhanced licence had bound themselves to pay the licence fee, gallonage fee, excise duty and security deposit and the like levied from time to time and therefore the licensees could not challenge the enhanced licence fee levied from time to time during the validity of their licence.

We are unable to agree. A perusal of Rules 24 and 25 of the Rules speak of the annual licence fee being charged from the licensees. This annual character of the licence fee has to be considered as licence fee for an Excise Year, i.e., for a period of 12 months commencing from 1st October and ending 30th September of the following year. Once the annual licence fee is enforced at the commencement of the Excise Year and has either been paid by the licensee or agreed to be paid in six bi-monthly installments, a the right of the licensee to operate that licence for that Excise Year gets crystalised and that right cannot be put in jeopardy during the subsistence of the concerned Excise Year. The rule making authority, was apparently, conscious of these Rules and therefore, while formulating G.O.M.S. No. 160. Revenue (Ex. III) dated 3rd March, 1990 categorically stipulated that "The amendments hereby made shall come into force on and from the first April, 1990". The Division Bench of the High Court while dealing with this aspect rightly observed.

"It should also be noted that the amendment to the Schedule introduced by G.O. 160 dated 3.3.1990 is not retrospective in operation as is the case with G.O.M.S. No. 74 dated 1.2.1990 relating to licence fee on distilleries. At any rate, there is no clear language in the amended provision which go to show that the enhancement will affect the existing licensees during the year itself. It cannot therefore be said that the increased quantum of licence fee brought about by the impugned G.O. should be projected into the Schedule of rates prevalent at the beginning of the year. Thus, viewed from any angle, we should uphold the contention of the learned counsel for the petitioners and hold that the enhanced licence fee introduced by the impugned G.O. will only be operative after the end of the excise year, i.e., after 30.9.1990 and for the excise year beginning from 1st October, 1990, the licensees have to pay the increased licence fee ten days before the commencement of the excise year (1990-91) as enjoined by Rule 25. The increased licence-fee will also be applicable to the licences issued on or before 1.4.1990 i.e. the date on which the impugned G.O. has come into force".

We are in complete agreement with the above view. In fiscal matters, the provisions are required to be strictly construed and there is no scope for looking to the unexpressed intendment.

We, accordingly, uphold the finding of the High Court to the effect that enhancement of the licence fee by G.O.M.S. 160 dated 3rd March, 1990 becomes effective only from 1st October, 1990 and that enhanced licence fee can be collected from the respondents w.e.f. 1st October, 1990 notwithstanding the fact that the block of 5 years for which they had obtained licence, had not yet expired. The impugned judgment is well considered and sound. We do not find any reason to interfere with the same.

These appeals, therefore, fall and are dismissed. However, we leave the parties to bear their own costs.

Advocates List

For

For Petitioner
  • Shekhar Naphade
  • Mahesh Agrawal
  • Tarun Dua
For Respondent
  • S. Vani
  • B. Sunita Rao
  • Sushil Kumar Pathak

Bench List

HON'BLE JUSTICE DR. A.S. ANAND (CJI)

HON'BLE JUSTICE R.C. LAHOTI

HON'BLE JUSTICE SHIVARAJ V. PATIL

Eq Citation

(2001) 9 SCC 497

LQ/SC/2000/1946

HeadNote

Excise — Andhra Pradesh Foreign Liquor Indian Liquor Rules, 1970 — R. 24 or 25 — Annual licence fee — Enhancement of, during currency of block of 5 years for which licence was valid — Effect of — Held, once annual licence fee is enforced at commencement of Excise Year and has either been paid by licensee or agreed to be paid in six bi-monthly installments, right of licensee to operate that licence for that Excise Year gets crystalised and that right cannot be put in jeopardy during subsistence of concerned Excise Year — Division Bench of High Court rightly held that enhanced licence fee introduced by G.O.M.S. No. 160 dt. 3.3.1990 would only be operative after end of Excise Year, i.e., after 30.9.1990 and for Excise Year beginning from 1.10.1990, licensees have to pay increased licence fee ten days before commencement of Excise Year (1990-91) as enjoined by R. 25 — Andhra Pradesh Excise Act, 1969, Ss. 29 and 31