SAMBASIVA RAO, C. J.

(1) ON 17th of September, 1974, some of these cases came up before Obul Reddi, C. J. and Ramachandra Raju, J. The respondents in the Writ Petitions, viz. , the government of Andhra Pradesh and the excise authorities relied on the Division bench judgment reported in Commissioner of Excise v. P. Bhogeswara Rao. The petitioners, however, canvassed the correctness of that decision. Consequently, the learned Judges directed these matters to be posted before a Full bench.

(2) THESE cases relate to denatured spirit. We may treat Writ Petition No. 973 of 1974 as a typical case The relief sought in it is to issue a writ of mandamus directing the respondents to act according to law without reference to board Circular Cr. No. 36759 Ex. /73/b. 3 dated 11th January, 1974, by suitably amending D. S. VII, IX and XI licences incorporating the normal annual quantity possessed by the petitioner in the previous years and to direct them for granting necessary transport and import permits for the said normal annual quantity enabling the petitioner to obtain supply from any distillery of his choice either in the State or outside the State.

(3) THE allegations made in the writ petition seeking the above relief are as follows :- The petitioner is a dealer in denatured spirit under D. S. VII, IX and xi licences granted to him by the Excise superintendent, Nellore, and renewed from time to time for many years. The quantity which may be possessed by the licensee during a particular year is mentioned in the licence. D. S. VII, IX and XI licences were given to him for 67,183, 60,000 and 45,460 litres respectively. The petitioner was getting the licences renewed every year for the same quantity. In 1973, transport permits required to lift the quantities of the spirit were not issued to the petitioner, aggrieved by which he filed W. P. Nos. 12 and 13 of 1973. This Court directed the granting of those permits and accordingly the petitioner lifted the entire quantity during the year 1972-73. As per the a. P. Denatured Spirit and Spirituous preparations Rules, 1971, which govern issue of the licences the respondents arc concerned only with the grant of licence and not with the total quantity of the spirit that is desired to be possessed by the licensee. The authorities have no discretion but to grant a licence for the quantity to which the applicant desires to possess during a particular licence year. Further condition No. 5 in D. S. VII licence provides that a licensee shall obtain his supplies of the spirit from (ay distillery in a State, (b) the holder of a similar licence and (c) from outside State by import. Condition No. 3 in D. S XI licence also is practically to the same effect. An import permit has to be obtained according to the manner prescribed in rule 7. The Excise Collector has to issue such permits. The provisions of the Excise Act and the rules show that the respondents have no power to fix the quota; nor are they under any obligation to supply the denatured spirit to the licensee as stated in the licences. Their only power is to grant licences and permits and that is with the sole object of regulating the business of the licensee and to have a check or supervision to see that the provisions of the Act and the rules are not violated. Likewise, obtaining of transport and import permits is required with a view to supervision and check the business activities of the licensee. The licensee alone has to make arrangements for obtaining the supply of the spirit from the sources mentioned in the conditions of the licence. It is the tash and responsibility of the licensee to obtain supply of the spirit up to the quantity mentioned in the licences from any source of his choice mentioned in the conditions of the licence. The respondents have no power to impose any cuts in the quantities mentioned in the licences or while renewing them for the succeeding years. However, in Commissioner of Excise v. B. Bhogeswara Rao, a Division Bench of this Court upheld the contention of the respondents that from year to year the authority could determine the quotas while granting licences or renewing them keeping in view the total production of the commodities in a given year and the competitive requirement of the society. It was held in the same decision that the cuts imposed by the respondents were not unreasonable and the priority fixed could not be said to be based on no principle and that it is arbitrary. The stand taken by the respondents in those matters before the Division Bench was that the production of alcohol in the state was not sufficient to meet the requirements of the licensees and for that reason they imposed cuts on the basis of priorities in G. O. Rt. No. 616 dated 12th april, 1972 and G. O. Rt. No. 115 dated 23rd February, 1972. At the same time they stated that they had no objection to issue import permits to any licensee who applied for it. In substance, the stand taken by the respondents in the cases before the Division Bench was that having regard to the exigencies of the stock position in the State, they would impose cuts on priority basis, but allow the licensee to obtain supply from outside the State if they so chose. The petitioners were not parties to that judgment and in any case the decision is not correct and requires reconsideration. It is the duty of the respondents to mention the normal annual quantity desired to be possessed by the petitioner under a licence and unless the quantity is mentioned it is impossible for the Collector of Excise to issue import permits. For the sugar year 1973-74, the Government of Andhra Pradesh issued instructions to impose a cut of 80 per cent on priority basis on supply of denatured spirit to the licensees from the stock manufactured in the distilleries in this State. Even according to this, the respondents should have renewed the licence of the petitioner mentioning the quantity he seeks to possess and issued transport permits only in respect of 20 per cent of the quantity mentioned therein. There is another complication created by the Commissioner of Excise by issuing instuctions dated 11th january, 1974, to the Superintendents to renew D. S. licences for 100 bulk litres per month under D. S. VII and IX licences and 200 bulk litres per month under D. S. XI licence. This fixation of flat rate is unreasonable, arbitrary and opposed even to the instructions issued by the Government. If all these instructions and cuts imposed on their basis are implemented, no licensee can carry on his business. With the consequence, the Excise Superintendent, who is the subordinate to the Commissioner of excise, renewed the licence of the petitioner for 1973-74 fixing the quantities at 100, 100 and 200 bulk litres per month, respectively, for D. S. VII, IX and XI licences. With this quantity the petitioner was unable to carry on any business as he was prevented from obtaining supplies. That is because the petitioner, who has been obtaining a supply of 1,72,643 bulk litres per year is now asked to carry on his business with 4,800 bulk litres only. He is ready and willing to obtain supplies of the spirit from outside the State. Because of the attitude taken by the respondents no import permits have been issued. There are enough stocks in the distilleries in the State and the cut of 80 per cent imposed by the Government is unreasonable and has no rational connection with the stock availability situation. Moreover, when a cut of such severe dimension is imposed on D. S. licensees, no such restrictions have been placed on the arrack contractors. Arrack, denatured spirit and rectified spirit arc all alcoholic liquids, though they are manufactured through different process. All of them are liquors which are intoxicants. The petitioner feels that all these cuts are imposed on D. S. licensees for the purpose of favouring the arrack contractors. There is no provision under the A. P. Denatured Spirit and Spirituous preparations Rules, 1971, empowering the excise Commissioner to impose any cut in the quantities mentioned in the D. S. licences. It is on the basis of these allegations that the reliefs mentioned above are sought by the petitioner.

(4) THE respondents jointly filed a single counter-affidavit in all the writ petitions. They allege that some of the wholesalers of D. S. licensees were clandestinely neutralising the spirit and selling it for the purpose of conversion into illicit arrack. It was such spirit that was the cause of the Suryapet tragedy. That apart, the Commissioner of Excise, who is the Chief Licensing Authority, has to see to the equitable distribution of the commodities among the various type of consumers in the State. Owing to acute shortage of molasses in the State there was a steep fall in the production of rectified spirit, which is the basic raw material for the denatured spirit and arrack. Even in 1972-73 the Government issued an order directing the Commissioner of Excise to impose cuts ranging from 50 per cent to 80 per cent on the basis of the priorities mentioned therein though the G. O. was questioned in a number of writ petitions, a Division bench of this Court upheld the cuts holding that the Commissioner had such power (it may be noted here this is the decision reported in Commissioner of excise v. B. Bhogeswara Rao the correctness of which ts canvassed now. Since the rectified spirit is the basic material, rules relating thereto have an over-riding effect on the denatured spirit rules also. Rules 21 and 23 of the Rectified Spirit Rules confer ample power on the Commissioner not only to restrict the allotment of the rectified spirit, but also to amend or alter or even tender to the licensee a new licence in accordance with any new condition with may be prescribed. However, the respondents felt that the imposition of 80 per cent cut might work hardship on smaller licensees who were doing legitimate business. The respondents fixed the flat rate of 100 or 200 litres with the intention of holding the balance between the bigger and smaller licensees. There has been a shortfall in the production of alcohol and the State was obliged to import 50 lakhs litres of rectified spirit from other States. This year the prospect is gloomy and it appears to be more difficult to get imports from other States. It is in view of this shortage of alcohol the impugned order was passed. So, it cannot be said to be arbitrary. The demand has outrun supplies and so the need for equitable distribution on rational basis in the interests of the society has arisen. The State has got power to regulate the possession of the commodity and it is a reasonable restriction warranted by the exigencies of the situation in the state. The imposition of stop cut is an economic necessity. The contention that the respondents are to fix the quantity of the commodity as desired by the licensee and it is the lookout of the licensee to obtain the quantity is untenable. If every licensee is given whatever quantity he desired and is also given a free hand in obtaining the quantities of spirit from whatever source he liked, it would defeat the very purpose of the rules and lead to an impossible situation. The argument that the petitioner should obtain the quantity he desires by import and whatever quantity applied for by him should be incorporated in the licence is contrary to the rules. The petitioner has to obtain a permit from the respondents if he is to import denatured spirit from outside the State. The respondents would not be able to import the required amount of rectified spirit to make up the existing shortfall. They are, however, willing to consider individual applications for import of rectified and denatured spirits to the extent possible. But no licensee can insist upon being given an import permit for the entire quantity mentioned in his licence This clamour for denatured spirit is patently for the reason that licensees could purchase that spirit at the cheap rate of 42 paise per litre and sell the same after neutralising it to chronic drunkards at highly profitable rate of Rs. 12 to Rs. 14 per litre. This has paralysed the business of the legitimate arrack contractors. The bench decision of this Court referred to above lays down the correct legal position. So, the reliefs sought by the petitioner are untenable and cannot be granted.

(5) BROADLY analysed the contentions of the petitioners are : The respondents are bound to state in the licences (D. S. VII, IX and XI) quantities of which the applicants seek to be in possession of. After issuing licences also they have no power to impose cuts and reduce quantities In other words, the respondents have no power to regulate the sale and distribution of denatured spirit. They have no power either to issue and renew licences for quantities of denatured spirit less than those for which the dealers apply for, or to impose cuts on the quantities for which licences have been issued, on the ground of lack of adequate quantities of the spirit and its equitable distribution. That is for the reason that the respondents have no duty or responsibility to supply the licensees with the quantities for which licences have been given or renewed. It is the lookout of the licensees to secure their supplies from distilleries in the State or outside the state or from wholesale dealers according to their own arrangements. When they are able to secure supplies, the respondents are bound to issue transport permits for such quantities. If, on the other hand, the licensees cannot arrange for the supplies up to the limit of the quantities mentioned in the licences, they will have to face the consequences and they cannot call upon the respondents to furnish them with. the supplies as mentioned in the licences. Under the guise of scarcity of denatured spirit, the respondents have no power to refuse import permits and cannot interfere with the trade of the petitioners while issing transport permits and justify the lame that it has been done with the object of equitable distribution.

(6) THE respondents, on the other hand, maintain that denatured spirit is one variety of alcohol and an intoxicant. Firstly, in the interests of the community, the respondents can impose reasonable restrictions on the manner in which the dealers in denatured spirit carry on their trade. Further, denatured spirit is required for industrial purposes like manufacturing French polish," etc. Alcohol is a commodity in which the Government has monopoly for supply and distribution. It is its exclusive right and privilege to control manufacture, sale and distribution of all alcoholic products. The law confers these powers on the Government and its appropriate officers. Consequently, the respondents have power to grant licences for denatured spirit according to the availability of the spirit in the state and outside. Within the State the government has got absolute monopoly in regard to manufacture and distribution. In so far as supplies from other states are concerned, the Union Government is making allocations and the respondents are to import denatured spirit and other spirits according to the allotments made by the Union Government. Law has conferred adequate powers on the respondents to issue and renew permits for denatured spirit also according to its availability and to regulate its supply and distribution as the exigencies of the supply position require and according to the requirements of all the licensees in the state. In order to enforce equitable distribution of available quantities and also to avoid abuse of the use of the denatured spirit, the respondents have power, under the law, to regulate supply and distribution of denatured spirit. It is in pursuance of that power that quantities have been reduced in the licences renewed, cuts were imposed and transport, permits for limited quantities issued.

(7) IT is of particular significance to note that all the writ petitions relate to the excise year 1973-74. Excise year starts from 1st October, and ends with 30th September of the succeeding year. So much so, the excise year of 1973-74 commenced on 1st October, 1973 and ended with 30th of September, 1974. That means the writ petitions have come up for disposal after the expiry of the excise period for which these reliefs are sought. The petitions were, however, filed long before the completion of the year. For example, W. P. No. 973 of 1974 was filed on 17th February, 1974. A Division Bench of this Court directed that they should be posted for final disposal in April, 1974 itself. The exigencies of the work of this Court have, however, made it impossible to dispose of these writ petitions earlier than this The learned Government Pleader wants to take advantage of this circumstance and urges that all the writ petitions should be dismissed as having become infructuous. The petitioners reply to this by pointing out that they have also sought a direction to the respondents to act according to law without reference to board Circular dated 11th January, 1974, by suitably amending the three licences for denatured spirit incorporating the normal annual quantity possessed by them in the previous years and to direct them for granting necessary transport and import permits for the normal annual quantity enabling them to obtain supplies from any distillery of their choice either in the State or outside the State. They say that if the law is declared on there reliefs sought by the petitioners, they would get the required relief at least in respect of succeeding years, even if directions cannot be issued for the year 1973-74. In fact, a contention is raised that even if the year is over, the petitioners would still be entitled for reliefs and permits to be granted also in respect of 1973-74. We are inclined to accept the stand taken by the petitioners and to accede to their request for declaring the law on the subject, so that their right in regard to licences for denatured spirit is placed beyond the pale of doubt or controversy. If the law is declared, that would be sufficient relief for the petitioners as their rights for the suceeding years would be governed by it. We will also deal at the appropriate place of this judgment, with the question whether the petitioners could be properly given any reliefs for the year 1973-74 which has expired.

(8) THE questions canvassed are to be decided on the basis of the Andhra Pradesh Excise Act, 1968, and the relevant rules made thereunder and in particular, the Andhra Pradesh Denatured Spirit and denatured Spirituous Preparations Rules, 1971. The respondents take their stand on the Bench decision in Commissioner of excise v. B. Bhogeswara Rao. But that is not the first announcement of this court on the subject. In. W. P. No. 5931 of 1972 Chinnappa Reddy, J. , by his order dated 14th March, 1973, sitting single, dealt with a similar question. The learned judge held that from a reading of the provisions of the Act and the Rules it is clear that none of them has anything to do with the equitable or effective distribution of denatured spirit. The Excise Superintendent, if he is approached for the grant of a transport permit under rule 12, cannot refuse to grant him a permit on the ground that the stock of denatured spirit available with the distillery is required by others whose need is greater. That is not a matter at all which concerns the authorities exercising powers under the excise Act or the rules made under the excise Act. The authorities are under no obligation to arrange or procure the supply of denatured spirit for the licensee from any distillery. Nor is there any obligation on any distillery to supply denatured spirit to persons producing transport permits. It is for the licensee to make his own arrangements for the supply of denatured spirit from a distillery if it is considered necessary to secure an effective or equitable distribution of denatured spirit among various consumers it is open to the Government to take appropriate action under other suitable statutes such as the Essential Commodities act The attempt to regulate the distribution of denatured spirit by means of transport permits is nothing but a misuse of the Excise Act and the Rules. That is how the learned Judge has enunciated the law. M. Krishna Rao, J. , took the same view in his decision dated 26th march, 1973, in W. P. No. 4820 of 1972, though a few new contentions not raised before Chinnappa Reddy, J. , were raised before him. In W. P. No. 547 of 1973 and batch Obul Reddi, J. , (as ho then was)followed these decisions in his order dated 28th March, 1973. The decisions of M. Krishna Rao, J. , in W. P. No. 4820 of 1972 and another writ petition were carried in appeals and these are the writ appeals which were disposed of by Gopal Rao ekbote, G. J. and Lakshmaiah, J. in commissioner of Excise v. B. Bhogeswara rao. 1 The learned Judges reversed the decisions and allowed the appeals. They observed :"it may be that the alcohol from which these commodities are manufactured or the said commodities do not belong to the Government but that does not mean that the Government has no power to control and regulate scarce commodities such as we are concerned in the interests of social needs. The conception that the Government can control and regulate its own products and not products belonging to others is totally misconceived. Consequently such a control can be effectuated through both the devices of licenses and transport permits. "in further enunciation of the law the learned Judges proceeded to state: "the scheme of the Act and the variour provisions referred to above, in our judgment, clearly provide guidelines both for fixing the quota as well as the priority. After all the various requirements of the society for which these commodities are required are well known. There can be no difficulty in fixing their relative priority in view of their importance to the society. Therefore, the provisions are not bad in view of Article 14 of the Constitution. After examining the relevant data relating to the availability and their needs, the cuts imposed are not unreasonable and the priority fixed cannot be said to be based on no principle or is arbitrary or fanciful. In this view, the learned Judges concluded by saying "the scheme of the Act and the provisions referred to above not only empower the authority to fix quota and "determine priority but in order to effectuate such a policy, the authority can impose cuts in the supply of these commodities. In other words, from year to year the authority can determine the quotas while granting licenses or renewing them keeping in view the total production of the commodities in a given year and the competitive requirements of the society. "it will be evident from the above passeges that the counter-affidavit of the respondents and the stand they take in these writ petitions are founded on the conclusions of the Division Bench. To complete the reference to the decided cases on this point, so far as this Court is concerned, we may refer to the decision of Muktadar, J. , dated 14th august, 1974 in W. P. No. 4467 of 1974, where our learned brother followed the Bench decision and held that the insistence of the authorities that the petitioner (licensee) should obtain a letter of recommendation from the industries Department was perfectly justified. In Writ Appeal No. 669 of 1974 against this order, Obul Reddi, C. J. and Krishna Rao, J. , affirmed this view following the Bench decision.

(9) WE will have to logically look to the Andhra Pradesh Excise Act, 1968 and the Rules made thereunder to find out answers to the questions posed before us. In fact, it was only on a construction of the Act and the Rules the decisions referred to above, taking diverse views, were rendered. It could not be otherwise. Let us first examine the purpose and nature of the Excise act. Is it purely a fiscal enactment or a piece of social legislation as well. The preamble to a statute generally indicates the scope and ambit of the Act. The excise Act, in its preamble, declares that it is to consolidate and amend the law relating to the production, manufacture, possession, transport, purchase and sale of intoxicating liquor and drugs the levy of duties of excise and countervailing duties on alcoholic liquors for human consumption and opium Indian hemp and other narcotic drugs and narcotics and to provide for matters connected therewith in the State of Andhra Pradesh. The intendment of collection of revenues by levy of excise and countervailing duties on alcoholic liquors for human consumption etc. , is manifest. There is also no doubt that the Act proposes to consolidate the law relating to the production, manufacture, possession, transport, purchase and sale of intoxicating liquors and drugs. As could be seen from the Act and the Rules made thereunder, some of the intoxicating liquors and drugs are not subjected to excise and countervailing duties All the same, the law proposes to control manufacture, possession, transport purchase and sale of intoxicating liquors and drugs. These need not necessarily be for human consumption, for in the first part of the preamble those words do not occur and only when the levy of excise and countervailing duties are mentioned, reference is made to alcoholic liquors for human consumption. The logical conclusion from this is that the provisions in the Act relating to the production, manufacture, possession etc. , can be also in respect of intoxicating liquors and drugs which are not fit for human consumption. Some of them might be essential for industrial and other purposes though they are unfit for human consumption. It is thus seen from the preamble itself that the act is also a piece of social legislation, in addition to being a revenue gathering fiscal enactment. The expression "intoxicating drugs," "liquor" and "intoxicant" are all defined in section 2. We are here concerned with denatured spirit. Section 2 (8) defines "denatured" as meaning "subjected to a process prescribed for the purpose of rendering unfit for human consumption". The expression "intoxicating drug" includes "ganja and any other intoxicating or narcotic substance which the Government may, by notification, declare to be an intoxicating drug. Sections 9, 10, 11 and 12 lay down that no intoxicant shall be imported, exported and transported without permits. Section 13 prohibits manufacture, collection etc. , of an intoxicant except under the authority and subject to the terms and conditions of a licence granted by such officer not below the rank of an Excise Superintendent as may be prescribed. Section 14 forbids possessing any intoxicant in excess of the quantity specified in sub-section (1) thereof. Under section 15 no person shall ell or buy any intoxicant except under the authority and in accordance with the terms and conditions of a licence. Section 16 seeks to regulate to the establishment of distilleries and warehouses. Section 17 empowers the Government to grant a lease for the supply, manufacture or sale of an intoxicant. From section 21 onwards, provision is made for levying excise and countervailing duties of excisable articles. Section 25 prescribes the form and conditions of licence and section 31 confers power on the appropriate authority to cancel or suspend licences in certain circumstances. Chapter VII provides for offences and penalties for contravening the conditions of the licence. Chapter VIII relates to detection, investigation and trial of offences. Section 72, under which the Government has the power to make rules, in clause (d) of sub-section (2)empowers the Government to make rules regulating the import, export, transport, manufacture, cultivation, collection, possession, supply or storage of any intoxicant. Those rules may also declare the process by which spirit shall be denatured and the denaturation of spirit ascertained and to cause spirit to be denatured through the agency or under the supervision of its own officers. All these provisions amplify the purpose of the legislation as succinctly indicated in the preamble. The conclusion that the Act is a social piece of legislation, in addition to being a revenue raising enactment, is thus logical and even inescapable.

(10) TO say it is one thing and to hold that the Act and the Rules provide for regulation and control of the supply, distribution, import, export and consumption of denatured spirit is altogether another thing. It is essential to note that the Act deals with a large variety of intoxicating liquors, drugs and narcotics which are fit both for human consumption as well as unfit for that purpose. That is why we find unusually large variety of rules made under the Act. These rules cover not only a large field but also a rich variety of drugs and spirits. It is of utmost import to notice that different sets of rules are made for different kinds of spirits. For instance, separate rules were made in the name of "the Andhra Pradesh Denatured Spirit and Denatured spirituous Preparations Rules, 1971 , to deal with denatured spirit. Likewise rules are made for rectified spirit, for arrack manufacture, for sale of neera, for controlling distilleries, etc. A reading of the Act and the different sets of rules made thereunder establishes the salient fact that the law thus enacted deals with different intoxicants and spirits in different ways. Excise and countervailing duties are levied under section 21 as we already noted; but they are levied only on exercisable articles at such rates not exceeding the rates mentioned in the schedule to the Act and as may be specified in the notification. It is significant to note that denatured spirit is not one of the excisable articles included in the schedule to the Act, though rectified spirit is one. We are informed by the learned Government pleader also that there is no notification imposing excise or countervailing duty on denatured spirit. We are pointing out this only to demonstrate that denatured spirit is treated in a different way from - other alcohols and spirits. We have already referred to the definition or the word "denatured" contained in the act. Coming to the definition of "denatured spirit" in the Rules contained in rule 2 (c) of the Denatured Rules it is defined as specifically denatured alcohol specified in the schedule and includes spirit subjected to any of the processes mentioned in the clause rendering it unfit for human consumption. The schedule to the rules lay down the formula for specially denatured alcohol. The schedule enumerates quite a large number of such denaturants for the manufacture of which denatured spirit is necessary. It is thus seen that though denatured spirit is alcohol it is rendered, through processes mentioned in the rules unfit for human consumption and it is intendeds obviously for industrial and other purposes. Rule 3 of the Rules specifically says that no excise or countervailing duty is leviable on denatured spirituous preparations except the gallonage fee at the rate of Re. 1 per gallon on the quantity obtained by the licensee from a distillery within the State. That gallonage fee however shall be paid by the licensee before a transport permit is granted under the provisions of the rules.

(11) WHAT is equally significant is that the Denatured Spirit Rules have their own provisions relating to possession, transport, import, export, sale, licence for possession and procedure for obtaining licences and their renewals. Even the forms prescribed for all these purposes under the Denatured Spirit Rules are different from forms for other purposes under the Act What we are trying to emphasis is that the law, i. e. , the Act and the Rules, treats denatured spirit differently from other alcoholic liquors and spirits. So, it would be wrong to adjudge the questions relating to licences, permits, etc. , concerning denatured spirit in a general way. They will have to be decided with specific reference to the special provisions in the Act and the rules relating to denatured spirit. The provisions in the Act concerning intoxicants will have to be understood and applied to the denatured spirit only in the light of the Denatured Spirit Rules. The learned Government Pleader emphasises on the fact that denatured spirit is also an intoxicant and intoxicating drug and so all the rules and regulations which pertain to such intoxicating drugs must be imported into the consideration of the questions relating to denatured spirit. In particular, he wants to refer to and rely on rules 21 and 23 of the rectified Spirit Rules in order to sustain his argument that the licensing authority has ample power to amend or alter any licence and to impose any restrictions and quotas as might be necessary, depending on the availability of the spirit. He draws inspiration for this argument from the observation of the Division Bench in Commissioner of Excise v. B. Bhogeswara Rao. In our view this is wholly unwarranted. What prevented the rule-making authority from including rules similar to rules 21 and 23 of the rectified Spirit Rules in the Denatured spirit Rules also, if they wanted to have powers of regulation as contemplated by those rules Rectified spirit is different from denatured spirit because according to the definition contained in rule 2 (k) of the Rectified Spirit Rules it is liquor containing undenatured alcohol of certain strength. Since it partakes of the essential nature of alcohol, the Act in its schedule includes rectified spirit fixing the maximum rate of excise duty leviable thereon. As we have pointed out denatured spirit is not one of the items included in the schedule. Thus there is a basic difference between denatured spirit and rectified spirit and it is wholly fallacious to import the rules relating to rectified spirit into consideration of problems relating to denatured spirit so, we will have to look only to the denatured Spirit Rules and the corresponding provisions of the Act for solving the problems that are raised.

(12) THE first claim of the petitioners is that they are entitled to be given licences for being in possession of any quantity of denatured spirit for which they apply. According to them the appropriate authority has no alternative but to give licence for the quantity mentioned by the applicant. The same applies to renewal of licences as well. They maintain that the authority is bound to gives and renew licences for quantities required by the applicants. On the other hand, the respondents contend that they have no such obligation and they are at liberty to permit the licensees to be in possession of such quantities of denatured spirit as are allowed by them. They can prescribe the quantity of the denatured spirit, while granting or renewing a licence, according to the availability of denatured spirit in the State and also having regard to the requirements of various industries and licensees. The respondents say that in order to have equitable distribution of denatured spirit which is becoming scarce as years roll by on account of the reduction in the available quantities of molasses, the need for equitable distribution is being felt. Since they have power to maintain equitable distribution and the supplies of denatured spirit are very limited, they can give or renew licence for any quantity that they think b Justified in the circumstances of the case.

(13) LETUS look at the Rules to find out which contention is correct and to what extent Rule 5 of the Denatured Spirit rules says that no person shall possess without a licence or permit under the rules Denatured Spirit or Spirits of the same nature in excess of three bulk litres. The licence for possession and use of denatured spirit in manufacture of french polish, varnish, etc. , for industrial purposes is provided under rule 12. That Rule says that the licence shall be in Form D. S. XI. The licence fee is Rs, 50 per annum. The licensee has to get his supplies from the distillery or a wholedsale licensee or from sources outside the State under an import permit. The licensee may use the products him self or sell them but it forbidden to sell denatured spirit. Rule 10 provides for wholesale licence for vending of denatured spirit and that shall be in Form d. S. VII. The licence fee therefore ig Rs. 150 per annum. Rule 11, in its turn, provides for retail licence which should be in Form D. S. IX for which licence fee is Rs. 25 per annum. Such a licensee shall obtain his supplies from the holder of a wholesale licence. He is required to sell the spirit in quantities not exeeding three bulk litres to any person at a time. There are other licences provided under rules 13 and 14 with which we are not now concerned. The rules themselves provide forms for application and licences for all these activities in denatured spirit. Rule 16 prescribes the procedure for obtaining licences. It requires every person desiring to obtain a licence to submit an application in Form d. S. XVII to the Excise Superintendent. If he desires to have more than one kind of licence he must submit separate applications. These licences are granted only for a period ending with the succeeding 3oth September. Sub-rule (5) of rule 16 lays down what the Excise superintendent, who is authorised to grant the licence, should do on receipt of of the applications. Before we refer to sub-rule (5) in detail, let us notice Form d. S. XVII which is the form for application of a licence. It requires details like the name of the applicant, his residential address, his company and other particulars like details of premises, applicants previous experience and details and other licences held by him. Column 4 requires the applicant to indicate the maximum quantity desired to be possessed in a year. So, the applicant, while applying, has to show in the application form the maximum quantity he desires to possess in a year. Now coming back to sub-rule (5) of rule 16, the Excise superintendent, on receipt of the application, may make such enquiries for verification of the details stated in the application and also such other enquiries as may be necessary and on being satisfied that the conditions for the grant of the licence applied for have been complied with, the Excise Superintendent may collect the licence fee and grant the licence. The other portions of sub rule (5) are only procedural and are not material, for the present discussion. So, on receipt of the application in Form D. S. XVI I, the Excise Superintendent may make enquiries for verification of the details stated in the application and also such other enquiries as may be necessary. It is only on being satisfied that the conditions for the grant of the licence applied for have been complied with, he has to grant the licence after collecting the licence fee. It would, therefore, be an unjustified claim on the part of the applicants to say that the Excise Superintendent is bound to grant licences when they apply for them and also for the quantities they indicate in their applications. There arc two enquiries contemplated by sub-rule (5) of rule 16. One enquiry is for verification of the details mentioned in the application. What those details are we have already mentioned. The excise Superintendent is also authorised to make such other enquiries as may be necessary. It is logical and reasonable to assume that such further enquiry would have a bearing on the applicants previous experience in the business and other businesses he has and the details of other licences held by him. It is not, therefore, unreasonable to hold, reading the application form in the light of rule 16 (5), that the Excise Superintendent can also make enquiries as to the actual requirements of the applicant for the quantity of the denatured spirit he has applied for. That means he can find out, through enquiry, whether the applicant bona fide requires the quantity of denatured spirit he desires to possess in a year. If, on such an enquiry, he is satisfied that his business and other lawful activities warrant the possession of the quantity of the spirit applied for, then, he has to give the licence as sought for. If, on the other hand, the Superintendent finds that the applicant does not bonafide require for his business or industry all that quantity which he desired in his application, he may reduce it according to his estimate of the requirements of the applicant. This conclusion is reinforced by the contents of Form D. S. XI, which is the Form for licence for possession and use of denatured spirit in the manufactures of french polish, etc. , and for industrial purposes. This Form is in accordance with rule 12. The following words in Form D. S. XI arc very significant and meaningful:"you. . . . . . . . . . . . . . . . at the premises situated at. . . . . . . . . . . . are hereby permitted to possess denatured spirit for use in the manufacture of the following commodities: (1) S. No. (2) Name of the commodity permitted to be manufactured. (3) Kind of denatured spirit Methyl alcohol permitted to be used in the manufacture of commodity mentioned in column 2 and the name of the denaturant. (4) Remarks. "columns No 2 and 3 in the table contain the words "permitted to be manufactured" and "permitted to be used in the manufacture of commodity mentioned in column 2 and the name of the denaturant. " The word "permit indicates certain amount of control in the licensing authority. The scope of that control will naturally have to be fixed in the light of the Rules and the forms. As we have already pointed out, that limit is only to find out the bona fide requirement of the applicant for his business and for his industry. The licensing authority has to give the licence for that quantity of denatured spirit as is, according to him, bona fide required by the applicant. That is why Form d. S. XI uses the words permitted to possess". The power of the licensing authority is obviously limited only to this extent, i. e. , to limit the quantity according to the bona fide requirements of the applicant as is ascertained on enquiry. There is no provision either in the Act or in the Rules or any indication in the forms that the licensing authority can reduce the quantity applied for on any other grounds. For instance, there is no warrant at all in the Rules to support the respondents contention that they can grant licences taking into consideration the position of the availability of denatured spirit or for purposes of equitable distribution. If that is intended, there is nothing which prevented the rule-making authority to have clearly stated so. On the other band rule 16 (5) cuts at the root of that contention. The Excise Superintendent may make only such enquiries for verification of the details mentioned in the application and also such other enquiries as may be necessary and he will have to be satisfied that the conditions for the grant of the licence applied for have been complied with. We must make it clear that we are deciding these cases as the rules stood during the relevant period. We are told that in December, 1974, i. e. , after the expiry of the excise year 1973-74, a new rule 29-A has been introducewd. Since that does not apply to the case, we are not considering that rule. Going by the Rules and the forms as they stood during the relevant period, there is no justification whatever for the respondents to appropriate to themselves the power to reduce the quantities of denatured spirit in the licences, saying that the available quantity of denatured spirit is less or that it is becoming scarce. Once the Excise superintendent is satisfied that the quantity applied for is in accordance with the bona fide requirements of the appellant, he is bound to give licence therefor. He has no alternative. The same thing applies for renewal of licences also. Rule 17 deals with renewals and it even goes to the extent of saying that if the licence is not duly renewed, though application therefor has been made as prescribed in sub-rule (1), the licensee shall have the right to carry on the business till its renewal is refused and the fact intimated. So, the same consideration applies to renewal of licence also. Simply because denatured spirit is also alcohol and one of the objects of the Excise Act is social welfare, it does not follow that the law, as the division Bench in Commissioner of Excise v. B. Bhogeswara Rao has said, has conferred power on the licensing authority to impose any reductions which, in its view, the exigencies of the supply position require. "with due respect, we are unable to agree with the view taken by the Division Bench in this behalf.

(14) FROM the reasoning and conclusion we have stated above flows the answer to the question whether the respondents can fix priorities amongst the different holders of licences for denatured spirit and impose cuts and reductions on the basis that the available stocks of that spirit are low and scarce. In W. P. No. 973 of 1974 the petitioner has been obtaining licences for the quantities applied for by him from 1965-66 to 1972-73. For the year 1973-74 his licence was renewed reducing quotas in the light of the communication from the Commissioner of Excise in Cr. No. 36759 dated 11th January, 1974. In those proceedings the Commissioner has referred to the boards proceedings dated 28th August, 1973 and directed all the Excise Superintendents to renew D. S. licences fixing for wholesale licences 100 bulk litres permonth or the quantity then held by the licensee whichever was less. The quota for french polish licences was fixed uniformly at 200 bulk litres per month or the quantity then held whichever was less Corresponding directions were given regarding retail licences. The government issued G. O. Rt. No. 397 dated 14th February, 1974, stating that the estimated production of alcohol in the current year was only 290. 25 lakh litres as against the demand of 591 lakh litres. The Government of India have also laid down certain priorities in the distribution of alcohol for its conservation and best use during the period of shortage. The G. O. proceeds to mention that the board of Revenue had suggested cuts during the previous year ranging from 50 to 80 per cent. So, the Government instructed the Board to release the quantities shown in column 5 of the schedule less the quantities, if any, already released on ad hoc basis for the first quarter of the Sugar year 1973-74 and not to revalidate the lapsed and time expired permits. The Government invited proposals from the Board for release of spirit for the rest of the year. It is in the light of these directions or instructions the quantities for the petitioners were fixed at the uniform rate of 100, 100 and 200 bulk litres, respectively under licences d. S. VII, IX and XI. The Division bench reviewed the provisions of the Act in relation to intoxicants generally and concluded that intoxicants being a rare commodity and capable of having deleterious and disastrous effects on the morals and health of the members of the society, are clearly intended to be controlled and regulated, which power includes power to prohibit their transport from one area to another The intoxicants can neither be transported without permits nor they can be manufactured, nor they can be possessed, purchased or sold without obtaining necessary licences and transport permits in that behalf. Then, relevant provisions of the Denatured Spirit Rules were referred to along with the rules governing rectified spirit. Referring to rule 23 of the Rectified Spirit Rules, the learned Judges thought that the same control and regulation contemplated by that rule of rectified spirit could be imported into the rules relating to denatured spirit by necessary implication. It was pointed out that there was no express rule in the denatured Spirit Rules fixing the quotas in view of certain considerations. But because Rectified Spirit Rules contain a provision like rule 23, similar power to control and regulate can be applied to denatured spirit also by necessary implication. This is the reasoning adopted by the learned Government Pleader before us also. With due respect to the learned judges, we arc unable to agree with this line of reasoning. We have said, more than once, that the Act deals with different alcohols and spirits in different ways and for that purpose different sets of rules were framed for different spirits. Denatured spirit differs from rectified spirit in essentials; while the former is unfit for human consumption the latter is not so. Excise and countervailing duties are leviable on the latter but not on the former. Consequently one has to look into the rules governing denatured spirit to find out whether there is any power of control and regulation conferred on the authorities in respect thereof. Because there are some rules providing for control! and regulation in the Rectified Spirit rules, it is not permissible to import them into the Denatured Spirit Rules by necessary implication. It is on the basis of this reasoning the learned Judges differed from the view expressed by ghinnappa Reddy. J. , in W. P. No. 5931 of 1972 on 14th March, 1973. Following their reasoning it was decided by the learned Judges that the scheme of the Act and that Rules empower the authority to fix quotas and determine priorities and in order to effectuate such a policy the authority can impose cuts in the supply of these commodities. They amplified this idea by saying that from year to year the authority can determine the quotas while granting licences or renewing them, keeping in view the total production of the commodities in a given year and the competitive requirements of the society. They, at the same time, recognised the fact that these commodities do not belong to the Government. Here, we may mention that the learned government Pleader asserted before us that all the denatured spirit produced anywhere in the State is the property of the Government. In order to support this very tall claim, the learned Government counsel relied on the Distillery rules where close control over the functioning of the distilleries though they are private is provided for. Simply because the distilleries are kept under keen supervision of the Government officials, it does not mean that the products of the distilleries are the properties of the Government. Nowhere in the Distillery Rules is there any provision conferring such property rights in the Government on the products. The aforesaid view expressed by the Division Bench that these commodities do not belong to the Government is also diametrically opposed to the contention of the learned Government pleader. Having said this, the learned judges proceeded to lay down that it does not mean that the Government has no power to control and regulate scarce commodities in the interests of social needs.

(15) WE are wholly disinclined to agree with this reasoning and view. It is of utmost importance to remember that nowhere in the Act and the Rules the responsibility and duty of supplying denatured spirit to the licensees is cast on the government and its offices. The Government is under no obligation to supply the quantity permitted to be possessed by licensees under their licences. It is entirely the lookout of the licensee to gather the material by himself. That is of course subject to the granting of transport and import permits and the payment of gallonage fee. When there is no obligation on the part of the respondents to furnish any supplies of denatured spirit to the licensees and the task of securing their own supplies up to the limit of the quantity mentioned in the licences is entirely on the licensee himself naturally it was thought that there was no necessity to control and regulate denatured spirit. Further it was not intended for human consumption. That is yet another reason for lack of control and regulation as is the case with the rectified spirit.

(16) THERE is nothing in the Act or in the Denatured Spirit Rules which empowers the Government and its officers to impose cuts or to fix priorities. Not only that there is no such power at all but equally significant is the circumstance that there arc no guiding principles even by necessary implication, according to which priorities and cuts can be fixed and imposed. In the absence of any principles which guide the appropriate authority to fix priorities and impose cuts and fix quotas, the power to do so even if it could be implied, would be wholly illegal as it is highly arbitrary in its nature. On the other hand, when the very task of gathering his own supplies is that of the licensee himself and there is no obligation at all on the Government in this behalf, it is not permissible to imagine that the Act and the Rules provide for control and regulation of the denatured spirit, as rectified spirit is done under its own Rule. Rules 10, 11 and 12, which deal with wholesale, retail and manufacturers possessing licences respectively, declare that the licensee shall obtain his supplies from a distillery manufacturing denatured spirit under rule 4 or from another wholesale licensee in Form D. S. VII or from sources outside the State under an import permit. In regard to retail licence under rule 11, it requires the licensee to obtain his supplies from the holder of a wholesale licence in Form d. S VII. We emphasise on this provision in these rules to point out that it is for the licensee to secure his own supplies and it is none of the responsibility of the government to give him any supplies. Such being the case it is not possible to import something into the Denatured spirit Rules which is not there, viz. , that the Government has power to control and regulate the purchase, supply and distribution of denatured spirit and in exercise of that power it can fix priorities and quotas and impose cuts. Chinnappa Reddy, J. , took the same view in w. P. No. 5931 of 1972 in his order dated 14th March, 1973 and the same has been adopted by M. Krishna Rao, J. , in W. P. No. 4820 of 1972 dated 26th March, 1973. "we agree with and uphold that conclusion of the learned Judges.

(17) FOR the same reasons we repell the argument of the learned Government pleader that the Government has monopoly for distribution of denatured spirit produced in the State and also imported from other States. Nashirwar v. State of m. P. on which he places reliance, has no application to denatured spirit. That case refers only to liquor, which is used for human consumption. But denatured spirit is altogether a different type and its position has to be examined only in the light of the special rules made in that behalf. There is nothing in the A. P. Arrack Manufactory Rules or the A. P. Distillery Rules, on which also the learned Government Pleader relies, which confers such power of monopoly for distribution in the Government of denatured spirit. He invites our attention to rules 75, 76 78, 79, 84 and 86 in the Distillery rules; but what we find from them is that they are only intended to provide close supervision of the distillery and its production. Sub-rule (2) of rule 86 says that the distiller shall issue at the distillery to the Distillery Officer such quantities of spirits, rectified spirits, and denatured spirits as may be indented for by him for supply to arrack depots and such other places or persons as may be directed by the Deputy Commissioner or Commissioner. This is of no use to the respondents because it only shows that certain quantities of the spirits produced by the distillery will have to be issued according to the directions of the Deputy Commissioner or the Commissioner for certain purposes. That cannot mean that the Government has any monopoly for distribution of the distillerys products. On the other hand, this rule is against such a contention.

(18) OUR attention is also invited to rule 18 of the Denatured Siprit Rules which provides for transfer of or amendment to licence. Sub-rules (1) to (5) of rule 18 provide as to what should be done when the licensee transfers his business or enters into a partnership or his partnership is dissolved or if he wants to shift his business to another premises sub-rule (6) is particularly stressed before us by the learned Government Pleader to contend that the licensing authority has power to regulate the distribution and supply. It reads :"the licensing authority may, at any time, call for any licence and may amend or alter it or may tender to the licensee a new licence in accordance with any further conditions which may be prescribed. No correction in the licence shall be effective and valid unless ordered and attested by the licensing Authority. "from this the learned Government Pleader wants to infer that unlimited powers of control are bestowed on the licensing authority. We are not inclined to think so. Obviously, that sub-rule, occurring as it does in the context of transfer of or amendment to licences, is intended to empower the licensing authority to add any further conditions by way of amendment or alteration of the licence or by way of tendering to him a new one if new circumstances in the process of running the licensees business arise. The sub-rule cannot have a larger import than that. If it is read in the light of all the rules, it is not possible to read from it a wholesale power in the licensing authority to control and regulate the supply and distribution of denatured spirit.

(19) THEN remains the claim of the petitioners that the respondents should be directed to grant necessary transport and import permits to obtain supplies of denatured spirit from any distillery of their choice either in the State or outside the state. To briefly recall the contentions of the two sides, the petitioners maintain that according to the rules they are free to obtain their own supplies of spirits from any distillery in the State or from outside. Once they are able to find the source of supply, pay the gallonage fee and apply for transport permit, the respondents are bound to issue them. The Government, on the contrary, contends that they have full power to control the supply and distribution of denatured spirit also, whether it is manufactured in the State or outside. The Central Government is now fixing the quotas of denatured spirit to the various States depending upon the supply position and only such quantity as is permitted by the Central Government can be brought into the State from other states. Having regard to the requirements of the different licensees and to the availability of the commodity, the Government can issue transport or import permits and fix priorities as they think reasonable, in order to effectuate equitable distribution. The conclusions we have already reached furnish answer to this question as well. We have already noticed that there is no obligation on the part of the Government to supply the licensees with the quantities of denatured spirit which they are permitted to possess under the licenses. The licenses themselves will have to obtain the permitted supplies. If they are unable to do so, they will have to curtail their business or industiy to that extent. They have no right to call upon the Government to make up the balance. Considering the problem from this basic position, it could be logically concluded that if a licensee is able to secure a promise or an agreement from a distillery inside or outside the State and complies with the other requirements for granting a transport or import permit, it should be the duty of the appropriate Governmental authority to issue such permits.

(20) WE will do well to refer to the material provisions in the Rules. Rule 6 says that no person shall transport denatured spirit, etc. , in excess of quantities specified in rule 5 except under a transport permit. The transport permit authorises movement of spirit only within the state. Transport permit shall not be granted before payment of the gallonage fee, where the denatured spirits and similar spirits are obtained from a distillery by a licensee. Likewise, provision is made for import and that is rule 7. It provides that no denatured spirit or like spirits shall be imported except by the person or institution holding licence under the Rules and except under an import permit. No import permit is granted unless an import pass fees of 22 paise per bulk litre is paid. If the holder of a licence in Forms D. S. VII and d. S. XI desires to import denatured spirit from outside the State, he has to apply to the Collector in Form D. S. IV with a Court-fee stamp of Rs. 2. On receipt of the application, the Collector may, after making such enquiry as he considers necessary and on being satified that there is no objection to grant the import permit, require the applicant to remit the import pass fee on the quantity to be imported. On payment of the fee, the Collector may grant the permit. Rule 8 lays down the requirements and procedure for issuing export permits. We have already referred to rules 10, 11 and 12 under which granting of wholesale, retail and possession for industrial purposes licences is dealt with. They clearly declare that a wholesale licensee or a licensee for possession for industrial purposes has to obtain his supplies from a distillery manufacturing denatured spirit or from another wholesale -licensee or from sources outside the State under an import permit. A retail licensee has to obtain his supplies from the holder of a wholesale licence. Thus, not only the task of obtaining supplies but also choosing the source of such supplies from the enumerated list of sources is given to the licensee. It is no doubt true that rules 7 and 8 relating to import and export permits provide for an enquiry by the Commissioner as he may consider necessary. But in the very nature of things it could be a very limited enquiry as to whether the licensee is able to enter into an agreement with a distillery inside or outside the State or a wholesale dealer for supply of a particular quantity and whether necessary fee has been paid or not. This nature of the enquiry is further amplified by the words used in rules 7 and 8. That enquiry by the commissioner is to satsify himself that there is no objection to issue the import or export permit. Reading these two rules along with rules 10 to 12, it is clear that once these requirements of the rules are satisfied, the Commissioner has to issue the permits. Rule 3 provides for payment of gallonage fee on the quantity obtained by the licensee from a distillery within the State and it shall be paid before a transport permit is granted. The commissioner, before issuing the permit asked for, will have to make an enquiry in regard to the compliance with all the requirements. An examination of the forms appended to the Rules would also lead to the same condition.

(21) FORMS D. S. I and D S. II are for transport permit and application for transport permit, respectively. Form D. S. I, which is the one for transport permit, includes the details as to the name of the transporter, his address, details of licences held by him, authority or order under which the permit was issued, quantity to be transported, particulars of gallonage fee, place of destination, place of despatch, details of route and the date from which the permit is valid. Form D. S. II practically requires the same details. Form D. S. III is the Form for import permit. D. S. IV is the Form of application for such permit. The application requires details like the name of the applicant, full address, details of licence held, whether the applicant is a firm or not, purpose for which the permit is applied for, quantity, etc. , of the variety forming the consignment, place from which the consignment will start and the place to which it will reach, route of passage, details of import pass fee, and probable time required for transit only. The applicant shall also give a declarattion that he will be bound by the provisions of the Excise Act and the rules, that he will pay the gallonage fee and shall obey the rules and regulations in force within the local area through which the consignment passes. These forms would not show that an enquiry could be made as to the total availability of the denatured spirit in the country or the State or that the licensing authority could take that availability into consideration to reduce the quantity applied for. We have already referred to Form d. S. IX, XI and XIII. They do not indicate any power in the authority to regulate the supply and distribution on the basis of the availability of the spirit. Form D. S. XI, which is the licence for possession for industrial purposes, provides in condition that quantity ot denatured spirit possessed at any time and that used and consumed under the licence shall not exceed 25 percent of the quantity allowed for the year. Thus, going by the Rules and the forms, we only find the power in the appropriate authorities to see that the conditions laid down by the Act and the rules are strictly obeyed and followed and no other power. They certainly do not clothe the authorities concerned with the power to refuse transport and import permits from distilleries and wholesalers within the State or outside the State or to reduce the quantities applied for on the ground that the supply position does not warrant permitting transport or import of such quantity.

(22) IT is not as if the Government has no statutory power to issue orders treating denatured spirit as an essential commodity and controlling and regulating its supply and distribution. If they so want and are so advised, they can take recourse to the Essential Commodities Act and issue necessary orders treating denatured spirit as an essential commodity and then try to regulate its supply and distribution. But so far, they have not chosen to do so. So, that Act or the orders made thereunder do not render any assistance to them in regulation of denatured spirit. They will have to abide by the Excise Act and the Denatured Spirit Rules and consequently cannot refuse transport and import permits to the licensees once they comply with the requirements and conditions of the Act and the Rules and the forms made thereunder. On the one side the Government says that supplies of denatured spirit are wholly inadequate for the requirements of the society, while the petitioners state that there is abundance of supply, and illegal restraints are imposed on them. They can transport and import required quantities from inside and outside the State in accordance with the rules. We are not, however, concerned with the supply position. We can only declare the law as it emerges from the Excise Act and the Denatured spirit Rules. According to them, once the licensees conform to the rules, they are entitled to transport and import denatured spirit and the respondents are bound to issue permits, when they are satisfied that all the conditions are complied with by the applicants.

(23) THE petitioners also allege discrimination against them saying that some of the licensees have been given larger quantities of the spirit without imposing cuts. It is not necessary to go into that question in the light of the law we are declaring.

(24) THE last point we will have to decide is as to what relief the petitioners are entitled in these writ petitions. All of them relate to the excise year 1973-74 which expired with 30th September, 1974, Since the period has expired, the learned Government Pleader contends that the writ petitions have become infructuous and should be accordingly dismissed in their entirety. On the other hand, learned counsel for the petitioners, while contending that the declaration of the law can be made so that it would be a proper guidance for future years also, made a feeble attempt that even if the year has expired, all the reliefs can be granted to them since they acted expeditiously and diligently in filing the writ petitions in time. If the Court is unable to dispose of the writ petitions within the time, it is not their fault and they should not be penalised for it. But unfortunately for the petitioners the quantities which they seek are for the excise year 1973-74 which was over and another excise year is going on now. It is not permissible whatever our sympathies might be in view of the legal position and the diligent manner in which the petitioners had acted, to grant them the reliefs for the year 1973-74, since it would be ineffective and meaningless writs. We respectfully share the opinion of the Supreme court stated in Guruswamy v. State of Mysore thus :"we would therefore in the ordinary course have given the appellant the writ he seeks. But, owing to the time which this matter has taken to reach us a consequence for which the appellant is in no way to blame, for he has done all he could to have an early hearing, there is barely a fortnight of the contract left to go. We were told that the excise year for this contract (1953-54) expires early in June. A writ would therefore be ineffective and as it is not our practice to issue meaningless writs we must dismiss this appeal ,and leave the appellant content with an enunciation of the law". So, except enunciating the law, we cannot issue writs in respect of the year 1973-74 as prayed for. To this extent the writ petitions are allowed.

(25) WE may conclude this judgment by enunciating and analysing the legal position relating to denatured spirit in the following manner:1. Applications for fresh licences and renewal of licences shall be made by the applicants in accordance with the forms prescribed therefor. Licensing authority has to make an enquiry as to whether the application is in accordance with the rules and also whether the quantity of the denatured spirit applied for is bona fide required by the applicant for his business or for his industry. His enquiry is limited only to this and nothing more. Once he is satisfied about these matters, he has no alternative but to issue or renew the licence as applied for. If he, however, is satisfied on enquiry that the applicant does not bona fide require the quantity of denatured spirit for the year, the authority is at liberty to issue licence for that quantity which, in his reasonable opinion reached after enquiry, is bona fide required by the applicant. 2. There is no obligation on the part of the Government and its officers to supply the permitted quantity of denatured spirit to the licensees. It is the look out of the licensees themselves to secure supplies which are permitted to them. 3. If they arrange for such supplies either within the State or outside the state the licensee can apply for transport or import permits and the authority will have to issue those permits after satisfying itself that the requirements of such permits have been satisfied by the licensee. He has no power to refuse such permits or to reduce the quantities or impose cuts on any ground, including the one that the commodity is scarce in the country and that its equitable distribution is necessary. 4. The Government and its officers are at liberty to enforce the provisions of the excise Act and the Denatured Spirit rules and see that all the requirements are observed by the licensees. But they cannot travel beyond the powers conferred on them under the Act and the rules in order to further regulate the supply and distribution of denatured spirit To this extent we overrule the view taken in Commissioner of Excise v. B. Bhogeswara Rao

(26) HAVING declined to grant the reliefs as prayed for, for the year 1973-74 but having enunciated the law as required in the writ petitions, we direct the respondents to pay the costs of the petitioners since, in effect, they have succeeded. As the Supreme Court has observed in guruswamys case they have in reality won their cases and are prevented from reaping the full fruits of their victory because of circumstances for which they are not responsible. So, they are entitled to the costs.

(27) WRIT Appeal No. 673 of 1974, which is preferred by a licensee against an interim order, is dismissed as infructuous, as we have passed final orders in the main writ petition itself. There will be no costs in it. Advocates fee Rs. 50 in each case. All writ petitions allowed; declaration granted. W. A. No. 673 of 1964 dismissed as infructuous.