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Supreme Court of India
Suresh Chandra vs Joga Singh Bisht on 26 October, 2020Author: L. Nageswara Rao
Bench: L. Nageswara Rao, Hemant Gupta, Ajay Rastogi
Non-Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal Nos. 3539-3540 of 2020
(Arising out of SLP (C) No.11769-11770 of 2020)
SURESH CHANDRA
…. Appellant(s)
Versus
JOGA SINGH BISHT & ORS.
…. Respondent(s)
JUDGMENT
L. NAGESWARA RAO, J.
1. The Writ Petition was filed by the First Respondent in
the High Court of Uttarakhand at Nainital, challenging the
settlement of FL 5 Shop Pithoragarh No.1 B in favour of the
Appellant. The Writ Petition was dismissed by the learned
Single Judge on the ground that the First Respondent does
not have locus standi. Questioning the legality and validity
of the judgment, the First Respondent filed a special
appeal. A Division Bench of the High Court stayed the
operation and execution of the settlement of FL 5 Shop
Pithoragarh No.1 B in favour of the Appellant herein until
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further orders. The Appellant filed an application to vacate
the interim order, which was dismissed. Aggrieved
thereby, the Appellant approached this Court by filing the
above appeals.
2. Sh. Balkar Singh was allotted the licence for a foreign
liquor shop at Pithoragarh on 23.03.2020 by the District
Level Allotment Committee for the period from01.04.2020
to 31.03.2021. As the shop was not being operated from
06.05.2020, Sh. Balkar Singh was directed to open the
shop. He submitted an application on 12.05.2020
requesting for cancellation of the allotment of the shop.
On receipt of the said application, the authorities directed
Sh. Balkar Singh to surrender the licence in accordance
with the provisions contained in Section 36 of the Excise
Act after depositing the amount for first and second
instalments along with cancellation charges prescribed for
the Month of May, 2020. Balkar Singh did not respond to
the letter written by the authorities. The amount
deposited by the licensee, Sh. Balkar Singh, was
confiscated and the allotment of the foreign liquor shop
license in his favour was cancelled under the provisions of
Section 34 of the Excise Act. Sh. Balkar Singh was
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informed on 28.05.2020 that the process for resettlement
of the shop shall be carried out according to the
Uttarakhand Excise Rules 2020-21 and the Uttarakhand
Excise (Administration of Licensees of Domestic/Foreign
Liquor and Beer Retail Sale) Rules, 2011and the loss that
the revenue may suffer after resettlement shall be
recovered from Sh. Balkar Singh.
3. An advertisement was issued by the District Excise
Officer, Pithoragarh on 02.06.2020 regarding resettlement
of the licence for foreign liquor shop Pithoragarh 1 B.
Applications were invited from interested persons for
issuance of a licence for the remaining period of the
financial year 2020-2021. The revenue fixed for the
remaining period of the financial year 2020-2021 was
Rs.7,70,62,471/-. As none responded to the said
advertisement, the District Excise Officer, Pithoragarh
issued another advertisement dated 06.06.2020. The
Appellant participated in the allotment process and he was
declared as the successful bidder and his bid for
Rs.3,46,78,112/- was accepted. The licence for foreign
liquor shop at Pithoragarh was allotted to him by an order
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dated 09.06.2020 subject to the conditions mentioned
therein.
4. The First Respondent filed a writ petition questioning
the allotment of the foreign liquor shop in favour of the
Appellant on the ground that the allotment in favour of the
Appellant resulted in loss of revenue. According to him,
the allotment of the foreign liquor shop in favour of the
Appellant for Rs.3,46,78,112/- could not have been made
when the total revenue was fixed in the advertisement was
Rs.7,70,62,471/-. By an order dated 06.08.2020, the High
Court dismissed the Writ Petition on the ground that the
First Respondent did not have locus standi to challenge the
allotment of the foreign liquor shop in favour of the
Appellant as he did not participate in the process of
resettlement of the liquor shop. In the appeal preferred by
the First Respondent against the judgment of the learned
Single Judge, a Division Bench of the High Court stayed the
operation and execution of the settlement of the foreign
liquor shop in favour of the Appellant until further orders
by an order dated 21.08.2020. It appears that the Division
Bench was prima facie satisfied that the First Respondent
offered a much higher amount in spite of which the licence
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was granted for a lesser amount in favour of the Appellant.
The Division Bench observed that locus standi cannot be a
ground for dismissal of the Writ Petition when there is an
allegation that the Government is losing revenue of a huge
amount of Rs.5 crores. The High Court was of the opinion
that the issue of loss of revenue is of immense public
interest. In view of the loss of revenue, the Division Bench
felt that the matter requires consideration.
5. The interim order dated 21.08.2020 was sought to be
vacated by the Appellant who filed an application which
was dismissed on 08.09.2020. The High Court recorded a
finding that it was aware about the proceedings that
were initiated for recovery of the deficient amount from
the original allottee, Sh. Balkar Singh. The High Court
observed that the State could not have allotted the shop
for an amount of Rs. 3.5 crores and there is a likelihood
of higher amount being offered in re-settlement.
6. Admittedly, the First Respondent was an
unsuccessful bidder at the time of original allotment in
favour of Sh. Balkar Singh. In the re-settlement of the
liquor shop after Sh. Balkar Singh expressed his inability
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to continue, the First Respondent did not participate in
the process. The Appellant was the highest bidder for
the allotment of the liquor shop and his offer of
Rs.3,46,78,112/- for the remaining period of the financial
year 2020-2021 was accepted.
7. The High Court committed an error in proceeding
on the premise that the First Respondent has offered a
much higher amount and that the State had wrongly
accepted a lesser amount offered by the Appellant. As
stated above, the First Respondent did not participate in
the resettlement process. The High Court was further
convinced with the contention of the First Respondent
that the State is suffering a loss of Rs. 5 crores. The
Government has brought to the notice of the Division
Bench that after re-settlement of the license in favor of
the Appellant, the shortfall of the annual revenue value
of Rs.7,70,62,471/- was being recovered from Sh. Balkar
Singh and that the recovery certificate to the effect of
Rs.4,08,70,998/- was issued to Sh. Balkar Singh. It is
clear from the above that there is no loss to the
Government. The liquor shops were closed for a short
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period of time in view of the Covid-19 pandemic. After
the permission was granted for reopening of the shops,
Sh. Balkar Singh expressed his inability to continue
running the shop. The resettlement of the foreign liquor
shop was for the remaining period of the financial year
2020-2021. The First Respondent filed a Writ Petition,
complaining about loss of revenue to the Government as
the resettlement of the foreign liquor shop was for a
lesser amount. In our opinion, the Writ petition was
rightly dismissed by the learned Single Judge on the
ground that the First Respondent has no locus standi to
maintain the Writ Petition. The Division Bench committed
an error in staying the operation of the resettlement in
favor of the Appellant, even after the compliance of the
conditions of the licence by the Appellant who deposited
the money as directed. In view of the order passed by
the Division Bench, the Appellant was restrained from
continuing his business activity. To examine the
bonafides of the First Respondent, we asked the learned
counsel appearing for him to get instructions as to
whether the First Respondent would be ready to offer a
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higher amount in view of the submission made on his
behalf before the Division Bench of the High Court. After
obtaining instructions, the learned counsel for the First
Respondent submitted that he is not willing to deposit
Rupees 8 crores, but would be willing to pay something
more than the offer made by the Appellant which was
accepted. A perusal of the pleadings would show that
there is no allegation of malafides on the part of the
Government. The only ground on which the High Court
interfered with the license is on the basis of the
purported loss caused to the revenue. In spite of the
Division Bench being informed that there is absolutely no
loss to the revenue in view of the recovery proceeding
initiated against Sh. Balkar Singh, the interim order was
not vacated. As a consequence, the Appellant was
prevented from continuing with his business in spite of
paying the amount of Rs.3 lakhs per day to the
Department. Interference with a valid license granted in
accordance with rules is unwarranted. The First
Respondent has misled the High Court by contending
that he is willing to offer a higher amount. Such an offer
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should not have been entertained as he did not
participate in the resettlement process. If such petitions
are encouraged, there will be no finality to any license or
permission granted by the Government, especially when
there is no complaint of any malafides, favoritism or
nepotism. In view of the above, the orders of the High
Court dated 21.08.2020 and 08.09.2020 are set aside.
8. The Appellant shall be permitted to continue with
the business activity of running the foreign liquor shop
forthwith, subject to compliance of the terms of
resettlement. It is needless to mention that in case of
non-compliance, suitable action may be taken by the
authorities. The Appellant could not run the foreign
liquor shop due to the interim order passed by the High
Court on 21.08.2020. The Writ Petition filed by the
Petitioner being frivolous in nature is, therefore,
dismissed with cost of Rs.1,00,000/- to be paid to the
Appellant within a period of four weeks from today.
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……………………………..
J.
[L.
NAGESWARA RAO]
………………
…………….J.
[HEMANT GUPTA]
………………
…………….J.
[AJAY RASTOGI]
New Delhi,
October 26, 2020.
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