Ms Darshan Singh And Company Moga District Punjab vs. State Of Punjab And Others

Facts

The petitioner, M/s. Darshan Singh & Company, challenged the Excise Policy of the State of Punjab for 2024-2025, specifically Clauses 2 and 15(2). The petitioner argued that the non-refundable application fee of ₹75,000 for liquor vends was arbitrary and unjustified. They also alleged a scam due to multiple applications by some individuals for the same vends using family members. The petitioner contended that the policy violated the Punjab Excise Act, 1914, and the Punjab Liquor License (First Amendment) Rules, 2024, as it was introduced without proper rules. The petitioner also objected to the distribution of vends by draw of lots, arguing for open auctions. The respondent-State asserted that the policy complied with the Act and Rules, and that Rule 36 of the Rules of 2024 permitted allotment by draw of lots.

Held

The Court held that the right to trade in liquor is not a fundamental right but an exclusive privilege of the State. The principles of natural justice have no application in matters of contract and trade, as reiterated in various Supreme Court judgments. The Court found that the State Government had framed the Punjab Liquor Licence Rules, 1956, in compliance with the Act, and Rules 35 and 36, as amended, provided for the allotment of liquor vends by draw of lots. The increase in the application fee to ₹75,000, which is non-refundable, was deemed not illegal or arbitrary, especially since applicants voluntarily applied knowing this condition. The Court also noted that the petitioner had not participated in the bidding process and appeared to be a busybody, rendering their challenge to the fees without basis. The Court relied on precedents like Assistant Excise Commissioner Vs. Issac Peter (1994) and Churchward Vs. Queen (1865-66) to emphasize that parties are bound by contractual obligations and statutory terms, and courts should not imply obligations contrary to the parties' intentions. The argument regarding unjust enrichment was also rejected as the applicants knowingly accepted the non-refundable fee. Therefore, no case for interference was made out.

Key Issues

1. Whether the Excise Policy of the State of Punjab for 2024-2025, particularly Clauses 2 and 15(2) concerning the non-refundable application fee of ₹75,000, is arbitrary and unjustified, violating the Punjab Excise Act, 1914, and the Punjab Liquor License (First Amendment) Rules, 2024? - Petitioner's argument: The fee is arbitrary and unjustified. The policy was introduced without proper rules, violating the Act and Rules. The distribution of vends by draw of lots is illegal and contrary to the Rules of 2024, which should have mandated open auctions. Reliance was placed on Kerala Samsthana Chethu Thozhilali Union Vs. State of Kerala (2006) and the principle that if a law requires something to be done in a particular manner, it must be done so. - Respondent's argument: The policy is in strict conformity with the Act and the Rules of 2024. Section 58(2) of the Act empowers the State Government to make rules for regulating import, export, etc. Rule 36 of the Rules of 2024 permits liquor vends to be allotted by way of "draw of lots".