- (1.) In this writ petition under Art. 32 of the Constitution, the petitioner, a partnership firm seeks reliefs of mandamus to direct the State Government and the Commissioner of Excise of M.P. to allow the petitioner to set up a distillery pursuant to the cabinet policy dated December 30, 1984 and to grant D-2 licence; to declare the letter dated February 8, 1982 as unconstitutional, illegal and of no effect in law and to direct the respondents Nos.1 and 2 to grant a licence to manufacture potable alcohol within the State of Madhya Pradesh and to grant D-1 licence to supply country made liquor, etc. This case has behind it chequered history which is necessary to adumbrate.
(2.) In the State of M. P. v. Nandlal Jaiswal, (1987) 1 SCR 1 : (AIR 1987 SC 25 1) this court considered the legality of the policy, the subject-matter in the writ petition. It was held therein that nine distilleries in the State of Madhya Pradesh including the one at Ujjain were set up on the lands and buildings belonging to the Government. The plants and machinery therein initially, were of the Government, but in course of time the licensees installed or replaced the plants and machinery and became the owners. The petitioner and its predecessors had licence for the distillery at Ujjain for well over 40 years to manufacture rectified spirit. The last of the licences held by the petitioner was for the years April 1, 1976 to March 31, 1981. The period of licence was at that time for five years. The practice as per the provisions of the M. P. Excise Act 1915 for short 'the Act' and M.P. Distilleries, Breweries and Warehouses Rules for short 'the rules' issued in exercise of the powers under S.62 was to call for the tenders to manufacture and supply the rectified spirit or denatured spirit, spirit (country made) to the retail vendors within the area attached to the distillery. Rajdahani Distillers Corporation, for short 'RDC' became the successful tenderer for the licensing period starting from April 1, 1981 to March 31, 1986. The petitioner challenged in Misc. Petition No. 701 / 81 in the M.P. High Court under Art. 226. Initially stay was granted, but later it was vacated on August 20, 1981. Licence was granted for the period starting from August 25, 1981 to March 31, 1986 to RDC and the distillery, plant and machinery at Ujjain was handed over to RDC on August 28, 1981. Thereafter the petitioner filed another writ petition No. 169/82 on March 16, 1982 for redelivery of the plant and machinery and the warehouses and other consequential reliefs. That writ petition was dismissed by the High Court against which Civil Appeal No. 5483/ 83 was filed, which is just now disposed of. The petitioner had applied for grant of licence on February 19, 1982 and he reiterated his request in number of reminders including one on November 3, 1986. In the interregnum the Govt. changed the policy by a Cabinet Sub-Committee policy decision dated December 30, 1984 under which they decided to grant licence to the existing licensees of the distilleries and that they should construct the factories at their expenses on the land allotted bv the State Govt. or acquired and allotted by the State Govt. and that they shift the business to new factories and the licence would be for a period of five years. Calling in question of that policy several writ petitions including the one by the petitioner were filed in the M.P. High Court. The Division Bench partly allowed the writ petition and quashed part of the policy decision. Against it appeals and special leave petitions were filed by the State and the unsuccessful petitioners including the petitioner. It was disposed of by this court reported in Jaiswal's case (AIR 1987 SC 251). During the hearing of the writ petition, the Attorney General of India conceded that if the petitioner makes any application for grant licence it would be considered by the State Govt. and be disposed of quickly. That concession was noted and the argument was founded thereon to hold that the Govt. did not intend to create any monopoly in favour of the existing licensees. This court upheld the policy of the Govt. and allowed the appeals and dismissed the special leave petitions of the petitioner and other. Pursuant thereto the petitioner made an application on December 25, 1987 followed by several reminders, Ultimately the State Govt. rejected the petition by letter dated February 8, 1988, which is impugned in this writ petition.
(3.) Under S.13 of the Act, the State Govt. is empowered to grant licence to manufacture, possession and sale of rectified spirit and the liquor in the distilleries or the breweries. Under S.14 and Rule XXII the licensee should also have licence to establish distillery to distil rectified spirit or denatured spirit or liquor and a warehouse wherein any intoxicant be deposited and kept without payment of duty, but subject to payment of the fee to the State Govt. as it may direct. No intoxicant shall be sold by operation of S.17, except under the authority and subject to the terms and conditions of the licence granted in that of behalf Rule XXII provides the method disposal of the licence which reads thus: "XXII. Disposal of licences - (1) Licence for the manufacture or sale of intoxicants shall be disposed of by tender, auction, fixed licence fee or in such other manner as the State Govt. may, by general or special order, direct. Except where otherwise prescribed, licence shall be granted by the Collector or by an Officer authorised by him in that behalf." Rules III to V of the Distillery and Warehouse Rules also made inter alia under subsection 2(h) of S.62 deal with the subject of grant of licence and provide, in the following terms, for different kinds of licences which may be issued, viz., licences in Forms D-1, D- 1(s) and D-2: "III. Subject to the sanction of the State Government, the Excise Commissioner ma y grant a licence in Form D-1 and Form D-1(s) for the wholesale supply of country spirit to retail vendors. IV.The Collector may issue, on payment of a fee of Rs. 1000 a licence in Form D-2 for the construction and working of a distillery to any person to whom a wholesale supply licence has been issued. V. Subject to sanction of the State Government the Excise Commissioner may issue a licence in Form D-2 for the construction and working of a distillery on payment of a fee of Rs. 1000." The State Govt. rejected application of the petitioner on three grounds, namely, (1) that the petitioner requested to issue a licence at the old place at Ujjain Distillery which is no longer available; (2) present policy of the Abate and the Central Govt. was to discourage manufacture of liquor for drinking purpose, except from molasses. (3) However, if it is manufactured from other raw materials other than the Mahua, his application would be considered. If the petitioner makes an application for establishment or manufacturing denatured spirit at other places and if they produce a No Objection Certificate from Central Development and Environmental Department, his application would be considered.;