- (1.) IN this petition under Art. 226 of the Constitution, the petitioner has prayed for quashing the order of the Excise Commissioner, Uttar Pradesh, dated 28-3-1977 (Annexure-I) in so far as it relates to giving to opposite party No. 3 the exclusive privilege of supplying country liquor in wholesale in Muzaffarnagar district.
(2.) CERTAIN material facts which are not in dispute may be stated. The petitioner as well as opposite party No. 3 are distillers having their distilleries in the districts of Muzaffarnagar and Bijnor respectively. For the year 1977-78 the Excise Commissioner, Uttar Pradesh (opposite party No. 2) invited tenders for grant of licences for the exclusive privilege of supplying country liquor in wholesale in various districts. The petitioner who had been granted the exclusive right of supplying country liquor in wholesale in the district of Muzaffarnagar for the year 1976-77, gave its tender for supply of country liquor in that district for the year 1977-78 also. Opposite party No. 3 had also given a tender for the supply of country liquor in wholesale, but not for the district of Muzaffarnagar. The rates offered by both the petitioner and opposite party No. 3 for supply of country liquor, were the same. By the impugned order dated 28-3-77 the Excise Commissioner granted to the petitioner the exclusive right of supplying country liquor in wholesale in the district of Bijnor and granted similar right to opposite party No. 3 in the district of Muzaffarnagar. The case of the petitioner is that as it had its Distillery in Muzaffarnagar district and had also tendered for supplying liquor in that district, it (the petitioner) should have been granted the privilege of supplying liquor in Muzaffarnagar district and that the Commissioner of Excise was not justified in granting such privilege to opposite party No. 3 which did not have its Distillery in Muzaffarnagar district and had not submitted a tender for supplying country liquor in Muzaffarnagar district. In the counter-affidavit filed on behalf of the opposite parties Nos. 1 and 2 namely State of U. P. and the Excise Commissioner, the stand taken is briefly as follows; The Excise Commissioner has under the provisions of the Uttar Pradesh Excise Act 1910 (hereinafter referred to as the Act) and the rules framed thereunder, absolute right to accept or reject any tender and to give the exclusive right of supplying country liquor in wholesale in any district, to any of the tenderers. The petitioner had given an undertaking that it would accept any district allotted to it for supplying country liquor in wholesale. There were certain complaints against the petitioner's Distillery of illegal supply of country spirit in Muzaffarnagar district and investigation by the Bureau of Intelligence is going on. During such investigation the State Government had suspended the Superintendent and Excise Inspector, Muzaffarnagar district. The petitioner cannot claim as of right that it should be granted the privilege of supplying country liquor in wholesale in any particular district.
(3.) IN order to appreciate the rival contentions on behalf of the petitioner and opposite parties Nos. 1 and 2, it is useful to set out the relevant provisions of the Act and the rules thereunder. Section 24 of the Act reads: "S. 24- Subject to the provisions of S. 31 the Excise Commissioner may grant to any person a licence for the exclusive privilege (1) of manufacturing or of supplying by wholesale, or of both; or (2) of selling by wholesale or by retail; or (3) of manufacturing or of supplying by wholesale, or of both and of selling by retail; any country liquor or intoxicating drug within any local area." Rule 417 reads as under: "The firm is selected in the following manner: The tenders in form C. L. 23 are invited by the Excise Commissioner vide notice in form C. L. 22 for the rates at which the different categories of spirit will be supplied at all specified bonded warehouses and wholesale depots in the area indicated. These tenders are submitted for orders of Government. The contract will ordinarily be awarded to the firm tendering at the lowest rates, but full power is reserved to accept such tender as may be deemed best in public interest, and to reject any of those received without reasons being assigned. No payment is required for the exclusive right of supply the object being to secure to the retail vendors a supply of good spirit at a cheap and fixed rate Spirit may be supplied from any distillery, whether situated within the State or outside. The detailed conditions of the contract are given in the notice in form C. L. 22 calling for tenders and in the form of licence C. L. 1." Under R. 417 certain conditions have been prescribed regarding disposal of tenders for wholesale supply of country liquor for sale in particular districts. Condition No. 13 provides that tenders should be sent to the Excise Commissioner in sealed covers and that full power is reserved for accepting such tender as may be deemed more advantageous and of rejecting any of those received without any reasons being assigned.;