V.D.Chaturvedi,J. - (1.) 1. Heard Shri Ram Raj learned counsel for the petitioner and Shri J.N.Mathur learned Additional Advocate General assisted by Shri H.P. Mathur learned Additional Chief Standing counsel.
(2.) ADMIT. Let notice be issued to private opposite parties, who have been arrayed in connected petitions also returnable at an early date. Impleadment may be done during the course of day. Liberty is given to the petitioner to serve notice on private opposite parties outside the court also. Office shall provide notices. While assailing the impugned Rule namely U.P. Demarcation and Regulation of Special Zones for Exclusive Privilege of Excise Shops Rules, 2009, learned counsel for the petitioner submits that the rule in question followed by Circular dated 12.2.2009 deprived the petitioners right of renewal of licence which was available through the U.P.Excise (Settlement of Licences for Retail Sale of Country Liquor) Rules, 2002, in short hereinafter referred as 2002 Rules. In this context the petitioners' counsel has relied upon the Supreme Court judgement reported in 2002(7) SCC 104, Secretary to Government, T.N. and another Vs. K. Vinayagamurthy. It has been submitted that while framing policy the State Government had created special zone i.e. called as Meerut Special Zone including Bareilly Division and provided that the licence for whole sale and retail shops for liquor be granted to the State Corporations and Apex Level Cooperative Societies. He further submits that while framing the policy vide circular dated 11.2.2009 and the rules framed thereafter, the State Government while exercising power under Section 4 of the Excise Act, in short hereinafter referred as Act, has extended exclusive privilege with regard to grant of licence for whole sale or retail shops to the State Corporation. The submission is that under the garb of corporation the contracts have been given to private persons for extraneous reasons. According to petitioner's counsel Apex Level Cooperative Society has been invited applications to form Joint Venture along with the private bodies to manage the retail sale of country liquor and foreign liquor. It has also been submitted that the 2009 rule has been framed contrary to statutory provisions contained in U.P. Excise Act. Rule 3 of the 2009 Rules for convenience is reproduced as under:- "Demarcation of Special Zone The Excise Commissioner, with prior approval of the State Government, may notify the demarcation of special zones which have been determined to be authorised to exercise the rights and powers given in sections 21,24,24-A, 24-B, 28,30 and 31 of the Act, by including various zones/charges/districts/preventive sectors/circles of the State in view of public health and safety, public interest and public order. Explanation: for the purpose of this rule zones/charges/districts/preventive sectors/circles will have the same meaning as mentioned in para 83 and 117 of the Excise Manual Volume I"
(3.) IT has also been submitted that the impugned policy decision has not been taken for augmentation of revenues but it has been made to extend undue benefit to the higher-ups and mafias who are working in the field of liquor. However, this allegation is denied by learned Additional Advocate General. The further submission of the learned counsel for the petitioner is that keeping this in view, the impugned provision is contrary to the provisions contained in Sections 24-A, 24-B, 25 of the Act as well as statutory rules. According to him, even if assuming that the government has taken a policy decision to involve Apex Level Cooperative Society in sale and purchase of country liquor, the same cannot be done contrary to the earlier existing rules as well as statutory provision contained in the Excise Act. IT has been submitted that involvement of private bodies through agreement shall amount to sub-letting and not permissible under the statute. Private respondent shall be benefited without criminal liability. On the other hand, Shri J.N.Mathur learned Additional Advocate General submits that the provision has been made to check the smuggling of liquor in Meerut Zone which joins New Delhi, Haryana and Uttaranchal. He also submits that in view of the provisions contained in Section 36-A of the Act, no unfettered right accrues to the petitioners to claim renewal of the shops in question; rather an argument has been advanced that there is an absolute bar for renewal of licence. The further submission is that the impugned provision has been made just to check the smuggling of the country- made liquor from the adjoining states and the state government has acted fairly and within its jurisdiction to increase its excise revenue. He further submits that under the Rules framed in pursuance to the power conferred by Section 40 of the Act, namely Uttar Pradesh Demarcation and Regulation of Special Zone for Exclusive Privilege of Excise Shops Rules, 2009, in short 2009 Rules, the government has power to allocate the shops to Apex Level Cooperative Societies or the Corporations in the manner different from remaining districts of the State.;