SRI LAKSHMI VENKATESHWARA ENTERPRISES v. THE STATE OF TELANGANA

Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Cor:rt may be pleased to suspend the operation of the common order dated 30-12-2024, passed by the Learned Single Judge in W.P No. 28529 ot 2024 by directing the Respondents No.2 to 6 to permit the petitioner firm to continue its day to day operations of their LE-VANTAGE Cafe and Bar including listing of the stocks from TGBCL Depot (Excise) through its l.D No.'1703291 (through online portal), pending disposal of the Writ ,\ppeal. Gounsel for the Appellant: SRI T.SRIKANTH REDDY Counsel for the Respondent No.'t to 7: SRI A.JAGAN, .t GP FOR PROHIBITION EXCISE Gounsel forthe Respondent No.8 & 9: SRI A.VENKATESH, Sr. COUNSEL, REp. FOR SRI P.VAMSHI KRISHNA WRIT APPEAL N0: 125 OF 2025 Writ Appeal under clause 15 of the Letters patent preferred Against the Order Dated. 3011212024 Passed in W.P.No.29567 of 2024 on the file, of the High Court. Between: SRI LAKSHMI VENKATESHWARA ENTERPR|SES, A .egistered partnership Firm vide No.1842 ol 2016 and running business under th-e name and style df LE,VANTAGE at premises N}.B-2-2531821N.197, Jubilee Hiils. Hvder;bad_ 500033. Represented by its Managing partner Sri. K. Sanjeev Kuma'r Reddy ...APPELLANT AND

1. THE STATE OF TELANGANA, Represented by its Secretary, Revenue (Excise-ll) Department, Secretariat, Teilangana State M.J.Road, Chandra. Telangana State- 500001 .

2. THE COMMISSTONER OF pROHBtTtON and EXC|SE, Abkari Bhavan, - -Vihar, Old Kaftal Mandi, Namiatty, nVOeiaOiO, 3. THE JOINT COMMt.gqlqN-ER OF EXCrSE,.Abkari Bhavan, M.J Road, Clg@ra Vihar, Otd Kattat Mandi, Nampaily, Hyderabad, ieijngi;a Stite 50000'1.

4. THE EXCISE SUPERINTENDENT, Excise and Prohibition, Jubilee Hills Zone, Hyderabad, Telangana State.

5. THE STATION HOUSE OFFICER (EXCISE), Jubilee Hills, Hyderabad, Telangana State.

6. THE DISTRICT PROHIBITION AND EXCISE OFFICER, HYDERABAD AbkaTi Bhavan M J Road Chandra Vihar Old Kaftal Mandi Nampally Hyderabad Telangana State 50000'1

7. A. Vara Prasad Reddy, S/o. Late Sri A. Venkateshwara Reddy, Aged about 69 years, Occ. Busiriess, R:/o. Villa No.39, Hill Ridge Vittas, G"achibowli, Ranga Reddy District.

8. A. VijayaSarada Reddy, S/o Business, Rl/o. Villa No.39, District. A Veera Reddy, Aged about. 62 years, Occ. Hill Ridge Villas, Gachibowli, Ranga Reddy ,,.RESPONDENTS lA NO: 2 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the operation of the common order dated 30-12-2024, passed by the Learned Single Judge in W.P No. 29567 of 2024 by directing the Respondents No.2 to 6 to permit the petitioner firm to continue its day to day operations of their LE-VANTAGE Cafe and Bar including listing of the stocks from TGBCL Depot (Excise) through its lD No.1703291 (through online portal), pending disposaI of the Writ Appeal. Counsel for the Appellant: SRI T.SRIKANTH REDDY Counsel for the Respondent No.1 to 6: SRI A.JAGAN GP FOR PROHIBITION EXCISE Counsel for the Respondent No.7 & 8: SRI A.VENKATESH, Sr. COUNSEL, REP. FOR SRI P.VAMSHI KRISHNA The Court delivered the following: COMMON JUDGMENT THE HON'BI,E THE ACTING CHIEF'JUSTICE SUJOY PAUL AND THE HON'BLE SMT. JUSTICE RENUI(A YARA WITIT APPEAL Nos. 124 AND 125 O)? 2()25 COMMON JUDGMENT: (Pe,r tlon'bte Smf. J.lstice Renukct Yoro) Since the issue involved in both these Writ Ap,peals is one and the same, thel' are being disposed of by way of this common judgment

2. Heard Sri 'l.Srikanth Reddy, learned counsel for the appellant, Sri A.Jagan, learned Government Pleader for Prohiltitior, ^.rJ'E*.i"., for the official respondents and Sri A.Venkatesh, learned Senior Counsel representing Sri P.Vamshi Krishna, learned counsel for respondent Nos.S and 9 in W.A.No.124 of 2025 and respondent Nos.7 and 8 in W.A.No. 125 of 2025.

3. These intriL Court appeals are directed against the common order, dated 13.L2.2O24, passed by a learned Single Judge of this Court in W.P.Nos 28529 and 29567 of 2O24, respectively-

4. For the sal<e of convenience, the facts and the submissions made in W.A.No. 125 of 2O25 are herettnder discussed

5. The background facts of the case are that the appellant has taken \premises bearing No.8-2-293l 82 /Al 19i,, .tubilee Hills, 2 Hyderabad, on lease from respondent Nos.7 and 8 and is running a Cafe and Bar in the name and style of 'LE VANTAGE'. The appellant entered into a rental agreement bearing document No-6316 of 2016 dated O3.12.2O16 with respondent Nos.7 and 8, who are the owners of the said premises. The saicl lease expired in the year 2O19 and there was no extension of lease. When the respondent Nos.7 and 8 refused to extend the lease, the appellant filed a suit in O.S.No-2225 of 2Ol9 on the file of VII Junior Civil Judge, City Civil Court, Hyderabad, seeking perpetual injunction to restrain the respondent Nos'7 and B from forcibly evicting the appellant from the said p."^i".!i The appellant also filed a suit in O.S No.1801 of 2Ol9 on the file of IV Additional Senior Civil Judge, City Cirril Court, Hyderabad, seeking specific performance of the registered lease deed for further extension of lease by 3 more years. Consequently, respondent Nos-7 and 8, who are the landlorcis, instituted a suit in O-S.No- 195 of 2O2O on the file of IV Additional Senior Civil Judge' City Civil Court, Hyderabad, for eviction of the appellant. Currently, the suit in O'S No'1801 of 2O19 has become infructuous as the period for rvhich the lease was to be extended by way of specific performance was lapsed' The only right subsisting in favour of the appellant as a tenant holding over is the right to be in possession of the premises, until evicted through due process of law. -/ 3

6. The appellant was granted licence to run a Cafe and Bar uide Licence No.l7 l2016- 17 dated 26.03.2016 for the period commencing frorn 23.06.2O17 and ending with 3O.O9.2O17. The licence was periodically rener.r'ed for running the Cafe ald Bar. The respondent No.6 issued proceedings dated 19.O9 .2022 for renern al of licence across the State of Telalgana. The appellant paid necessar5r licence fee for renewal ol the licence. As per the amendecl Rule 9,{ of the Telangana Excise (Grant of Licence of Selling by Bar rlnd conditions of Licence) Rules, 2005 (for short, 'the Rules of 2005'), in terms of G.O.Ms.No.46, Revenue (Excise-Il) Department dated 10.05.2O23, the annual renewal o[ 28 licence shall be deemed subject to conditions that the proof of payment of requisite renewal fee, proof of payment of first instalment ol' BET, Bank Guarantee, proof of payment of Trade Licence for current year and Form 48 Af{idavit are attached. The appellant paid the necessary amount uide Ctlallan No.63O2555881 dated 27 .O9 .2023. hence 28 licence is deemed to be renewed on 3O.O9.2024 as per the amended Rule 9A of the Rules, 2O05. However, the respondent No.6 refused to renew the 28 licence on the ground that the appellant failed to submit valid sale deed/lease deed from the owner of the premises.

7. Aggrieved b1. the refusal to renew licence, thr: appellant filed W.P.No.29567 of 2024 to declare the proceedings in 4 Cr.No.B4l454 /2022lDPEO(H), dated 19.lO-2O24 issued bv respondent No.6 as illegal, arbitrary and violative of the order dated

16.10.2024 passed in W.P.No.28529 of 2024, wlrcrein, the appellalt was permitted to continue day-to-day operations of Le-Vantage Cafe arrd Bar, including lifting the stock from TGBCL Depot (Excise) through its ID.No. 1703291 in view of the Rule 9A of the Telangana Excise (Grant of Licence of Selling by Bar and conditions of Licence) Rules, 2OO5 (for short, the Rules, 2005J. B. The learned Single Judget upon examining the case, of the appellant and the respondents on the basis of the judgments of this Court in Mandakini RestoLuroltt and Bar v. Deputg Commissioner of Prohibition and Excisel and. Atla Venkata Krishna Reddg a' The Gouernment of Andhra Prordesh2 dismissed the aforesaid writ petition, holding that r.r'hen the firm is not having valid lease deed, there can be no question of renewal of the licence. Aggrieved by the same, the present Writ Appeal is preferred. g. In the grounds of appeal, the appellalt contended that one of the partner, who is the son of respondent No.7, the landlord, brought the lease of the subject land as his investment and therefore, no separate lease is required. Further, the appellant contends that the unofficial respondent Nos.7 an<1 8 have waived rather estopped from insisting 'zoosl+;aLo tas 'zot3ls) aro t:o the renewai of the lease deed, as they joinecl the scn of respondent No.7 as partner in the appellant partnership hrm by bringing the leased premises irlto partnership hrm. The appellant contends that its rights as a lessee would not come to an end automati,:alh . u.hen a civil suit is pending. "he grant of licence/renewal cannol be at the whims and fancies of the ou-ners of the premises, who have developed greedy eye on the business of the appellant. The appellant contended that absolute injunction order is passed in its favour and the said document has to be considered in accordance u,il h Section 3 1 of Telangana Excise Act, Rules 5, 6, 9 and 10 of the Rules, 2005 and the licence of the appeilant ought to have been renewed

10. According to the appellant, the learned Singie Judge erred in relying upon the judgment of Mandakini Resto,urant and. Bo;y's case (1 supra), which is based on the un-arnended Rule. There is an error in the hnding of the learned Single Judge while holding that Rule 6 of the Rules, 2OO5 needs to be followed even while. renewing the original licence. As per the amended Rule 94 of the Rules, 2O05, there is no mention that all the conditions set out while granting licence have to be complied again. Though the lease deed was not extended, the appellant has the absolute injunction order in I.A.No.513 of 2019 in O.S.No.2225 of 2Al9 and the said order can replace the lease deed in proof of possessiolt. Until the appellant is evicted under due process I 6 of law, the appellalrt continues to tre in possession and, therefore, entitled for extension of the licence for carrying on the business. The appellant contends that under Rule 6 of the Rules, 2OO5, the conditions mentioned for grant of initial licence are not applicable for renewal of licence. Also, Rule 9A of the Rules, 2005, does not speak about valid subsisting lease deed for renerval of licence.

11. Further, according to the appellant, there is failure on the part of the Single Judge in considering the existence of interim order passed in favour of the appellant and the covenant of the lease deed., which contemplates extension of the lease deed on enhancement of 10% of the rental amount. Lastly, the appellalt sums up its contentions in the appeal claiming that as long as it is in lawful possession of the premises, it can also exercise its right to do business under Article 19 of the Constitution of India. On the basis of aforementioned grounds, the appellant prayed to set aside the impugned common order passed by the learned Single Judge.

12. During the course of arguments, learned counsel for the appellant would submit that the appellant is in legal possession of the premises on the strength of the temporar-y injunction granted by the learned VII Junior Civil Judge, City Civil Court, Hyderabad and, therefore, they also have right to run the business in the said premises, until evicted under due process of law. While so, the same 1 ./,, /,/ i'l extend a '^- +La landlords i'e respondent is vehementlY opposed by the counsel for the lar Nos.7 and 8 claiming that legat possession on the basis of a temPorarY injunction order gr anted by a Court would not autor-.raticaliy the right to continue to do business in the premises' Learned counsel for the landlords rvould contend that an injrrnction or'der protects the right of the appeilant to be in possession until evicted under due process of law' b,t the said injunctio""::::-,:: to the aPPellant to continue to do busrner dependent upon the statute governing the issuance of licence and reneu'al of licence '[he counsel for the landlords -""t: t:t;'::':"' the licence to rLtn the Cafe and Bar expired' and ir-'' order to contlnue to d'o business the appellant has to get renewal of the licence bY meeting the terms and conditions stipulated uncler Rule 9A of the ;:T.""'fi I I Rules of 2OO5'

27.O3.2O24rn

13. Learned counsel for the "ee"11"t,i":::::r'::i"Jx. relied upon the judgment of the High Cour W'P'No'22 657 of2o23 (LB-BMP) arising from a dispute between a landlord and tenant' wherein the tenant was running a Hotel in the name and style of Velvette Hotel' un<ler trade licence granted on l]1'O7'2019' At the time of renewal of licence' the Health Offrcer, BBMP office sought No Objection Certificate (NOC) from the landlord' In the context' due to disputes' the landlords objected to 8 continuzrnce of the hotel business activity of the petitioner therein. In the said case, the High Court of Karnataka held that requirement of NOC is only procedural requirement and cannot be insisted in a-11 circumstances and proceeded to state that the outcome of the arbitration proceedings between the landlord and tenant would have a bearing on the right of the petltioner to carry on business and such contingence would arise onl5r 1vhs, the litigation attains finality and accordingly, the respondent Nos. 1 and 2 therein were directed to consider the request for renewal or fresh licence rvithout reference to NOC from the landlord.

14. Learned counsel for the appellant also relied upon the judgment of the High Court of Karnataka dated 25.O1.2O11 in W.A.No.257O of 2O09. The said appeal arises from the dismissal of the vt'rit petition by a learned Single Judge, which was filed seeking grant of licence, on the ground that the landlady has not consented for grant of licence. A civil case was instituted between the landlady and tenant. Since the dispute was not yet adjudicated by the civil Court, the learned single Judge had held that trade licence cannot be granted. The said order has been assailed by way of u'rit appeal, wherein, it was held that there is no specihc provision wherein consent of the landlord is mandatory in all circumstances. It is held that after the termination of lease, though the possession is unlawful, the lessee cannot be ,/ o prevented from putting the premises to use. While so, the landlord can at best seek mesne profits in accordance with iaw. The property can be put to use only by obtaining the trade licence from BBMP. Since the consent of the landlord is not mandatory and since it is only a procedural requirement, the denial of renewal of trade licence is held unsustainable.

15. In response to the contentions of the learned counsel for the appellant, the learned counsel for the landlords would submit that the citations relied upon by the appellant are not with regard to renewal of an excise licence for running a Bar, but for renewai of licence to run ,! hotel. Learned counsel for the landlords submits that the facts and circumstances of the citations referred by the iearned counsel for the appellant are not applicable to the facts and circumstances of the present case. Instead the citations referred by the learned Single Judge in Mandakini Resto,uro,nt and Bar's case (1 supra) and AIIa Venkcrta Krishna Reddgs case (2 supra) are squarely applicable to the facts of the present case, as said cases referred to the disputes between the landlord and tenant in the context of renewal of excise licence under Rule 9A of the Rules of 2OO5. It is contencled that this Court has held that the conditions that apply for issuance of a licence under Rule 9A of the Rules, 2OO5 are also applicable while renewing the licence. in that context, learned counsel for the landlords referred \-* \ 10 {- to judgment of the Hon,ble Supreme Court of India in C.Albert Morris v. K.Chorndraseko;roln and other33 wherein, a reference was made to the case of M.C.Chockalingam and others a' Ma'nickaaoso,gam and others (MANU/SC/O33Bl1g73l, where the main question dealt was that whether a tenant who is not a statutory tenant is entitled to claim to be in lawful possession of premises following termination of tenancy or on expiry of the lease. The Hon'ble Supreme Court held in M.C.Chockalingam's case, that litigious possession cannot be regarcled as lau,{ul possession. Consequently, an1' right which the clealer has over the site was a right which had been acquired'ih terms of the lease. when the lease expires and when the landlord declined to reneu, the same and also called upon the erst\l,'hile tenant to surrender possession, the erstwhile lessee can no longer assert that he had any right to the site. i6. Learned counsel for the landlords referred to judgment rendered byalearnedsingleJudgeofthisCourtinW.P.No.366Blof2olBdated

22.02.2016, wherein it was held that "continuance of possession over the leased premises by virtue of the 1ega1 protection u'ould not have the effect of extending the lease for the purpose of Rule 6 or Rule 9A of the Rules, 2O05". As Rule 6 of the Rules' 2005, specihcally requires production of a lease deed from the owner of the premises, the protection afforded by the injunction order insofar as the possession of r 2006{1) ALM06(sc) 11 / the respondent No.S therein is concerned cannot be a substitute for the legal requirernent of producing a lease deed. The possession of respondent No.5 therein would only be protected by such injunction, but she is not enritled to seek renewal of a Bar licence without a lease deed in relation to the said premises.

17. Having considered the rival contentions of the appellant-tenant and the respondents-landlords, there is a need to examine rvhether the amendecl Rule 9A of the Rules, 20O5 supports the contention of the appellant about the conditions meant for grant of a licence are not applicable for renewal of said licence. A close reading of tfre ftLte sa, renewal of 28 liccnce before and after amendment, shor'vs that there was only a minor amendment made about renewal of 28 licence deemed subject to conditions specified, while the rest of the conditions remained the same. Only for the purpose of facilitating the running of business while the renewal application is pending, there is a deemed grant of renewal of licence, otherwise the amended Rule 9,{ also requires same c,.rnditions to be fulfilled for renewal of 28 licence, which includes an affidavit in Form 48. The affidavit in Form 48 requires productton of a valid lease deed for the property where the Bar is located. 'lhus, the Rules clearly stipulate that the appellant has to produce a valid lease deed for the property for renewal of the licence. The appellant cannot escape the obligation to produce a valid \ t2 t lease deed for the Premlses ln order to get renewal of 28 licence' While so, on account of disputes between the appellant and its landlords, there is no extension of lease deed and the suit filed seeking specihc performance of extension of a lease deed for execution of fresh lease deed has become infructuous'

18. The current status of the appellant is that there is no valid lease deed for the premises and the suit hled in connection thereof has become infructuous. The only subsisting right of the appellant is to be in possession of the leased premises' until evicted under due. process of 1aw. In the said facts an<l circumstances' even as per amended Rule 9A of the Rules, 2oo5, the appellant has to produce a fresh lease deed before the licencing authority for renerval of 28 licence' The citations referred by the appellant are not related to renewal of 28 connection $'ith running Hotel licence for running Bar' but are in The citations referred bY the business in the State of Karnataka' counsel for landlords in ltlandokinl Restaurant and Bar's case (i supra) alrd Atla Venkata Krishna Reddgis case (2 supra) are dealing with issuance of 28 licence with respect to leased premises when there is no extension of lease and, therefore' squarely applicable to the facts of the present case- The dicta laid down by the Hon'ble Supreme court in M.C.ChockalingA,rt's case that litigious possession is not legal possession and right arisen from a legal lease cannot be extended / / -'- _t) upon expiry of the lease is a rationale, which is binding to the present case. On the basis of the ratio laid down rn Mo;ndakini Resto,ura,nt and Bo,r,s case ( I supra) and Atla venkata Krishna Reddgls case (2 supra), the appellant has only a right to be in possession of the leased premises until evicted under due process of law' However' the said possession does not entitle him to get extension of 28 licence' Since the appellant is not entitled to grant 2E} licence, the question of interfering with the action taken by respondent Nos'2 to 5 in sealing the Bar counter Irridge Liquor Store and Liquor Fridge does not arise. Thus, there are rto grounds to interfere with the impugned gQmmon order passed by the learned Single Judge of this Court' The appeals lack merit and arl' liable to be dismissed.

19. Accordingll, tl're Writ Appeals are dismissed. There shall be no order as to costs Miscellaneous appiications, if any, pending in these appeals, shall stand ciosct I //TRUE COPY// SDr-8. SATYAVATHI PUTY REGISTRAR SI-CTION OFFICER \,",

2. a One CC to SRI T SRIKANTH REDDY' Advocate [OPUC] One CC to SRI P VAMSHI KRISHNA' Advocate [OPUC] TwoCCstoGPFoRPRoHlBlTloNEXclSE,HighCourtfortheStateof ieringJn, it HYderabad [oUTl

4. Two CD Copies BSR BS @* HIGH COURT DATED: 05lC)212025 / ? COMMON J['DGMENT WA.Nos.124 and 125 ot 2025 ? c f, \r-" '\" 'i HE Sr4 ()*( 0 6 fiAB 2025 I , t.- . t e. r r.,.! DISMISSING BOTH THE WRIT APPEALS, WITHOUT COSTS ,{'