The High Court · 2023
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI (Letters Patent Appellate Jurisdiction) L.P.A No. 329 of 2022 1. State of Jharkhand through Secretary cum Commissioner, Department of Excise and Prohibition, Government of Jharkhand, Ranchi, PO, PS and District-Ranchi 2. Deputy Commissioner, Singhbhum East, Jamshedpur, PO & PS- Jamshedpur, District-Singhbhum East 3. Assistant Commissioner of Excise, East Singhbhum, Jamshedpur, PO & PS-Jamshedpur District-Singhbhum East …....…Respondents/Appellants Versus Ramji Prasad, s/o Sri Awadh Bihari Sahu, r/o Radium Road, Near Maharaja Hotel, PO-Ranchi & PS-Sadar, District-Ranchi, Jharkhand …. ...Petitioner/Respondent CORAM: HON'BLE MR. JUSTICE SHREE CHANDRASHEKHAR HON'BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY For the State of Jharkhand For the Respondent : Mr. Gaurav Raj, AC to AAG-II : Miss Chandana Kumari, Advocate --------- Dated: 12th December 2023 Per, Anubha Rawat Choudhary, J. 1. This appeal has been filed against the judgment dated 14th March 2022 passed in W.P(C) No.626 of 2011 whereby the order impugned in the writ petition dated 13th August 2010 passed by the Member, Board of Revenue, Jharkhand in Excise Revision Case No. 22 of 2008 has been set aside and the appellants have been directed to refund the entire license fee to the respondent for the financial year 2007-08 along with statutory interest of a nationalized bank from the date of deposit till the date of disbursement. 2. The matter relates to the license granted to the respondent for manufacture and wholesale supply of country liquor in the district of Singhbhum East, Jharkhand . 3.
Legal Reasoning
The writ petition was filed for the following reliefs: “That in the instant writ application the petitioner is desirous of issuance of an appropriate writ (s) / order (s) and / or direction (s) for quashing the order dated 13.8.2010 passed by the Court of Member, Board of Revenue, Jharkhand, in Excise Revision Case 2 L.P.A No.329 of 2022 No. 22 / 2008 (Annexure-9), whereby and whereunder the Court of Member, Board of Revenue, Jharkhand has dismissed and rejected the claim of the petitioner for refund of license fee deposited by the petitioner for manufacture and wholesale supply of country liquor in the district of Singhbhum East, Jharkhand, amounting to Rs. 33,60,736/- for the period from 1.4.2007 to 31.3.2008 with a finding that the claim of the petitioner for remission before the Court of Member, Board of Revenue, as claimed under Section 39 of the Bihar & Orissa Excise Act, 1914, is not maintainable. AND
Decision
For issuance of further writ/order / direction as Your Lordships may deem fit and proper for doing conscionable justice to the petitioner.” The learned writ Court allowed the writ petition by making the 4. following observations: “Considering the rival submission of the parties, looking into facts and circumstances of the case, this Court considered that the orders passed by the Member, Board of Revenue, which is assailed before this Court, is not sustainable in the eyes of law as Member, Board of Revenue as well as State of Jharkhand has not disputed the contention of the petitioner. The respondents / State has admitted that for the financial year 2007-08 a sum of Rs. 33,60,736/- has been deposited as a license fee for the financial year 2007-08 and State Authorities have not granted any license with regard to retail shop, as such, it was not the fault of the petitioner for non-supply of manufactured liquor. Thus, the amount, which was deposited by the petitioner is fit to be reimbursed in the form of refund or in the form of remission under Section 39 of the Bihar and Orissa Excise Act, 1914, adopted by State of Jharkhand. Accordingly, the order dated 13.08.2010 passed by the Member, Board of Revenue, Jharkhand in Excise Revision Case No. 22 / 2008 is set aside. This Court is surprised that even the Board of Revenue has considered the fact that for the year 2007-08, which starts from 01.04.2007 to 31.03.2008, the State Government in view of Clause-8 of Form - 27 has not issued any license to the retailer, as such, the license fee, which was deposited by the petitioner for the year 2007- 08 to the tune of Rs. 33,63,736/- must be remitted under Section 39 of the Bihar and Orissa Excise Act for the non-utilized period of 2007-08. Accordingly, this Court allowed the writ petition directing the respondent / State to refund the said amount along with statutory interest of a nationalized bank from the date of deposit till the date of disbursement.” 5. The foundational facts are as under: - a. Under the tender notice published for the grant of exclusive privilege for manufacture and wholesale supply of country liquor for the period from 18th October 2005 to 31st March 2008, the respondent was granted the exclusive privilege for manufacture and wholesale supply of country liquor in the district of Singhbhum East, Jamshedpur. The respondent deposited the license fee and was issued a license in Form-27. 3 L.P.A No.329 of 2022 b. One Lakshmi Narayan Ramswaroop Sheohari and Company was granted license for retail sale of country liquor in the district of Singhbhum East for the period from 2004 to 2007 who surrendered the license on 31st March 2006 and thereafter country liquor shops falling within the district of Singhbhum East remained closed. The State Government did not take any steps for appointment of any other retail vendor in the district of Singhbhum East after 31st March 2006. c. As soon as the respondent came to know that the appellants were taking steps for giving retail licence to the retail vendors of country liquor in the district of Singhbhum East, the respondent got his license renewed for the financial years 2006-07 and 2007-08 on payment of license fee amounting and Rs.33,60,736/- respectively. The amount was deposited with a covering letter stating that the respondent will not claim any refund for the period when no license for retail vendor was issued by the appellants in the district of Singhbhum East. to Rs.32,00,700/- in d. For the entire period of 2007-08, no retail vendor was the district of Singhbhum East and appointed consequently the respondent could not supply any quantity of country liquor in the district of Singhbhum East despite the renewal of the license for manufacture and wholesale supply of country liquor in the district of Singhbhum East and deposit of license fee. e. On the one hand the appellants realized the license fee for the whole period of 2007-08 and on the other hand completely blocked the business of the respondent as there was no retail licensee to take supply of country liquor from the appellants whose area of operation was the district of Singhbhum East. f. Under the aforesaid circumstances, the respondent applied before the Member, Board of Revenue, Jharkhand under section 39 of The Jharkhand Excise Act (hereinafter referred to as the Act) seeking a refund of the license fee for the financial year 2007-08 on the sole ground that during this period the respondent could not supply any country liquor to the retailers as the State Government failed to grant retail license for country liquor in the district of Singhbhum East. The respondent had also relied upon the earlier order passed by the Member, Board of Revenue, Jharkhand in Case No. 20-31 of 2006 decided on 1st November 2006. However, the Member, Board of Revenue, Jharkhand, 4 L.P.A No.329 of 2022 the application for refund vide order dated rejected 13th August 2010 impugned in the writ petition by observing as follows: - losses incurred by “This court have examined the case and also taken on record the various aspects. A business has its risk and it remains as a matter of question whether the State can also make good any unforeseen the petitioner like an insurance agency. The fact of the case remains that the government in fact failed to appoint any retailer licensee who would have been able to lift the business stock of the present applicant. In a sense the applicant suffered monetary losses due to this aspect. But then due to some reason if the licence was granted and the retailers would prefer not to lift any material then, too the result would have been the same. A business has some risk and may be borne at times. A business man while entering into the competitive aspects of such business takes the entire matter in its totality although one can always accuse some person for his financial set back for some reason or the other. The question of law comes in whether the Board of Revenue under Section 39 of the Act has such powers, to allow such financial discretionary or otherwise reimbursement. A mere reading of the provision says that the power of the Board is limited to “order reduction in the amount of fees payable in respect of (thereof) due to unexpired portion by the Government”. The simple reading means that though the law originally enacted in the year 1915 did not provide the Board a discretionary power to order grant or the out go of the fund from the State Exchequer. Consequently, this Court is not in a position to grant any relief sought by the petitioner as the same is not covered by the law regarding the order passed by this Court, as quoted by the petitioner in Case Nos. 20- 31/06, dated 01-11-2006, but I understand that the same is being challenged in the appropriate forum. Consequently, the matter is dismissed for reasons stated above.” g. The earlier order passed by the Member, Board of Revenue in Case No.20 to 31 of 2006 dated 1st November 2006, referred to in the order impugned before the learned writ Court has been brought on record. In the said case different applications were filed by different licensees who were granted the license for retail vend in country liquor and spiced country liquor for the year 2005-2006 and they sought remission of the license fee under section 39 of the Act on account of non-supply of country liquor and spiced country liquor. It has been recorded in the order passed by the Member, Board of Revenue that in effect there was no production or supply of spiced country liquor in Jharkhand by the holders of exclusive privilege for the whole year during which the applicants held retail licenses for sale of such liquor and a somewhat similar situation prevailed so 5 L.P.A No.329 of 2022 far as the manufacture and wholesale supply of country liquor was concerned. Concerning Case No.21 of 2006, it was recorded that there could not have been any supply of country liquor in Dhanbad from 1st October 2005 till the wholesaler commenced production on 15th April 2006. It was argued on behalf of the State in the said case before the Member, Board of Revenue that remission can be allowed only during the currency of the license and for the unexpired portion of the grant while the applicant had applied for remission after the license lapsed on 31st March 2006. The Member, Board of Revenue rejected the arguments and held that such interpretation defies logic for the simple reason that it defeats the very purpose of section 39 of the Act. It has been held that if the remission could be allowed only during the currency of license, then what course would the licensee have if he was to seek remission for the last day of the period i.e. 31st March. 6. The decision and findings of the learned Member, Board of Revenue are as under: “It has been argued on behalf of the State that remission can be allowed only during the currency of a license and for the unexpired portion of the grant while that the applicants have applied for remission after their license lapsed on 31st March 2006. This interpretation defies logic for the simple reason that it defeats the very purpose of Section 39 of the Act. If remission could be allowed only during the currency of the license, then what recourse would the licensee have if he was seeking remission say for 31st March? Obviously, he cannot apply for remission on 31st March itself and would not then be entitled for any remission since the license would have lapsed on 31st March. Such an interpretation would be a travesty of justice best avoided. What is more, the licenses in question were current and had not expired during the period for which remission is being sought. Moreover, these applications were filed on 31st March 2006 when the license was still current. Grant of a license constitutes a contract between the State and the licensee in which the retail licensee is bound to lift certain stocks every month while the State is to ensure supply. In the current group of cases, there has been no supply and yet the licensees had to pay fees. In such a case the licensees can be granted remission of fees.” 7. As noticed above, the learned writ Court vide the impugned order has set aside the order passed by the Member, Board of Revenue, Jharkhand and directed refund of the license fee of Rs.33,60,736/- relating to the period of 2007-08 with interest. 6 L.P.A No.329 of 2022 Arguments of the appellants. 8. The learned counsel for the appellants has submitted that the learned writ Court while directing a refund of Rs.33,60,736/- relating to the period of 2007-08 has failed to consider that section 39 of the Act did not provide for a refund and it only provides for a remission during the currency of the license period. It was their further case that the respondent had voluntarily applied for renewal of license for manufacture of country liquor with a clear undertaking that he would not claim any refund and the respondent was estopped from claiming a refund even if no retail vendor was appointed for the area of operation of the respondent. It is further submitted that no country liquor was manufactured by the respondent during the period in question. It has been argued that as per Condition No. 11(Ka) of the grant of exclusive privilege for manufacture and wholesale supply of country liquor for the period from 18th October 2005 to 31st March 2008 vide letter contained in Memo No. 1724 dated 18th October 2005 the respondent was obliged to maintain the minimum stock of seven days of supply which was never kept by the respondent and as per Condition No. 11(Kha) the respondent was obliged to supply country liquor even to the retailers of other districts on requirement but as the respondent did not manufacture country liquor the possibility of the appellants to source supply got reduced. The learned counsel has also referred to Clause-9 (Gha) of the annual license as placed on record (period 18th October 2005 to 31st March 2006 which is said to be renewed for the period 2007-08 also) to submit that there is a clear provision that in case the appointed licensee in a particular district is not supplying the liquor then under such circumstances the Excise Commissioner can issue an order for supply of liquor from the licensee situated and working in the adjoining district and if such an order is issued then the licensee is duty bound to make such supplies. By referring to the aforesaid provision, the learned counsel for the appellants has submitted that the Excise Commissioner could have directed the respondent to make supply in the adjoining district but as the respondent did not manufacture any liquor and violated the terms and conditions of the license therefore the respondent is not entitled for refund of license fee. It is also argued that the respondent had applied for renewal of license only to prevent any possibility 7 L.P.A No.329 of 2022 of the department from calling for or appointing any other person. Arguments of the respondent. 9. On the other hand, the learned counsel appearing on behalf of the respondent has submitted that the impugned order passed by the learned writ Court has been rightly passed and the same does not call for any interference. The respondent cannot be made to suffer on account of laches on the part of the appellants who did not issue any license of retail vend of country liquor in the area of operation of the respondent i.e. the district of Singhbhum East, where the respondent was granted the license to manufacture and wholesale supply of country liquor. 10. It was the case of the respondent before the learned writ Court that the retail licensees were to submit a monthly lifting programme of country liquor before the Deputy Commissioner and a weekly lifting programme was also to be issued. The retailers were required to obtain a permit from the district authority and on the production of such permit, they were authorized to get the supply of country liquor. It was the specific case of the respondent that after surrendering of the aforesaid license by Lakshmi Narayan Ramswaroop Sheohari and Company on 31st March 2006 no permit was issued by the District Excise Authority for the district of Singhbhum East for lifting the country liquor from the warehouse of the respondent and, consequently, during the financial year 2007-08 from 1st April 2007 to 31st March 2008 not a single ounce of country liquor was lifted from the warehouse of the respondent. It was the case of the respondent before the learned writ Court that the State Government failed to appoint any retail licensee for the sale of country liquor in the district of Singhbhum East the appellants were not entitled to retain the license fee deposited by the respondent for the period from 1st April 2007 to 31st March 2008 and consequently, the license fee amounting to Rs.33,60,736/- for the period from 1st April 2007 to 31st March 2008 was sought to be refunded. It was the further case of the respondent before the learned writ Court that as per Conditions Nos.19 and 20 of the sale notification published in the Excise Form No.27, the retailers were legally duty bound to lift the Minimum Guarantee Quantity (MGQ) of the country made liquor and furnish to the whole seller MGQ on weekly basis but on account of absence of any 8 L.P.A No.329 of 2022 country liquor retail license shop in the district of Singhbhum East the respondent was prevented from supplying the country liquor for its area of operation i.e. Singhbhum East. The respondent has opposed the prayer and heavily relied upon the order passed by the Member, Board of Revenue in Case No. 20-31 of 2006, wherein the refund was allowed. 11. During the course of the argument, it was not disputed that not even a single retail vendor was appointed in the district of Singhbhum East during the period 2007-08 and the area of operation of the respondent was confined to the district of Singhbhum East and so far as the Clause regarding supply in other districts is concerned the same was subject to any requisition or order of the appellants. During the course of the argument, on instructions from the concerned officers of the Department, the learned counsel for the appellants submitted before this Court that during the period 2007-08 the Excise Commissioner did not issue any order directing the respondent to make supply to any other district outside the district of Singhbhum East. Findings of this Court. 12. It is not in dispute that the respondent after having participated in the tender became successful and was granted the exclusive privilege for manufacture and wholesale supply of country liquor in bottles for the period from 18th October 2005 to 31st March 2006 only for the district of Singhbhum East. The license was to be granted every year and upon deposit of the license fee the respondent was initially granted the license for the period 18th October 2005 to 31st March 2006. The respondent got the license renewed for the financial year 2006-07 and 2007-08 on payment of license fee amounting to Rs.32,00,700/- and Rs.33,60,736/- respectively by giving an undertaking that he would not claim any refund of the license fee. 13. It is further not in dispute that during the period in question i.e. 2007-08 no retail license for the sale of country liquor was issued for the entire district of Singhbhum East, the area of operation of the respondent. It is also not in dispute that the entire trade in liquor right from the manufacture, wholesale, and retail are fully regulated by the appellants and the wholesale supply of country liquor was to be made by the respondent only to the retail licensees within the district of Singhbhum East and the respondent could supply to any other licensee outside the district of 9 L.P.A No.329 of 2022 Singhbhum East as and when directed by the Excise Commissioner but no such direction was issued for the period in question. 14. Since the respondent was completely prevented by the acts/omissions of the appellants from entering into any business of supply of country liquor, the respondent applied to the Member, Board of Revenue for a refund of the license fee which was dismissed and was challenged in the writ Court and allowed by the impugned order. The point for consideration is as to whether the learned writ Court is justified in directing the appellants to refund the license fee. 15. In the aforesaid context, it would be useful to consider section 39 of the Act, the relevant clauses of the exclusive privilege, and relevant conditions of license which are quoted as under:- “Section 39. Power of Board to reduce fees: The Board may, if it thinks fit, at any time during the period for which any license has been granted, order a reduction of the amount of fees payable in respect of thereof during the unexpired portion of the grant.” Clauses 5,7, 8, and 9 of the annual license as placed on record (period 18th October 2005 to 31st March 2006 which is said to be renewed for the period 2007-08 also):- “5- vuqKfIr/kkjh >kj[k.M mRikn vf/kfu;e vkSj mlds v/khu cuk;s x;s fu;eksa ls tgk¡ rd mudk blls laca/k gks] vko) jgsxkA og ftl ftyk esaa ’kjkc dh fc(cid:216)h djuk pkgrs gSa] ml ftyk dh U;wure izR;kHkwr ek=k ij nks :i;k izfr ,y0ih0 yhVj dh nj ls vuqKfIr 'kqYd ¼ykbZlsal Qhl½ ,deq’r vfxze tek djsxkA ;fn fo(cid:217)kh; o"kZ esa U;wure izR;kHkwr ek=k ls vf/kd vkiwf(cid:217)k gksrh gS rks mruh vf/kd ek=k ds fy, fu;ekuqlkj vuqKfIr ’kqYd …ykbZlsal Qhl‰ ns; gksxkA 7- mDr xksnkeksa ls ’kjkc dh fc(cid:216)h cksry esa Hkjdj dh tk;sxhA ’kjkc dh ’kfDr] eki rFkk cksVfyax dh izf(cid:216);k ogh gksxh tks jktLo i"kZn~ le;≤ ij fo’ks"k ;k lkekU; vkns’k nsdj fu;r djsaA 8- bl ykbZlsal ds v/khu ’kjkc dh fc(cid:216)h le;≤ ij dsoy mUgha O;fDr;ksa …vkxs vuqKfIr izkIr fo(cid:216)srk ds :i esa fofufnZ"V‰ ds lkFk dh tk;sxh tks fofgr izi= esa ikjd is’k djsaxs vkSj ftlesa muds gkFk 'kjkc cspus dk mUgsa izkf/kdkj fn;k x;k gS vkSj buds gkFk dsoy mlh izdkj@izdkjksa dh vkSj mruh gh ek=k esa ’kjkc dh fc(cid:216)h dh tk;sxh tks ,sls ikjdksa esa mfYyf[kr gksa] mlls vf/kd ughaA 9- …d‰ vuqKfIr/kkjh ml xksnke ls tgk¡ ls vuqKfIr ds v/khu le;≤ ij 'kjkc cspus dh vuqefr nh xbZ gks vuqKfIr izkIr [kqnjk foØsrkvksa }kjk is’k fd;s x;s ikjdksa esa mfYyf[kr ek=k ;k ek=kvksa esa vkSj izdkj@izdkjksa dh ’kjkc fc(cid:216)h 10 L.P.A No.329 of 2022 ds rkSj ij vkiwf(cid:217)kZ djus ds fy;s ck/; gksxkA …[k‰mi;qZDr ’k(cid:217)kZ&7 esas fofufnZ"V ’kjkc dh vkiwf(cid:217)kZ esa pwd djus ij mRikn vk;qDr ds funsZ’kkuqlkj vFkZn.M yxk;k tk;sxkA vFkZn.M dh jde mruh gks ldrh gS tks vuqKfIr izkIr fo(cid:216)srkvksa }kjk ekaxh xbZ fdUrq vkiwfrZ u dh x;h ’kjkc ij yxus okys mlij dj rFkk vkiwf(cid:217)kZ esa pwd o blls ljdkj dks gksus okyh jktLo gkfu dk jde gksxkA …x‰ vuqKfIr/kkjh] mik;qDr ;k mRikn vk;qDr ds vkns’kkuqlkj vU; fdlh vuqKfIr/kkjh ds xksnke dks ml vuqKfIr/kkjh ds [kpZ ij ’kjkc dh vkiwf(cid:217)kZ djsxk tks fu/kkZfjr ek=k esa ’kjkc dh vkiwf(cid:217)kZ djus esa foQy jgk gSA vk;qDr mRikn vius foosd ls ,sls foQy vuqKfIr/kkjh ij vFkZn.M yxk ldrs gSaA …?k‰ ;fn fdlh ftyk ds fu;qDr Bsdsnkj }kjk ’kjkc dh vkiwf(cid:217)kZ ugha dh tk jgh gks] rks mRikn vk;qDr ds vkns’k ij ml ftyk ds vxy&cxy ds ftyk esa dk;Zjr Bsdsnkjksa }kjk fu/kkZfjr nj ij gh ml vuqKfIr/kkjh dks ns’kh 'kjkc dh vkiwfrZ djuk ck/;dkjh gksxkA …M+‰ vuqKfIr/kkjh mu lHkh lkekU; ;k fo’ks"k vkns’kksa ls vkc) gksxk tks mRikn vk;qDr le;≤ ij tkjh djsaA” Clause 11 of the grant of exclusive privilege for manufacture and wholesale supply of country liquor for the period from 18th October 2005 to 31st March 2008 vide letter contained in Memo No. 1724 dated 18th October 2005:- “11- …d‰ ns’kh 'kjkc ds Fkksd vkiwfrZdÙkkZ ftyk esa tgk¡ ij vk;qDr mRikn@mik;qDr] xksnke LFkkfir djus dk vkns’k nsaxs] ogk¡ ls [kqnjk vuqKk/kkfj;ksa dks muds }kjk cksry esa ns’kh 'kjkc dh Fkksd vkiwfÙkZ djsaxs] vkSj mik;qDr }kjk fu/kkZfjr U;wure Lda/k …de ls de ,d lIrkg ds [kir ds cjkcj cksry esa Lda/k‰ cuk;s j[ksaxsA ¼[k½ vxj fdlh ftyk esa fu;qDr Fkksd vkiwfÙkZdÙkkZ }kjk ns’kh 'kjkc dh vkiwfÙkZ ugha dh tk jgh gks rks vk;qDr mRikn ds vkns’k ls ml ftyk ds vxy&cxy ds ftys esa dk;Zjr~ Fkksd vkiwf(cid:217)kd(cid:217)kkZ }kjk foHkkx }kjk fu/kkZfjr nj ij gh ml ftyk esa ns’kh 'kjkc dh vkiwfÙkZ djuk ck/;dkjh gksxkA” 16. Clause 5 of the exclusive privilege for manufacture and wholesale of country liquor granted for the period 18th October 2005 to 31st March 2008 stipulates that the licensee will have to pay Rs.2/- per L.P. liter on the Minimum Guarantee Quantity by way of license fee at a time in advance. It also provides that if in any financial year, the supply is more than the Minimum Guarantee Quantity then an additional license fee would be accordingly payable. 17. The retail licensees are required to lift the Minimum Guarantee Quantity every financial year and thus the advance license fee payable as per aforesaid Clause 5 of the exclusive privilege is directly linked with the Minimum Guarantee Quantity for the district. 11 L.P.A No.329 of 2022 18. Clause 8 of the exclusive privilege mentions that the sale of liquor is permissible only to those persons who have a license even the quantity to be supplied by the respondent is also fully regulated. Clause 9 (Gha) of the exclusive privilege and clause 11(Kha) of the license provide that the respondent is bound to supply liquor to the licensees of the adjoining districts as and when directed by the excise commissioner. 19. Thus, the respondent could not have supplied the country liquor to any person other than those who had a license within the district of Singhbhum East and to whom the Excise Commissioner would have directed the respondent to supply. Since no retail license was issued in the district of Singhbhum East which was the area of operation of the respondent, the respondent could not have supplied country liquor to any person within the district of Singhbhum East during the period in question. So far as the supply of country liquor to persons outside the district of Singhbhum East is concerned no such order was issued by the Commissioner directing the petitioner to supply country liquor to any licensee outside the district of Singhbhum East. 20. Clause 11(Ka) of the license provides that the respondent was to maintain a stock of consumption for one week based on the Minimum Guarantee Quantity to be supplied to the retail licensees. It is the case of the appellants that the respondent did not manufacture country liquor though disputed by the respondent. However, the fact remains that neither there was any retail licensee to take supplies from the respondent nor there was any order from the Excise Commissioner to make any supply to any other district and thus there was nobody to take country liquor from the respondent during the entire license period of 2007-08. 21. This Court also finds that on the earlier occasion the Member, Board of Revenue had passed the order of refund in Case No. 20-31 of 2006 vide order dated 1st November 2006. 22. The appellants realized the full amount of the license fee in advance @ Rs.2/- per L.P. liter calculated and based on the Minimum Guarantee Quantity for the district of Singhbhum East but neither issued any retail license for the sale of the country liquor within the district of Singhbhum East nor issued any order/direction on the respondent to supply 12 L.P.A No.329 of 2022 country liquor to any person or licensee outside the district of Singhbhum East. 23. It is the case of the appellants though disputed by the respondent that the respondent did not manufacture any country liquor for the period in question. As per the appellants, the respondent neither manufactured nor supplied any amount of country liquor during the period in question. 24. This Court is of the considered view that once the license for manufacture or supply of country liquor is issued and the license fee is realized in advance based on the Minimum Guarantee Quantity of the district to be sold through the retail licensees, the amount of license fee cannot be permitted to be retained by the appellants when neither any retail license was issued in the district for the entire period in question nor any order was placed before the respondent to supply country liquor to any person/licensee outside the district. The argument of the appellants that the respondent is estopped from claiming a refund as the respondent had agreed not to claim a refund of the license fee is also rejected as the parties are governed by the terms and conditions of the exclusive privilege and the license under which they have mutual obligations to perform and the appellants have completely failed to perform their part by not giving any retail license for the area of operation of the respondent, i.e. Singhbhum East. Therefore, the insistence on the part of the appellants to retain the entire license fee for the period in question under the aforesaid circumstances is ex-facie arbitrary and violative of Article 14 of the Constitution of India. 25. Section 39 of the Act empowers the Member, Board of Revenue to order a deduction of the amount of fee payable during the unexpired portion of the grant. This Court finds that the license fee as mentioned in Clause 5 of the exclusive privilege is by way of advance payment quantity @ Rs.2/- L.P liter on Minimum Guarantee Quantity for the entire district and if a situation is created by the appellants depriving the respondent to supply country liquor, then section 39 of the Act can be invoked to claim a refund. The argument of the appellants that section 39 of the Act does not apply in the claim of refund is rejected. Otherwise also the 13 L.P.A No.329 of 2022 action of the appellants in not granting any retail license for the area of operation of the respondent and not placing any order upon the respondent for the entire period of 2007-08 and simultaneously realizing and insisting on retaining the advance license fee deposited by the respondent is arbitrary and cannot be sustained in law. 26. In view of the aforesaid findings, this Court does not find any illegality or perversity in the order impugned by the learned writ Court, and accordingly, the present appeal is dismissed. (Shree Chandrashekhar, J.) (Anubha Rawat Choudhary, J.) Sudhir/ A.F.R