Kanupriya Jaiswal v. State of U.P

Heard Shri Rakesh Kumar, learned counsel for the petitioner and learned ACSC for the State - respondents. The instant writ petition has been filed against the impugned order dated 15.03.2024 passed by the respondent no. 1 as well as the impugned order dated 20.02.2023 passed by the respondent no. 3 and order dated 02.04.2022 passed by the respondent no. 4. Learned counsel for the petitioner submits that the petitioner purchased the entire premises of the Hotel, namely, M/s Moti Mahal (Food & Flavours) and obtained licence in form FL - 6, i.e., for retail vend of Indian Made Foreign Liquor and Foreign Liquor for consumption in the premises of Hotel. He further submits that after purchase, on 05.03.2015, the Commissioner of Excise granted approval of transfer of the licence of Bar (FL - 6) in the name of the petitioner and accordingly, the name of the petitioner was recorded as licensee of FL - 6. Thereafter, the petitioner obtained a licence of Bar for retail sale of Indian Made Foreign Liquor for consumption in the premises of the restaurant in the form of FL - 07. The said licence of FL - 7 was granted to the petitioner by the District Magistrate. He further submits that vide order dated 27.03.2021, the District Magistrate issued notice under section 34 of the U.P. Excise Act suspending both the licenses of Bar and one country liquor shop of the petitioner. The said licences were suspended on the ground that on 24.03.2021, a truck bearing registration No. UP 25 BT 6310 loaded with country liquor manufactured by M/s Cooperative Company Limited was found in Bareilly, which was issued to wholesale country liquor licensee of Kanpur for sale in Kanpur Nagar, but it was found in Bareilly. The driver of the said truck made a statement that the country liquor was to be delivered to one Manoj Kumar Jaiswal, i.e., the petitioner. He further submits that thereafter, an FIR was lodged, bearing Case Crime No. 215/2021 under sections 60/72 of U.P. Excise Act. He further submits that in the suspension order, it was further mentioned that two FIR's, being Case Crime Nos. 0097/2021 & 0098/2021, have been registered alleging supply of country liquor without payment of excise duty. The said FIR's were transferred to the SIT and a fresh Case Crime No. 3/2021 was registered by the SIT under sections 62(2) of Excise Act, sections 120-B, 420, 467, 468, 471, 477A IPC and section 66 of the IT Act as well as sections 7/13 of the Prevention of Corruption Act. Learned counsel for the petitioner further submits that due to the 2nd wave of COVID - 19, the petitioner could not submit his reply within time, but later on, he submitted his reply. On 15.11.2021, the Licensing Authority, by consolidated order, revoked the suspension order of licence of bar, i.e., FL - 6 & FL-7 as well as the suspension order of country liquor shop. Also, the show cause notice issued to the wife and mother of the petitioner were withdrawn. Being aggrieved by the order dated 15.11.2021, the District Excise Officer preferred an appeal under section 11(1) of the U.P. Excise Act before the Commissioner of Excise, Prayagraj, which was allowed and the matter was remanded vide order dated 31.01.2022 for reconsideration of the issue. In pursuance of the remand order, on 19.02.2022, a notice was issued to the petitioner, which was delivered to the wife of the petitioner, who filed her reply stating that her husband is confined in jail. The petitioner enlarged on bail on 15.03.2022 and submitted an application stating therein that when the petitioner was confined in jail, the Bareilly Development Authority carried out demolition proceedings of the Bar of the petitioner and therefore, the entire documents kept in the Office were destroyed. On 02.04.2022, the petitioner again submitted an application for further time, but on the same day, the impugned order dated 02.04.2022 was passed by the Licensing Authority without granting further time. Against the order of cancellation, the petitioner preferred an appeal under section 11(1) of the U.P. Excise Act before the Excise Commissioner, Prayagraj, which has been dismissed vide impugned order dated 20.02.2023. Aggrieved by the order dated 20.02.2023, the petitioner filed revision under section 11(2) of the Excise Act, which has been dismissed vide impugned order dated 15.03.2024. Learned counsel for the petitioner further submits that the proceedings can be initiated against the petitioner only in terms of section 34(1) of the U.P. Excise Act, read with rule 21 of the Uttar Pradesh Excise (Settlement of Licenses for Retail Sale of Country Liquor) (Thirteenth Amendment) Rules, 2020' (hereinafter referred to as 'the Rules of 2020'), but in the case in hand, none of the ingredients mention therein are attracted for cancellation of the petitioner's licence. He further submits that in absence of any of the ingredients, the impugned orders cannot be justified. He further submits that the petitioner has not been convicted for which the licence can be cancelled as contemplated under section 31(4)(c) of the Excise Act. He further submits that on an identical set of facts, Writ Tax No. 623/2022 (Kanupriya Jaiswal Vs. State of U.P. & 5 Others) has been allowed by this Court vide order dated 29.03.2023. Per contra, learned ACSC supports the impugned orders and submits that since the petitioner has violated the terms & conditions of the licence, therefore, his licence has rightly been cancelled. He further submits that in view of section 34(1)(b) of the Excise Act, the licence has been cancelled and since the petitioner has violated the provisions of Rules of 2020, where an affidavit has been submitted before the Licensing Authority at the time of grant of licence, therefore, the licence has rightly been cancelled. He further submits that an FIR has been lodged against the petitioner, which shows there is a criminal case pending against the petitioner. After hearing learned counsel for the parties, the Court has perused the record. The licence of the petitioner has been cancelled under section 34(1)(b) of the Excise Act and for justifying the action taken under section 34(1)(b) of the Excise Act, the respondent has referred that an FIR has been lodged against the petitioner, which is pending and therefore, the petitioner has filed false affidavit stating that no criminal case is registered against him. On a pointed query to the learned ACSC as to when an affidavit has been filed stating therein that no criminal case is pending against the petitioner leading for submission of false affidavit, he could not reply or show from the record that when an affidavit was filed. Once at the time of submission of affidavit, if no criminal case was registered against the petitioner or his family, it cannot be said that the petitioner has filed a false affidavit, which led for taking action against the petitioner. The record also does not reflect that the petitioner is convicted in any criminal case, which could lead to taking action under section 34(1)(c) of the Excise Act. This Court in Kanupriya Jaiswal (supra) has taken the view that if the ingredients of section 34(1), read with rule 21 of the Rules of 2020 is not attracted, no licence can be cancelled. The relevant paragraphs of the said judgement is quoted below:- "In the light of the said provisions contained in Section 34 of the Act read with Rule 21 of the Rules, 2020, it is argued by the petitioner that merely because the husband of the petitioner is involved in an offence, none of the ingredients of Section 34 of the Act or Rule 21 of the Rules, 2020 are attracted so as to exercise power of cancellation as has been done by the department. He argues that Section 34(1)(b) of the Act provides that in the event of breach of any condition of the license either by the licensee, or by his servant or by any person acting on his behalf in respect of the conditions of the license, steps can be taken for cancellation, whereas in the present case, the husband of the petitioner does not fall in any of the said three categories and even otherwise, there is no allegation of breach of any condition of the license granted to the petitioner. It is also argued that in terms of Section 34(1)(c) of the Act, the powers can be invoked by the Licensing Authority only if the holder of the license is convicted of an offence, whereas admittedly in the present case, the petitioner has never been convicted of any offence, thus, it is argued that none of the conditions prescribed under Section 34(1)(a) to (e) are attracted. It is further argued that even in terms of Rule 21 of the Rules, 2020, steps for cancellation can be taken only when the licensee is convicted of an offence punishable and specified in Rule 21(1)(g) of the Rules, 2020, whereas in the present case the petitioner being the license holder has not been convicted in any of the offences. In the counter affidavit filed by the State it has been reiterated that the husband of the petitioner was involved in an offence, which is the foundation for passing of the order. It is further sought to be argued that at the time of obtaining license, the petitioner had given an affidavit that neither herself nor any of the family members are involved in any crime, whereas a criminal case was admittedly registered against husband of petitioner. In the light of the said submission and on perusal of the cancellation order, it transpires that it has been cancelled merely because the husband of the petitioner is accused for an offence. None of the ingredients of Section 34(1) of the Act or Rule 21 of the Rules, 2020 get attracted so as to enable the Licensing Authority to cancel the license on these grounds as has been done in the present case. Considering the fact that there is no authority vested in the authorities to take steps for cancellation either under Section 34 of the Act or under the Rules only on the ground that husband of the petitioner is an accused, the order impugned dated 02.04.2022 passed against the petitioner cancelling the license as well as the appellate order dated 31.01.2022 are wholly unsustainable and are quashed. The writ petition is accordingly allowed. The amount of security forfeited shall be refunded to the petitioner in accordance with law and her application for renewal of the shop license for the period 2022-23 shall be considered afresh and fresh orders thereupon shall be passed within a period of three weeks from the production of a certified copy of this order in accordance with law." In the case in hand also, learned ACSC could not show as to how section 34(1)(b) of the Excise Act is attracted. In view of the aforesaid facts & circumstances of the case as well as the law laid down by this Court, the impugned orders cannot be sustained in the eyes of law. The same are hereby quashed. The writ petition succeeds and is allowed. The amount of security forfeited shall be refunded to the petitioner in accordance with law and his application for renewal of the shop license for the period in question shall be considered afresh and fresh orders thereupon shall be passed within a period of three weeks from the production of a certified copy of this order in accordance with law. Order Date :- 26.5.2025 Amit Mishra AMIT KUMAR MISHRA High Court of Judicature at Allahabad

Heard Shri Rakesh Kumar, learned counsel for the petitioner and learned ACSC for the State - respondents. The instant writ petition has been filed against the impugned order dated 15.03.2024 passed by the respondent no. 1 as well as the impugned order dated 20.02.2023 passed by the respondent no. 3 and order dated 02.04.2022 passed by the respondent no. 4. Learned counsel for the petitioner submits that the petitioner purchased the entire premises of the Hotel, namely, M/s Moti Mahal (Food & Flavours) and obtained licence in form FL - 6, i.e., for retail vend of Indian Made Foreign Liquor and Foreign Liquor for consumption in the premises of Hotel. He further submits that after purchase, on 05.03.2015, the Commissioner of Excise granted approval of transfer of the licence of Bar (FL - 6) in the name of the petitioner and accordingly, the name of the petitioner was recorded as licensee of FL - 6. Thereafter, the petitioner obtained a licence of Bar for retail sale of Indian Made Foreign Liquor for consumption in the premises of the restaurant in the form of FL - 07. The said licence of FL - 7 was granted to the petitioner by the District Magistrate. He further submits that vide order dated 27.03.2021, the District Magistrate issued notice under section 34 of the U.P. Excise Act suspending both the licenses of Bar and one country liquor shop of the petitioner. The said licences were suspended on the ground that on 24.03.2021, a truck bearing registration No. UP 25 BT 6310 loaded with country liquor manufactured by M/s Cooperative Company Limited was found in Bareilly, which was issued to wholesale country liquor licensee of Kanpur for sale in Kanpur Nagar, but it was found in Bareilly. The driver of the said truck made a statement that the country liquor was to be delivered to one Manoj Kumar Jaiswal, i.e., the petitioner. He further submits that thereafter, an FIR was lodged, bearing Case Crime No. 215/2021 under sections 60/72 of U.P. Excise Act. He further submits that in the suspension order, it was further mentioned that two FIR's, being Case Crime Nos. 0097/2021 & 0098/2021, have been registered alleging supply of country liquor without payment of excise duty. The said FIR's were transferred to the SIT and a fresh Case Crime No. 3/2021 was registered by the SIT under sections 62(2) of Excise Act, sections 120-B, 420, 467, 468, 471, 477A IPC and section 66 of the IT Act as well as sections 7/13 of the Prevention of Corruption Act. Learned counsel for the petitioner further submits that due to the 2nd wave of COVID - 19, the petitioner could not submit his reply within time, but later on, he submitted his reply. On 15.11.2021, the Licensing Authority, by consolidated order, revoked the suspension order of licence of bar, i.e., FL - 6 & FL-7 as well as the suspension order of country liquor shop. Also, the show cause notice issued to the wife and mother of the petitioner were withdrawn. Being aggrieved by the order dated 15.11.2021, the District Excise Officer preferred an appeal under section 11(1) of the U.P. Excise Act before the Commissioner of Excise, Prayagraj, which was allowed and the matter was remanded vide order dated 31.01.2022 for reconsideration of the issue. In pursuance of the remand order, on 19.02.2022, a notice was issued to the petitioner, which was delivered to the wife of the petitioner, who filed her reply stating that her husband is confined in jail. The petitioner enlarged on bail on 15.03.2022 and submitted an application stating therein that when the petitioner was confined in jail, the Bareilly Development Authority carried out demolition proceedings of the Bar of the petitioner and therefore, the entire documents kept in the Office were destroyed. On 02.04.2022, the petitioner again submitted an application for further time, but on the same day, the impugned order dated 02.04.2022 was passed by the Licensing Authority without granting further time. Against the order of cancellation, the petitioner preferred an appeal under section 11(1) of the U.P. Excise Act before the Excise Commissioner, Prayagraj, which has been dismissed vide impugned order dated 20.02.2023. Aggrieved by the order dated 20.02.2023, the petitioner filed revision under section 11(2) of the Excise Act, which has been dismissed vide impugned order dated 15.03.2024. Learned counsel for the petitioner further submits that the proceedings can be initiated against the petitioner only in terms of section 34(1) of the U.P. Excise Act, read with rule 21 of the Uttar Pradesh Excise (Settlement of Licenses for Retail Sale of Country Liquor) (Thirteenth Amendment) Rules, 2020' (hereinafter referred to as 'the Rules of 2020'), but in the case in hand, none of the ingredients mention therein are attracted for cancellation of the petitioner's licence. He further submits that in absence of any of the ingredients, the impugned orders cannot be justified. He further submits that the petitioner has not been convicted for which the licence can be cancelled as contemplated under section 31(4)(c) of the Excise Act. He further submits that on an identical set of facts, Writ Tax No. 623/2022 (Kanupriya Jaiswal Vs. State of U.P. & 5 Others) has been allowed by this Court vide order dated 29.03.2023. Per contra, learned ACSC supports the impugned orders and submits that since the petitioner has violated the terms & conditions of the licence, therefore, his licence has rightly been cancelled. He further submits that in view of section 34(1)(b) of the Excise Act, the licence has been cancelled and since the petitioner has violated the provisions of Rules of 2020, where an affidavit has been submitted before the Licensing Authority at the time of grant of licence, therefore, the licence has rightly been cancelled. He further submits that an FIR has been lodged against the petitioner, which shows there is a criminal case pending against the petitioner. After hearing learned counsel for the parties, the Court has perused the record. The licence of the petitioner has been cancelled under section 34(1)(b) of the Excise Act and for justifying the action taken under section 34(1)(b) of the Excise Act, the respondent has referred that an FIR has been lodged against the petitioner, which is pending and therefore, the petitioner has filed false affidavit stating that no criminal case is registered against him. On a pointed query to the learned ACSC as to when an affidavit has been filed stating therein that no criminal case is pending against the petitioner leading for submission of false affidavit, he could not reply or show from the record that when an affidavit was filed. Once at the time of submission of affidavit, if no criminal case was registered against the petitioner or his family, it cannot be said that the petitioner has filed a false affidavit, which led for taking action against the petitioner. The record also does not reflect that the petitioner is convicted in any criminal case, which could lead to taking action under section 34(1)(c) of the Excise Act. This Court in Kanupriya Jaiswal (supra) has taken the view that if the ingredients of section 34(1), read with rule 21 of the Rules of 2020 is not attracted, no licence can be cancelled. The relevant paragraphs of the said judgement is quoted below:- "In the light of the said provisions contained in Section 34 of the Act read with Rule 21 of the Rules, 2020, it is argued by the petitioner that merely because the husband of the petitioner is involved in an offence, none of the ingredients of Section 34 of the Act or Rule 21 of the Rules, 2020 are attracted so as to exercise power of cancellation as has been done by the department. He argues that Section 34(1)(b) of the Act provides that in the event of breach of any condition of the license either by the licensee, or by his servant or by any person acting on his behalf in respect of the conditions of the license, steps can be taken for cancellation, whereas in the present case, the husband of the petitioner does not fall in any of the said three categories and even otherwise, there is no allegation of breach of any condition of the license granted to the petitioner. It is also argued that in terms of Section 34(1)(c) of the Act, the powers can be invoked by the Licensing Authority only if the holder of the license is convicted of an offence, whereas admittedly in the present case, the petitioner has never been convicted of any offence, thus, it is argued that none of the conditions prescribed under Section 34(1)(a) to (e) are attracted. It is further argued that even in terms of Rule 21 of the Rules, 2020, steps for cancellation can be taken only when the licensee is convicted of an offence punishable and specified in Rule 21(1)(g) of the Rules, 2020, whereas in the present case the petitioner being the license holder has not been convicted in any of the offences. In the counter affidavit filed by the State it has been reiterated that the husband of the petitioner was involved in an offence, which is the foundation for passing of the order. It is further sought to be argued that at the time of obtaining license, the petitioner had given an affidavit that neither herself nor any of the family members are involved in any crime, whereas a criminal case was admittedly registered against husband of petitioner. In the light of the said submission and on perusal of the cancellation order, it transpires that it has been cancelled merely because the husband of the petitioner is accused for an offence. None of the ingredients of Section 34(1) of the Act or Rule 21 of the Rules, 2020 get attracted so as to enable the Licensing Authority to cancel the license on these grounds as has been done in the present case. Considering the fact that there is no authority vested in the authorities to take steps for cancellation either under Section 34 of the Act or under the Rules only on the ground that husband of the petitioner is an accused, the order impugned dated 02.04.2022 passed against the petitioner cancelling the license as well as the appellate order dated 31.01.2022 are wholly unsustainable and are quashed. The writ petition is accordingly allowed. The amount of security forfeited shall be refunded to the petitioner in accordance with law and her application for renewal of the shop license for the period 2022-23 shall be considered afresh and fresh orders thereupon shall be passed within a period of three weeks from the production of a certified copy of this order in accordance with law." In the case in hand also, learned ACSC could not show as to how section 34(1)(b) of the Excise Act is attracted. In view of the aforesaid facts & circumstances of the case as well as the law laid down by this Court, the impugned orders cannot be sustained in the eyes of law. The same are hereby quashed. The writ petition succeeds and is allowed. The amount of security forfeited shall be refunded to the petitioner in accordance with law and his application for renewal of the shop license for the period in question shall be considered afresh and fresh orders thereupon shall be passed within a period of three weeks from the production of a certified copy of this order in accordance with law. Order Date :- 26.5.2025 Amit Mishra AMIT KUMAR MISHRA High Court of Judicature at Allahabad