KERALA SAMSTHANA CHETHU THOZHILALI UNION versus STATE OF KERALA AND ORS.

Citation: [2006] 3 S.C.R. 420 · Decided: 24-03-2006 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed

Cited by 4 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
KERALA SAMSTHANA CHETHU THOZHILALI UNION 
v. 
STATE OF KERALA AND ORS. 
MARCH 24, 2006 
B 
[S.B. SINHA AND P.K. BALASUBRAMANY AN. JJ.] 
KertJ!a Abkari Shops Disposal Rules, 2002: Rules 4(2) and 9(/0)(b). 
C 
Sale of arrack--Ban of--Workers engaged in the manufacture, import, 
export, transport, sale and possession of arrack rehabilitated and paid 
compensation at the rate of Rs. 30,000 per worker-Benefits under Abkari 
Workers Welfare Fund Board Act were also given---lt was also directed that 
one arrack worker each must he employed in all toddy shops--High Court 
upheld validity of Rules ./(2) and 9( IO;(b)---{'orrectness of Held: A Rule is 
D required to be made in conformity with the provisions of the Act whereunder 
it is made- -Stall' has no power to direct a particular class of workers to be 
employed in other categories of liquor shops -State cannot thrust employees 
upon an unwilling employa-- Furthermore, Slate cannot rehabilitale one set 
of workers at the cost of the other -Hence, Rule ./(2) declared ultra vires in 
E its entirety- Administrative Law. 
F 
Doctrines: 
"Take it or leave it.._ -Explained 
The appellants were a federation of trade unions of toddy tappers 
and workers in toddy shops. The provisions of the Kerala Abkari Act 
sought to control and regulate various categories of intoxicating liquor 
and intoxicating drugs including arrack and toddy. The respondent-State 
banned the sale of arrack and took a policy decision to rehabilitate the 
workers engaged in the manufacture, import, export, transport, sale and 
G possession of arrack and paid compensation at the rate of Rs. 30,000 per 
worker. The said workers were also paid benefits under the Abkari 
Workers Welfare Fund Board Act. 
The respondent-State, in exercise of the power under Section 29 of 
H 
420 
-
KERALA SAMSTHANA CHETHU THOZHILALI UNION 1·. STATE OF KERALA 
42 J 
the Act, inserted the Kerala Abkari Shops Disposal Rules, 2002 directing A 
that one arrack worker each must be employed in all toddy shops. The validity 
of the said Rules was questioned both by the holders oflicences as also by the 
toddy workers. Th~ High Court upheld the validity of the Rules. Hence the 
appeal. 
The following question arose before the Court:-
Whether Rules 4(2)and 9(10)(b) of the Kerala Abkari Shops Disposal 
Rules, 2002 are ultra vires the Kerala Abkari Act? 
Allowing the appeals, the Court 
B 
c 
HELD: I. The Kerala Abkari Act was enacted to consolidate and 
amend the law relating to the import, export, transport, manufacture, sale 
and possession of intoxicating liquor and/or intoxicating drugs in the State. 
While framing the Kerala Abkari Shops Disposal Rules, 2002 for the 
purposes of the Act, the legislative policy cannot be abridged. The Rules D 
'!lust be framed to carry out the purposes of the Act. 1425-E, F] 
2. By reason of Section 8 of the Act, trade in arrack was prohibited as 
far back as in the year 1996. By reason of the impugned Rules, the State has 
not laid down the terms and conditions for employment of a worker. The Act 
does not contain any provision therefor. Under the common law as also under E 
the provisions of the Specific Relief Act, 1963, an employer is entitled to 
employ any person he likes. It is well-settled that no person can be thrust 
upon an unwilling employer except in accordance with the provisions of a 
special statute operating in the field. Such a provision cannot be made by the 
State in exercise of its power under delegated legislation unless the same is 
expressly conferred by the statute. [430-G, H; 431-A, BJ 
F 
3.1. A Rule is not only required to be made in conformity with the 
provisions of the Act whereunder it is made, but the same must be in 
conformity with the provisions of any other Act, as a subordinate 
legislation cannot be violative of any plenary legislation made by the 
Parliament or the State Legislature. [431-B] 
G 
3.2. Rules 4(2) and 9(IO)(b) in the Rules were introduced six years after 
the trade in arrack was completely prohibited. Section 18-A of the Act 
recognizes the common law right of the State to part with the privilege. The 
State's exclusive privilege of supply or sale of liquor is also not in question. 
H 
422 
SUPREME COCRT REPORTS 
[2006] 3 S.C.R. 
_ A Section 18-A was enacted having regard to Article 47 of the Constitution of 
India. The State while parting with its exclusive privilege or a part thereof, 
may impose such conditions but once such terms and conditions 

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