RAJA MALLAIAH AND ANR. versus ANIL KISHORE AND ORS.

Citation: [1980] 3 S.C.R. 794 · Decided: 25-04-1980 · Supreme Court of India · Bench: O. CHINNAPPA REDDY · Disposal: Dismissed

Judgment (excerpt)

A 
B 
c 
D 
E 
I! 
G 
n 
794 
RAJA MALLAIAH AND ANR. 
v. 
AN!L KISHORE AND ORS. 
April 25, 1980 
[0. CHINNAPPA REDDY AND A. P. SEN, JJ.] 
.. 4ndhra Pradesh (Lease of Rigllt to sell Liquor in Retail) Rules. 1969-
Rule 12 read with Rules 3 and 4 and administrative 
instruction thereunder> 
scope of-J¥hrther regrouping of 78 shops as a single lot 
for auctioning at 
the postponed auction, without 'recording reasons therefor and holding of 
such an auction within half an hour of the decision regarding regroup is con-
trary to Rule 12. 
Under Rule 4 of the Andhra 
Pradesh Excise (Lease of 
Right to sell 
Liquor in Retail) Rules, 1969, made in exercise of the powers conferred upon 
the Government by section 72 read with section 17, 29, 31 and 64 of the 
Andhra Pradesh 
Excise Act, 
1968, a notification dated August 20, 
1979 
was published in the District Gazette, Hyderabad, by the Commissioner of 
Excise Andhra Pradesh, giving a notice of a proposal to hold an auction from 
September 1, 1979 to September 3, 1979, of the right to sell arrack, in retail 
in respect of 78 arrack shops in the twin cities of Hyderabad and Secunderabad 
during the Abkari year October 1, 1979 to September 30, 1980. The notifi-
cation mentioned that 22 out of 78 shops would be auctioned in ten groups 
of two and three shc>ps, while the remaining 56 shops would be auctioned 
individually. This was according to the pattern which obtained for the year 
1978-79 for which year the auction fetched an aggregate monthly rental of 
Rs. 32,99,537-72 np. 
On account of some representations made by 
Excise 
Contractors in regard to some conditions regarding the bottling of arrack, the 
auction was postponed to September 7, 1979. Auction was sought to be held 
on September 7, 1979 and September 12, 1979 but there were no bids. 
On 
September 21, 1979, the 
Collector (the auctioning authority) 
followed a 
peculiar procedure. First he auctioned 34 arrack shops in Hyderabad 
City 
individually and the bids fetched 
an aggregate of Rs. 6,49,700 
(monthly 
rental). Then he put the 34 shops to auction as a single lot but there was 
no bid. Similarly he auctioned the 44 
arrack 
shops of Secunderabad 
city 
individually and they fetched an aggregate bid of Rs. 6,02,100 (monthly ren-
tal). He then put the 44 shops to auction as a single lot, but there 
was 
no bid. Thereafter he put the entire lot of 78 shops to auction as a single 
lot. There was no bid. The auction was postponed to September 22, 1979 
and on that 'day the same peculiar procedure was repea.ted. 
The highest bid 
for all the 78 shops in one lot was Rs. 24,00,000/-, while there were two 
tenders for Rs.~15.ll,111/11 ps and 
Rs. 25,55,555/55 ps. Therefore, the 
tender for Rs. 25,55,555155 ps. was accepted. 
Seventeen persons who were lessees of the arrack shops in the twin cities 
during the year 1978-79 filed two writ petitions in the High Court of Andhra 
Pradesh questioning the auction held on September 21. 1979 and September 
22, 1979 on the ground that the Collector had no jurisdiction to auction the 
78 shops as one lot, thereby altering the entire pattern of the 
auction as 
• 
• 
• 
RAJ A MALLAIAH v. ANIL KISHORE 
795 
notified earlier. lt was pleaded that the action of the Collector was contrary 
A 
to rule 12 of the A.P. (Lease of Right to sell Liquor in Retail) Rules, 1969 
and the administrative 
instructions 
issued by the Excise 
Commissioner by 
.J 
which the Collector was bound. A learned single Judge allowed the writ 
petitions and directed a reauction to be held within __.?.. period of fifteen days. 
The present appellants and some others, as well as the State of Andhra 
Pradesh preferred appeals under clause 15 of the Letters Patent. The Divi-
sion Bench dismissed them on the ground that there was 
a 
contravention 
B 
..,. 
oJ Rule 12 of the Rules as the auctioning authority failed to record reasons 
for grouping the 78 shops in one lot. 
• 
Dismissing all the appeals by special leave, the Court 
HEW : I. The scheme of the Andhra Pradesh Excise 
Act 
sho\vs that 
the Commissioner is at the apex, as it were, of the Excise Administrations 
of the State. He is the Chief Controlling Authority for all matters connected 
, with the administration of the Excise Act and has the control of the adminis-
tration of the Excise Department The Collector who is invested with the 
power to perform various functions under the Act is also 
subject to the 
control of the Commissioner. Having regard t

Excerpt shown. Read the full judgment & AI analysis in Lexace.