SHIV KUMAR BHAGAT versus STATE OF BIHAR AND ORS.

Citation: [2003] SUPP. 3 S.C.R. 654 · Decided: 12-09-2003 · Supreme Court of India · Bench: N. SANTOSH HEGDE · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
SHIV KUMAR BHAGAT 
V. 
STATE OF BIHAR AND ORS. 
SEPTEMBER 12, 200..i 
B 
[N. SANTOSH HEGDE AND B.P. SINGH, JJ.] 
Bihar and Orissa Excise Rules: 
R.45-Additional licence-Requirements for granting-Compliance 
C of-Indian Made Foreign Liquor-Wholesale vending- Collector 
recommending to Excise Commissioner for sanction of one additional 
wholesale liquor licence for sale of IMFL-Existing licensee filing petition 
before Excise Commissioner, who held that recommendation for an 
additional licence was justified-Existing licensee's revision before Board 
D of Revenue dismissed, but his writ petition allowed by High Court on the 
ground that the additional licence granted was illegal inasmuch as the 
Collector while making the recommendation to Excise Commissioner had 
not complied with the requirement of r.45-Held, in sum and substance 
bath the Collector as well as the Commissioner while granting licence for 
E 
the retail sale or wholesale vend of IMFL must keep in mind the needs of 
the people of the area concerned-The true test with reference to r.45 is 
whether the additional licence has been granted having regard to the needs 
of the people of that area and with a view to counteract supply through 
illicit sources-The use of the words "to meet an ascertained demand for 
such article" only means that the authorities must make an assessment as 
F to whether the demand for the excisable article in question has increased 
and whether supply of such excisable article, in the instant case JMFL, can 
be met with the existing licensees-On facts, 
the requirements of the 
provisions of the Act and r.45 have been complied with-Under the 
circumstances and on the material as were placed before the Commissioner, 
G his conclusion that the grant of an additional licence was justified cannot 
be found fault with-Even assuming that there was some technical defect 
by reason of some omission on the part of the Collector, inasmuch as he 
did not mention all the relevant facts in the letter of recommendation itself, 
the same cannot in view of the provisions of Section 41 of the Act, 
H invalidate the licence granted by the Excise Commissioner-The submission 
654 
S. K. BHAGAT v. STATE [B.P. SINGH, J.] 
655 
that since the period of licence having run out there was nothing left to A 
be decided in this appeal, which also has become infructuous, is also 
misconceived--So far as the grant of wholesale licence to vend IMFL is 
concerned, under the Rules the same may be granted for any number of 
years not exceeding five years, as the Board may decide in each case-
Bihar Excise Act,1915-S.4/. 
B 
Words and Phrases: 
Expression "to meet an ascertained demand for such article"-
Meaning of in the context ofr.45 of the Bihar and Orissa Excise Rules. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7269 of 
2003. 
From the Judgment and Order dated 13.8.2002 of the Patna High 
Court in C.W.J.C. No. 7075 of 2002. 
R.K. Jain, Satyabir Bharti and Mrs. Rachna Gupta for the Appellant. 
A. Sharan, Arup Banerjee, S.A. Khan, Deba Prasad Mukherjee, B.B. 
Singh and Ms. Sunita R. Singh for the Respondent. 
The folk>wing Order of the Court was delivered : 
B.P. SINGH, J. : Special Leave granted. 
c 
D 
E 
We have have heard counsel for the parties at length. In this appeal F 
the appellant has impugned the judgment and order of the High Court of 
Judicature at Patna dated 13.8.2002 in CWJC No. 7075 of2002. The High 
Court while allowing the writ petition filed by respondent No. 5 herein 
quashed the letter of the Collector dated 13 .2.2002 recommending the grant 
of one additional licence for wholesale vending of Indian Made Foreign 
Liquor (hereinafter referred to as "IMFL") for the district of Begusarai on G 
the ground that the same was not made in accordance with Rule 45 of the 
Bihar and Orissa Excise Rules (hereinafter referred to as the "Rules") 
framed under Section 89 of the Bihar Excise Act, 1915 (hereinafter referred 
to as "the Act). It held that since the recommendation made by the Collector 
was not in accordance with the Rules, the recommendation could not be H 
656 
SUPREME COURT REPORTS [2003) SUPP. 3 S.C.R. 
A acted upon and accepted by the Commissioner by his order dated 18.3.2002. 
The facts of the case in so}ar as they are relevant for the disposal 
of this appeal are as follows : · 
The Collector ofBegusarai sent a proposal to the Excise Commissioner 
B for sanction of one additional wholesale liquor licence in favour of the 
appel
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