STATE OF KERALA AND OTHERS versus KANDATH DISTILLERIES

Citation: [2013] 4 S.C.R. 1053 · Decided: 22-02-2013 · Supreme Court of India · Bench: K.S. RADHAKRISHNAN · Disposal: Appeal(s) allowed

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Judgment (excerpt)

[2013] 4 S.C.R. 1053 
STATE OF KERALA AND OTHERS 
v. 
KANDATH DISTILLERIES 
(Civil Appeal No. 1642 of 2013) 
FEBRUARY 22, 2013 
[K.S. RADHAKRISHNAN AND DIPAK MISRA, JJ.] 
Liquor - Application for licence for setting up distillery unit 
A 
B 
- Non-consideration of - After intervention of the Court, 
application considered and then rejected by competent C 
authority - Courts below quashed the rejection order directing 
grant of the licence - On appeal, held: Courts below wrongly 
directed grant of distillery licence by issuing writ of mandamus 
- Grant of the same was within the discretionary power of the 
competent authority - Court should not have interfered with the 
D 
same, unless the applicant established a better claim over 
others, which the applicant failed - Abkari Act - s. 14 - Foreign 
Liquor (Compounding, Blending, Bottling) Rules, 1975 - r.4. 
Constitution of India, 1950 - Art.19(1)(g) and Art.47 -
E 
Fundamental right to trade or business in liquor - Held: In view 
of the directive principles provided under Art.47, State has 
exclusive right or privilege in respect of portable liquor - A 
citizen has, therefore, no right to trade or business in liquor 
as a beverage and the activities, which are res extra 
commercium. 
F 
Writ - Mandamus - A Writ of Mandamus can be issued 
only when a legal right is established against an authority who 
has legal duty emanating in discharge of public duty or 
operation of law - Court to issue the writ of mandamus keeping 
G 
in mind the legislative scheme, its object and purpose, the 
subject matter, the evil sought to be remedied, State's 
exclusive privilege etc. 
1053 
H 
1054 
SUPREME COURT REPORTS 
(2013] 4 S.C.R. 
A 
Administrative Law: 
Policy decision - Liquor policy of State - Judicial review 
of - Held: Monopoly in the trade of liquor is with the State -
State has the power to frame and reframe, change and 
8 rechange, adjust and readjust its policy, which cannot be 
declared as illegal or arbitrary by the Court on the ground that 
earlier Policy was better - Judicial Review. 
Statutory discretion - Exercise of - Exercise of the 
discretion must be based on reasonable grounds and cannot 
C lapse into the arbitrariness or caprice anathema to the rule 
of law envisaged under Art.14 of the Constitution - However, 
the onus to prove the discrimination is on the complainant -
Abkari Act - s.14 - Foreign Liquor (Compounding Blending, 
Bottling) Rules, 1975 - r.4. - Constitution of India, 1950 - Art. 
D 14 - Evidence Act, 1872 - s.10 - Onus to prove. 
Judicial review - Of discretionary decision - Court cannot 
impede the exercise of discretion of an authority acting under 
the Statute by issuing writ of Mandamus - Writ - Writ of 
E mandamus. 
The respondent applied on 12.1.1987, for licence for 
establishing distillery unit in a particular district. In the 
year 1998 and prior thereto, large number of applications 
for setting up of distillery units were received. State 
F Government granted licence to 4 applicants. Out of them 
two licences, were for the establishment of the unit, in the 
district for which the respondent had applied for. 
Respondent challenged the non-consideration of his 
G application. Initially the State communicated the 
respondent that his application would not be considered 
in view of the policy decision not to grant further 
licences. After intervention of the Court, the State 
considered the application of the respondent and rejected 
H the same. Respondent challenged the rejection of his 
STATE OF KERALA v. KANDATH DISTILLERIES 
1055 
application. Single Judge of High Court allowed the writ A 
petition and directed the State to grant licence applied for, 
by the respondent. In writ appeal, Division Bench of High 
Court upheld the order of Single Judge. Hence the 
present appeal. 
Allowing the appeal, the Court 
HELD: 1. Article 47 is one of the Directive Principles 
of State Policy which is fundamental in the governance 
B 
of the country and the State has the power to completely 
prohibit the manufacture, sale, possession, distribution 
C 
and consumption of liquor as a beverage because it is 
inherently dangerous to the human health. Consequently, 
it is the privilege of the State and it is for the State to 
decide whether it should part with that privilege, which 
depends upon the liquor policy of the State. State has, 
D 
therefore, the exclusive right or privilege in respect of 
portable liquor. A citizen has, therefore, no fundament

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