LexSTATE OF KERALA & ORS. versus B. SURENDRA DAS ETC
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A B (2014] 3 S.C.R. 1054 STATE OF KERALA & ORS. v. B. SURENDRA DAS ETC. (Civil Appeal Nos. 3196-98 of 2014) MARCH 5, 2014 [H.L. GOKHALE AND J. CHELAMESWAR, JJ.] ABKARI POLICY: Kera/a Abkari Policy - Object of - Held: Is to curb the rampant alcoholism in the State of Kera/a, which C claims to have the highest consumption of alcohol as against the other states in India, and whereby the younger generation is getting addicted - The objective is in pursuance of Article 47 of the Constitution which declares it to be a Directive Policy for the State to endeavour to bring about prohibition of D consumption of intoxicating drinks - Constitution of India, 1950 - Article 47 - Liquor. CONSTITUTION OF /NOIA, 1950 - Article 47 - Liquor - Right to trade - Held: There is no fundamental right to trade E . in liquor - At the same time where such a trade is permitted, there cannot be any room for discrimination. KERALA ABKARI ACT: r.13 - Kera/a Abkari Policy 2011-12 -Amendment to s.13 F omitting words 'three star' from r. 13(3) - Constitutionality of - Held: In the case of B. Six Holiday Resorts, the deletion of two star hotels from the eligibility of FL-3 licences was upheld by Supreme Court - It was held therein that promotion of tourism should be balanced with general public interest and G that if policy is not open to challenge the amendment of the rules to effect the policy can also not be challenged - Deletion of three star hotels falls in the same genre as the deletion of two star hotels, which was done earlier - This being the position, the State cannot be faulted for deletion of three star H 1054 STATE OF KERALA & ORS. v. B. SUREN ORA DAS 1055 ETC. hotels after a periodical revision of the policy. A r.13 - Kera/a Abkari Policy 20'11-12 -Amendment to r.13 introducing distance rule - Constitutionality of - Held: The consequences of the amendment would be that four star and five star hotels would not be permitted to have FL-3 licences 8 only on the ground that they are within the prohibited distance from such hotels which have poor hygiene standards, and which are not following norms laid down by the State Government - As per the report of the GAG, there was violation of licence conditions by the Bar Hotels - The Excise C Commissioner also sent a letter to the Government · highlighting poor standards maintained by the 418 unclassified bars and requesting not to grant fresh FL3 licenses as during the last one year several people had died due to excessive drinking in the unclassified hotels - Even then seven more FL3 licenses were issued - Moreover in the D Abkari Policy for 2010-11, the Government declared that the FL3 licensees not having the requisite star qualification and ,,-.;ho were functional during 2009-10 should be regularized - Government having not taken a firm stand to ensure that only hotels of a minimum standard are issued FL3 licenses has E seriously compromised public safety - This is counter- productive to the objective of r. 13(3), which is to promote tourism, as well as to the State's avowed policy of improving the health and nutrition standards of its citizens - In the circumstances, although there is no dispute regarding the F power of the State Government to bring about the necessary reform, by modifying the rules, it has got to be justified on the touchstone of the correlation between the provision and the objective to be achieved - If that correlation is not established, surely the rule will suffer from the vice of arbitrariness, and G therefore will be hit by Article 14 - The State Government has appointed a one-man commission for reviewing the Abkari Policy, by issuing a necessary notification - The commission would take into consideration the hard realities which are reflected in the report of the CAG and make necessary H 1056 SUPREME COURT REPORTS [2014] 3 S.C.R. A recommendations - In these circumstances, distance rule by way of addition of Rule (3E) in Rule 13(3) is held to be bad in law - The state government will not proceed to deny FL3 licenses to hotels with a classification of four star and above by resorting to their deletion under r. 13(3) until the report of B the one-man commission is received, and until it takes action against the non-standard restaurants which have been permitted under the sixth and seventh proviso of r. 13(3). Classification and reclassification of hotels - Bar licence - Held: The two
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