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Judgment
N.K. Patil, J.—In these batch of writ petitions, the Petitioners being the Societies Registered under the Karnataka Co-operative Societies Act, are questioning the legality and validity of the impugned Notification dated 19.7.2004 bearing No. FD:17:EDC:2004, vide Annexure-A issued by the 1st Respondent. Further, they sought for a direction directing the Respondents to issue licence in their favour for the Excise Year 2004-05.
The grievance of the Petitioners in these writ petitions is that, they are the registered Societies under the Karnataka Co-operative Societies Act. The main object of the Petitioners-societies is to promote the activity of tapping and all the members of the Petitioners-societies are engaged in the family avocation of tapping of Toddy. The members of the Petitioners-societies have no other avocation than tapping of the trees for Toddy. The tapping of the Toddy, its transport and sale are governed under the Karnataka Excise (Tapping of Trees) Rules, 1991. These Petitioners are doing the business in pursuance of the necessary licence granted by the Government as governed under the relevant Rules. The authorities had considered their request and renewed their licences for the relevant Excise years earlier. When they are doing their business for their avocation of livelihood, to shock and surprise of the Petitioner-societies, they came to know about the Government Notification dated 19.7.2004 in No. FD:17:EDC:2004(iii) vide Annexure-A, banning the tapping of trees for Toddy which has been issued unilaterally without any justification. Therefore, the Petitioners-societies are constrained to approach this Court, by way of filing these writ petitions.
The principal submission canvassed by the learned Senior Counsel appearing for the Petitioners is on two folds. He has submitted that, the decision taken by the Government by way of issuing impugned Notification is arbitrary, illegal and discriminatory in nature on the ground that, the State Government has taken a decision only in so far as Gulbarga and Raichur District are concerned and it has not taken any decision in respect of Udupi and Dakshina Kannada Districts. Nor the Respondents have produced any authenticated documents to substantiate the stand taken by them in their statement of objections, except making oral statements. This is nothing but colourable exercise of powers by the authorities contrary to the materials on record. It is not the case of the Respondents that, the Petitioners-societies have violated the terms of the licence granted by the authorities and doing the business contrary to the relevant Rules. If at all, the State Government wants to take a Policy decision, it must take the same in a reasonable manner without any discrimination. Banning of tapping of trees for Toddy in two Districts and permitting the same in another two districts of the State, is impermissible, in view of the well settled law laid down by the Apex Court in the case of Khoday Distilleries Limited v. State of Karnataka, reported in 1995 (1) SCC 575.
Further, he submitted that when the State permits trade or business in the potable liquor with or without limitation, the citizen has the right to carry on trade or business subject to the limitations, if any, and the State cannot make discrimination between the citizens who are qualified to carry on the trade or business. Further he has placed reliance on the principles of law laid down by the Supreme Court at para No. 46 of the above said judgment. Therefore, he submitted that, the impugned Notification issued by the Respondents is highly illegal, unreasonable, besides, capricious, arbitrary and opposed to Article 14 of the Constitution of India and it is liable to be quashed.
Further, the learned Senior Counsel appearing for the Petitioners-societies vehemently submitted that, the Respondents have not produced any material or documentary evidence to justify the stand taken by them at Para Nos. 4, 9 and 10 of the statement of objections, except making an oral statement and the same will not satisfy to justify the issuance of impugned Notification vide Annexure-A. During the course of the submission, the learned Additional Government Advocate has made available the xerox copy of the charges to the learned Senior Counsel appearing for the Petitioners-societies to show that 17 cases were initiated against some of the Petitioners-societies in Sedam, Chincholi and Chittapur Taluk and out of said 17 cases, three cases were decided in acquittal and remaining cases are pending adjudication, but he has failed to produce FIR and chargesheet in those cases. On perusal of the same, the learned Senior Counsel appearing for the Petitioner-societies submitted that, the stand taken by the Respondents in their objections at Para No. 9 cannot be taken into consideration. If in case, any Petitioners- societies had violated the terms and conditions of the licences, it is very much open for the Respondents to initiate proper proceedings, as envisaged under the mandatory provisions of the Excise Act and Rules and it is not the ground to make discrimination between the districts, in view of the well settled law laid down by the Apex Court as stated supra. Further, he submitted that, if viewed from any angle, the impugned Notification issued by the State Government is opposed to law, facts and circumstances of the case and it is liable to be set aside.
Per contra, the learned Additional Government Advocate appearing for Respondents, inter-alia, contended and substantiated the impugned Notification issued by the State Government, banning tapping and sale of Toddy in six taluks of Gulbarga and Raichur Districts on the ground that, there are no sufficient toddy trees are available in those Taluks and they are not in a position to run the business for evoking their livelihood Several cases had been initiated against some of the Petitioners-societies in Sedam, Chincholi and Chittapur Taluks and they are pending adjudication before the jurisdiction Courts. Further, the Respondents have taken a specific stand in their statement of objections that, the Government has taken a policy decision to ban tapping and sale to Toddy in four Taluks of Gulbarga and two Taluks of Raichur Districts. The Toddy Tappers Co-operative Societies were manufacturing and selling spurious toddy by using chemicals like "Chloral Hydrate", which endangers the health of the consumers. In addition to that, the Government has also suffered considerable loss of revenue. Therefore, the Government has taken a policy decision to ban the tapping and sale of toddy in the above six Taluks, after spelling it in the budget and issued the Notification. The said Notification has been issued by the Government, after collecting necessary reports from the Deputy Commissioner of Excise of the concerned Districts about how many trees are available in those districts and other materials and after scrutinizing the materials made available by the respective Deputy Commissioners for Excise of the respective Districts, the Government has taken a Policy decision, in the interest of public at large. So far as, the Dakshina Kannada and Udupi Districts are concerned, there are sufficient toddy trees are available and they are not found in using chemicals like "Chloral Hydrates" which endangers the health of the consumers. In Gulbarga and Raichur Districts also, only six Taluks were not permitted for tapping and selling of toddy and not in other Taluks, hence, the question of discrimination by the Government does not arise, in taking the policy decision for the welfare of the citizens of the Districts. Further, he vehemently submitted that, as a matter of fact, cases had been registered against some of the Petitioners-societies in those taluks as stated supra, and they have got Report of Chemical Analysis from the Chief Chemist and Ex-Officio Assistant of Chemical Examiner to Government of Karnataka, Central Laboratory, Department of Excise, Bangalore and the matters have been seized by the respective jurisdictional Court. Therefore, he submitted that no injustice as such has been committed by the Government in issuing the impugned Notification and the decision taken by the Government is just and reasonable and also taking into consideration the ground reality of the matter in dispute.
Further, he submitted that, in view of the well settled principles of law laid down by the Supreme Court and this Court in hosts of judgment that, the Government has got power to take a policy decision in the interest of economy, social justice and on financial aspects. This matter has been spelled on the floor of the house in the Budget. Further, he submitted that, there is no dispute about the principles of law laid down by the Apex Court in Khoday Distilleries''s case, which was relied by the learned Senior Counsel appearing for the Petitioners-societies. The facts and circumstances of the said judgment is not at all applicable to the facts and circumstances of this case. Nor the Petitioners-societies have made out any good grounds to interfere with the impugned Notification issued by the Respondents. Hence, the writ petitions filed by the Petitioners-societies are liable to be rejected.
After having heard the learned Senior Counsel appearing for the Petitioner-societies, the learned Additional Government Advocate appearing for the Respondents at a considerable length of time and after careful perusal of the grounds urged by the Petitioners, the stand taken by the Respondents in their statement of objections and also the contentions of the learned Senior Counsel for the Petitioners-societies, the points that arise for consideration in these writ petitions are:
(i) Whether the policy decision taken by the Government by way of issuing impugned Notification banning tapping of Toddy in Gulbarga and Raichur Districts is in accordance with law?
(ii) Whether the State Government has violated Article 14 of the Constitution of India and taken a decision arbitrarily and unreasonably?
Re. Points 1 and 2:
After thorough evaluation of the entire materials available on record threadbare and after careful perusal of the contentions urged by the learned Senior Counsel appearing for the Petitioners-societies and the learned Additional Government Advocate for Respondents, I do not find any error, illegality, much less, any irregularity committed by the Respondents, while issuing the impugned Notification. The Government has taken the said policy decision, after taking into consideration the social and financial justice, other implications in those districts and also taking into consideration the violation of the terms of licences by the Petitioners-societies, as rightly pointed out by the Respondents in their statement of objections that some of the Petitioners-societies are manufacturing and selling spurious toddy by using chemicals like Choloral Hydrate, which endanger the health of the consumers. The said stand taken by the Respondents in their statement of objection is supported by the report of Chemical Analysis submitted by the Chief Chemist and Ex-officio Assistant of Chemical Examiner to Government of Karnataka, Central Chemical Laboratory, Department of Excise, Bangalore. The copy of the said report is produced by the learned Additional Government Advocate. In the said report, obtained by the Sub-Inspector of Excise, Sedam Sub-Range, Sedam, dated 24.3.2004, the Chief Chemist and Ex-Officio Assistant, has opined that: "Presence of Chloral Hydrate was detected in the above stated packets at Sl. No. 1: (ii) Presence of ethyl alcohol was detected in the above stated bottles at Sl. No. 2.... etc."
Further, it is significant to note that manufacturing and selling toddy by using chemicals like "Chloral Hydrate" which endangers the health of the consumers is found in "Modi''s Medical Jurisprudence and Toxicology" 14th Edition, wherein the symptoms have been explained for using the chloral hydrate, which reads as follows:
Symptoms: The patient complains of a burning pain in the mouth, throat and stomach immediately after swallowing a poisonous dose, but it is not marked if the drug is administered in a mucilaginous mixture. This is followed by drowsiness, unconsciousness, loss of reflexes, and deep sleep passing into coma. The face is cyanosed, the pulse is slow, feeble and irregular, the breathing is stertorous, the skin is cold with sub-normal temperature and pupils are contracted. Some times, a scarlatinal or urticarial rash may be seen on the skin. Death usually occurs from paralysis of the respiratory centre. In a few cases death may occur from failure of the heart soon after swallowing the drug.
After careful perusal of the symptoms as found in the above book, the consumption of "Chloral Hydrate" endangers the life of human beings and those who uses will have serious repercussion and such person will suffer from lot of side effects.
Further, it is pertinent to note that, the Respondents have given details about the standing and yielding trees in those two districts at para No. 10 of their statement of objections stating that "in four Taluks of Gulbarga District, there are 2,73,628 toddy trees (date trees), out of them only 73,400 were marked for tapping toddy. In two Taluks of Raichur District, there are 1,98,000 Toddy trees (date trees) and out of them only 78,810 trees were marked for tapping toddy. Though 73,400 trees and 78,810 trees were marked for tapping, all the trees cannot be tapped for 365 days." The Respondents have also stated regarding the pendency of cases against the Petitioners-societies under Sections 13, 14 etc., of the Karnataka Excise Act, 1965 in Para No. 9 of their objections and out of 15 cases, 14 cases are pending adjudication before the jurisdictional Court. It is the specific stand taken by the Respondents in their statement of objections that, the Petitioners-societies have engaged in manufacturing and selling spurious toddy by using Chloral Hydrate and the authorities have also seized nearly 1600 K Gs of choloral hydrate in Sedam and Chincholi Taluks. The State Government taking into consideration all these materials and on the basis of the Report of Chemical Analysis and also the reports submitted by the Deputy Commissioner of Excise of those Districts has taken a decision, which is just and reasonable. I do not find any error or illegality, in the said decision and therefore, the Petitioner-societies are not entitled to seek any reliefs at the hands of this Court under extra ordinary jurisdiction of Article 226 of the Constitution of India.
Further, the learned Senior Counsel appearing for the Petitioners-societies placed reliance on the decision of the Constitution Bench in the case of Khoday Distilleries Ltd. and Others Vs. State of Karnataka and Others, , regarding the discriminations and violation of Article 14 of the Constitution of India, committed by the Respondents. He has taken me through para Nos. 46 and 60 in particular para 60(g) of the said judgment and submitted that "the citizen has the right to carry on trade or business subject to the limitations, if any and the State cannot make discrimination between the citizens who are qualified to carry on the trade or business." There is no dispute regarding the well settled law laid down by the Supreme Court in the above case. But, in the instant case, the facts and circumstances are entirely different in nature and hence, the said reliance placed by the learned Senior Counsel for the Petitioners-societies is not at all applicable to the present case.
The learned Additional Government Advocate appearing for Respondents has made available the original record to show the statistics collected by them in respect of Dakshina Kannada and Udupi Districts, including Mangalore, Bhantwal, Ujre, Sullia Taluks, regarding the standing trees and yielding trees of all these taluks and submitted that, in all these five Taluks there are 11,05,658 coconut trees and other trees, totally about more than ten lakh trees. So far as Gulbarga district is concerned, there are 73,400/- trees in Sedam, Chincholi and Chittapur Taluks. This aspect of the matter has been carefully scrutinized by the competent authority before taking a decision and placing the matter before the Legislation. Therefore, I do not find any discrimination committed by the Government, while taking the above decision. The specific contention taken by the learned Senior Counsel appearing for the Petitioner regarding the discrimination made by the State Government is concerned, the same has got no substance and the said contention is liable to be rejected. Accordingly, it is rejected.
For yet another reason, these writ petitions are liable to be rejected is, in view of the well settled law laid down by the Supreme Court in Khoday Distelleries case that: "nobody has got fundamental right to do liquor business." Further regarding the interference of this Court in the policy decisions taken by the State Government is concerned, this Court has got very limited scope to interfere with the Policy decision taken by the State Government having regard to the ground reality and after collecting the statistics. It is worthwhile to consider the principles of law laid down by the Apex Court in the case of Government of Maharashtra and Others Vs. Deokar''s Distillery, at Para No. 14, which is relevant reads as follows:
...There is, no doubt, a degree of public accountability in all Government Enterprises. But, the present question is one of the extent and scope of judicial review over such matters. With the expansion of the State''s presence in the field of trade and commerce and of the range of economic and commercial enterprises of Government and its instrumentalities there is an increasing dimension to Government concern for stimulating efficiency, keeping costs down, improved management methods, prevention of time and cost over-runs in projects, balancing of costs against time-scales, quality control, cost benefit ratios etc. In search of these values it might become necessary to adopt appropriate techniques of management of projects with concomitant economic expediencies, these are essentially matters of economic policy which lack adjudicative disposition, unless they violate constitutional or legal limits on power or have demonstrable pejorative environmental implications or amount to clear abuse of power. This again is the judicial recognition of administrator''s right to trial and error, as long as both trial and error are bona fide and within the limits of authority.
xxx xxx xxx
In regard to Courts and policy we might recall the following words of a learned author:
The Courts are kept out of the lush field of administrative policy, except when policy is inconsistent with the express of implied provisions of a statute which creates the power to which the policy relates or when a decision made in purported exercise of a power is such that a repository of the power, acting reasonably and in good faith, could not have made it.
Further in the case of Tata Cellular v. Union of India, reported in 1994 (6) SCC 65, it is held that:
...
Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation....
Further Lord Scarman in Nottinghamshire County Council v. Secretary of State for the Environment proclaimed:
"Judicial review" is a great weapon in the hands of the Judges; but the Judges must observe the constitutional limits set by our parliamentary system upon the exercise of this beneficial power.
The Supreme Court in the case of Balco Employees Union v. Union of India and Ors. reported in 2002 (2) S.C.C. 333 held thus:
It is evident from the above that it is neither within the domain of the Courts nor the scope of the judicial review of to embark upon an enquiry as to whether a particular public policy is wise or whether better public policy can be evolved. Nor are our Courts inclined to strike down a policy a the behest of a Petitioner merely because it has been urged that a different policy would have been fairer or wiser or more scientific or more logical.
In view of the well settled law laid down by the Supreme Court and the Division Bench of this Court regarding the Policy decisions taken by the Government, this Court cannot interfere with the same. It is pertinent to note that, the Court cannot be called upon to undertake the Government duties and functions. The Court shall not ordinarily interfere with a policy decision of the State. Social and economic belief of a Judge should not be invoked as a substitute for the judgment of the legislative bodies (see Ira Munn v. State of Ellinois 1876 (94) US (Supp) 113
In Om Kumar and Ors. v. Union of India 2001 (2) SCC 386, it was held that:
...where administrative action is challenged under Article 14 as being discriminatory, equals are treated unequally or unequals are treated equally, the question is for the constitutional Courts as primary reviewing Courts to consider the correctness of the level of discrimination applied and whether it is excessive and whether it has a nexus with the objective intended to be achieved by the administrator. For judging the arbitrariness of the order, the test of unreasonableness may be applied. The action of the State, thus, must be judged with extreme care and circumspection.
But in the instant case, I do not find any such arbitrariness or unreasonableness committed by the Government in taking such a decision by banning tapping of Toddy in the above two districts. Therefore, in my considered view on this ground also, these writ petitions are liable to be dismissed.
Having regard to the facts and circumstances of the case as stated above and taking into consideration the totality of the cases in hand, I do not find any justification nor any good grounds to interfere with the impugned Notification issued by the Government, vide Annexure-A.
For the foregoing reasons as stated supra, the writ petitions filed by the Petitioners are dismissed.