K. Raja vs Government of Tamil Nadu

N.V. Balasubramanian, J.—Petitioner in W.P. No. 6369 of 1999 is the Petitioner in W.P. No. 7757 of 1999 and the Petitioner in W.P. No. 5360 of 1999 is a resident of the village in which the Petitioner is carrying on the business.

W.P. No. 6369 of 1999 is filed for a writ of Certiorarified Mandamus calling for the records of the first Respondent, viz., the Commissioner of Prohibition & Excise, Chennai in F1/7790/99, to quash the proceedings of the first Respondent dated 8.4.1999 and consequently direct the first Respondent to grant renewal of the FL3 licence in favour of the Petitioner in accordance with the Rules.W.P. No. 7757 of 1999 is filed for a writ of declaration to declare the following portion of the condition No. 2 of the FL3 licence, viz., "The licensee should not issue liquor either in pegs or in sealed bottles to the permit holders who reside elsewhere, other than in the same hotel:" issued under the Tamil Nadu Liquor (Permit & Licence) Rules, 1981 (hereinafter to be referred to as "the Liquor Permit Rules") as in valid and unconstitutional in so far as the Petitioner is concerned. The other writ petition, W.P. No. 5360 of 1999, is filed by a third party for a writ of Certiorari to quash the FL3 licence granted in favour of the Petitioner in W.P. No. 6369 of 1999.

In W.P. No. 6369 of 1999, notice was ordered and the first Respondent has filed a counter affidavit. The Petitioner in W.P. No. 5360 of 1999 has also filed a petition in W.M.P. Nos. 10404 and 10405 of 1999 to implead himself as a party in W.P. No. 6369 of 1999 and to vacate the interim injunction granted by this Court on 16.4.1999 in W.M.P. No. 9179 of 1999 in W.P. No. 6369 of 1999.

The necessary facts leading to the filing of the writ petition, W.P. No. 6369 of 1999 are that the Petitioner had opened a lodge and restaurant on 15.11.1998 in Thammampatti Village, Gangavalli Taluk, Salem District. According to the Petitioner, it had been running the lodge and restaurant and the Petitioner desired to have a bar in the hotel and the Petitioner, therefore, made an application under the provisions of the Liquor Permit Rules for the grant of a bar licence. The Petitioner was granted licence in Form FL3 on 19.2.1999 enabling the Petitioner to have a Bar. The case of the Petitioner is that the Petitioner has made arrangements for the release of stocks of Indian Made Foreign Liquor (IMFL) from the TASMAC Depot, Salem and opened the Bar/Permit room in the hotel on 26.2.1999. The Petitioner has stated that though the Petitioner started the lodge prior to the opening of the bar, the Petitioner had not invited its friends and well-wishers for the opening of the bar and there was a get together of the friends and relatives to celebrate the opening of the lodge and also the bar. The Petitioner has stated that some trade rivals who were aggrieved over the opening of the bar have sent false complaints to the authorities and on 2.3.1999, the Revenue Divisional Officer, Attur inspected the Petitioner bar stating that he was inspecting the bar at the instance of the Collector, Salem. The Assistant Divisional Excise Officer also inspected the Petitioner bar room on the same date. Both of them submitted their reports and the first Respondent has issued a show-cause notice to the Petitioner directing it to explain as to why FL3 licence granted in favour of the Petitioner should not be cancelled and the charges noticed in the show-cause notice read as under:

(a) (1) The hotel has not satisfied the criteria laid down for a Star Hotel eligible for grant of bar licence as (i) there is no proper Reception room. No facilities such as TV and newspapers have been provided and only a few chairs have been put in a corner in the name of Reception Room.

(ii) In the conference hall no privacy or partition compartments have been provided. Only some chairs have been placed there in.

(iii) No restaurant or hotel is functioning it.

(2) No bills were prepared and no accounts were maintained for the sale of stocks from 26.2.99.

(b) Further during the surprise inspection of Additional Divisional Excise Officer on 1.3.99, he has found that the licensee has sold the IMFS bottles to the consumer so as to� "enable them to take out the un-opened bottles from the bar to neighbouring hotels for use, and that these bottles are sold to such consumers after detaching the TASMAC labels bearing on each bottle without opening the bottles. Thus by selling liquor to other than those who stay in the lodging house, the licensee has violated the licence.

(c) It is seen from the report sent by the Assistant Commissioner (Excise), Salem that very meagre number of person only occupied the lodge as may be seen from the following details:

Date: No.of occupants

26.2.99 1

27.6.99 6

28.2.99 4

1.3.99 2

2.3.99 1

Details of sales 26.2.99 to 2.3.99

Brandy 180 240

375 24

750 2

Whisky 180 40

375 6

750 9

Rum 180 32

375 2

750 1

Beer 650 17

350 3

When the number of occupants and the sales effected in this bar is compared, the sale is highly disproportionate to the number of occupants in the lodge. This clearly shows that the bar has been run as an IMFL retail shop rather than as a bar.

The Petitioner submitted its reply on 27.3.1999 to the above said charges levelled against the Petitioner.

The first Respondent by the impugned order dated 8.4.1999 held that all the charges were proved and the charge (c) is a serious charge. According to the first Respondent, the Petitioner was running the bar as a IMFL retail shop. The first Respondent also found that the Petitioner itself has accepted the supply of liquor to others and has thus violated the main condition of the licence. He, therefore, held that the Petitioner has caused loss of revenue to the Government by getting the licence on a false ground and running the bar as if it was an IMF retail shop. He, therefore, passed the order cancelling the FL3 licence granted in favour of the Petitioner. The Petitioner has challenged the order.

Mr. R. Krnhnamoorthy, Learned Senior Counsel appearing for the Petitioner submitted that the order passed by the first Respondent is illegal and violative of the principles of the natural justice. Learned Senior Counsel submitted that there was no consideration of the explanation offered by the Petitioner and no enquiry was held enabling the Petitioner to prove the facts. Learned Senior Counsel submitted that according to the certificate issued by the Director of Tourism Development Corporation, Tamil Nadu, the Petitioner had satisfied the criteria for a Three Star Hotel and when the certificate is in force, it is impermissible for the first Respondent to hold that the Petitioner did not satisfy the criteria for a Three Star Hotel under Rule 2(xvi) of the Liquor Permit Rules. Learned Senior Counsel also submitted that there was no inspection held on.1.3.1999 and he referred to the copy of inspection book which shows that the inspection was held only on 2.3.1999. Learned Senior Counsel further submitted that neither the copy of the statement of the Revenue Divisional Officer nor the Additional Divisional Excise Officer was furnished to the Petitioner and as regards the non-maintenance of accounts Learned Senior Counsel submitted that bill books were under preparation and it is not correct to state that the Petitioner was not maintaining the sales account. Learned Senior Counsel submitted that there was no inspection on 1.3.1999 and the first Respondent was not correct in holding that the charges were proved. Learned Senior Counsel submitted that as regards the disproportionate sales compared to the number of occupants in the lodge, the first Respondent proceeded only on the basis of certain assumption. According to the Learned Senior Counsel, the Star Hotel caters not only needs of the inmates of the hotel, but also others and it is open to anybody to purchase liquor in the bar. Learned Senior Counsel referred to two cash bills for the purchase of liquor by third parties in two star Hotels dated 15.4.1999 and submitted that it is permissible for anyone to buy liquor and the assumption of the first Respondent that the sale of liquor to an outsider in a bar is violative of the conditions of the licence is not justified and practical. Learned Senior Counsel submitted that such condition was imposed when the sale of liquor was confined to permit holders in the State and when there is no necessity to obtain permit to buy liquor, there is absolutely no prohibition for anybody to buy they liquor in a bar. Learned Senior Counsel submitted that the condition that a licensee should not sell liquor either in sealed bottles to the permit holders residing elsewhere other than the hotel is not followed in any of Star Hotels. Learned Senior Counsel submitted that the condition of the licence that liquor should be sold to inmates is beyond the scope of the Act and Rules. Learned Senior Counsel submitted that the said condition is arbitrary and unreasonable as the bar is established not only to cater to the needs of the restaurant of the hotel, but also outsiders and the imposition of the condition that the bar or the restaurant of the hotel should cater to the needs of the residents of the hotel is unreasonable. Learned Senior Counsel submitted that there are number of Star Hotels in the State catering not only to the needs of the residents of the hotels, but also to outsiders. Learned Senior Counsel, therefore, submitted that the condition itself is invalid and the findings arrived at by the first Respondent for cancellation of the licence are not sustainable in law.

The Respondents have filed a counter affidavit in W.P. No. 6369 of 1999 wherein the stand of the Respondents is that the Petitioner itself admitted that the Petitioner sold liquor to the outsiders and on inspection on 2.3.1999, it was found that the Petitioner cannot be regarded as a Star Hotel, eligible for the grant of FL3 licence. The stand of the Respondents is that there is no proper reception room in the hotel and there are also no facilities of television and newspapers and few chairs were put in the corner of the reception room and the Petitioner has not maintained accounts for the sale of liquor. According to the Respondents, the Petitioner admitted that it was not maintaining sales accounts properly. It is also stated that an inspection was made on 1.3.1999 and it was prima facie found that the Petitioner had sold IMFL bottles to the consumers. Though the inspection was not recorded, the inspection report for the inspection held on 1.3.1999 would establish the fact of inspection and it is not mandatory that every inspection should be recorded in the inspection book. It is stated that the Petitioner should not sell liquor to anybody approaching as in IMFL retain shop and in the case of FL3 licence, the licensee has to sell liquor to the inmates and not to outsiders. The Respondents have further stated that though the copies of the inspection reports of the Revenue Divisional officer and Additional Divisional Excise Officer were not furnished, the show-cause notice was issued to the Petitioner and the'' Petitioner was given full opportunity. It is also stated that once the violation has been noticed, the first Respondent was quite justified in taking action. In the counter affidavit there is also a reference to the inspection conducted by the Collector of Salem wherein the Collector has come to the conclusion that the hotel did not conform to the requirements of a Star Hotel.

The other writ petition, W.P. No. 7757 of 1999, as already seen, is for a writ of declaration to declare a part of the condition imposed in the FL3 licence granted in favour of the Petitioner as invalid and when the writ petition came up for admission, it was heard along with other W.P. No. 6369 of 1999, since the points raised in both the writ petitions are inter related.

In so far as the impugned order is concerned, it clearly reveals that only on the basis of certain objections received from the public against the functioning of the bar in the Petitioner hotel, an enquiry was held by the Collector of Salem. In so far as the charge No. (1) is concerned, though the first Respondent has held that the Petitioner has not satisfied the criteria laid down for a Star Hotel eligible for the grant of bar licence, the first Respondent has not conducted any enquiry in that matter. The Director of Tourism Development Corporation, Government of Tamil Nadu, as seen from the file, by certificate dated 19.1.1999 has certified that the Petitioner hotel has satisfied the criteria for a Star Hotel as required under Rule 2 (xvi) of the Liquor Permit Rules. There was an inspection by the Assistant Commissioner of Excise, Salem on 14.12.1998 and he has also certified that the Petitioner hotel satisfied all the terms and conditions for the grant of FL3 licence. The Collector of Salem, in his letter dated (sic) 3.1.1999 to the Special Commissioner, has also certified that the Petitioner satisfied the conditions stipulated and recommended for the grant of FL3 licence. It is only on the basis of the recommendation, FL3 licence was granted in favour of the Petitioner.

In so far as the first charge is concerned when the Petitioner has denied the charge, the first Respondent should have conducted an independent enquiry and then come to the conclusion whether the Petitioner hotel has satisfied the conditions of a Star Hotel stipulated for the grant of licence. Even assuming that, it is open to the Respondents to go into the question whether the Petitioner hotel is a Star Hotel or not. notwithstanding the certificate given by the Director of Tourism Development Corporation, Government of Tamil Nadu and the first Respondent has the jurisdiction to decide whether the Petitioner hotel fulfilled the requirements of the relevant rules and the certificate given by the Director of Tourism is not conclusive, the first Respondent has not conducted any enquiry on this aspect of the matter. Hence, the finding of the first Respondent on the first charge, in my view, is based only on assumption and on the basis of the reports of the Revenue Divisional Officer and Additional Divisional Excise Officer.

In the first charge there is an additional charge, viz., non-maintenance of the sales accounts for the sale of liquor in the Petitioner hotel from 26.2.1999. The Petitioner has admitted the non-maintenance of the sales accounts and he has given explanation that the bills were under preparation. The above explanation was not, in my view, rightly accepted by the first Respondent. Under Rule 25 of the Liquor Permit Rules, particularly paragraph IX, it is obligatory of the licensee to maintain true accounts of all transactions under the licence and the accounts shall be maintained from day-to-day in the form of accounts prescribed for the respective licences. The rule also prescribes that it is an obligation on the part of the licensee to maintain all indents, bills, invoices, permits, etc. relating to purchase or sale of any kind of liquor and there is also an obligation on the part of the licensee to maintain accounts for a period of five years from the date of expiry of the licence to which they relate. The purpose of the said rule is that the licensee dealing with the purchase or sale of liquor should maintain a full and true accounts of the transactions so that there may not be any misuse in the sale of said intoxicating article. The absence of accounts, in my view, would make it impossible for any one, either the licensee or the inspecting officials, to say with absolute certainty the number of bottles purchased or sold or the stock in hand. The presence of the accounts exhibiting the sale, purchase or the stock of liquor is essential to verify the statement of the licensee as to the number of bottles sold or purchased and it would enable the authorities to effectively verify the statement of the licensee as to the stock position on hand. The licence granted is really a privilege given by the State to licensee to sell liquor and" it is open to the State to impose conditions against the exploitation of the licence granted in favour of the licensee and one of the conditions is to maintain accounts properly. Admittedly, the Petitioner was not maintaining accounts either for the purchase or for the sale of liquor and the explanation for the non-maintenance of accounts that bills were under preparation was rightly rejected by the first Respondent. As already seen, it is one of the conditions of the licence that the licensee should maintain the accounts for daily transactions in the Forms F. Ac.3 and F. Ac.3A. Further, under Sections 21 and 22 of the Tamil Nadu Prohibition Act, 1937, in the agreement executed by the licensee/Petitioner, the Petitioner has agreed to abide by all the conditions of the licences and permits. Since one of the conditions of the agreement was violated by the Petitioner, the first Respondent was quite justified in holding that the Petitioner has violated the said condition of the licence.

The third charge is with reference to the inspection of the Additional Divisional Excise officer on 1.3.1999 wherein he has found that the Petitioner sold IMFL to consumers so as to enable them to take out the non-opened from the bar to neighbouring hotels for use and those bottles were sold to such consumers after detaching the TASMAC labels bearing on each bottle without opening the bottles. Though the first Respondent has stated that there was an inspection on 1.3.1999, a perusal of the file shows that there was no actual inspection held on that date. The Additional Divisional Excise officer in his report dated 2.3.1999 has stated that he found one Chinnathambi standing outside the bar on 1.3.1999 at 8.00 pm. and the statement of Chinnathambi was recorded. However, neither a copy of the statement of Chinnathambi, nor a copy of the report of the Additional Divisional Excise Officer dated 2.3.1999 was furnished to the Petitioner. It is only on the basis of the report of the Additional Divisional Excise Officer, Salem, it is stated that the Petitioner has sold IMFL bottles to consumers to enable them to take out the non-opened bottles from the bar to neighbouring hotels for use and those bottles were sold to such consumers after detaching the TASMAC labels bearing on each bottle without opening the bottles. Since copies of the statement of Chinnathambi and the report of the Additional Divisional Excise Officer, Salem were not furnished to the Petitioner and no enquiry was also held, it must be held that the finding regarding the said charge is not sustainable in law. That apart, there is no finding by the first Respondent that the Petitioner had sold IMFL bottles after detaching TASMAC labels bearing on each bottle without opening the bottles. I, therefore, hold that the finding of the first Respondent on that part of the charge is not sustainable in law.

The next charge is very serious charge. The charge is that the Petitioner has sold liquor to those who resided elsewhere other than the Petitioner hotel. The Petitioner has admitted the said charge and the admission of the Petitioner was not withdrawn at any point of time. As a mater of fact, in paragraph 8 of the affidavit filed in support of the writ petition, W.P. No. 6369 of 1999, the Petitioner has admitted that "...they had been selling liquor not only to their inmates but also to others who visit their Bar and restaurant". The admission of the Petitioner is significant in the sense that the Petitioner has sold liquor not only to the inmates of the hotel, but to the outsiders also who visited the bar and restaurant. One of the conditions relating to the grant of FL3 licence is that licence is given for possession of liquor by Star Hotels for supply to foreign tourists, foreigners resident in India and also citizens of India for consumption within the licensed room of the hotel or for removal to their private rooms in the same hotel in which they stay for consumption there. There is an additional condition that the licensee should not issue liquor either pegs or in sealed bottles to those who reside in elsewhere other than the same hotel. Since the Petitioner himself has admitted that it was selling liquor to outsiders also in the bar, it is a clear breach of the condition of the licence granted in favour of the Petitioner. It is one of the main conditions of FL3 licence that the licensee should sell liquor for consumption within the permit room in the hotel or to inmates who reside in the same hotel for consumption in the room. Hence, it is impermissible for a licensee to sell liquor in sealed bottles to outsiders and if such a practice is allowed, then there would be no difference between the IMFL shop and a bar room in a Star Hotel. The above condition has been incorporated in the licence to maintain the vital distinction between a bar and IMFL shop and an unrestricted sale of IMFL bottles in a bar would make no difference between a bar and an IMFL shop and the bar in a Star Hotel would be converted to an IMFL shop. That apart, the condition is imposed on the ground of public policy to the effect that a bar should remain as a bar and a retail liquor shop should remain as a retail liquor shop and it is not possible to combine both in one place. As a matter of fact, there is a prohibition against a liquor shop to have a bar attached to it, and conversely a bar cannot be converted into a liquor shop by unrestricted sale of liquor in sealed bottles not only to the residents but also to outsiders who throng the bar for getting supply of liquor. Since the Petitioner has admitted the said violation of the condition, I have to hold that the finding of the first Respondent on the violation of the said condition is based on materials on record and it is impermissible for the Petitioner to run the bar as an IMFL retail shop. As rightly stated by the first Respondent, the privilege fee for a bar is one lakh rupees, whereas for the privilege to sell liquor in IMFL shop, the licence amount payable would depend upon the highest bid in the auction and it was found in that area, an IMFL shop was sold for a sum of Rs. 25 lakhs. The business hours of two also vary. If the Petitioner is allowed to use the bar as an IMFL retail shop, then there will be a loss of revenue to the Government and the Petitioner by suppressing the real facts, had obtained the licence on false grounds. The agreement entered into by him clearly shows that the Petitioner has agreed to operate the bar only as a bar and the Petitioner has expressly agreed that the need for grant of FL3 licence is to provide IMFL to the inmates staying in the hotel and since the Petitioner has also agreed to such a condition for the grant of licence in his favour, it is not open to him to plead that it is open to him to sell liquor to outsiders also and convert the bar as an IMFL shop. I am also of the view that the mere fact that some other bar is selling liquor to outsiders is of no consequence when it was found that the Petitioners violated the terms and conditions of the licence. It is well settled that the commission of two wrong cannot make one right and it is not open to the Petitioner to take advantage of the wrong committed by any other person to plead that what was done by it is also right. Though, I have held that there was no inspection of the Petitioner''s premises on 1 3.1999, there is no dispute that there was an inspection held on 2.3.1999. The show-cause notice issued to the Petitioner referred to the details of the sales from 26.2.1999 to 2.3.1999 and in the reply to the show-cause notice, the Petitioner has admitted that the Petitioner was selling liquor to general public visiting the restaurant for taking food, Hence, it is not possible to draw the line and take note of the events that happened with 1.3.1999 alone, but, in my view, the show-cause notice was issued on the basis of inspection held 2.3.1999 also. Since there is a breach of the essential condition for" the grant of licence in favour of the Petitioner, coupled with the fact that the Petitioner was not maintaining the accounts, the first Respondent was quite justified in cancelling the licence issued in favour of the Petitioner.

In so far as the writ petition challenging the validity of the part of the condition contained in the licence is concerned, as already seen, the Petitioner had applied for the grant of licence only to provide "IMFL to inmates staying in the hotel". The Petitioner had also executed an agreement that he would observe all conditions contained in the licence and abide by the provisions of the Tamil Nadu Prohibition Act and the rules made thereunder and the orders relating to the grant of the licence. He has also agreed that in case of any non-observance of any of the clauses in the Act or the rules or any breach of any condition contained in the licence, the licence may be cancelled. The conditions are imposed on the basis of the statutory provisions contained in Sections 20A, 21 and 22 of the Tamil Nadu Prohibition Act and the Petitioner having agreed to abide by the conditions, it is impermissible for him to challenge the validity of the said condition.

In this connection, the following observations of the Supreme Court in the case of State of Haryana v. Jage Ram AIR 1980 SC 2018 are relevant for the purpose of this case:

They entered into a contract with the state authorities with the full knowledge of conditions which they had to carry out in the conduct of their business, on which they had willingly and voluntarily embarked. The occurrence of a commercial difficulty, inconvenience or hardship in the performance of those conditions, like the sale of liquor being less in summer than in winter, can provide no justification for not complying with terms of the contract which they had accepted with open eyes. The Respondents could not, therefore, invoke the writ jurisdiction of the High Court to avoid the contractual obligations incurred by them voluntarily. On this ground alone, the State in entitled to succeed in this appeal.

The judgment in Har Shankar was followed in Sham Lal and Others Vs. State of Punjab, , wherein, the Appellants were the highest bidders in an auction for the sale of country liquor vends at various places in the State of Punjab. The Appellants were called upon by the State to pay the amounts which they were liable to pay under the terms of the auction, whereupon they filed writ petitions in the High Court to challenge the demand. Relying upon the passage from Har Shankar extracted above, the Court held that the licensees could not be permitted to avoid the contractual obligations voluntarily incurred by them and that, therefore, the High Court was right in refusing to exercise its jurisdiction under Article 226 of the Constitution in their favour.

In view of these decisions, the preliminary objection raised by the learned Solicitor General to the maintainability of the writ petitions filed by the Respondents, has to be upheld. We hold accordingly that the High Court was in error in entertaining the writ petitions for the purpose of examining whether the Respondents could avoid their contractual liability by challenging the Rules under which bids offered by them were accepted and under which they became entitled to conduct their business. It cannot ever be that a licensee can work out the licence if he finds it profitable to do so and he can challenge the conditions under which he agreed to take the licence, if he finds it commercially inexpedient to conduct his business.

The Supreme Court has reiterated the said position in the case of Khoday Distilleries Ltd. and Others Vs. State of Karnataka and Others, and the observations of the Supreme Court which are relevant for the purpose of this case read as under:

(f) "For the same reason, again, the State can impose limitations and restrictions on the trade or business in potable liquor as a beverage which restrictions are in nature different from those imposed on the trade or business in legitimate activities and goods and articles which are res commercium. The restrictions and limitations on the trade or business in potable liquor can again be both under Article 19(6) or otherwise. The restrictions and limitation can extend to the State carrying on the trade or business itself to the exclusion of and elimination of others and/or to preserving to itself the right to sell licenses to do trade or business in the same, to others.

(g) 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 of business.

In a recent decision in the case of Rajendra Singh Vs. State of Madhya Pradesh and others, , the Supreme Court held as under: -"It has been held by a Constitution bench of this Court in Har Shankar and Others Vs. The Dy. Excise and Taxation Commr. and Others, that: (SCC p. 748, para 22) "The writ jurisdiction of High Courts under Article 226 of the Constitution is not intended to facilitate avoidance of obligations voluntarily incurred.� At the same time, it was observed that the licensees are not precluded from seeking to enforce the statutory provisions governing the contract. It must, however, be remembered that we are dealing with parties to a contract, which is a business transaction, no doubt governed by statutory provisions."

Following the above decisions of the Supreme Court, I hold that it is not open to the Petitioner to wriggle out of the said condition after having agreed to abide by the same. Further, the condition clause challenged in the writ petition is merely couched in the negative form of what is already stated in the earlier part of the same condition and the essential condition of the FL3 licence is that it is permissible for a licensee to sell liquor in pegs for consumption within the bar room in the hotel or in the sealed bottles to those who are staying in the hotel for taking to the private rooms for consumption in their rooms. I therefore hold that the said clause is not beyond the rule making power found in Rule 17 of the Liquor Permit Rules and it cannot be stated that a new condition was incorporated in the licence granted to the Petitioner. Therefore, I am unable to accept the submission of the Learned Senior Counsel that the clause impugned in W.P. No. 7757 of 1999 is beyond the rule making power. The unreported decision of this Court in W.P. No. 10085 of 1987 dated 7.1.1997 on which a reliance was placed by the Learned Senior Counsel is not applicable to the facts of the case. The result is the writ petition W.P. No. 7757 of 1999 is liable to be dismissed.

There is an impleading petition in W.M.P. No. 10404 of 1999 in W.M.P. No. 6369 of 1999. The impleading Petitioner has filed the petition to implead himself as a party in the said writ petition. Learned Counsel for the impleading Petitioner submitted that it is on the objection raised by the Petitioner, the proceedings have been taken and therefore, he should be impleaded as a party in the said writ petition. Learned Counsel referred to several decisions in support of his submission, However, I am unable to accept the submission of the Learned Counsel for the impleading party. The licence was granted in favour of the Petitioner and it was cancelled by the first Respondent. The question that arises in the writ petition, W.M.P. No. 6369 of 1999 is whether the cancellation of the licence by the 1st Respondent is justified and the question has to be decided on the basis whether there are materials for the first Respondent to come to the conclusion that there was any breach of the conditions of the licence and whether the licence was rightly cancelled by the first Respondent. In considering that question, the presence of a trade rival or even the public is not necessary as the validity of the order has to be seen with reference to the reasons stated in the order and it is well settled that it is not possible to improve the order by filing of counter affidavit or further statements. Therefore, the presence of a trade rival or the public in a writ petition filed by the Petitioner questioning the cancellation of its licence is unnecessary. I hold that the first Respondent is neither a necessary party nor a proper party. The decisions relied upon by the Learned Counsel for the impleading Petitioner are not applicable to the facts of the case and I hold that the presence of the impleading Petitioner in the writ petition is unnecessary. Accordingly, I reject the W.M.P. No. 10404 of 1999 filed by him. Consequently, the other W.M.P. No. 10405 of 1999 is also rejected.

W.M.P. No. 5360 of 1999:

This petition is filed by a resident of the village with a prayer to quash the FL3 licence granted in favour of the writ Petitioner in W.M.P. No. 6369 of 1999. Since I have already upheld the order of the first Respondent in cancelling the licence in favour of the Petitioner in W.M.P. No. 6369 of 1999, the writ petition has become infructuous and accordingly, it is liable to be dismissed as infructuous.

W.P. No. 6369 of 1999: - The writ petition is dismissed. No costs.W.M. Ps. 10404 and 10405 of 1999 are rejected.

W.P. No. 7757 of 1999: - The writ petition is dismissed. No costs.

W.P. No. 5360 of 1999: - The writ petition is dismissed as infructuous. No costs.

All other W.M. Ps. are closed.