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Judgment
The petitioner seeks to issue a writ of mandamus declaring the action of the respondents in not granting remission of proportionate licence fee for the period from 1-8-1997 to 21-9-1997 for the shop No.132, Bhoopalpally, Warangal district, as arbitrary and illegal and direct the respondent to refund the proportionate licence fee.
The petitioner states that pursuant to the notification issued by the District Collector, Warangal district, in CR No.888/ 97/P&E/A3 dated 24-7-1997 inviting the tenders for 32 unsold shops in pursuance of the earlier gazette notification No.8/97/A3 dated 6-4-1997 for the remaining period i.e., from 1-8-1997 to 31-3-1998 for which the upset price of Rs.2,85,000/- was fixed for the shop no.132 and the petitioner filed his tender by depositing a sum of Rs.75,000/-on 30-7-1997 for the lease amount of Rs.2,87,826/-for the period from 1-8-1997 to 31-3-1998.
The petitioner submits that against the action of the District Collector, Warangal, proposing to auction the Indian made Foreign Liquor shop No.132 at a shifted place of Bhoopalpally village, one Mr. Gandam Raju and Burra Swamy filed W.P.No.17534/1997 and obtained an interim stay in W.P. MP No.21282/97 dated 30-7-1997 directing the Prohibition and Excise Superintendent, Warangal, not to issue the licence for shop No.132, Bhoopalpally commencing from 1-8-1997. The petitioner herein got impleaded himself in W.P.No.17534/1997 and filed vacate stay petition and the writ petition was dismissed on 10-9-1997. After dismissal of the writ petition, the tender of the petitioner has been finalised on 20-9-1997 and the licence was issued on 22-9-1997. Thus, the petitioner submits that in view of the stay order of this Court, his tender was not finalised and for no fault of him, he was prevented from carrying on the business from 1-8-1997 to 21-9-1997, and therefore, he is entitled for the remission of licence fee for the above said period during which he was not granted any licence and no business was transacted by him.
The Government Pleader states that the petitioner is not entitled for any remission of licence fee as the tender of the petitioner was accepted only on 20-9-1998 and the licence was issued on 22-9-1997 and that the petitioner is bound to pay the entire licence fee as quoted in the tender pertaining to the period from 1-8-1997 to 31-3-1997. It is further submitted by the learned Government Pleader appearing for the respondents that u/s 20 of A.P. Excise Act read with Rule 33 of A.P. Excise (Indian & Foreign Liquor Retail Sale Conditions of Licences) Rules, 1993, unless the shop is ordered to be closed by a competent authority under the provisions of the Excise Act, no demand of rental/licence fee shall be made for the period for closure of shop and in this case as there is no order of closure of the shop, and therefore, the petitioner is not entitled for the remission of licence fee.
The only question involved in this writ petition is whether the writ petitioner is entitled for the remission of licence fee for the period during which his tender was not finalised pursuant to the direction granted by this Court directing the Prohibition and Excise Superintendent, Warangal, not to grant licence in favour of the petitioner. In answer to this question, it is relevant to extract some of the provisions of A.P.Excise Act which read thus :-
"20. Closing of Shops for preservation of public peace :--(1) The District Magistrate may, by notice in writing to the licensee, require that any shop in which any intoxicant is sold shall be closed at such times or for such period as he may think necessary for preservation of the peace.
Explanation :--For the purposes of this section the expression ''District Magistrate'' includes the Additional District Magistrate or any other person empowered to exercise the powers of District Magistrate.
(2) If any riot or any unlawful assembly is apprehended or occurs in the vicinity of any such shop any Magistrate of the First or Second class may, for reasons to be recorded in writing, require such shop to be kept closed for such reasonable period as he may think necessary.
(3) The licensee shall not, on account of the closure of his shop under this section, be entitled to any compensation except to the refund of such licence fee paid by him in respect of the shop as is proportionate to the period during which the shop is required to be kept closed under this section."
As per Rule 33 of the A.P, Excise (Indian and Foreign Liquor Retain Sale Conditions of Licences) Rules, 1993,lhe licensee is not entitled to claim compensation where the licence is withdrawn or a shop is ordered to be closed by a competent authority under the provisions of the Act, but no demand of refund shall be made for the period of closure during which the competent authority is ordered to be closed and the licence is also entitled for the refund of the proportionate licence fee.
The learned Government Pleader submits that as contemplated u/s 20 of the A.P. Excise Act, there was no notice or any order by the District Magistrate requiring to close down the shop, and therefore, unless there is an order u/s 20, the licensee is not entitled for refund of such licence fee in respect of shop in proportionate to the period during which the shop is required to be kept closed. Under Rule 33 of the A.P. Excise (Indian and Foreign Liquor Retail Sale Conditions of Licences) Rules, 1993, unless the shop is ordered to be closed by the competent authority under the Act, the licensee is not entitled for refund of the rental or remission of licence fee.
Tenders were called for grant of lease and licence to sell Indian liquor and foreign liquor for the period from 1-8-1997 to 31-3-1998 and the minimum bid price for the said period was fixed as Rs.2,85,000/-and the petitioner offered the lease amount/ licence fee of Rs.2,87,826/- for the aforesaid period from 1-8-1997 to 31-3-1998. Admittedly, the petitioner was prevented from obtaining the licence and carrying on the business by reason of grant of stay order by this Court and only after dismissal of the writ petition, the licensing authority granted licence, and thus, the petitioner was prevented from carrying on the business from 1-8-1997 to 21-9-1997.
This Court had an occasion to consider the similar issue in the case of K.K.V. Veerabhadra Rao v. Superintendent of Excise, Visakhapatnam, 1981 (1) An.W.R. 346, by His Lordship Sri Justice P.A . Choudary, (as he then was), in para 7 of the said judgment held that :-
"..... The next question that arises is whether the action of this Court preventing the petitioner from doing his business can be described as an action of the State? It is elementary that when one of the parties to a contract breaches the contract causing loss to the other party to the contract law requires that the other innocent party should be compensated by the party responsible for the breach. So far there can be no difference of opinion. But what can plausibly be argued on behalf of the State is that the State is not responsible - in any way for the action of this Court and that the orders of this Court cannot be described as acts of breach of a State contract. This argument compels us to consider the meaning of the concept of the State. The State is an abstract legal concept. In it is concentrated the supreme coercive power. From the point of view of constitutional law the word "State" may be described as a collection of legal powers. These legal powers are exercised by the State through its three well-known great departments of Executive, Legislature and Judiciary. It is not an accident that our Constitution describes and delineates the powers of these three branches under the Chapter heading ''State''. Under a written Constitution, such as ours, the powers and functions of these three organs of the State are defined and derived from the same common source which is the Constitution. In their allotted spheres of activity each one of these organs represents the abstract legal entity called the State as fully as the others. It follows therefore, that by their acts as much as by their omissions these three organs of the State acting in their respective spheres of authority bind the State fully. There cannot therefore be any difference in law between an act of breach of a public contract committed by the Executive and a breach of such a contract committed by orders of a superior Judiciary. In fact Kelsen refused to recognize and vital difference between the Executive and Judiciary, He treated both of them jurisprudentially as indistinguishable. It follows, therefore, that the orders of stay that this Court passed and by which the petitioner was injured were in the ultimate analysis attributable to the State itself. This Court can act only in the name of the State and only for and on behalf of the State. This is particularly so in relation to the power and jurisdiction of this Court under Article 226 of the Constitution which provides for public law remedies. The State is therefore, in my opinion, responsible for the acts of this Court. Thus, the Stale becomes liable to compensate the innocent party that suffered by the acts of this Court. "
For the aforesaid reasons, the petitioner is fully justified in seeking the remission of licence fee for the aforesaid period.
Accordingly, the writ petition is allowed directing the respondents to refund the proportionate licence fee for the period from 1-8-1997 to 21-9-1997 in respect of shop No.132,Bhoopalpalli, Warangal district, to the petitioner within three months from the date of receipt of a copy of this order. No costs.