M/S Highfield Distillers And Bottlers Pvt. Ltd. vs State Of Uttarakhand & Others

Ramesh Ranganathan, CJ

Heard Sri Shobhit Saharia, learned counsel for the appellant-writ petitioner and Sri B.S. Parihar, learned Standing Counsel for the State and, with their consent, the appeal is disposed of at the stage of admission.

The appellant herein invoked the jurisdiction of this Court under Article 226 of the Constitution of India to quash the inspection report dated 29.10.2018 to the extent the bonded warehouse of the appellant was sealed on the oral instructions received by the Additional Excise Commissioner, Uttarakhand.

Facts, to the limited extent necessary, are that the appellant-writ petitioner is a license holder of BWFL-2, and was permitted to operate a warehouse in the State of Uttarakhand where they stored Indian Made Foreign Liquor manufactured at their plant in Chandigarh in the State of Punjab and Haryana. A surprise inspection of the warehouse was caused on 27.10.2018. Likewise a high level inspection was carried out by a combined team led by two Assistant Excise Commissioners (Enforcement), Garhwal Division on 29.10.2018 and, based on their report, the appellant-writ petitioner's bonded warehouse was sealed. Aggrieved by the sealing of the warehouse, which the appellants claim was on the oral directions of the Additional Excise Commissioner (Enforcement), they invoked the writ jurisdiction of this Court under Article 226 of the Constitution of India.

By the order under appeal dated 26.03.2019, the learned Single Judge has, while relegating the appellant to the remedy of an appeal under Section 11 of the U.P. Excise Act, also recorded a finding that the appellant had not only imported and transported liquor illegally, but had also generated an online transport pass, and had managed the forged signature of the authorized Excise Inspector; a show cause notice was issued by the Excise Commissioner on 08.03.2019; it appeared that the appellant-writ petitioner had generated a transport pass on 26.10.2018, which was forged as it was never countersigned by the Excise Inspector; and the appellant-writ petitioner had managed a forged signature of the Excise Inspector for illegal transportation of the foreign liquor. Aggrieved thereby, the present appeal.

Sri Shobhit Saharia, learned counsel for the appellant-writ petitioner, would submit that exercise of power must also satisfy the test of reasonableness for it not to violate Article 14 of the Constitution of India; it is only if a written order, directing sealing of the warehouse of the appellant-writ petitioner, was passed by the Competent Authority, could the appellant-writ petitioner have then been called upon to avail the alternative remedy of filing an appeal under Section 11 of the U.P. Excise Act; oral orders which affect the appellant-writ petitioner's right, and has civil consequences, is impermissible in law; while a show cause notice was issued to the appellant, calling upon them to show cause why they not be blacklisted and why their licence may not be cancelled, no show cause notice or a written order was passed directing sealing of the premises; and, in a writ petition filed by the appellant-writ petitioner, the learned Single Judge had recorded findings of fact which rendered the appellate remedy, under Section 11 of the U.P. Excise Act, redundant since the Appellate Authority would undoubtedly be bound by the findings recorded by the learned Single Judge in the order under appeal.

While fairly stating that no written order directing sealing of the premises was issued by the Additional Excise Commissioner (Enforcement), and the appellant's warehouse was sealed on the oral instructions of the said officer, Sri Anil Bisht, learned Standing Counsel for the Government, would submit that the facts of the case warranted sealing of the premises; a vehicle was found transporting liquor, manufactured in the name of the appellant-writ petitioner, to several retailers; the vehicle, on interception, was found carrying 425 full bottles of IMFL allegedly manufactured by the appellant; and since these 425 full bottles of IMFL was being transported without payment of State Excise Duty, the action of the authorities was wholly justified.

Any action of the authorities, which has civil consequences, must be taken on a written order being passed, and a copy thereof being served on the person affected thereby, so that he may question its validity in appropriate legal proceedings. Oral instructions directing sealing of the premises, without a written order, would undoubtedly prejudice the person whose premises has been directed to be sealed on such oral directions.

We are satisfied, therefore, that no such oral directions could have been issued, and the authorities ought to have passed a written order, and should have communicated the same to the appellant-writ petitioner to enable him to question the same in duly constituted legal proceedings. In cases where the person, who has invoked the writ jurisdiction of this Court, is relegated to avail the alternate remedy of an appeal, any observations on merits would undoubtedly cause him prejudice, for the appellate authority would undoubtedly be influenced by the observations made in the order passed by this Court.

We consider it appropriate, in such circumstances, to set-aside the order under appeal to the extent, findings of the fact have been recorded against the appellant herein. While Sri B.S. Parihar, learned Standing Counsel, would submit that the second respondent is the competent authority who sealed the premises, Sri Shobhit Saharia, learned counsel for the appellant-writ petitioner, would contend otherwise, and submit that it is the first respondent who is the Competent Authority.

Without going into this dispute, suffice it to direct the Competent Authority (either respondent no. 1 or respondent no. 2) to pass a written order for sealing of the premises of the appellant-writ petitioner, and communicate the same to him within one week from the date of receipt of a copy of this order. On receipt of the order from the Competent Authority, it is open to the appellant to avail his appellate remedy under Section 11 of the U.P. Excise Act. In case the appellate/revisional jurisdiction is invoked by the appellant herein, the Appellate/Revisional Authority shall consider the appeal/revision on its own merits without being influenced by any observations made either by the learned Single Judge in the order under appeal or in the order now passed by us.

We wish to make it clear that the order now passed by us shall not be construed as absolving the appellant of blame, and all that we have said is that it is not for the High Court, under Article 226 of the Constitution of India, to record findings on merits as these are all matters for the appellate/revisional authority to consider. While Sri Shobhit Sahaira, learned counsel for the appellant-writ petitioner, would request that the seal fixed on the appellant-writ petitioner's premises be directed to be removed, we must bear in mind that this Court would exercise its discretionary jurisdiction, under Article 226 of the Constitution of India, only in larger public interest. While we may not be understood to have expressed any opinion on the allegations leveled against the appellant-writ petitioner, suffice it to observe that the allegations leveled against the appellant-writ petitioner, if true, are grave and serious. We see no reason, therefore, to accede to the appellant's request for de-sealing of the premises or the seal placed on the subject premised to be removed. Subject to the orders that may be passed by the Appellate/revisional Authority, in the appeal/revision, if any preferred by the appellant, the seal placed on the subject premises shall remain. With the aforesaid observations, the appeal is disposed of. No costs.

Let a copy of this order be furnished to the learned counsel for the parties, within two days, on payment of usual charges.