Case Note & Summary
The petitioner, S.B. Manjunath, a CL-9 licensee running Moon Star Bar and Restaurant in Honnalli Town, Davanagere District, applied on 19.01.2024 under Rule 23 of the Karnataka Excise Licenses (General Conditions) Rules, 1967 for shifting his bar and restaurant to another location. The Deputy Commissioner of Excise, Davanagere, considered the application and granted permission by order dated 29.01.2024. Respondent No.3, Mallesh H.R., who was a rival or interested party, filed an appeal before the Excise Commissioner (Respondent No.1). The Commissioner, by order dated 13.06.2024, allowed the appeal and set aside the Deputy Commissioner's order, directing the Deputy Commissioner to pass consequential orders. Pursuant to this, the Deputy Commissioner passed an order on 05.07.2024 cancelling the shifting permission. The petitioner challenged both orders before the High Court under Articles 226 and 227 of the Constitution. The primary legal issue was whether the appellate authority could reverse the Deputy Commissioner's decision without affording the petitioner a hearing. The petitioner argued that the Commissioner's order was passed in gross violation of natural justice as no notice was issued to him before the appeal was decided. The respondents contended that the appeal was maintainable and the Commissioner had power to pass such orders. The High Court, after hearing all parties, found that the Commissioner's order did not record any notice or hearing given to the petitioner. The court held that the order was passed in gross violation of principles of natural justice and was therefore unsustainable. The court quashed the Commissioner's order dated 13.06.2024 and the consequential order dated 05.07.2024, and restored the Deputy Commissioner's order dated 29.01.2024. The court also directed that the shifting permission be implemented within two weeks from the date of the order.
Headnote
A) Excise Law - Shifting of License - Natural Justice - Rule 23 of Karnataka Excise Licenses (General Conditions) Rules, 1967 - The appellate authority reversed the Deputy Commissioner's order granting shifting permission without issuing notice or hearing the licensee - Held that the order was passed in gross violation of principles of natural justice and was liable to be quashed (Paras 5-6).
Issue of Consideration
Whether the appellate authority could set aside the Deputy Commissioner's order granting permission to shift a CL-9 license without hearing the licensee.
Final Decision
The High Court quashed the order dated 13.06.2024 passed by the Excise Commissioner and the consequential order dated 05.07.2024 passed by the Deputy Commissioner of Excise, and restored the order dated 29.01.2024 passed by the Deputy Commissioner of Excise. The court directed that the shifting permission be implemented within two weeks from the date of the order.
Law Points
- Natural justice
- right to be heard
- appellate authority's power
- shifting of excise license
- Rule 23 of Karnataka Excise Licenses (General Conditions) Rules
- 1967
