Ramya Wines Vs. Government of Andhra Pradesh and ors. - Court Judgment

Excerpt:
(i) civil - maintainability of writ petition - article 226 of constitution of india, rule 28 of a.p. indian liquor and foreign liquor rules, 1970, section 28 of a.p. excise act, 1968 and rule 66-a of a.p. indian liquor and foreign liquor rules, 1970 - existing licencees impugned government notification whereby new applicants issued fresh licences without impleading new licencees - held, writ petition cannot be maintained as new licencees not made party to petition. (ii) review of administrative decision - administration worked out certain formula for issuance of licence whereby commissioner determined number of licences in particular area - formula adopted by authorities rational - validity of formula cannot be made subject matter of judicial review. - - for better understanding, the pleadings in w. the petitioner contends that it is contrary to the provisions of the act as well as the relevant rules besides being irrational. 109 as well as the notification issued by the licensing authority are in violation of the fundamental rights under articles 19(1)(g) and 21 of the constitution of india. 3. the commissioner of prohibition and excise, government of andhra pradesh, who is a respondent in all the writ petitions has filed a common counter-affidavit as well as an additional common counter. 109 dated 11.3.2002 and therefore the petitioners are bound by rule 66-a as well. the notification as well as the policy are not contrary to law and are not arbitrary. like wise, where the population is more than 10,000 but does not exceed 50,000, the jicence fee is rs. it is well settled by reason of various decisions of the supreme court and this court. by reason of the counterpart agreement, the provisions of the act, the rules and orders made thereunder existing on the date of issue of licence as well as those that would be issued from time to time are also binding on the licensee. at best, its features can be described in a broad tentative manner. the high court should do well to reject the applications of such busybodies at the threshold. 35. as on the date of filing of the writ petitions, in most of the cases, new licences were granted/even according to the counter-affidavit, the impugned notification prescribed a time schedule according to which the last date for receipt of applications is 15.4.2002 and the selections were held on 17.4.2002. the notification required all the selected persons to complete the formalities like giving bank guarantee and counterpart guarantee, execution of counterpart agreement and obtaining licence by 24.4.2002. this court while admitting the writ petitions, refused interim order and observed that any grant of licence will be subject to the result of the writ petitions. it does not dilute the broad powers under section 28(1). 37. specific powers do not exclude general powers is a well settled proposition of law. it can be for any other reason like increasing revenue of the state. the government order issued is well within the powers and is as per rule 28 of 1970 rules read with rule 2 of 1998 rules. knowing fully well, all the petitioners applied for renewal in accordance with rule 26-a of 1970 rules. having obtained renewal of licence and having carried on the business in accordance with the conditions of licence, counter part agreement, the petitioners cannot turn around and question the grant of new licences as well as the condition imposed as per para 5 of g. 151 dated 30.3.2002. he therefore submits that the petitioners cannot be heard to complain any arbitrariness or irrationality. 42. in support of his contention, he placed strong reliance on the judgment of the supreme court in assistant excise commissioner v. doctrine of fairness or the duty to act fairly and reasonably is a doctrine developed in the administrative law field to ensure the rule of law and to prevent failure of justice where the action is administrative in nature. 45. the state has come forward with the counter-affidavit as well as the additional counter-affidavit categorically stating the position after the impugned notification. 50. i fail to understand as to how this decision in ram kumar's case (supra) would assist the learned counsel for the petitioners. it can only operate towards the end of the excise year by which time in all likelihood the licensee must have enjoyed the licence and carried on the business for almost an year. 52. in the present case, the petitioners are not compelled to pay any excise duty or the cost price of the liquor, which they fail to lift from apbcl. further, on a true interpretation of rule 66-a it is not possible to hold that the failure to lift the liquor having minimum value (issue price) as prescribed will automatically entail in the cancellation/non-renewal of licence. 53. in the counter-affidavit, the reasons for enacting such a rule have been explained stating that if such a restriction is not imposed, the licensee may indulge in unlawful activities such as sale of non-duty paid liquor, sale of id liquor or sale of indian liquor above the recommended maximum retail price (rmrp). the licensee may also suppress the turnover and make profit by exploiting the consumers. it is as good and fair a formula as that thought of by the respondents. if the excise commissioner chose to adopt one formula instead of another, it is not for the court to substitute its judgment in a proceeding under article 226 of the constitution and say that the other formula would have been better or should have been preferred. it is well settledthat a policy decision of the governmentof the day is beyond the purview of thejudicial review unless it is shown to becontrary to the act or the constitution or itis tainted with mala fide and extraneous considerations. they obtained renewal of licenses knowing fully well that the government is going to sanction new outlets. 57. in the result, for the above reasons, all the writ petitions fail and accordingly they are dismissed.orderv.v.s. rao, j.1. all the petitioners are holders of form il-24 licence issued under the a.p. indian liquor and foreign liquor rules, 1970. by virtue of the licence granted to them, they are permitted to sell indian liquor and foreign liquor (iml) in sealed or capsuled bottles in quantities not exceeding six quarts bottles (each of 750 ml) of all liquor other than beer and 12 quarts bottles of beer at any time or in any single transaction. all the petitioners obtained licences for the year 2001-2002 valid from 1.3.2001 to 31.3.2002. at the time of renewal of their licence for the year 2002-2003 (from 1.4.2002 to 31.3.2003), the licensing authority issued a notification in accordance with the government policy inviting applications for grant of lease of right to sell indian liquor, foreign liquor and beer in retail at places mentioned in the list appended to the notification (in some cases such notifications were issued on 9.4.2002 or thereabout). assailing the said notifications issued by the licensing authorities in various districts, the petitioners approached this court challenging the policy of the state in allowing retail outlets in various mandals. in all the writ petitions, a writ of mandamus is sought for declaring the notifications issued by the licensing authority inviting applications for grant of new licences and also for declaring clauses 4 and 5 in g.o. ms. no. 109 dated 11.3.2002 whereby and whereunder the excise policy for the year 2002-2003 was notified. as common questions of law arise for consideration, all the writ petitions are being disposed of by this common judgment. for better understanding, the pleadings in w.p. no. 5770 of 2002 may be noticed.2. the petitioner is the licensee of m/s. ramya wines. he was granted a licence on 31.3.1998, which was renewed from time to time. the licence was also renewed in april 2002 and the same is valid up to 31.3.2003. it is the case of petitioner that for the year 2002-2003, the government announced the policy in g.o. ms. no. 109 revenue (ex.ii) department dated 11.3.2002 inter alia enhancing the licence fee from the existing rates i.e., from rs. 2,85,000/-to rs. 3,00,000/- in places where the population does not exceed 10,000 and to rs. 4,50,000/- in the areas where the population is between 10,001 and 50,000 and also allowing new shops/outlets - one shop per mandal and as many shops as required based on the existing level of consumption of liquor in a unit i.e., a mandal. the policy also provides that if the licensee fails to lift liquor having minimum value (issue price) of at least six times the proportionate licence fee, the licence is liable for cancellation/non-renewal. the petitioner contends that it is contrary to the provisions of the act as well as the relevant rules besides being irrational. the petitioner also alleges that after issue of g.o. ms. no. 109, the licensing authority is insisting to incorporate a condition in tune with clause (5) of g.o. ms. no. 109 in the counterpart agreement executed by the licensee at the time of renewal of the licence. it is also further alleged that if a new shop/ outlet is allowed, the petitioner has to suffer loss of sales and fall in business turnover which ultimately results in the petitioner not lifting liquor having minimum value of six times the proportionate licence fee and would therefore incur a disqualification for renewal of licence. it is his further case that the excise policy in g.o. ms. no. 109 as well as the notification issued by the licensing authority are in violation of the fundamental rights under articles 19(1)(g) and 21 of the constitution of india.3. the commissioner of prohibition and excise, government of andhra pradesh, who is a respondent in all the writ petitions has filed a common counter-affidavit as well as an additional common counter. the allegation that the petitioners' fundamental right under articles 19(1)(g) and 21 of the constitution of india is violated is denied. the locus standi of the petitioners to question the excise policy and notification inviting applications for new licences is also questioned. the maintainability of the writ petitions for not impleading the affected parties i.e., the new licensees is also raised.4. a reading of the counter-affidavit and additional counter affidavit inter alia discloses that the government issued g.o. ms. no. 152 revenue (excise-ii) department dated 30.3.2002 in exercise of powers under section 72 read with sections 28 and 29 of the a.p. excise act, 1968 ('the act' for brevity) amending the rules applicable for the excise year 2002-2003. g.o. ms. no. 109 revenue (excise-ii) department dated 11.3.2002 contemplates the guidelines and fee structure on certain slabs of iml outlets for the year 2002-2003 strictly in accordance with the excise act and the rules made thereunder. the government also issued a memo bearing no. 21860/ex.uu(2)/2002-1, dated 8.4.2002 according permission to the commissioner of prohibition and excise for issuing a notification to establish 1623 new iml shops throughout the state as detailed in the annexure to the said memo. pursuant to the said memo, the commissioner issued a circular being cr.no. 1701/2002/cpe/g2 dated 8.4.2002 communicating a set of model gazette notifications to all the collectors and prohibition and excise superintendents etc., in the state for their guidance. accordingly, the prohibition and excise superintendents in the state issued gazette notifications on 8.4.2002 calling for applications from the intending applicants for grant of il 24 licences for the year 2002-2003. as per the time schedule mentioned in the notification, the last date for receipt of applications is 15.4.2002 and the selections will be made on 17.4.2002. all the selected candidates have to complete the formalities by 24.4.2002 and obtain licences on the same day. pursuant i to the above notifications, several applications have been received and the applications having been processed, the licences have been granted to open new outlets/shops. it is also mentioned that during the year 2001-2002 in a batch of writ petitions being w.p. no. 9199 of 2001 and batch, similar notifications were challenged which were dismissed by a learned single judge on 28.6.2001. the same was confirmed by a division bench of this court in sree wines v. state of a.p., : 2001(5)ald399 (db).5. the petitioners are the existing licensees and they have no right to challenge the grant of licences to new licensees or question the policy of the government. as per the new policy, one shop per mandal is allowed where no new shop can be opened and in all other places, as many shops as required will be allowed on the basis of consumption and if a licensee fails to lift the liquor to the value of six times the proportionate licence fee, the licence is liable to be cancelled. for calculating the number of shops required based on consumption, an exercise has been made on an objective basis for establishment of new outlets. the new shops basing on existing level of consumption (category-a) are assessed on the basis of business potential of a place whether it is a village, town or municipality taking as a unit. in respect of municipal corporations of hyderabad, vijayawada and visakhapatnam, having larger population and where the licensing fee is rs. 12.30 lakhs per annum, the excise station has been taken as a unit. in respect of each unit, the total number of shops, total licence fee and total sales of a.p. beverages corporation limited (for short apbcl) to these shops during the last year has been taken into account. the apbcl sale value equivalent to eight times the licence fee of a shop in the place has been taken as a viable point for location of a new shop. based on this viability, the total shops that can be established in a unit (village, mandal, town or municipality) have been calculated. the shop/new outlet is not selected irrespective of consumption formula. by applying this formula, it was proposed to sanction 760 retail iml outlets based on the existing level of consumption in 366 mandals of the state.6. insofar as the sanction/permission for new shops at the rate of one shop per mandal (category-b) is concerned, the mandals were selected where the iml/ beer consumption is less than eight times the licence fee which may be due to high retail price at which liquor is being sold by the existing licensees in order to prevent the opening of new iml shops and to carry on illegal activities by way of syndicates. in this category, 746 shops were sanctioned to cover 746 mandals, which are not covered by category-a shops. apart from category-a and category-b shops, 117 new licences in various districts which do not have a single retail outlet and not fallen either in category-a or categbry-b were also approved. in the additional counter-affidavit, the reasons for imposing a condition on a licensee to lift liquor having a minimum value (issue price) of at least six times of the proportionate licence fee has been explained.7. the learned counsel m/s. t. amarnath goud, a. jagannadham, kln swamy and o. manoher reddy made lead submissions on behalf of the petitioners. the summary of their submissions is as follows: the impugned notification dated 8.4.2002 is contrary to the policy contained in g.o. ms. no. 109 dated 11.3.2002. the impugned policy does not enable the licensing authority to grant new licences in such a manner that opening of a new shop would result in disqualifying the existing licensees for renewal of licence. elaborating further, they contend that by reason of promoting new outlets either on consumption basis or on the basis of requirement of one shop at each mandal, the capacity of a licensee to lift liquor from apbcl gets reduced and automatically he will not be able to lift liquor at least six times of the proportionate licence fee. this would result in cancellation/non-renewal of licences. the procedure adopted is irrational and arbitrary violating article 14 of the constitution of india. in all the districts, new outlets under category-b have been selected only at places where the licence fee slab is rs. 3,00,000/- whereas while selecting places for new outlets under category-a (consumption basis), shops have been selected at places where the licence slab is rs. 4.5 lakhs and above. this is discriminatory and irrational. the formula adopted by the respondents in determining the shops either on consumption basis or requirement basis does not stand to scrutiny on a rational principle. clause (4) of g.o. ms. no. 109 is contrary to rule 28 of the a.p. indian liquor and foreign liquor rules as none of the factors for sanctioning new shops are present in the whole exercise.8. the learned government pleader for excise sri m. subrahmanyam opposed the writ petitions contending that the petitioners have no locus standi to question the policy of the government in the factsand circumstances of the case, especially, insofar as the grant of licence to a rival trader is concerned. they also contend that in the absence of necessary parties who are likely to be affected by orders of this court, a writ petition under article 226 of the constitution of india is not maintainable. thirdly it is contended that the policy in g.o. ms. no. 109 dated 11.3.2002 was notified much before the petitioners made applications for renewal of licence for the year 2002-2003 and that knowing fullywell about the proposals to sanction new outlets for grant of il24 licences, the petitioners have obtained renewal of licences and also executed counterpart agreements. as per the licence, they arebound by the provisions of the act, the relevant rules and conditions of licence and therefore they cannot question the action of the licensing authority or the commissioner of excise or the government in sanctioningnew shops which is exclusively within the purview of these authorities under rule 28 of the rules. the petitioners cannot be permitted to resile from the contractual obligations. they cannot be permitted to turn around and question the sanction of new shops. by reason of the counter part agreement, the petitioners are bound by the subsequent amendments made to the act and the rules. by g.o. ms. no. 464, revenue (excise-ii) department dated 31.7.2002, the government has inserted rule 66-a giving statutory status to clause (5) in g.o. ms. no. 109 dated 11.3.2002 and therefore the petitioners are bound by rule 66-a as well. the notification as well as the policy are not contrary to law and are not arbitrary. it is also contended that the petitioners have no fundamental right under articles 19(1)(g) and 21 of the constitution of india.points for consideration:9. the four points that stem up for consideration from the rival submissions are:1. whether the petitioners have locus standi to question the government policy and the consequential notification issued by the licensing authority inviting applications for grant of new licences?2. whether the writ petitions are maintainable under article 226 in the absence of necessary and proper parties as respondents?3. whether the impugned policy and the impugned notification are ultra vires the provisions of the act and the rules? and4. whether the impugned notification and the impugned policy suffer from the vice of arbitrariness and thereby violate article 14 of the constitution of india?10. before considering the various points that arise for consideration, it is necessary to notice the legal frame work and the relevant case law dealing with the right of a licensee under the act to question the policy of the state on the touch stone of articles 14, 19(1)(g) and 21 of the constitution of india.legal framework:11. the state legislature enacted the a.p. excise act, 1968 so as to consolidate the law relating to production, manufacture, possession, transport, purchase and sale of intoxicating liquors and drugs and the levy of duties of excise and countervailing duties on alcoholic liquors for human consumption. chapter-iv of the act contains provisions, which deal with manufacture, possession and sale of excisable articles and intoxicating liquors and substances. chapter vii of the act provides for offences and penalties. the provisions of detection and investigation and trial of offences under the act are contained in chapter viii of the act. insofar as this case is concerned, some of the provisions in chapter-iv may be noticed.12. section 13 provides that no person shall manufacture or collect any intoxicant except under the authority and subject to the terms and conditions of a licence granted by a licensing authority. section 15 lays down that no person shall sell or buy an intoxicant except under the authority and in accordance with the terms and conditions of a licence granted in that behalf. sub-section (2) of section 15 stipulates various licensing authorities for a district and the state as such. sections 17 and 28 are relevant and read as under:section 17. grant of exclusive privilege or manufacture etc.:--(1) subject to the provisions of section 28 and any rules made in this behalf, the government may, subject to such conditions as they may deem fit to impose, grant for a fixed period to any person at any place a lease or licence or both either jointly or severally for the exclusive privilege,-- (i) of manufacturing or of supplying by wholesale or of both; or(ii) of selling by wholesale or by retail; or(iii) of manufacturing or of supplying by wholesale, or of both and of selling by retail any liquor or other intoxicant within any such area in the state as may be specified in the said order. (2) the government may confer on any officer the power mentioned in sub-section (1).section 28: forms and conditions of licence etc. :--(1) every permit issued or licence granted under this act shall be issued or granted on payment of such fees, for such period, subject to such restrictions and conditions, and shall be in such form and shall contain particulars, as may be prescribed.(2) the conditions prescribed under sub-section (1) may include provisions of accommodation by the licensee to prohibition and excise officers at the licensed premises on the payment of rent or other charges for such accommodation at or near the licensed premises and the payment of the costs, charges and expenses including the salaries and allowances of the prohibition and excise officers which the government may incur in connection with the supervision to ensure compliance with the provisions of this act, the rules made thereunder and the licence. 13. a plain reading of the above two provisions would show that a licence granted under the act and the rules prescribed for selling liquor in wholesale/ retail is subject to restrictions and conditions. the licensing authority can impose any condition while granting a licence to sell liquor. sub-section (2) of section 28 specifically enumerates some of the conditions, which can be incorporated in a licence.14. insofar as iml is concerned, three sets of rules govern the situation. all these rules are issued under section 72 of the act. the a.p. indian liquor and foreign liquor rules, 1970 (hereinafter called 'the 1970 rules') were issued under section 72 read with sections 9, 11 to 15 and 28 of the act. the a.p. excise (indian liquor and foreign liquor retail sale conditions of licences) rules, 1993 were made in exercise of powers conferred by the act under section 72 read with sections 28 and 29 of the act. likewise, in exercise of the powers under section 72 read with sections 28 and 29, the government made a.p, excise (lease of right to sell indian liquor, foreign liquor and beer in retail under il 24 licence) rules, 1998.15. we are mainly concerned with applicability, enforceability and interpretation of some of the provisions in 1970 rules. be it noted that prohibition was imposed in the state in december 1994 prohibiting manufacture, sale or consumption of intoxicant liquors except toddy. however, some time in 1997, the policy of prohibition was withdrawn insofar as iml is concerned. so as to grant licences for shops to sell iml also lease out right/privilege to sell indian liquor, the government initially evolved the system of auctioning the shops as per rule 2 of 1998 rules. with effect from 1998-99 open licence system policy was introduced by amending rule 2 of 1998 rules.16. broadly stated, the procedure for granting licences is somewhat as follows; before the beginning of the excise year i.e., from 1st march, the state government will issue necessary orders as to the number of il-24 licences to be granted in each district, municipality, town and village. the commissioner will accordingly issue directions under rule 28 of the 1970 rules directing all the licensing authorities i.e., the prohibition and excise superintendents in each district to issue notifications inviting applications. after issuing notifications under rule 2 of 1998 rules, the procedure contemplated under rule 31 of 1970 rules is followed and if there is only one applicant seeking licence for one shop, subject to the applicant satisfying the conditions of solvency and other particulars, the licence is granted to him for a period of one year i.e., from 1st april of the year to 31st march of the next year. if there are more applicants than one seeking licence for the same shop, the selection for grant of licences among the eligible applicants shall be by drawal of lot. the person who is granted licence in form il-24 in accordance with rule 23(1)(xiii) is entitled to sell iml and he shall not be allowed to permit consumption of liquor on the licensed premises.17. the licence fee payable is prescribed under rule 25. it lays down that the licence fee shall be as shown in the schedule appended to the rules from time to time. the rules provide for licence fee for each shop depending on the area or the population of the area, village, town or municipality where the shop is located. as per the schedule, where the population is (insofar as il-24 license is concerned) less than 10,000, the licence fee is rs. 3.00 lakhs per annum. like wise, where the population is more than 10,000 but does not exceed 50,000, the jicence fee is rs. 4.5 lakhs. where the population is above 50,000 and does not exceed 3,00,000, rs. 8.25 lakhs is the licence fee and where the population is above 3,00,000 and does not exceed 7,00,000, the licence fee is rs. 10,35,000/-. likewise, where the population is more than 7,00,000, the licence fee is rs. 12,30,000/-. the relevant entry in the schedule also provides that even though a shop falls within an area with less population, if it is within a belt of 5 kms from the periphery of municipal corporation or municipality, the licence fee shall be at the rate of fee of retail shops situated within the respective municipality or municipal corporation.18. the licence in form il-24 is given subject to the licensee executing a counter part agreement as required under section 29 and rule 30 of the 1970 rules and also subject to conditions of licence given in form il-24. one of the conditions in il-24 licence provides that the licensee shall sell only duty paid indian liquor bottles affixed with excise adhesive labels and manufacturer's labels duly approved by the commissioner of excise as required under the rules. as per clause (2) of the counter part agreement, executed in form il-28a, the licensee is bound by all the provisions of the act, the rules and orders thereunder existing and also those that would be issued from time to time. the counterpart agreement contains another covenant that if the licensee surrenders the licence in the middle of the lease year, he shall pay the licence fee up to 31 st march of the lease year in which the surrender becomes effective and he will pay the annual licence fee at the rates shown in the schedule appended to the 1970 rules before commencement of the lease year to which it relates to either in full or in three equal instalments as laid down in rule 25.19. rule 26-a of 1970 rules deals with renewal of a licence. sub-rule (1) provides that an existing licensee has to make an application for renewal of licence one month in advance before expiry of the licence. however, the commissioner of prohibition and excise is empowered to condone the delay in making an application for renewal after expiry of the period of licence subject to paying penalty of rs. 100/-per each day of delay. again before issue of a renewed licence, the licensee has to execute a counterpart agreement in form il-28. be it also noted that as per sub-rule (2) of rule 26-a, if the application for renewal of licence made under sub-rule (1) is not returned or licence is not renewed before the expiry of licence, the licensee shall have the right to carry on the business till its renewal is refused under intimation.20. it is not denied before this courtthat all the petitioners were granted licences/renewed licences for the excise year 2001-2002 and before the expiry of the licence period - 31.3.2002, all of them made applications under rule 26-a(1) for renewal of licence and they did not withdraw their applications for renewal after the notification was published by the licensing authority inviting applications. it is also not denied that the policy for the year 2002-2003 in g.o. ms. no. 109 dated 11.3.2002 was published much before all the petitioners made applications for renewal of their licences.relevant case law21. the law does not recognize the right to trade in intoxicating substances. the state alone has exclusive privilege to manufacture and sell intoxicant substances and liquor. there is no fundamental right to do business in liquor. it is res extra commercium. it is well settled by reason of various decisions of the supreme court and this court. it is not necessary to extract the relevant passages from those judgments. it is sufficient to refer to the judgment in khoday distilleries limited v. state of karnataka, : (1995)1scc574 . the constitution bench considered all the earlier authorities on the subject and in para 60 summarized the law as culled out from the earlier decisions.22. it was held that the fundamental right under article 19(1)(g) does not extend to carrying on the trade or business which is inherently vicious and pernicious. it does not also extend to carrying on trade or business in activities which are immoral and criminal. right does not extend to carrying on trade or business in goods, which are obnoxious and injurious to health and welfare of the general public. all these are res extra commercium (outside commerce). potable liquor as beverage is dangerous and injurious to health and, therefore, a citizen has no fundamental right to trade in liquor. the state has power to prohibit the manufacture, sale, possession and distribution of potable liquor as beverage and for the same reason the state can create a monopoly either in itself or in the agency created by it for the manufacture, possession, sale and distribution of liquor. for the said purpose, the state can impose limitations and restrictions on the trade or business in potable liquor as a beverage which restrictions are different from those imposed on trade or business in legitimate activities and goods. the state may even carry on business to the exclusion and elimination of others preserving to itself the right to sell licences to do business in liquor. when the state permits trade or business in the potable liquor, the citizen has the right to carry on trade or business subject to the limitations and conditions imposed and the state cannot make discrimination between the citizens who are qualified to carry on the trade. the state can adopt any mode of selling licences with a view to maximise its revenue so long as the method adopted is not discriminatory. the power of the state to raise revenue by levying taxes and fees should not be confused with the power of the state to levy taxes and fees on the production, sale and income derived from potable liquor. by imposing taxes, fees on the sale of liquor and augmenting its resources, the state does not become a party to such activities.23. the various points that arise for consideration have to be examined in the background of legal framework and relevant case-law.in re point no. 1:locus standi:24. when the notification was issued and policy was announced, the petitioners were holding licences. the notification was issued inviting applications to grant new licences and also imposing additional conditions. the petitioners are aggrieved by both.25. insofar as clause (5) of g.o. ms. no. 109 is concerned, by reason of clause (2) of the counterpart agreement executed by each of the petitioners in form il-28-a, they were also bound by the said conditions which by now have been incorporated as rule 66-a in 1970 rules by reason of g.o. ms. no. 464 dated 31.7.2002. as per the rule, as already noticed, a retail licence will be liable for cancellation/non-renewal, if the licensee fails to lift liquor having minimum value (issue price) of at least six times the proportionate licence fee. by the time the writ petitions came to be filed, this amendment was not on the statute book. but, g.o. ms. no. 109 containing similar clause was already there. by reason of the counterpart agreement, the provisions of the act, the rules and orders made thereunder existing on the date of issue of licence as well as those that would be issued from time to time are also binding on the licensee. therefore, even rule 66-a is binding on all of them. when the petitioners contend that rule 66-a or for that matter para 5 of g.o. ms. no. 109 is arbitrary, it cannot be said that they have no locus standi to question the impugned notification and the impugned policy. however, with reference to the other aspect of the matter, it cannot be said that the petitioners have locus standi to challenge the notification and the policy.26. by reason of paragraph 4 of g.o. ms. no. 109, the commissioner and the government decided to sanction new shops under categories a and b. though by the date of filing of most of the writ petitions, new licences were not issued, the whole purpose of the exercise was to grant new licences, presumably to rival traders of the petitioners. can an existing licensee question the sanction or grant of a licence to a river trader? the learned government pleader in support of the submission that being rival traders, the petitioners cannot question the grant of new licences under the new policy, relied on the decisions in j.m. desai v. roshan kumar, air 1976 sc 578; v. narayana v. s. babu rao, : air1978ap437 and rajappa kawati v. g. hanumantha rao, : 1995(3)alt878 .27. in j.m. desai's case (supra), the supreme court considered the question whether the proprietor of a cinema theatre holding a licence for exhibiting cinematographic films is entitled to invoke the certiorari jurisdiction for quashing a 'no objection certificate' granted by the district magistrate in favour of a rival in trade. the supreme court elaborately considered the concept of 'aggrieved person' and 'locus standi' and observed as under:according to most english decisions, in order to have the locus standi to invoke certiorari jurisdiction, the petitioner should be an 'aggrieved person' and in a case of defect of jurisdiction, such a petitioner will be entitled to a writ of certiorari as a matter of course, but if he does not fulfil that character, and is a 'stranger', the court will, in its discretion, deny him this extraordinary remedy, save in very special circumstances. this takes us to the further question: who is an 'aggrieved person'?and what are the qualifications requisite for such a status? the expression 'aggrieved person' denotes an elastic and to an extent an elusive concept. it cannot be confined within the bounds of a rigid, exact andcomprehensive definition. at best, its features can be described in a broad tentative manner. its scope and meaning depends on diverse, variable factors such as the content and intent of the statute ofwhich contravention is alleged, the specific circumstances of the case, the nature andextent of the petitioner's interest and thenature and extent of the prejudice orinjury suffered by him. english courts havesometimes put a restricted and sometimes awide construction on the expression'aggrieved person'. however, some generaltests have been devised to ascertain whether an applicant is eligible for this category so as to have the necessary locus standi or 'standing' to invoke certiorari jurisdiction.28. after referring to various decisions to ascertain whether an applicant is an aggrieved person or not, the supreme court laid down:it will be seen that in the context of locus standi to apply for a writ of certiorari, an applicant may ordinarily fall in any of these categories: (i) 'person aggrieved'; (ii) 'stranger'; (iii) busybody of meddlesome interloper. persons in the last category are easily distinguishable from those coming under the first two categories. such persons interfere in things which do not concern them. they masquerade as crusaders for justice. they pretend to act in the name of pro bono publico, though they have no interest of the public or even of their own to protect. they indulge in the past time of meddling with the judicial process either by force of habit or from improper motives. often they are actuated by a desire to win notoriety or cheap popularity; while the ulterior intent of some applicants in this category may be no more than spoking the wheels of administration. the high court should do well to reject the applications of such busybodies at the threshold.29. having noticed various authorities, the supreme court held that a rival trader cannot invoke the certiorari jurisdiction of the high court under article 226 of the constitution of india for quashing a licence given to a rival trader.30. in v. narayana's case (supra) a division bench of this court considered the question whether a licensee under the a.p. excise (arrack and toddy licences general conditions) rules, 1969 has locus standi to challenge the order of the district collector directing shifting of the shop. after referring to the decision in j.m. desai's case (supra), and other decisions of the supreme court, the division bench observed:the mere fact that on account of proximity of the shop to their area of operation, their business would be affected, is no ground to hold that any of their legal right is infringed. no undertaking is given either under the act or the rules or the licence given to him that a shop in the nearby area would not be permitted to be opened by any other licensee. even if the order permitting the shifting of shop is illegal, as held in n.r & f mills v. ntg & bros., : [1970]3scr846 , the petitioners would have no locus standi to challenge the grant of permission because no right vested in them was infringed. it was however argued by mr. bhujangarao the learned counsel for the petitioners that the order itself being a nullity and being illegal cannot be allowed to stand. that question, however, would come up for consideration before the court if the petitioners have locus standi to maintain the petition, .31. another division bench in rajappa kawati 's case (supra), following the judgment in j.m. desai's case (supra), held that the existing stage carriage permit holder cannot question the grant of another stage carriage permit to a rival bus operator.32. the learned government pleader contends that the petitioners are mainly aggrieved by the grant of licences to other shops in the locality or area where the petitioners are running the shops. therefore, they cannot be permitted to invoke the jurisdiction of this court. no doubt, there cannot be any dispute with the legal position. however, as the petitioners are equally aggrieved by para 5 of g.o. ms. no. 109 dated 11.3.2002, which is now inserted as rule 66-a of 1970 rules, it cannot be said that the petitioners have no locus standi to question the policy.in re point 2:absence of necessary parties maintainability of writ petition:33. in exercise of the powers underarticle 226 of the constitution of india, the high court can either enforce the rights, be it constitutional, statutory or community rights. the power is also exercised to compel the public authorities to discharge their statutory duties and common law duties. while passing orders and issuing necessary writs, more often than not the rights of other persons are affected. in the absence of such affected persons it is not proper for the high court to exercise the jurisdiction under article 226 of the constitution of india and issue writs either for enforcing the rights or for compelling due performance of the duties.34. in prabodh verma v. state of u.p., : [1985]1scr216 , it has been held by the supreme court that in writ petitions filed against the state questioning the validity of recruitment of a large number of persons in service could not be proceeded with and take decision adverse to those affected persons without getting them or their representatives impleaded as parties. the said view was followed by the supreme court in ishwar singh v. kuldip singh, 1995 suppl. (1) scc 179; j. jose dhanapaul v. s. thomas, : (1996)iillj646sc and all india sc & st employees association v. a. arthur jeen, : [2001]2scr1183 . therefore, when the necessary parties whose rights were affected are not made parties to the writ petitions, the court exercising jurisdiction under article 226 should reject the writ petitions in limini.35. as on the date of filing of the writ petitions, in most of the cases, new licences were granted/even according to the counter-affidavit, the impugned notification prescribed a time schedule according to which the last date for receipt of applications is 15.4.2002 and the selections were held on 17.4.2002. the notification required all the selected persons to complete the formalities like giving bank guarantee and counterpart guarantee, execution of counterpart agreement and obtaining licence by 24.4.2002. this court while admitting the writ petitions, refused interim order and observed that any grant of licence will be subject to the result of the writ petitions. therefore, it was incumbent on the part of the petitioners to find out the particulars of the new licensees who were granted licence pursuant to and in furtherance of the impugned notification and make them parties to the writ petitions. though this court observed that grant of new licences will be subject to the result of the writ petitions, no steps were taken in that direction. in the absence of affected parties being before this court, it would not only be impermissible, but also unfair to issue a writ as prayed for and set at naught the new licences which have admittedly been put to, use and those licences will be expiring by 31.3.2003. this point is answered accordingly.in re point no. 3 question of ultra vires:36. sri manoher reddy, learned counsel vehemently contends that g.o. ms. no. 109 dated 11,3.2002 and the impugned notification are ultra vires the powers of the authorities. he placed reliance on rule 28 of 1970 rules. the learned government pleader, however, relies on the same rule 28 in support of the contention that it is within the purview of the government and the commissioner of excise to lay down guidelines for grant of licences to new outlets. a reference to the relevant provisions of the act has already been made. as already pointed; out, it is competent to the government to grant lease or licence for a fixed period to any person for exclusive privilege of selling liquor or any other intoxicant subject to certain conditions as the government may deem fit to impose. the broad power under section 28(1) to impose any restriction and conditions cannot be confused with specified restrictions and conditions adumbrated in sub-section (2) of section 28. to my mind sub-section (2) of section 28 only gives conditions illustratively. it does not dilute the broad powers under section 28(1).37. specific powers do not exclude general powers is a well settled proposition of law. the supreme court in ajay canu v. union of india, : air1988sc2027 , after referring to its earlier decision in om prakash v. union of india, : air1971sc771 , explained this principle. the supreme court laid down that specifying the particular power is only illustrative and does not in any way restrict the general power. that takes me to rule 28 of 1970 rules, which reads as under:28. number of licences:--subject to such directions which the government may issue in this regard, from time to time, the commissioner shall be competent to fix number of licences to be granted in an area having due regard to' requirement, public order, health, safety and such other factors as he thinks fit. subject to such directions or instructions as the commissioner may give in this behalf, the licensing authority may grant licences in each category and to each person in any area.38. rule 28 of 1970 rules contains two limbs. under the first limb, it shall be competent to the commissioner to fix number of licences to be granted in an area having regard to (i) requirement (ii) public order, safety and (iii) such other factors as he thinks fit. the power of the commissioner is subject to any directions that the government may issue in that regard. as and when the government or the commissioner issues such directions the licensing authority may grant licences in each category to different persons in an area. it is not necessary that whenever the commissioner decides to issue licences, he must obtain necessary directions from the government. the commissioner can independently determine the number of licences to be granted in an area. whenever such exercise is taken up the two factors are the requirement of the area and the public order and health of the people. these two requirements are in addition to any other factor which the commissioner may consider appropriate and deems fit. it must not be forgotten that in exercise of its absolute privilege, the state's endeavour is always to augment its, revenue by parting with privilege to trace and do business in iml. there cannot be any objection if the commissioner decides and adopts a method to increase the revenue of the state and grants new licences in an area. the requirement in an area may or may not have any relation with the object of augmenting revenue of the state. the submission of the learned counsel for the petitioners that the commissioner and the government must assess requirement of the area/each unit (village, town, municipality, corporation etc.,) before issuing the notification cannot be accepted. it can be for any other reason like increasing revenue of the state.39. along with the counter-affidavit, the statement showing the sale statistics of liquor from 1998-99 to 2001-2002 has been annexed. this shows that there is abnormal increase in the sale of liquor. other statements were also annexed to the additional counter affidavit showing that year after year there has been more demand for sanctioning additional licences though at one point of time there used to be few shops in each area/unit. indeed, taking 1998-99 as basis, the statistics show that by 2002-2003, upto 15.4.2002, the percentage of growth of sales is abnormally high at 111%. therefore, the growth of sales in iml is a very relevant consideration while granting additional licences under rule 28 of the 1970 rules.40. as already seen, under section 17 read with section 28, it is always open to the government or appropriate licensing authority to impose restrictions or conditions while granting lease or licence to trade or do business in indian liquor. the policy in g.o. ms. no. 109 dated 11.3.2002 or consequent notifications cannot be declared as ultra vires. the government order issued is well within the powers and is as per rule 28 of 1970 rules read with rule 2 of 1998 rules. the licensing authority has issued notification, which is within the powers of the licensing authority. point no. 3 is answered accordingly. in re-point no. 4:whether policy is arbitrary?41. before considering the question of arbitrariness, it is necessary to advert to the submission raised by the learned government pleader for excise. he submits that even before the petitioners applied for renewal of licences for the year 2002-2003, g.o. ms. no. 109 dated 11.3.2002 was published. knowing fully well, all the petitioners applied for renewal in accordance with rule 26-a of 1970 rules. after publication of the notification, none of the petitioners have withdrawn their applications for renewal. on the contrary, they obtained orders under rule 26-a(1)(a), executed the counterpart agreement in form il-28 as per rule 26-a (1)(b) and carried on the business for the excise year 2002-2003. none of the petitioners can be said to have suffered any loss and they have no grievance for redressal. further, the licence issued in il-24 is also subject to a counterpart agreement executed by the petitioners. therefore, the petitioners are bound to discharge their contractual obligations under the counterpart agreement. having obtained renewal of licence and having carried on the business in accordance with the conditions of licence, counter part agreement, the petitioners cannot turn around and question the grant of new licences as well as the condition imposed as per para 5 of g.o. ms. no. 109 dated 11.3.2002 which is now being incorporated as condition no. 11 of form il-24 licence by reason of g.o. ms. no. 151 dated 30.3.2002. he therefore submits that the petitioners cannot be heard to complain any arbitrariness or irrationality.42. in support of his contention, he placed strong reliance on the judgment of the supreme court in assistant excise commissioner v. issac peter, : [1994]2scr67 , a division bench judgment of this court in sri rama wines v. excise superintendent, : 1998(2)ald686 (db) and a full bench judgment of this court in sri narasimha wines v. prohibition and excise superintendent, : 2001(6)alt240 (fb). in view of the law laid down in those authorities, there is no other go but to countenance the submission of the learned government pleader for excise department. in issac peter's case (supra) it has been held by the supreme court as under:..................... doctrine of fairness or the duty to act fairly and reasonably is a doctrine developed in the administrative law field to ensure the rule of law and to prevent failure of justice where the action is administrative in nature. just as principles of natural justice ensure fair decision where the function is quasi-judicial, the doctrine of fairness is evolved to ensure fair action where the function is administrative. but it can certainly not be invoked to amend, alter or vary the express terms of the contract between the parties. this is so, even if the contract is governed by statutory provisions i.e., whether it is a statutory contract or rather more so. it is one thing to say that a contract every contract must be construed reasonably having regard to its language. but this is not what the licensees say. they seek to create an obligation on the other party to the contract, just because it happens to be the state. they are not prepared to apply the very same rule converse case i.e., where the state abundant supplies and wants the licensees to lift all the stocks. the licensees will undertake no obligation to lift all those stocks even if the state suffers loss. this one-sided obligation in modification of express terms of the contract, in the name of duty to act fairly is what we are unable to appreciate. the decisions cited by the learned counsel for the licensees do not support their proposition.43. in sri rama wines's case (supra), the question that arose is whether it is competent to the licensing authority to impose conditions while granting licences. having regard to the provisions of the act it was held:the licence though was granted under section 28 of the act, is subject to certain conditions as prescribed in the rules. it is true that conditions of licence do not contain any such liability to pay any enhanced licence fees. but the conditions do not place any embargo on the authorities to collect the same. when such is the situation and when the authorities have been clothed with the power to require the applicant to given an undertaking for such payment, it cannot be said that the undertaking is contrary to the letter and spirit of the licence or section 28 of the act. the counterpart agreement is a statutory one and an undertaking has been given as prescribed in clause (iv) of form il-28 under rule 30. it is not far to seek the reason for requiring the licensee to give such an undertaking. the population of a place varies due to the lapse of time and also for the reason of merger of another area into the concerned village/town/ municipality. many other situations also can be visualized. these situations cannot be anticipated on the date of grant of licence. since the licence fees was payable depending upon the density of the population, the act gives the power to the authorities to require the licensee to pay the enhanced licence fee as and when levied, even during the currency of the period of licence. this power having been given by the act itself, it cannot be said that it runs counter to the licence granted under the act.44. in sri narasimha wines's case (supra), the validity and virus of sub-rule (9) of rule 25 of 1975 rules was challenged as arbitrary and discriminatory. this court referred to the decisions in har shankar v. dy. excise commissioner, : [1975]3scr254 and shamlal v. state of punjab, : air1976sc2045 and held that when the licensees accept the terms of the contract entered into by duly completing the formalities and obtained licence, they cannot be allowed to question the conditions of licence especially when they have accepted the licence for almost the entire period. the licensees are bound to fulfil the contractual obligations. only because some hardship is caused to the licensee by reason of ups and downs in the business, a writ of mandamus shall not be issued in aid of such licensee. the relevant observations are as under:writ of mandamus cannot be issued directing the statutory authorities to act contrary to law. a matter governed by contract qua contract would not attract the writ jurisdiction of this court as in such a matter public law element is not involved. the state by reason of any statutory rule or otherwise can reserve unto itself the right to revise the licence fee and or the matters ancillary or incidental thereto. only because some hardship is caused, the same by itself may not be a ground for declaring the same ultra vires.45. the state has come forward with the counter-affidavit as well as the additional counter-affidavit categorically stating the position after the impugned notification. no reply affidavit is filed denying the allegations made in the counter affidavit. therefore, this court has to presume that all the licensees who at the relevant time applied for renewal of licences have not withdrawn the applications for grant of licence after announcement of the policy as per g.o. ms. no. 109 and after the impugned notifications were issued inviting applications. they had not even stopped their business and they went on carrying on their business and therefore they cannot be heard to say that paragraphs 4 or 5 of the impugned policy would result in detriment to them. no factual foundation is laid to support the contention of the petitioners.46. whether it is competent to the state to impose a condition as is now inserted as rule 66-a? as already noticed, initially in g.o. ms. no. 105, the government decided that a condition should be imposed in the licence to the effect that if a licensee fails to lift the iml stock with a minimum value (issue price) at least six times the proportionate licence fee, the licence will be liable for cancellation/non-renewal.47. sri kln swamy, the learned counsel has vehemently contended that it is not competent to the state or the licensing authority to impose such a condition. reliance is placed on the judgment of the supreme court in b.c. banerjee v. state of madhya pradesh, : [1971]81itr105(sc) and excise commissioner v. ram kumar, : air1976sc2237 . per contra, the learned government pleader brought to my notice a subsequent decision of the supreme court in state of a.p. v. prabhakar reddy, : 1987(12)ecc41 where the apex court considered the decisions in b.c. banerjee's case (supra) and ram kumar's case (supra) and explained those two decisions.48. in ram kumar's case (supra) the licence was granted under u.p. excise act, 1910 which contained a condition (condition 3-a) to the effect that if a licensee fails to lift the monthly proportionate quantity in any month, he shall be liable to pay compensation to the state government at the rate equal to the rate of 'still head duty per litre' of spiced spirit and still head duty per litre of plain spirit as may be in the area in which the shop is situated on the quantity falling short of such monthly proportionate quota and such compensation shall be paid by the 7th of the month following the month to which such shortfall relates. the said condition was challenged before the allahabad high court, which allowed all the writ petitions. in the appeals preferred to the supreme court by special leave, the question that fell for consideration was whether the condition incorporated in the licence, as noticed hereinabove is valid and enforceable. the supreme court referred to the decision in b.c. banerjee's case (supra) and came to the conclusion that the demand for disguised compensation, is in fact and in reality a demand for excise duty on the unlifted quantity of liquor which is not authorised by the provisions of the act and therefore held that such levy is ultra vires. it is apt to excerpt the following passage from ram kumar's case (supra).49. we have, therefore, not the slightest hesitation in holding that the demand made by the appellants though disguised as compensation, is in reality a demand for excise duty on the unlifted quantity of liquor which is not authorized by the provisions of the act. this being the sole point involved in appeals other than appeal nos.399 to 404 of 1975, the former appeals cannot succeed. - in the result they are dismissed with one set of costs.50. i fail to understand as to how this decision in ram kumar's case (supra) would assist the learned counsel for the petitioners. rule 66-a (para 5 of g.o. 109) does not seek to levy or collect any compensation or excise duty for unlifted liquor. it merely says that in such an event licence is liable for cancellation/non-renewal. further, as presently seen, rule 66-a does not operate either in the beginning of the excise year or in the middle of the excise year. it can only operate towards the end of the excise year by which time in all likelihood the licensee must have enjoyed the licence and carried on the business for almost an year.51. a full bench of five learned judges of this court in atluri bramhanandam v. tahsildar, : air1977ap196 , took a view that the government is not entitled to claim from the excise contractors, excise duty component on the unlifted minimum guaranteed quantity. the state carried the appeals to the supreme court, which was decided in y. prabhaker reddy's case (supra) and the decision of the full bench of this court was reversed. while doing so, the earlier decisions in banerjee's case (supra) and ram kumar's case (supra) were considered and it was held that in both the decisions what was sought to recover was excise duty and therefore they are distinguishable as no excise duty can be levied on the unlifted liquor as per the provisions of the relevant act.52. in the present case, the petitioners are not compelled to pay any excise duty or the cost price of the liquor, which they fail to lift from apbcl. further, on a true interpretation of rule 66-a it is not possible to hold that the failure to lift the liquor having minimum value (issue price) as prescribed will automatically entail in the cancellation/non-renewal of licence. the very fact that rule 66-a provides for giving an opportunity for hearing before passing an order of cancellation/non-renewal would show that discretion vests in the licensing authority and he is required to consider each and every case. if the reasons for not lifting the liquor of minimum value as prescribed in rule 66-a are genuine and beyond the control of the licensee, the renewal of licence for the next excise year cannot be denied.53. in the counter-affidavit, the reasons for enacting such a rule have been explained stating that if such a restriction is not imposed, the licensee may indulge in unlawful activities such as sale of non-duty paid liquor, sale of id liquor or sale of indian liquor above the recommended maximum retail price (rmrp). the licensee may also suppress the turnover and make profit by exploiting the consumers. further, as rightly contended by the state, if by the end of licence period the licensee knows his position that he will not be able to lift the liquor as required under rule 66-a of the rules, he need not apply and if he chooses to apply, it would belie the contention that he fell short of the prescribed limit in rule 66-a. under rule 26-a it is not compulsory for any licensee to obtain renewal. rule 26-a only provides that if a licensee applies for renewal one month in advance for renewal and fails to get renewal before the commencement of the excise year i. e., 1st april, he may still continue to do business till he receives the rejection order. it does not mean that a licensee whose licence is not viable and who is incurring losses for various reasons must still apply for a renewal and await any orders. nobody compels any licensee to seek renewal of his licence, which comes to an end by 31st march of the excise year.54. whether the formula adopted fordetermining the number of shops as per thepolicy is rationale? as explained in thecounter affidavit, the new retail outlets areidentified under categories a, b and c.categories b and c do not present anydifficulty. under category 'b' one shop isallotted to each mandal where it is notpossible to determine the additional shopsbased on consumption. likewise, under category 'c' shops are allotted mandal wise though the place is remote and inaccessable. much controversy arose in regard to category 'a' new outlets. if for the previous year the turnover of all the shops in a unit; be it a village, town, municipality or corporation - is abnormally high, it is presumed that all the shops are viable and there is a scope for allotting new shops within the unit. to determine the number of shops in an area, the government have evolved a formula. it postulates that the total turn over in the excise year (based on sales figures at issue price of apbcl) is multiplied by the total licence fee payable by all the shops. it pre-supposes that if the average turn over i.e., the value of liquor lifted from apbcl is six times the licence fee in respect of each shop or it is more, it is a case for sanctioning a new outlet. though as per rule 66-a the prescribed quantity lifted is six times the licence fee for the purpose of determining the additional shops on the consumption basis, authorities have applied factor 8. in the additional counter affidavit the possible expenditure required for a shop in a village where the licence fee is rs. 3,00,000/- is explained. the illegality or irrationality in the methods adopted is not pointed out by any of the learned counsel for the petitioners, though in some cases statistics have been produced before me to show that the total quantity of liquor in terms of money lifted for the excise year 2002-2003 is less than the total quantity of liquor lifted from apbcl during the excise year 2001-2002. even according to this, the sales have not fallen down drastically. the fonnula adopted by the authorities is therefore rationale. in any event as laid down by the supreme court in excise commissioner v. prem jeet singh, : air1983sc1056 , it is not for this court to nicely balance the pros and cons and find fault with the formula. in the said decision, it was held as under:had this figure been adopted, the increase would be seen to be substantial. this figure was arrived at by adopting a formula based on the unaccepted bids for individual shops in the previous year. both the methods of calculation have been described in the special leave petition in some detail. we do not think it necessary to probe deeper into the rival methods of computation. it is not the function of this court. even assuming that there is some merit in the method of computation of notional value suggested by the respondents, it was a matter entirely for the excise commissioner to adopt the formula which he thought was more reasonable. it is not as if the formula adopted by the excise commissioner is so utterly unreasonable that it has necessarily to be thrown out of hand. it is not a slap dash. speculative formula based on any unintelligible hypothesis or on facts drawn from imaginary sources. it is as good and fair a formula as that thought of by the respondents. if the excise commissioner chose to adopt one formula instead of another, it is not for the court to substitute its judgment in a proceeding under article 226 of the constitution and say that the other formula would have been better or should have been preferred. it not the function of the court at all. after all it is to the government and the excise commissioner that the legislature has entrusted the task of protecting the revenue and it was in the interests of the revenue that the excise commissioner was acting. .55. the petitioners have not alleged any mala fides on the part of the respondents. therefore, the validity of the formulacannot be subject matter of judicial review.further, policy decision of the government,especially in the matter of intoxicantscannot ordinarily be interfered unless it isgrossly arbitrary violating article 14 ofthe constitution of india. it is well settledthat a policy decision of the governmentof the day is beyond the purview of thejudicial review unless it is shown to becontrary to the act or the constitution or itis tainted with mala fide and extraneous considerations.56. in a recent judgment of this court in association of drugs and pharmaceuticals manufacturers v. a.p.h.m.h & idc, : 2002(2)ald609 , after referring to all the decisions i have held that the policy decision of the government cannot be interfered by court of judicial review unless it violates the constitutional or legal provisions. the petitioners have not even attempted to show any arbitrariness in the policy of the government. they obtained renewal of licenses knowing fully well that the government is going to sanction new outlets. they obtained licenses and carried on their business from april, 2002 till february, 2003 and therefore they cannot be heard to contend that the policy of the government, impugned in these writ petitions, is arbitrary or illegal.57. in the result, for the above reasons, all the writ petitions fail and accordingly they are dismissed. no costs.

Judgment:
ORDER

V.V.S. Rao, J.

1. All the petitioners are holders of Form IL-24 licence issued under the A.P. Indian Liquor and Foreign Liquor Rules, 1970. By virtue of the licence granted to them, they are permitted to sell Indian liquor and Foreign Liquor (IML) in sealed or capsuled bottles in quantities not exceeding six quarts bottles (each of 750 ml) of all liquor other than Beer and 12 quarts bottles of beer at any time or in any single transaction. All the petitioners obtained licences for the year 2001-2002 valid from 1.3.2001 to 31.3.2002. At the time of renewal of their licence for the year 2002-2003 (from 1.4.2002 to 31.3.2003), the licensing authority issued a notification in accordance with the Government policy inviting applications for grant of lease of right to sell Indian Liquor, Foreign Liquor and Beer in Retail at places mentioned in the list appended to the notification (in some cases such notifications were issued on 9.4.2002 or thereabout). Assailing the said notifications issued by the licensing authorities in various districts, the petitioners approached this Court challenging the policy of the State in allowing retail outlets in various mandals. In all the writ petitions, a writ of mandamus is sought for declaring the notifications issued by the licensing authority inviting applications for grant of new licences and also for declaring Clauses 4 and 5 in G.O. Ms. No. 109 dated 11.3.2002 whereby and whereunder the excise policy for the year 2002-2003 was notified. As common questions of law arise for consideration, all the writ petitions are being disposed of by this common judgment. For better understanding, the pleadings in W.P. No. 5770 of 2002 may be noticed.

2. The petitioner is the licensee of M/s. Ramya Wines. He was granted a licence on 31.3.1998, which was renewed from time to time. The licence was also renewed in April 2002 and the same is valid up to 31.3.2003. It is the case of petitioner that for the year 2002-2003, the Government announced the policy in G.O. Ms. No. 109 Revenue (Ex.II) Department dated 11.3.2002 inter alia enhancing the licence fee from the existing rates i.e., from Rs. 2,85,000/-to Rs. 3,00,000/- in places where the population does not exceed 10,000 and to Rs. 4,50,000/- in the areas where the population is between 10,001 and 50,000 and also allowing new shops/outlets - one shop per mandal and as many shops as required based on the existing level of consumption of liquor in a unit i.e., a mandal. The policy also provides that if the licensee fails to lift liquor having minimum value (issue price) of at least six times the proportionate licence fee, the licence is liable for cancellation/non-renewal. The petitioner contends that it is contrary to the provisions of the Act as well as the relevant rules besides being irrational. The petitioner also alleges that after issue of G.O. Ms. No. 109, the licensing authority is insisting to incorporate a condition in tune with Clause (5) of G.O. Ms. No. 109 in the counterpart agreement executed by the licensee at the time of renewal of the licence. It is also further alleged that if a new shop/ outlet is allowed, the petitioner has to suffer loss of sales and fall in business turnover which ultimately results in the petitioner not lifting liquor having minimum value of six times the proportionate licence fee and would therefore incur a disqualification for renewal of licence. It is his further case that the excise policy in G.O. Ms. No. 109 as well as the notification issued by the licensing authority are in violation of the fundamental rights under Articles 19(1)(g) and 21 of the Constitution of India.

3. The Commissioner of Prohibition and Excise, Government of Andhra Pradesh, who is a respondent in all the writ petitions has filed a common counter-affidavit as well as an additional common counter. The allegation that the petitioners' fundamental right under Articles 19(1)(g) and 21 of the Constitution of India is violated is denied. The locus standi of the petitioners to question the excise policy and notification inviting applications for new licences is also questioned. The maintainability of the writ petitions for not impleading the affected parties i.e., the new licensees is also raised.

4. A reading of the counter-affidavit and additional counter affidavit inter alia discloses that the Government issued G.O. Ms. No. 152 Revenue (Excise-II) Department dated 30.3.2002 in exercise of powers under Section 72 read with Sections 28 and 29 of the A.P. Excise Act, 1968 ('the Act' for brevity) amending the Rules applicable for the excise year 2002-2003. G.O. Ms. No. 109 Revenue (Excise-II) Department dated 11.3.2002 contemplates the guidelines and fee structure on certain slabs of IML outlets for the year 2002-2003 strictly in accordance with the Excise Act and the Rules made thereunder. The Government also issued a memo bearing No. 21860/Ex.UU(2)/2002-1, dated 8.4.2002 according permission to the Commissioner of Prohibition and Excise for issuing a notification to establish 1623 new IML shops throughout the State as detailed in the annexure to the said memo. Pursuant to the said memo, the Commissioner issued a Circular being Cr.No. 1701/2002/CPE/G2 dated 8.4.2002 communicating a set of model gazette notifications to all the Collectors and Prohibition and Excise Superintendents etc., in the State for their guidance. Accordingly, the Prohibition and Excise Superintendents in the State issued gazette notifications on 8.4.2002 calling for applications from the intending applicants for grant of IL 24 licences for the year 2002-2003. As per the time schedule mentioned in the notification, the last date for receipt of applications is 15.4.2002 and the selections will be made on 17.4.2002. All the selected candidates have to complete the formalities by 24.4.2002 and obtain licences on the same day. Pursuant I to the above notifications, several applications have been received and the applications having been processed, the licences have been granted to open new outlets/shops. It is also mentioned that during the year 2001-2002 in a batch of writ petitions being W.P. No. 9199 of 2001 and batch, similar notifications were challenged which were dismissed by a learned single Judge on 28.6.2001. The same was confirmed by a Division Bench of this Court in Sree Wines v. State of A.P., : 2001(5)ALD399 (DB).

5. The petitioners are the existing licensees and they have no right to challenge the grant of licences to new licensees or question the policy of the Government. As per the new policy, one shop per Mandal is allowed where no new shop can be opened and in all other places, as many shops as required will be allowed on the basis of consumption and if a licensee fails to lift the liquor to the value of six times the proportionate licence fee, the licence is liable to be cancelled. For calculating the number of shops required based on consumption, an exercise has been made on an objective basis for establishment of new outlets. The new shops basing on existing level of consumption (category-A) are assessed on the basis of business potential of a place whether it is a village, town or municipality taking as a unit. In respect of Municipal Corporations of Hyderabad, Vijayawada and Visakhapatnam, having larger population and where the licensing fee is Rs. 12.30 lakhs per annum, the excise station has been taken as a unit. In respect of each unit, the total number of shops, total licence fee and total sales of A.P. Beverages Corporation Limited (for short APBCL) to these shops during the last year has been taken into account. The APBCL sale value equivalent to eight times the licence fee of a shop in the place has been taken as a viable point for location of a new shop. Based on this viability, the total shops that can be established in a unit (village, Mandal, Town or Municipality) have been calculated. The shop/new outlet is not selected irrespective of consumption formula. By applying this formula, it was proposed to sanction 760 retail IML outlets based on the existing level of consumption in 366 Mandals of the State.

6. Insofar as the sanction/permission for new shops at the rate of one shop per Mandal (category-B) is concerned, the Mandals were selected where the IML/ Beer consumption is less than eight times the licence fee which may be due to high retail price at which liquor is being sold by the existing licensees in order to prevent the opening of new IML shops and to carry on illegal activities by way of syndicates. In this category, 746 shops were sanctioned to cover 746 Mandals, which are not covered by category-A shops. Apart from Category-A and Category-B shops, 117 new licences in various districts which do not have a single retail outlet and not fallen either in Category-A or Categbry-B were also approved. In the additional counter-affidavit, the reasons for imposing a condition on a licensee to lift liquor having a minimum value (issue price) of at least six times of the proportionate licence fee has been explained.

7. The learned Counsel M/s. T. Amarnath Goud, A. Jagannadham, KLN Swamy and O. Manoher Reddy made lead submissions on behalf of the petitioners. The summary of their submissions is as follows: The impugned notification dated 8.4.2002 is contrary to the policy contained in G.O. Ms. No. 109 dated 11.3.2002. The impugned policy does not enable the licensing authority to grant new licences in such a manner that opening of a new shop would result in disqualifying the existing licensees for renewal of licence. Elaborating further, they contend that by reason of promoting new outlets either on consumption basis or on the basis of requirement of one shop at each Mandal, the capacity of a licensee to lift liquor from APBCL gets reduced and automatically he will not be able to lift liquor at least six times of the proportionate licence fee. This would result in cancellation/non-renewal of licences. The procedure adopted is irrational and arbitrary violating Article 14 of the Constitution of India. In all the districts, new outlets under category-B have been selected only at places where the licence fee slab is Rs. 3,00,000/- whereas while selecting places for new outlets under category-A (consumption basis), shops have been selected at places where the licence slab is Rs. 4.5 lakhs and above. This is discriminatory and irrational. The formula adopted by the respondents in determining the shops either on consumption basis or requirement basis does not stand to scrutiny on a rational principle. Clause (4) of G.O. Ms. No. 109 is contrary to Rule 28 of the A.P. Indian Liquor and Foreign Liquor Rules as none of the factors for sanctioning new shops are present in the whole exercise.

8. The learned Government Pleader for Excise Sri M. Subrahmanyam opposed the writ petitions contending that the petitioners have no locus standi to question the policy of the Government in the factsand circumstances of the case, especially, insofar as the grant of licence to a rival trader is concerned. They also contend that in the absence of necessary parties who are likely to be affected by orders of this Court, a writ petition under Article 226 of the Constitution of India is not maintainable. Thirdly it is contended that the policy in G.O. Ms. No. 109 dated 11.3.2002 was notified much before the petitioners made applications for renewal of licence for the year 2002-2003 and that knowing fullywell about the proposals to sanction new outlets for grant of IL24 licences, the petitioners have obtained renewal of licences and also executed counterpart agreements. As per the licence, they arebound by the provisions of the Act, the relevant Rules and conditions of licence and therefore they cannot question the action of the licensing authority or the Commissioner of Excise or the Government in sanctioningnew shops which is exclusively within the purview of these authorities under Rule 28 of the Rules. The petitioners cannot be permitted to resile from the contractual obligations. They cannot be permitted to turn around and question the sanction of new shops. By reason of the counter part agreement, the petitioners are bound by the subsequent amendments made to the Act and the Rules. By G.O. Ms. No. 464, Revenue (Excise-II) Department dated 31.7.2002, the Government has inserted Rule 66-A giving statutory status to Clause (5) in G.O. Ms. No. 109 dated 11.3.2002 and therefore the petitioners are bound by Rule 66-A as well. The notification as well as the policy are not contrary to law and are not arbitrary. It is also contended that the petitioners have no fundamental right under Articles 19(1)(g) and 21 of the Constitution of India.

Points for consideration:

9. The four points that stem up for consideration from the rival submissions are:

1. Whether the petitioners have locus standi to question the Government policy and the consequential notification issued by the licensing authority inviting applications for grant of new licences?

2. Whether the writ petitions are maintainable under Article 226 in the absence of necessary and proper parties as respondents?

3. Whether the impugned policy and the impugned notification are ultra vires the provisions of the Act and the Rules? and

4. Whether the impugned notification and the impugned policy suffer from the vice of arbitrariness and thereby violate Article 14 of the Constitution of India?

10. Before considering the various points that arise for consideration, it is necessary to notice the legal frame work and the relevant case law dealing with the right of a licensee under the Act to question the policy of the State on the touch stone of Articles 14, 19(1)(g) and 21 of the Constitution of India.

Legal Framework:

11. The State Legislature enacted the A.P. Excise Act, 1968 so as to consolidate the law relating to production, manufacture, possession, transport, purchase and sale of intoxicating liquors and drugs and the levy of duties of excise and countervailing duties on alcoholic liquors for human consumption. Chapter-IV of the Act contains provisions, which deal with manufacture, possession and sale of excisable articles and intoxicating liquors and substances. Chapter VII of the Act provides for offences and penalties. The provisions of detection and investigation and trial of offences under the Act are contained in Chapter VIII of the Act. Insofar as this case is concerned, some of the provisions in Chapter-IV may be noticed.

12. Section 13 provides that no person shall manufacture or collect any intoxicant except under the authority and subject to the terms and conditions of a licence granted by a licensing authority. Section 15 lays down that no person shall sell or buy an intoxicant except under the authority and in accordance with the terms and conditions of a licence granted in that behalf. Sub-Section (2) of Section 15 stipulates various licensing authorities for a District and the State as such. Sections 17 and 28 are relevant and read as under:

Section 17. Grant of exclusive privilege or manufacture etc.:--(1) Subject to the provisions of Section 28 and any rules made in this behalf, the Government may, subject to such conditions as they may deem fit to impose, grant for a fixed period to any person at any place a lease or licence or both either jointly or severally for the exclusive privilege,--

(i) of manufacturing or of supplying by wholesale or of both; or

(ii) of selling by wholesale or by retail; or

(iii) of manufacturing or of supplying by wholesale, or of both and of selling by retail any liquor or other intoxicant within any such area in the State as may be specified in the said order.

(2) The Government may confer on any officer the power mentioned in Sub-section (1).

Section 28: Forms and conditions of licence etc. :--(1) Every permit issued or licence granted under this Act shall be issued or granted on payment of such fees, for such period, subject to such restrictions and conditions, and shall be in such form and shall contain particulars, as may be prescribed.

(2) The conditions prescribed under Sub-section (1) may include provisions of accommodation by the licensee to Prohibition and Excise officers at the licensed premises on the payment of rent or other charges for such accommodation at or near the licensed premises and the payment of the costs, charges and expenses including the salaries and allowances of the Prohibition and Excise Officers which the Government may incur in connection with the supervision to ensure compliance with the provisions of this Act, the rules made thereunder and the licence.

13. A plain reading of the above two provisions would show that a licence granted under the Act and the Rules prescribed for selling liquor in wholesale/ retail is subject to restrictions and conditions. The licensing authority can impose any condition while granting a licence to sell liquor. Sub-section (2) of Section 28 specifically enumerates some of the conditions, which can be incorporated in a licence.

14. Insofar as IML is concerned, three sets of rules govern the situation. All these rules are issued under Section 72 of the Act. The A.P. Indian Liquor and Foreign Liquor Rules, 1970 (hereinafter called 'the 1970 Rules') were issued under Section 72 read with Sections 9, 11 to 15 and 28 of the Act. The A.P. Excise (Indian Liquor and Foreign Liquor Retail Sale Conditions of Licences) Rules, 1993 were made in exercise of powers conferred by the Act under Section 72 read with Sections 28 and 29 of the Act. Likewise, in exercise of the powers under Section 72 read with Sections 28 and 29, the Government made A.P, Excise (Lease of Right To Sell Indian Liquor, Foreign Liquor and Beer in Retail Under IL 24 licence) Rules, 1998.

15. We are mainly concerned with applicability, enforceability and interpretation of some of the provisions in 1970 Rules. Be it noted that prohibition was imposed in the State in December 1994 prohibiting manufacture, sale or consumption of intoxicant liquors except toddy. However, some time in 1997, the policy of prohibition was withdrawn insofar as IML is concerned. So as to grant licences for shops to sell IML also lease out right/privilege to sell Indian liquor, the Government initially evolved the system of auctioning the shops as per Rule 2 of 1998 Rules. With effect from 1998-99 Open Licence System Policy was introduced by amending Rule 2 of 1998 Rules.

16. Broadly stated, the procedure for granting licences is somewhat as follows; Before the beginning of the excise year i.e., from 1st March, the State Government will issue necessary orders as to the number of IL-24 licences to be granted in each District, Municipality, Town and Village. The Commissioner will accordingly issue directions under Rule 28 of the 1970 Rules directing all the licensing authorities i.e., the Prohibition and Excise Superintendents in each district to issue notifications inviting applications. After issuing notifications under Rule 2 of 1998 Rules, the procedure contemplated under Rule 31 of 1970 Rules is followed and if there is only one applicant seeking licence for one shop, subject to the applicant satisfying the conditions of solvency and other particulars, the licence is granted to him for a period of one year i.e., from 1st April of the year to 31st March of the next year. If there are more applicants than one seeking licence for the same shop, the selection for grant of licences among the eligible applicants shall be by drawal of lot. The person who is granted licence in Form IL-24 in accordance with Rule 23(1)(xiii) is entitled to sell IML and he shall not be allowed to permit consumption of liquor on the licensed premises.

17. The licence fee payable is prescribed under Rule 25. It lays down that the licence fee shall be as shown in the schedule appended to the Rules from time to time. The Rules provide for licence fee for each shop depending on the area or the population of the area, village, town or municipality where the shop is located. As per the schedule, where the population is (insofar as IL-24 license is concerned) less than 10,000, the licence fee is Rs. 3.00 lakhs per annum. Like wise, where the population is more than 10,000 but does not exceed 50,000, the Jicence fee is Rs. 4.5 lakhs. Where the population is above 50,000 and does not exceed 3,00,000, Rs. 8.25 lakhs is the licence fee and where the population is above 3,00,000 and does not exceed 7,00,000, the licence fee is Rs. 10,35,000/-. Likewise, where the population is more than 7,00,000, the licence fee is Rs. 12,30,000/-. The relevant entry in the schedule also provides that even though a shop falls within an area with less population, if it is within a belt of 5 kms from the periphery of Municipal Corporation or Municipality, the licence fee shall be at the rate of fee of Retail Shops situated within the respective municipality or municipal corporation.

18. The licence in Form IL-24 is given subject to the licensee executing a counter part agreement as required under Section 29 and Rule 30 of the 1970 Rules and also subject to conditions of licence given in Form IL-24. One of the conditions in IL-24 licence provides that the licensee shall sell only duty paid Indian liquor bottles affixed with excise adhesive labels and manufacturer's labels duly approved by the Commissioner of Excise as required under the Rules. As per Clause (2) of the counter part agreement, executed in Form IL-28A, the licensee is bound by all the provisions of the Act, the Rules and orders thereunder existing and also those that would be issued from time to time. The counterpart agreement contains another covenant that if the licensee surrenders the licence in the middle of the lease year, he shall pay the licence fee up to 31 st March of the lease year in which the surrender becomes effective and he will pay the annual licence fee at the rates shown in the schedule appended to the 1970 Rules before commencement of the lease year to which it relates to either in full or in three equal instalments as laid down in Rule 25.

19. Rule 26-A of 1970 Rules deals with renewal of a licence. Sub-rule (1) provides that an existing licensee has to make an application for renewal of licence one month in advance before expiry of the licence. However, the Commissioner of Prohibition and Excise is empowered to condone the delay in making an application for renewal after expiry of the period of licence subject to paying penalty of Rs. 100/-per each day of delay. Again before issue of a renewed licence, the licensee has to execute a counterpart agreement in Form IL-28. Be it also noted that as per Sub-rule (2) of Rule 26-A, if the application for renewal of licence made under Sub-rule (1) is not returned or licence is not renewed before the expiry of licence, the licensee shall have the right to carry on the business till its renewal is refused under intimation.

20. It is not denied before this Courtthat all the petitioners were granted licences/renewed licences for the excise year 2001-2002 and before the expiry of the licence period - 31.3.2002, all of them made applications under Rule 26-A(1) for renewal of licence and they did not withdraw their applications for renewal after the notification was published by the licensing authority inviting applications. It is also not denied that the policy for the year 2002-2003 in G.O. Ms. No. 109 dated 11.3.2002 was published much before all the petitioners made applications for renewal of their licences.

Relevant Case Law

21. The law does not recognize the right to trade in intoxicating substances. The State alone has exclusive privilege to manufacture and sell intoxicant substances and liquor. There is no fundamental right to do business in liquor. It is res extra commercium. It is well settled by reason of various decisions of the Supreme Court and this Court. It is not necessary to extract the relevant passages from those judgments. It is sufficient to refer to the judgment in Khoday Distilleries Limited v. State of Karnataka, : (1995)1SCC574 . The Constitution Bench considered all the earlier authorities on the subject and in para 60 summarized the law as culled out from the earlier decisions.

22. It was held that the fundamental right under Article 19(1)(g) does not extend to carrying on the trade or business which is inherently vicious and pernicious. It does not also extend to carrying on trade or business in activities which are immoral and criminal. Right does not extend to carrying on trade or business in goods, which are obnoxious and injurious to health and welfare of the general public. All these are res extra commercium (outside commerce). Potable liquor as beverage is dangerous and injurious to health and, therefore, a citizen has no fundamental right to trade in liquor. The State has power to prohibit the manufacture, sale, possession and distribution of potable liquor as beverage and for the same reason the State can create a monopoly either in itself or in the agency created by it for the manufacture, possession, sale and distribution of liquor. For the said purpose, the State can impose limitations and restrictions on the trade or business in potable liquor as a beverage which restrictions are different from those imposed on trade or business in legitimate activities and goods. The State may even carry on business to the exclusion and elimination of others preserving to itself the right to sell licences to do business in liquor. When the State permits trade or business in the potable liquor, the citizen has the right to carry on trade or business subject to the limitations and conditions imposed and the State cannot make discrimination between the citizens who are qualified to carry on the trade. The State can adopt any mode of selling licences with a view to maximise its revenue so long as the method adopted is not discriminatory. The power of the State to raise revenue by levying taxes and fees should not be confused with the power of the State to levy taxes and fees on the production, sale and income derived from potable liquor. By imposing taxes, fees on the sale of liquor and augmenting its resources, the State does not become a party to such activities.

23. The various points that arise for consideration have to be examined in the background of legal framework and relevant case-law.

In Re point No. 1:

Locus standi:

24. When the notification was issued and policy was announced, the petitioners were holding licences. The notification was issued inviting applications to grant new licences and also imposing additional conditions. The petitioners are aggrieved by both.

25. Insofar as Clause (5) of G.O. Ms. No. 109 is concerned, by reason of Clause (2) of the counterpart agreement executed by each of the petitioners in Form IL-28-A, they were also bound by the said conditions which by now have been incorporated as Rule 66-A in 1970 Rules by reason of G.O. Ms. No. 464 dated 31.7.2002. As per the Rule, as already noticed, a retail licence will be liable for cancellation/non-renewal, if the licensee fails to lift liquor having minimum value (issue price) of at least six times the proportionate licence fee. By the time the writ petitions came to be filed, this amendment was not on the statute book. But, G.O. Ms. No. 109 containing similar clause was already there. By reason of the counterpart agreement, the provisions of the Act, the Rules and orders made thereunder existing on the date of issue of licence as well as those that would be issued from time to time are also binding on the licensee. Therefore, even Rule 66-A is binding on all of them. When the petitioners contend that Rule 66-A or for that matter para 5 of G.O. Ms. No. 109 is arbitrary, it cannot be said that they have no locus standi to question the impugned notification and the impugned policy. However, with reference to the other aspect of the matter, it cannot be said that the petitioners have locus standi to challenge the notification and the policy.

26. By reason of paragraph 4 of G.O. Ms. No. 109, the Commissioner and the Government decided to sanction new shops under categories A and B. Though by the date of filing of most of the writ petitions, new licences were not issued, the whole purpose of the exercise was to grant new licences, presumably to rival traders of the petitioners. Can an existing licensee question the sanction or grant of a licence to a river trader? The learned Government Pleader in support of the submission that being rival traders, the petitioners cannot question the grant of new licences under the new policy, relied on the decisions in J.M. Desai v. Roshan Kumar, AIR 1976 SC 578; V. Narayana v. S. Babu Rao, : AIR1978AP437 and Rajappa Kawati v. G. Hanumantha Rao, : 1995(3)ALT878 .

27. In J.M. Desai's case (supra), the Supreme Court considered the question whether the proprietor of a cinema theatre holding a licence for exhibiting cinematographic films is entitled to invoke the certiorari jurisdiction for quashing a 'no objection certificate' granted by the District Magistrate in favour of a rival in trade. The Supreme Court elaborately considered the concept of 'aggrieved person' and 'locus standi' and observed as under:

According to most English decisions, in order to have the locus standi to invoke certiorari jurisdiction, the petitioner should be an 'aggrieved person' and in a case of defect of jurisdiction, such a petitioner will be entitled to a writ of certiorari as a matter of course, but if he does not fulfil that character, and is a 'stranger', the Court will, in its discretion, deny him this extraordinary remedy, save in very special circumstances. This takes us to the further question: Who is an 'aggrieved person'?And what are the qualifications requisite for such a status? The expression 'aggrieved person' denotes an elastic and to an extent an elusive concept. It cannot be confined within the bounds of a rigid, exact andcomprehensive definition. At best, its features can be described in a broad tentative manner. Its scope and meaning depends on diverse, variable factors such as the content and intent of the statute ofwhich contravention is alleged, the specific circumstances of the case, the nature andextent of the petitioner's interest and thenature and extent of the prejudice orinjury suffered by him. English Courts havesometimes put a restricted and sometimes awide construction on the expression'aggrieved person'. However, some generaltests have been devised to ascertain whether an applicant is eligible for this category so as to have the necessary locus standi or 'standing' to invoke certiorari jurisdiction.

28. After referring to various decisions to ascertain whether an applicant is an aggrieved person or not, the Supreme Court laid down:

It will be seen that in the context of locus standi to apply for a writ of certiorari, an applicant may ordinarily fall in any of these categories: (i) 'person aggrieved'; (ii) 'stranger'; (iii) busybody of meddlesome interloper. Persons in the last category are easily distinguishable from those coming under the first two categories. Such persons interfere in things which do not concern them. They masquerade as crusaders for justice. They pretend to act in the name of Pro Bono Publico, though they have no interest of the public or even of their own to protect. They indulge in the past time of meddling with the judicial process either by force of habit or from improper motives. Often they are actuated by a desire to win notoriety or cheap popularity; while the ulterior intent of some applicants in this category may be no more than spoking the wheels of administration. The High Court should do well to reject the applications of such busybodies at the threshold.

29. Having noticed various authorities, the Supreme Court held that a rival trader cannot invoke the certiorari jurisdiction of the High Court under Article 226 of the Constitution of India for quashing a licence given to a rival trader.

30. In V. Narayana's case (supra) a Division Bench of this Court considered the question whether a licensee under the A.P. Excise (Arrack and Toddy Licences General Conditions) Rules, 1969 has locus standi to challenge the order of the District Collector directing shifting of the shop. After referring to the decision in J.M. Desai's case (supra), and other decisions of the Supreme Court, the Division Bench observed:

The mere fact that on account of proximity of the shop to their area of operation, their business would be affected, is no ground to hold that any of their legal right is infringed. No undertaking is given either under the Act or the Rules or the licence given to him that a shop in the nearby area would not be permitted to be opened by any other licensee. Even if the order permitting the shifting of shop is illegal, as held in N.R & F Mills v. NTG & Bros., : [1970]3SCR846 , the petitioners would have no locus standi to challenge the grant of permission because no right vested in them was infringed. It was however argued by Mr. Bhujangarao the learned Counsel for the petitioners that the order itself being a nullity and being illegal cannot be allowed to stand. That question, however, would come up for consideration before the Court if the petitioners have locus standi to maintain the petition, .

31. Another Division Bench in Rajappa Kawati 's case (supra), following the judgment in J.M. Desai's case (supra), held that the existing stage carriage permit holder cannot question the grant of another stage carriage permit to a rival bus operator.

32. The learned Government Pleader contends that the petitioners are mainly aggrieved by the grant of licences to other shops in the locality or area where the petitioners are running the shops. Therefore, they cannot be permitted to invoke the jurisdiction of this Court. No doubt, there cannot be any dispute with the legal position. However, as the petitioners are equally aggrieved by para 5 of G.O. Ms. No. 109 dated 11.3.2002, which is now inserted as Rule 66-A of 1970 Rules, it cannot be said that the petitioners have no locus standi to question the policy.

In Re point 2:

Absence of necessary parties Maintainability of writ petition:

33. In exercise of the powers underArticle 226 of the Constitution of India, the High Court can either enforce the rights, be it constitutional, statutory or community rights. The power is also exercised to compel the public authorities to discharge their statutory duties and common law duties. While passing orders and issuing necessary writs, more often than not the rights of other persons are affected. In the absence of such affected persons it is not proper for the High Court to exercise the jurisdiction under Article 226 of the Constitution of India and issue writs either for enforcing the rights or for compelling due performance of the duties.

34. In Prabodh Verma v. State of U.P., : [1985]1SCR216 , it has been held by the Supreme Court that in writ petitions filed against the State questioning the validity of recruitment of a large number of persons in service could not be proceeded with and take decision adverse to those affected persons without getting them or their representatives impleaded as parties. The said view was followed by the Supreme Court in Ishwar singh v. Kuldip Singh, 1995 Suppl. (1) SCC 179; J. Jose Dhanapaul v. S. Thomas, : (1996)IILLJ646SC and All India SC & ST Employees Association v. A. Arthur Jeen, : [2001]2SCR1183 . Therefore, when the necessary parties whose rights were affected are not made parties to the writ petitions, the Court exercising jurisdiction under Article 226 should reject the writ petitions in limini.

35. As on the date of filing of the writ petitions, in most of the cases, new licences were granted/Even according to the counter-affidavit, the impugned notification prescribed a time schedule according to which the last date for receipt of applications is 15.4.2002 and the selections were held on 17.4.2002. The notification required all the selected persons to complete the formalities like giving bank guarantee and counterpart guarantee, execution of counterpart agreement and obtaining licence by 24.4.2002. This Court while admitting the writ petitions, refused interim order and observed that any grant of licence will be subject to the result of the writ petitions. Therefore, it was incumbent on the part of the petitioners to find out the particulars of the new licensees who were granted licence pursuant to and in furtherance of the impugned notification and make them parties to the writ petitions. Though this Court observed that grant of new licences will be subject to the result of the writ petitions, no steps were taken in that direction. In the absence of affected parties being before this Court, it would not only be impermissible, but also unfair to issue a writ as prayed for and set at naught the new licences which have admittedly been put to, use and those licences will be expiring by 31.3.2003. This point is answered accordingly.

In Re point No. 3

Question of Ultra vires:

36. Sri Manoher Reddy, learned Counsel vehemently contends that G.O. Ms. No. 109 dated 11,3.2002 and the impugned notification are ultra vires the powers of the authorities. He placed reliance on Rule 28 of 1970 Rules. The learned Government Pleader, however, relies on the same Rule 28 in support of the contention that it is within the purview of the Government and the Commissioner of Excise to lay down guidelines for grant of licences to new outlets. A reference to the relevant provisions of the Act has already been made. As already pointed; out, it is competent to the Government to grant lease or licence for a fixed period to any person for exclusive privilege of selling liquor or any other intoxicant subject to certain conditions as the Government may deem fit to impose. The broad power under Section 28(1) to impose any restriction and conditions cannot be confused with specified restrictions and conditions adumbrated in Sub-section (2) of Section 28. To my mind Sub-section (2) of Section 28 only gives conditions illustratively. It does not dilute the broad powers under Section 28(1).

37. Specific powers do not exclude general powers is a well settled proposition of law. The Supreme Court in Ajay Canu v. Union of India, : AIR1988SC2027 , after referring to its earlier decision in Om Prakash v. Union of India, : AIR1971SC771 , explained this principle. The Supreme Court laid down that specifying the particular power is only illustrative and does not in any way restrict the general power. That takes me to Rule 28 of 1970 Rules, which reads as under:

28. Number of licences:--Subject to such directions which the Government may issue in this regard, from time to time, the Commissioner shall be competent to fix number of licences to be granted in an area having due regard to' requirement, public order, health, safety and such other factors as he thinks fit. Subject to such directions or instructions as the Commissioner may give in this behalf, the licensing authority may grant licences in each category and to each person in any area.

38. Rule 28 of 1970 Rules contains two limbs. Under the first limb, it shall be competent to the Commissioner to fix number of licences to be granted in an area having regard to (i) requirement (ii) public order, safety and (iii) such other factors as he thinks fit. The power of the Commissioner is subject to any directions that the Government may issue in that regard. As and when the Government or the Commissioner issues such directions the licensing authority may grant licences in each category to different persons in an area. It is not necessary that whenever the Commissioner decides to issue licences, he must obtain necessary directions from the Government. The Commissioner can independently determine the number of licences to be granted in an area. Whenever such exercise is taken up the two factors are the requirement of the area and the public order and health of the people. These two requirements are in addition to any other factor which the Commissioner may consider appropriate and deems fit. It must not be forgotten that in exercise of its absolute privilege, the State's endeavour is always to augment its, revenue by parting with privilege to trace and do business in IML. There cannot be any objection if the Commissioner decides and adopts a method to increase the revenue of the State and grants new licences in an area. The requirement in an area may or may not have any relation with the object of augmenting revenue of the State. The submission of the learned Counsel for the petitioners that the Commissioner and the Government must assess requirement of the area/each unit (village, town, municipality, Corporation etc.,) before issuing the notification cannot be accepted. It can be for any other reason like increasing revenue of the State.

39. Along with the counter-affidavit, the statement showing the sale statistics of liquor from 1998-99 to 2001-2002 has been annexed. This shows that there is abnormal increase in the sale of liquor. Other statements were also annexed to the additional counter affidavit showing that year after year there has been more demand for sanctioning additional licences though at one point of time there used to be few shops in each area/unit. Indeed, taking 1998-99 as basis, the statistics show that by 2002-2003, upto 15.4.2002, the percentage of growth of sales is abnormally high at 111%. Therefore, the growth of sales in IML is a very relevant consideration while granting additional licences under Rule 28 of the 1970 Rules.

40. As already seen, under Section 17 read with Section 28, it is always open to the Government or appropriate licensing authority to impose restrictions or conditions while granting lease or licence to trade or do business in Indian liquor. The policy in G.O. Ms. No. 109 dated 11.3.2002 or consequent notifications cannot be declared as ultra vires. The Government Order issued is well within the powers and is as per Rule 28 of 1970 Rules read with Rule 2 of 1998 Rules. The licensing authority has issued notification, which is within the powers of the licensing authority. Point No. 3 is answered accordingly.

In Re-point No. 4:

Whether policy is arbitrary?

41. Before considering the question of arbitrariness, it is necessary to advert to the submission raised by the learned Government Pleader for Excise. He submits that even before the petitioners applied for renewal of licences for the year 2002-2003, G.O. Ms. No. 109 dated 11.3.2002 was published. Knowing fully well, all the petitioners applied for renewal in accordance with Rule 26-A of 1970 Rules. After publication of the notification, none of the petitioners have withdrawn their applications for renewal. On the contrary, they obtained orders under Rule 26-A(1)(a), executed the counterpart agreement in Form IL-28 as per Rule 26-A (1)(b) and carried on the business for the excise year 2002-2003. None of the petitioners can be said to have suffered any loss and they have no grievance for redressal. Further, the licence issued in IL-24 is also subject to a counterpart agreement executed by the petitioners. Therefore, the petitioners are bound to discharge their contractual obligations under the counterpart agreement. Having obtained renewal of licence and having carried on the business in accordance with the conditions of licence, counter part agreement, the petitioners cannot turn around and question the grant of new licences as well as the condition imposed as per para 5 of G.O. Ms. No. 109 dated 11.3.2002 which is now being incorporated as condition No. 11 of Form IL-24 licence by reason of G.O. Ms. No. 151 dated 30.3.2002. He therefore submits that the petitioners cannot be heard to complain any arbitrariness or irrationality.

42. In support of his contention, he placed strong reliance on the judgment of the Supreme Court in Assistant Excise Commissioner v. Issac Peter, : [1994]2SCR67 , a Division Bench Judgment of this Court in Sri Rama Wines v. Excise Superintendent, : 1998(2)ALD686 (DB) and a Full Bench Judgment of this Court in Sri Narasimha Wines v. Prohibition and Excise Superintendent, : 2001(6)ALT240 (FB). In view of the law laid down in those authorities, there is no other go but to countenance the submission of the learned Government Pleader for excise department. In Issac peter's case (supra) it has been held by the Supreme Court as under:..................... Doctrine of fairness or the duty to act fairly and reasonably is a doctrine developed in the administrative law field to ensure the rule of law and to prevent failure of justice where the action is administrative in nature. Just as principles of natural justice ensure fair decision where the function is quasi-judicial, the doctrine of fairness is evolved to ensure fair action where the function is administrative. But it can certainly not be invoked to amend, alter or vary the express terms of the contract between the parties. This is so, even if the contract is governed by statutory provisions i.e., whether it is a statutory contract or rather more so. It is one thing to say that a contract every contract must be construed reasonably having regard to its language. But this is not what the licensees say. They seek to create an obligation on the other party to the contract, just because it happens to be the State. They are not prepared to apply the very same rule converse case i.e., where the State abundant supplies and wants the licensees to lift all the stocks. The licensees will undertake no obligation to lift all those stocks even if the State suffers loss. This one-sided obligation in modification of express terms of the contract, in the name of duty to act fairly is what we are unable to appreciate. The decisions cited by the learned Counsel for the licensees do not support their proposition.

43. In Sri Rama Wines's case (supra), the question that arose is whether it is competent to the licensing authority to impose conditions while granting licences. Having regard to the provisions of the Act it was held:

The licence though was granted under Section 28 of the Act, is subject to certain conditions as prescribed in the Rules. It is true that conditions of licence do not contain any such liability to pay any enhanced licence fees. But the conditions do not place any embargo on the authorities to collect the same. When such is the situation and when the authorities have been clothed with the power to require the applicant to given an undertaking for such payment, it cannot be said that the undertaking is contrary to the letter and spirit of the licence or Section 28 of the Act. The counterpart agreement is a statutory one and an undertaking has been given as prescribed in Clause (iv) of Form IL-28 under Rule 30. It is not far to seek the reason for requiring the licensee to give such an undertaking. The population of a place varies due to the lapse of time and also for the reason of merger of another area into the concerned village/town/ municipality. Many other situations also can be visualized. These situations cannot be anticipated on the date of grant of licence. Since the licence fees was payable depending upon the density of the population, the Act gives the power to the authorities to require the licensee to pay the enhanced licence fee as and when levied, even during the currency of the period of licence. This power having been given by the Act itself, it cannot be said that it runs counter to the licence granted under the Act.

44. In Sri Narasimha wines's case (supra), the validity and virus of Sub-rule (9) of Rule 25 of 1975 Rules was challenged as arbitrary and discriminatory. This Court referred to the decisions in Har Shankar v. Dy. Excise Commissioner, : [1975]3SCR254 and Shamlal v. State of Punjab, : AIR1976SC2045 and held that when the licensees accept the terms of the contract entered into by duly completing the formalities and obtained licence, they cannot be allowed to question the conditions of licence especially when they have accepted the licence for almost the entire period. The licensees are bound to fulfil the contractual obligations. Only because some hardship is caused to the licensee by reason of ups and downs in the business, a writ of mandamus shall not be issued in aid of such licensee. The relevant observations are as under:

Writ of mandamus cannot be issued directing the statutory authorities to act contrary to law. A matter governed by contract qua contract would not attract the writ jurisdiction of this Court as in such a matter public law element is not involved. The State by reason of any statutory rule or otherwise can reserve unto itself the right to revise the licence fee and or the matters ancillary or incidental thereto. Only because some hardship is caused, the same by itself may not be a ground for declaring the same ultra vires.

45. The State has come forward with the counter-affidavit as well as the additional counter-affidavit categorically stating the position after the impugned notification. No reply affidavit is filed denying the allegations made in the counter affidavit. Therefore, this Court has to presume that all the licensees who at the relevant time applied for renewal of licences have not withdrawn the applications for grant of licence after announcement of the policy as per G.O. Ms. No. 109 and after the impugned notifications were issued inviting applications. They had not even stopped their business and they went on carrying on their business and therefore they cannot be heard to say that paragraphs 4 or 5 of the impugned policy would result in detriment to them. No factual foundation is laid to support the contention of the petitioners.

46. Whether it is competent to the State to impose a condition as is now inserted as Rule 66-A? As already noticed, initially in G.O. Ms. No. 105, the Government decided that a condition should be imposed in the licence to the effect that if a licensee fails to lift the IML stock with a minimum value (issue price) at least six times the proportionate licence fee, the licence will be liable for cancellation/non-renewal.

47. Sri KLN Swamy, the learned Counsel has vehemently contended that it is not competent to the State or the licensing authority to impose such a condition. Reliance is placed on the judgment of the Supreme Court in B.C. Banerjee v. State of Madhya Pradesh, : [1971]81ITR105(SC) and Excise Commissioner v. Ram Kumar, : AIR1976SC2237 . Per contra, the learned Government Pleader brought to my notice a subsequent decision of the Supreme Court in State of A.P. v. Prabhakar Reddy, : 1987(12)ECC41 where the Apex Court considered the decisions in B.C. Banerjee's case (supra) and Ram Kumar's case (supra) and explained those two decisions.

48. In Ram Kumar's case (supra) the licence was granted under U.P. Excise Act, 1910 which contained a condition (Condition 3-a) to the effect that if a licensee fails to lift the monthly proportionate quantity in any month, he shall be liable to pay compensation to the State Government at the rate equal to the rate of 'still head duty per litre' of spiced spirit and still head duty per litre of plain spirit as may be in the area in which the shop is situated on the quantity falling short of such monthly proportionate quota and such compensation shall be paid by the 7th of the month following the month to which such shortfall relates. The said condition was challenged before the Allahabad High Court, which allowed all the writ petitions. In the appeals preferred to the Supreme Court by special leave, the question that fell for consideration was whether the condition incorporated in the licence, as noticed hereinabove is valid and enforceable. The Supreme Court referred to the decision in B.C. Banerjee's case (supra) and came to the conclusion that the demand for disguised compensation, is in fact and in reality a demand for excise duty on the unlifted quantity of liquor which is not authorised by the provisions of the Act and therefore held that such levy is ultra vires. It is apt to excerpt the following passage from Ram Kumar's case (supra).

49. We have, therefore, not the slightest hesitation in holding that the demand made by the appellants though disguised as compensation, is in reality a demand for excise duty on the unlifted quantity of liquor which is not authorized by the provisions of the Act. This being the sole point involved in appeals other than Appeal Nos.399 to 404 of 1975, the former Appeals cannot succeed. - In the result they are dismissed with one set of costs.

50. I fail to understand as to how this decision in Ram Kumar's case (supra) would assist the learned Counsel for the petitioners. Rule 66-A (para 5 of G.O. 109) does not seek to levy or collect any compensation or excise duty for unlifted liquor. It merely says that in such an event licence is liable for cancellation/non-renewal. Further, as presently seen, Rule 66-A does not operate either in the beginning of the excise year or in the middle of the excise year. It can only operate towards the end of the excise year by which time in all likelihood the licensee must have enjoyed the licence and carried on the business for almost an year.

51. A Full Bench of Five learned Judges of this Court in Atluri Bramhanandam v. Tahsildar, : AIR1977AP196 , took a view that the Government is not entitled to claim from the excise contractors, excise duty component on the unlifted minimum guaranteed quantity. The State carried the appeals to the Supreme Court, which was decided in Y. Prabhaker Reddy's case (supra) and the decision of the Full Bench of this Court was reversed. While doing so, the earlier decisions in Banerjee's case (supra) and Ram Kumar's case (supra) were considered and it was held that in both the decisions what was sought to recover was excise duty and therefore they are distinguishable as no excise duty can be levied on the unlifted liquor as per the provisions of the relevant Act.

52. In the present case, the petitioners are not compelled to pay any excise duty or the cost price of the liquor, which they fail to lift from APBCL. Further, on a true interpretation of Rule 66-A it is not possible to hold that the failure to lift the liquor having minimum value (issue price) as prescribed will automatically entail in the cancellation/non-renewal of licence. The very fact that Rule 66-A provides for giving an opportunity for hearing before passing an order of cancellation/non-renewal would show that discretion vests in the licensing authority and he is required to consider each and every case. If the reasons for not lifting the liquor of minimum value as prescribed in Rule 66-A are genuine and beyond the control of the licensee, the renewal of licence for the next excise year cannot be denied.

53. In the counter-affidavit, the reasons for enacting such a Rule have been explained stating that if such a restriction is not imposed, the licensee may indulge in unlawful activities such as sale of non-duty paid liquor, sale of ID liquor or sale of Indian Liquor above the recommended maximum retail price (RMRP). The licensee may also suppress the turnover and make profit by exploiting the consumers. Further, as rightly contended by the State, if by the end of licence period the licensee knows his position that he will not be able to lift the liquor as required under Rule 66-A of the Rules, he need not apply and if he chooses to apply, it would belie the contention that he fell short of the prescribed limit in Rule 66-A. Under Rule 26-A it is not compulsory for any licensee to obtain renewal. Rule 26-A only provides that if a licensee applies for renewal one month in advance for renewal and fails to get renewal before the commencement of the excise year i. e., 1st April, he may still continue to do business till he receives the rejection order. It does not mean that a licensee whose licence is not viable and who is incurring losses for various reasons must still apply for a renewal and await any orders. Nobody compels any licensee to seek renewal of his licence, which comes to an end by 31st March of the excise year.

54. Whether the formula adopted fordetermining the number of shops as per thepolicy is rationale? As explained in thecounter affidavit, the new retail outlets areidentified under Categories A, B and C.Categories B and C do not present anydifficulty. Under Category 'B' one shop isallotted to each Mandal where it is notpossible to determine the additional shopsbased on consumption. Likewise, under Category 'C' shops are allotted Mandal wise though the place is remote and inaccessable. Much controversy arose in regard to Category 'A' new outlets. If for the previous year the turnover of all the shops in a unit; be it a village, town, municipality or corporation - is abnormally high, it is presumed that all the shops are viable and there is a scope for allotting new shops within the unit. To determine the number of shops in an area, the Government have evolved a formula. It postulates that the total turn over in the excise year (based on sales figures at issue price of APBCL) is multiplied by the total licence fee payable by all the shops. It pre-supposes that if the average turn over i.e., the value of liquor lifted from APBCL is six times the licence fee in respect of each shop or it is more, it is a case for sanctioning a new outlet. Though as per Rule 66-A the prescribed quantity lifted is six times the licence fee for the purpose of determining the additional shops on the consumption basis, authorities have applied factor 8. In the additional counter affidavit the possible expenditure required for a shop in a village where the licence fee is Rs. 3,00,000/- is explained. The illegality or irrationality in the methods adopted is not pointed out by any of the learned Counsel for the petitioners, though in some cases statistics have been produced before me to show that the total quantity of liquor in terms of money lifted for the excise year 2002-2003 is less than the total quantity of liquor lifted from APBCL during the excise year 2001-2002. Even according to this, the sales have not fallen down drastically. The fonnula adopted by the authorities is therefore rationale. In any event as laid down by the Supreme Court in Excise Commissioner v. Prem Jeet Singh, : AIR1983SC1056 , it is not for this Court to nicely balance the pros and cons and find fault with the formula. In the said decision, it was held as under:

Had this figure been adopted, the increase would be seen to be substantial. This figure was arrived at by adopting a formula based on the unaccepted bids for individual shops in the previous year. Both the methods of calculation have been described in the special leave petition in some detail. We do not think it necessary to probe deeper into the rival methods of computation. It is not the function of this Court. Even assuming that there is some merit in the method of computation of notional value suggested by the respondents, it was a matter entirely for the Excise Commissioner to adopt the formula which he thought was more reasonable. It is not as if the formula adopted by the Excise Commissioner is so utterly unreasonable that it has necessarily to be thrown out of hand. It is not a slap dash. Speculative formula based on any unintelligible hypothesis or on facts drawn from imaginary sources. It is as good and fair a formula as that thought of by the respondents. If the Excise Commissioner chose to adopt one formula instead of another, it is not for the Court to substitute its judgment in a proceeding under Article 226 of the Constitution and say that the other formula would have been better or should have been preferred. It not the function of the Court at all. After all it is to the Government and the Excise Commissioner that the Legislature has entrusted the task of protecting the revenue and it was in the interests of the revenue that the Excise Commissioner was acting. .

55. The petitioners have not alleged any mala fides on the part of the respondents. Therefore, the validity of the formulacannot be subject matter of judicial review.Further, policy decision of the Government,especially in the matter of intoxicantscannot ordinarily be interfered unless it isgrossly arbitrary violating Article 14 ofthe Constitution of India. It is well settledthat a policy decision of the Governmentof the day is beyond the purview of thejudicial review unless it is shown to becontrary to the Act or the Constitution or itis tainted with mala fide and extraneous considerations.

56. In a recent judgment of this Court in Association of Drugs and Pharmaceuticals Manufacturers v. A.P.H.M.H & IDC, : 2002(2)ALD609 , after referring to all the decisions I have held that the policy decision of the Government cannot be interfered by Court of judicial review unless it violates the constitutional or legal provisions. The petitioners have not even attempted to show any arbitrariness in the policy of the Government. They obtained renewal of licenses knowing fully well that the Government is going to sanction new outlets. They obtained licenses and carried on their business from April, 2002 till February, 2003 and therefore they cannot be heard to contend that the policy of the Government, impugned in these writ petitions, is arbitrary or illegal.

57. In the result, for the above reasons, all the writ petitions fail and accordingly they are dismissed. No costs.