SC gives the go-ahead for G.O. on liquor shops

Says State government is free to issue, renew licences to outlets

May 24, 2018 01:45 am | Updated 01:45 am IST - NEW DELHI

The Supreme Court on Wednesday allowed Tamil Nadu government to give effect to its May 21 order to renew licences and grant fresh ones, on a case-by-case basis, to retail liquor shops located in areas covered by the local self-governing bodies or areas proximate to municipal pockets in the State.

The order by a vacation bench of Justices A.M. Khanwilkar and Naveen Sinha may come as a relief for 810 liquor shops which were closed immediately after the Madras High Court ruled that they were in violation of a Supreme Court judgment of December 2016, ordering nationwide prohibition on the sale of liquor within 500 metres of highways. The High Court decision had come on a writ petition filed by K. Balu of the Advocates’ Forum for Social Justice.

The Tamil Nadu government, represented by advocate Yogesh Kanna, had appealed against the High Court decision in the apex court late last month. On May 14, the SC gave the State a week’s time to re-visit the issue and pass “appropriate orders”.

On Wednesday, satisfied by the State’s May 21 G.O., the vacation bench directed that the government was “free to give effect” to it.

The court rejected Mr. Balu's request that the order should be implemented only after hearing him. However, the court said he was free to pursue the “appropriate remedy” and left open “all questions in that behalf”.

The May 21 order shows that the government decided to accept the suggestions of the Commissioner of Prohibition and Excise with regard to the issuance of new/renewal of licences to various establishments under the Tamil Nadu Liquor (Licence and Permit) Rules, 1981 and the Tamil Nadu Liquor Retail Vending (in Shops and Bars) Rules, 2003.

The order said that self-governing bodies forming part of a Statutory Development Authority for which a development plan has been approved as per the provisions of the Tamil Nadu Town and Country Planning Act, 1971, and census towns, which are panchayats that are not statutorily notified and administered as a town but whose population nevertheless has attained urban characteristics, may be treated at par with municipal areas when applicants apply for new/renewal of licences for sale of liquor.

Nod from Collectors

The order records the suggestion of the Commissioner that FL1 and FL 11 licence be issued for retail vending liquor shops. The order said shops located in municipal areas can be granted approval by the district collectors concerned on a case-by-case basis after carrying out field inspections.

The High Court had held untenable a letter by the Prohibition and Excise Commissioner to the Collectors on September 1, 2017, instructing them to allow liquor shops within certain limits to function. The Bench had found the letter contradictory to the intent behind the Supreme Court’s ban on sale of liquor close to highways. The High Court had confined its direction to liquor shops run by the Tamil Nadu State Marketing Corporation (Tasmac).

On July 11, 2017, the apex court had exempted municipal areas from the December 2016 prohibition. The court had clarified that the sale ban was mainly focused on busy national and State highways inter-connecting cities, towns and villages.

The ban was to prevent drunken driving and not prohibit licensed establishments within municipal areas, the court had said.

However, the July 11 order had triggered more questions than answers.

States, primarily Tamil Nadu, had returned to the Supreme Court, asking whether panchayats would also be included within the definition of “municipal areas”.

On February 25, the court had left it in the hands of the respective State governments to make a decision after examining “whether an area covered by a local self-governing body is proximate to a municipal agglomeration or is sufficiently developed” to apply the exemption granted to municipal areas in the July 11 order.

The court had also left it open to individual licensees to submit their representations to the competent authorities in the State to obviate both litigation before the High Courts and repeated recourse to applications to the apex court.

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