JUDGMENT
S.T. Kharche, J.
1. By invoking the writ jurisdiction of this Court under Articles 226 and 227 of the Constitution of India, the petitioner sought the following relief –
“(i) By an appropriate writ, order or direction be pleased to quash the communication at Annexure P-2 and direct the respondent No. 2 to permit the petitioners to carry on the business as per licence.
(ii) By an interim order, stay the effect and operation of Annexure P-2, and consequently permitting the petitioners to carry on the business as per their original licence quota.”
2. Relevant facts are as under :
The petitioner is a partnership firm and petitioner No, 2 is a partner of that firm which deals in the business of sugar, jaggery and other allied items. The petitioner applied for licence for selling of mhowa flowers and storing the same. The respondent No. 2 granted licence bearing licence No. 75/1978-79 and also allowed the partnership firm to lift up the quota of 3000 quintals of mhowa flowers. The licence was renewed from time to time and in the year 1989-90 the said quota was reduced to 2000 quintals. During the years 1986-87, 1987-88 and 1988-89 the petitioner could not carry on the business in larger quantity because of the illness of petitioner No. 2, who was looking after the business. The licence of the petitioners was never cancelled or suspended at any time before. They were regular in payment of licence fees and ultimately the licence was renewed from time to time. The licence fees of Rs. 1,000/- was accepted and the licence was renewed for the period 1-4-1991 to 31-3-1992. Thereafter, respondent No. 2/Collector suddenly communicated the petitioner by the letter dated 12-4-1991 that the quota was reduced from 2000 quintals to 100 quintals on the ground that though the sanctioned quota of 2000 quintals was there the business carried on by the firm for the previous three years 1987-88, 1988-89 and 1989-90 showed that the actual lifting of mhowa flowers was very much less and, therefore, in view of the Circular dated 4-3-1991 the said quota was reduced from 2000 quintals to 100 quintals. This communication is under challenge in this petition.
3. Mr. Gilda, learned counsel, for the petitioners contended that before reducing the quota, the petitioner-firm was not served with the show cause notice and no opportunity of showing cause as to why the proposed action should be taken was served. The petitioner/firm was not asked to produce the records about the transaction of sale and purchase and they were also not asked to give any explanation as to why they could not lift up the required and sanctioned quota of 2000 quintals during the period of those three years and in such a situation the partnership firm had no opportunity to meet the case and this would amount of violation of principles of natural justice. Therefore, the impugned communication issued by the Collector is basically illegal, mala fide and taken in colourable exercise of power so as to prevent the petitioner/firm from lawfully carrying on the business of mhowa flowers. He contended that the decision of the Collector in reducing the quota from 3000 quintals to 2000 quintals per year and then suddenly reducing the said quota from 2000 quintals to 100 quintals without assigning any reason shows the non-application of mind and, therefore, the impugned order/communication cannot be sustained in law. In support of these submissions, he relied on the decision of Constitution Bench of the Supreme Court in A.V. Venkateshwaran vs. Ramchand Sobhraj Wadhwani, and also on Anr. decision of Supreme Court in Baburam Prakash Chandra Maheshwari vs. Antarim Zila Parishad Muzqffarnagar, .
4. Mr. Gilda further contended that though efficacious remedy is available for redressal of petitioners’ grievance under Section 137(2) of the Bombay Prohibition Act, 1949 (for short B.P. Act), asking the petitioners to avail the remedy of preferring an appeal against the impugned order to the State Government would be something in the nature of appeal from Caesar to Caesar and, in such circumstances, the writ petition is quite maintainable under Article 226 of the Constitution of India. In support of these submissions he relied on the decision of Single Bench of this Court in Nilesh alias Narayan Y. Jadhav vs. State of Maharashtra and Ors., 1991 Mh.LJ, 770. He further relied on the decision of Single Bench of this Court in Procter and Gamble India Ltd. vs. Municipal Corporation of Greater Bombay, 2004(1) Mh.LJ. 406.
5. The learned A.G.P. contended that in the year 1989-90 while renewing the licence a show cause notice was served vide letter dated 14-6-1989 contending that as to why the licence should not be cancelled as the petitioner/firm failed to carry out the required transactions during the past period of three years. The explanation of the petitioner/firm was not found satisfactory and in spite of this the licence came to be renewed in the year 1990-91 with the yearly quota of 2000 quintals instead of 3000 quintals and for subsequent reduction on the same ground it was not found necessary to issue notice in that behalf and therefore the reduction of quota of 2000 quintals to 100 quintals was quite justified and legal. He contended that the Commissioner of Excise of the State has issued the Circular dated 4-3-1991 for giving certain guidelines in relation to the cancellation of the licence issued in accordance with the provisions of Section 54(i)(b) of the B.P. Act, and since the petitioner/firm was found to have not lifted the sanctioned quota for the continuous period of three years, i.e. 1987-88, 1988-89 and 1989-90, the sanctioned quota of 2000 quintals was rightly reduced to 100 quintals.
6. The learned A.G.P. further contended that there is efficacious remedy available for the petitioner/firm for redressal of their grievance. The petitioner/firm did not file an appeal as is provided under Section 137(2) of the B.P. Act to the Commissioner of State Excise and thereafter to the Government respectively within 90 days from the date of the order passed by the Collector and directly approached this Court by invoking the writ jurisdiction and, as such, the petition is liable to be rejected on this ground.
7. I have given thoughtful consideration to the contentions canvassed by the learned counsel for the parties. It is not in dispute that the petitioner is a partnership firm carrying on the business of production of sugar and jaggery. It is also not in dispute that the licence in Form No. MF-II has been granted by the Collector in accordance with the provisions of Rules 5 and 6 of the Bombay Mhowra Flowers Rules, 1950. It is also not in dispute that the said licence was granted bearing licence No. 75/78-79 and it was renewed from time to time on payment of requisite fees. It is also not in dispute that the quota of lifting of Mhowara flowers was not to exceed 3000 quintals per year and the same was reduced to 2000 quintals per year by the order dated 23-3-1990 passed by the Collector and also there is no dispute that the petitioner/firm paid requisite fee of Rs. 1000/- and the licence was renewed for the period 1-4-1990 to 31-3-1991 and thereafter again the said licence was renewed on 28-3-1991 for the period 1-4-1991 to 31-3-1992. The position that emerges from the undisputed facts is that the petitioner/firm was allowed to lift up the quota of 2000 quintals of Mhowra flowers by virtue of the licence granted to them up to the date of renewal of the licence as per the order passed by the Collector on 23-3-1990. This quota was sought to be reduced by the communication dated 12-4-1991 and the quota has been reduced from 2000 quintals to 100 quintals.
8. It is necessary to reproduce relevant rules of the Bombay Mhowra Flowers Rules, 1950. Rule 5 is in respect of the procedure to be followed for grant of licence. It contemplates :
“5.(1) On receipt of an application under Rule 4, the Collector or the authorised officer shall make inquiries for verification of the particulars given in the application and such other inquiries as he deems necessary. If he is satisfied that there is no objection to grant the licence applied for he may grant the applicant the licence on payment of the fee (inclusive of consideration) prescribed under sub-rule (2). The licence for the possession of mhowra flowers shall be in Form M.F.I and the licence for the sale thereof shall be in Form M.F.II.
(2) The fees in respect of licences granted under sub-rule (1) shall be as specified in the Schedule appended to these rules.”
Rule 6 contemplates thus :
“Before granting any licence under rule 5 the Collector or the authorised officer shall, after making such enquiries as he deems necessary, fix the maximum quantity of mhowra flowers which the licensee may possess –
(i) during the period of the validity of the licence or at any one time;
and
(ii) in the case of a licence to be granted for the possession of mhowra flowers for bona fide use other than use in distillation, during any one month.”
Rule 7 contemplates thus:
“Every licence shall be granted for one year commencing on the 1st day of April and ending on the 31st day of March next following and may be renewed thereafter for a period of one year on each occasion on payment of fees prescribed in sub-rule (1) of rule 4 and sub-rule (2) of rule 5 :
Provided that a licence granted for the first time under these rules may be granted at any time after the 1st day of April upto the 31st March next following :
Provided further that a licence for the possession of mhowra flowers may be granted or renewed for a period of less than one year, as the Collector or the authorised officer deems fit.”
9. Plain reading of the aforesaid rules would reveal that while granting any licence under Rule 5, the Collector or the authorised officer is supposed to make such enquiries as he deems necessary and then fix the maximum quantity of mhowra flowers which the licensee may possess in accordance with Rule 6. Therefore, Rule 6 presupposes the enquiries which should be conducted in judicious manner after hearing the licensee and after considering the material that may be produced during the course of the enquiry. In the present case, it is obvious that the sanctioned quota was suddenly reduced from 2000 quintals to 100 quintals per year vide communication dated 12-4-1991 and the reason assigned in the said communication is that sufficient business was not carried out by the petitioner/firm during the period of past three years and on the presumption that the petitioner was not in need of the sanctioned quota of 2000 quintals per year. It is pertinent to note that while issuing the said communication the Collector did not either issue show cause notice to the petitioner/firm calling upon them to show cause as to why the sanctioned quota should not be reduced nor the petitioner/firm was called upon to explain as to what was the reason for not lifting up the sanctioned quota of 2000 quintals. It is not known as to what material was considered by the Collector while issuing the said communication.
10. It appears that the Circular dated 4-3-1991 has been issued by the Commissioner, State Excise, in which certain directions to the Collectors have been given and the Collectors have been asked not to renew the licence in accordance with the provisions of Section 54(i)(b) of the Act if it is found that during the last three years no transaction is carried out regarding mhowra flowers There is a stipulation in the Circular that there was a use of illegal mhowra flowers for manufacturing of illicit liquor and in order to curb the illegal manufacturing of liquor it was necessary that the quota should be sanctioned on the basis of the average in relation to the lifting of the sanctioned quota for the previous three years. It is obvious that this Circular is in general nature and it will depend on the facts and circumstances of each case as to whether the sanctioned quota in a particular case is liable to be reduced.
11. Since the Collector did not hold any enquiry as is provided under Rule 6, nor gave an opportunity of hearing to the petitioners, this Court is of the considered opinion that the principles of natural justice are violated and, therefore, Mr. Gilda rightly relied on the decision of Supreme Court in A.V, Venkateswaran’s case, , cited supra, wherein the Supreme Court observed that, “the wide proposition that the existence of an alternative remedy is a bar to the entertainment of a petition under Art. 226 of the Constitution unless (1) there was a complete lack of jurisdiction in the officer or authority to take the action impugned, or (2) where the order prejudicial to the writ petition has been passed in violation of the principles of natural justice and could, therefore, be treated as void or non est and that in all other cases, Courts should not entertain petitions under Art. 266, or in any event not grant any relief to such petitioners cannot be accepted. The two exceptions to the normal rule as to the effect of the existence of an adequate alternative remedy are by no means exhaustive, and even beyond them a discretion vests in the High Court to entertain the petition and grant the petitioner relief notwithstanding the existence of an alternative remedy. The broad lines of the general principles on which the Court should act having been clearly laid down, their application to the facts of each particular case must necessarily be dependent on a variety of individual facts which must govern the proper exercise of the discretion of the Court, and in a matter which is thus pre-eminently one of the discretion, it is not possible or even if it were, it would not be desirable to lay down inflexible rules which should be applied with rigidity in every case which comes up before the Court.
12. The decision of the constitution Bench of the Supreme Court in the aforementioned case was followed by the Apex Court in Baburam Prakash Chandra Maheshwari vs. Antarim Zilla Parishad, Muzzafarnagar, wherein it is observed that, “there are at least two well recognised exceptions to the doctrine with regard to the exhaustion of statutory remedies. In the first place, it is well settled that where proceedings are taken before a Tribunal under a provision of law, which is ultra vires it is open to a party aggrieved thereby to move the High Court under Art. 226 for issuing appropriate writ for quashing them on the ground that they are incompetent, without his being obliged to wait until those proceedings run their full course. In the second place, the doctrine has no application in a case where the impugned order has been made in violation of the principles of natural justice.
13. In the present case, it is manifest that the impugned communication issued by the Collector was issued without following the principles of natural justice and, therefore, cannot be sustained.
14. The next contention of Mr. Gilda is that though alternate remedy is available to the petitioner under Section 137(2) of the B.P. Act, it cannot be said that the writ petition is not maintainable. In support of this submission, he relied on the decision of this Court in Nilesh alias Narayan Y. Jadhav vs. State of Maharashtra, 1991 Mh.LJ. 770, cited supra wherein it has been observed in para 4 that “to take up the last point first, Section 137 provides the remedy of an appeal to a person aggrieved by orders passed by any Prohibition Officer, Collector or Commissioner. In the present case, against the order of the 2nd respondent, the petitioner could have gone in appeal to the State Government. However, Exh.A which is the impugned order, gives the impression of the 2nd respondent acting in consonance with the policy formulated by the State Government. If that be correct, and, on that subject there is no dissenting voice from the respondents, the remedy of preferring an appeal against the impugned order to the State Government would be something in the nature of an appeal from Caesar to Caesar. When the authorities speak of a person taking recourse to Article 226 only after exhausting other remedies which are meaningful and capable of rendering relief unto him. In the present case the 2nd respondent purports to speak the mind of the State Government and, therefore, driving the petitioner to approach the State Government against the impugned order, would be of no assistance. Consequently, this point raised on behalf of the respondents has to be negatived.”
15. Similarly, same view has been taken by the Single Bench of this Court in the case of Procter and Gamble India Ltd. vs. Municipal Corporation of Greater Bombay, 2004 (1) Mh.L.J. 406, cited supra, wherein it has been observed that “once the petitions are admitted for final hearing, without any reservation of right in favour of the respondents to raise plea of non-maintainability of the petitions on account of any such alternative remedy being available to the petitioners, the respondents cannot be allowed to non-suit the petitioners, at final stage, merely on such a technical plea and more particularly when the petitioners have a good case on merits. Objections challenging tenability on account of availability of alternative remedy rejected.”
16. Having regard to the law laid down by the Supreme Court, it is not possible to accept that the communication dated 12-44991 issued on the basis of the Circular dated 4-3-1991 by the Commissioner, State Excise, is sustainable in law. In the facts and circumstances, it is not possible to accept the contention of the learned A.G.P. that since the remedy is available for redressal of the grievance of the petitioner/firm by filing an appeal before the Commissioner under Section 137(2) of the B.P. Act, the writ petition is not maintainable. The facts and circumstances of the present case are somewhat identical with the case of Nilesh vs. State, 1991 Mh.L.J. 770. In the present case, the Commissioner State Excise, himself has issued the Circular dated 4-3-1991 and, therefore, the appeal against the communication issued by the Collector to the Commissioner would be a futile exercise and thus the technical plea about jurisdiction is liable to be ignored more particularly when the petitioners have good case on merits. In that view of the matter, the writ petition is perfectly maintainable under Article 226 of the Constitution. Therefore, this Court is of the considered opinion that in the facts and circumstances of the present case and in the interest of justice, this Court is required to exercise the extra-ordinary jurisdiction under Article 226 of the Constitution for quashing the impugned communication dated 12-4-1991.
17. Pertinent to note that this petition was admitted on 15-10-1991 and stay was also granted to the impugned communication dated 12-4-1991, as a consequence of which the petitioner/firm continued to lift up the sanctioned quota of 2000 quintals per year right from the year 1991 till date. In the circumstances, it is made clear that it would be open for the Collector to hold the necessary enquiry in accordance with Rule 6 and to take appropriate decision in the matter on merits while considering as to what quota can be sanctioned for the coming years, if such an application is moved by the petitioner/firm for the year 2004-05. In the result, the writ petition is allowed. The impugned communication dated 12-4-1991 is hereby quashed and Rule is made absolute in the aforesaid terms. No costs.