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Thursday, January 24, 2013

grant of exclusive privilege and the licence = the High Court entertained the writ petition preferred by the first respondent herein and quashed the grant of exclusive privilege and the licence granted in favour of Ropan Sahoo and Mukesh Kumar, the respondent Nos. 5 and 6 in the writ petition, the present appeals have been preferred by the grieved persons as well as by the State.- the restrictions enshrined in clauses (d) and (e) of Rule 34(1) of the Rules in relation to the minimum distance between the proposed shops and the Vishnu Temple, petrol pump and bus stand and at a latter part of the judgment has expressed the opinion that there has been infraction of statutory Rule, namely, Rule 34 which casts a statutory duty on the department to pass on order with reasons relaxing the restrictions. We are disposed to think that the High Court, as far as the first part of the opinion is concerned, has been guided by the factum that the Commissioner-cum-Secretary in his recommendation to the Minister of Excise and Tourism had not specifically referred to clauses (d) and (e) of Rule 34(1) of the Rules. It is pertinent to state here that it is perceptible from the note sheet that the Secretary had referred to the proposal received from the Collector, endorsement made by the Excise Commissioner, the objections raised by the objectors and also expressed the view that the said objections were devoid of merit and, accordingly, recommended for approval. The cumulative effect of the note sheet goes a long way to show that every authority was aware of the distance and recommended for relaxation of clauses (d) and (e) of sub-rule (1) of Rule 34 and the concerned Minister had endorsed the same. Non-mentioning of the Rule or sub-rule, in our considered opinion, does not tantamount to non-passing of an order. The dominant test has to be the application of mind to the relevant facts. The second part of the order, if properly appreciated, conveys that no reasons have been ascribed. The proviso to Rule 34(1) lays a postulate that the distance as mentioned under clauses (d) and (e) may be relaxed by the State Government in special circumstances. The recommendations made by the Collector refers to the circumstances, namely, that there is a demand for consumption of liquor within the hotel premises; that illegal liquor cases have been booked in the nearby area; and that the proposal is in the interest of the Government revenue. The said recommendations, as is reflectible, have been concurred with by the higher authorities and, hence, there can be no trace of doubt that they constitute the special circumstances. 25. In view of our aforesaid analysis, the appeals are allowed and the order passed by the High Court is set aside. It is further clarified that if the Government, if so advised, can invoke the power under the proviso to Rule 34(1) of the Rules for the purpose of relaxation for grant of exclusive privilege and licence pertaining to the said shops in respect of current and subsequent financial years. In the facts and circumstances of the case, the parties shall bear their respective costs.


                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                      CIVIL APPEAL NO.   615   OF 2013
                (Arising out of S.L.P. (C) No. 34902 of 2009)


Ropan Sahoo & another                        ... Appellants

                                   Versus

Ananda Kumar Sharma & others                   ...Respondents

                                    WITH

                     CIVIL APPEAL NO.   616     OF 2013
                (Arising out of S.L.P. (C) No. 35166 of 2009)

State of Orissa & others                           ....Appellants

                             Versus

Ananda Kumar Sharma & others          ....Respondents





                               J U D G M E N T


Dipak Misra, J.



      Leave granted in both the special leave petitions.

   2. Questioning the legal  acceptability  of  the  order  dated  16.9.2009
      passed by the Division Bench of the High Court Orissa  at  Cuttack  in
      WP(C) No. 3913 of 2009 whereby the High  Court  entertained  the  writ
      petition preferred by the first  respondent  herein  and  quashed  the
      grant of exclusive privilege and the  licence  granted  in  favour  of
      Ropan Sahoo and Mukesh Kumar, the respondent Nos. 5 and 6 in the  writ
      petition, the present appeals  have  been  preferred  by  the  grieved
      persons as well as by the State.

   3. Shorn of unnecessary details the  facts  which  are  requisite  to  be
      stated are that Mukesh Kumar, the respondent No.  6  before  the  High
      Court, had submitted
an application for grant of licence  to  open  an
      IMFL “Off” shop in Ward No. 16, Bargarh Town for the year  2007-08  on
      28.1.2008.  As a report was  submitted  that  the  proposed  site  was
      violative of sub-rule 1(c) of Rule 34 of  Orissa  Excise  Rules,  1965
      (for short “the Rules”), the said respondent  chose  to  withdraw  the
      application for the aforesaid year by indicating personal reasons.  
In
      respect of the next financial year he again submitted  an  application
      for grant of licence at  the  same  place.   The  Collector,  Bargarh,
      invited objections and pursuant to the same the writ petitioner  filed
      his objection on 18.10.2008.  
The  Inspector  of  Excise  submitted  a
      report on 2.2.2009 stating about the  existence  of  a  bathing  ghat,
      Vishnu temple,  bus  stand  and  petrol  pump  within  the  prohibited
      distance,  but  recommended  for  relaxation  of  restrictions.    
The
      Collector, Bargarh, recommended for opening of the shop for  remaining
      part of the year 2008-09 in relaxation of  the  restrictions  and  the
      Excise Commissioner also recommended to the  Government  on  19.2.2009
      for sanction by relaxing of the restrictions.  
As the  factual  matrix
      would reveal, the State Government on the basis of the recommendations
      invoked the power of relaxation under Rule 34 of the Rules and granted
      licence in favour of the said respondent for the remaining  period  of
      2008-09.  
Be it noted, in a similar manner relaxation was granted  for
      opening of the IMFL/Beer (‘ON’ shop) at Hotel Sawadia for  the  period
      from 2.3.2009 to 31.3.2009.

   4. Being grieved by the grant of  said  licences,  the  first  respondent
      invoked the jurisdiction of the High Court under Article  226  of  the
      Constitution principally contending that the report submitted  by  the
      Excise Inspector with regard to certain aspects, namely,  location  of
      the  bathing  ghat,  etc.  were  not  factually  correct;   that   the
      recommendations made by  the  authorities  were  highly  improper  and
      unwarranted; and that the relaxation had been granted in an  extremely
      arbitrary manner and, therefore, the grant of exclusive privilege  and
      the licence deserved to be axed.  The High Court perused the documents
      brought on record, called for the record to  satisfy  itself  in  what
      manner the power of relaxation was exercised, and after perusal of the
      record and on consideration of to  various  recommendations,  came  to
      hold that as far as the respondent No. 5 was concerned for sanction of
      a beer parlour ‘ON’ shop licence for the remaining period of  2008-09,
      no order was passed relaxing the Rules before the grant  of  exclusive
      privilege.  As far as the  sanction  of  IMFL  Restaurant  licence  in
      respect of 6th respondent was concerned, the High Court expressed  the
      similar view.
We think it apt to reproduce  the  ultimate  conclusion
      recorded by the High Court: -

           “13.   Proviso  to  Rule   34   specifically   prescribes   that
           restriction on the minimum distance as mentioned in  Clause  (d)
           and (e) may be  relaxed  by  the  State  Government  in  special
           circumstances.  There being no order  by  the  State  Government
           relaxing the aforesaid two Clauses in relation  to  the  minimum
           distance between the proposed shops and  the  place  of  worship
           i.e. the Vishnu Temple, petrol pump and bus stand, the order  of
           the State Government approving the sanction/grant  of  exclusive
           privilege in favour of  opposite  parties  5  and  6  cannot  be
           sustained in law.”

   5.  After so stating the High Court referred to Section 41 of  the  Bihar
      and Orissa Excise Act, 1915 (for brevity “the Act”)  and  observed  as
      follows: -

           “Rule 34 of the Rules castes a statutory duty on the  Department
           to pass order with  reasons  relaxing  the  restrictions.   When
           there has been infraction  of  such  statutory  duty,  the  same
           cannot be covered under Section 41 of the Act.”

   6. Being of the aforesaid view, the High Court quashed the privileges and
      the licences granted in favour of the private respondents therein.

   7. We have heard Mr. Bhaskar P. Gupta, learned  senior  counsel  for  the
      beneficiaries of the grant, Mrs. Kirti Renu  Mishra,  learned  counsel
      for the State and Mr. G. Ramakrishna Prasad, learned counsel appearing
      for the respondent No. 1 in both the appeals.

   8. At the very outset we may note that it is the admitted  position  that
      both the proposed sites come within the prohibited area  as  envisaged
      under Rule 34(1)(d) and (e) of  the  Rules.   Rule  34  of  the  Rules
      stipulates  that  the  places  in  respect  of  which   licences   for
      consumption of liquor on vendor’s premises should not be granted.  The
      said Rule reads as follows: -

           “34. Licences for shops for consumption of  liquor  on  vendor’s
           premises not to be granted at certain places : (1) No  new  shop
           shall be licensed for the consumption of liquor on  the  vender,
           premises –

              a) in a marketplace, or

              b) at the entrance to market place, or

              c) in close proximity to a bathing-ghat, or

              d) within at  least  five  hundred  meters  from  a  place  of
                 worship, recognized  educational  institution,  established
                 habitant  especially  of  persons  belonging  to  scheduled
                 castes and  labour  colony,  mills  and  factories,  petrol
                 pumps,  railway  stations/yard,  bus  stands,  agricultural
                 farms or other places of public resort, or

              e) within at least one kilometer from  industrial,  irrigation
                 and other development projects areas, or

              f) in the congested portion of a village :

                 Provided that the restriction on the minimum  distance  as
           mentioned under clauses (d) and (e) may be relaxed by the  State
           Government in special circumstances.

                 (2) So far as  practicable,  an  established  liquor  shop
           licensed for the consumption of liquor on the premises shall not
           be allowed to remain on a site which would  not  under  sub-rule
           (1) be permissible for the location of a new shop.

                 (3) In areas inhabited by Scheduled Tribes, country spirit
           shops shall not be licensed to be placed immediately on the side
           of a main road or in any other prominent position that is likely
           to place temptation in their way.”

   9. On a perusal of the aforesaid Rule, it is crystal clear that the State
      Government has been conferred with the power to relax the  restriction
      on the minimum distance as mentioned in clauses (d) and (e) pertaining
      to the minimum distance.  As has already been  indicated  hereinbefore
      there is no cavil  that  the  material  on  record  pertained  to  the
      relaxation of the restriction as prescribed under clauses (d) and  (e)
      of sub-rule (1) of Rule 34 of the  Rules.   The  High  Court,  as  the
      impugned   order   would   reflect,   has   quashed   the   order   of
      approval/sanction  and  the  consequent  grant  of  licences  on   the
      foundation that there has been no order relaxing the  restrictions  on
      the minimum distance as mentioned in Clauses (d) and (e)  relating  to
      the proposed shops in exercise of powers of the said Rule by the State
      Government and, in any case, no reasons have been ascribed. Thus,  the
      question that emanates for consideration is whether the High Court has
      appositely appreciated the note sheet in the file and arrived  at  the
      correct conclusion or not.

  10.  The High Court, as demonstrable, has  reproduced  the  communications
      made by the Joint Secretary to the Government by  fax  vide  memo  No.
      1159/Ex. dt. 2.3.2009 addressed to the Excise Commissioner  about  the
      Restaurant “ON” shop licence in favour  of  Mukesh  Kumar  at  “RASSOI
      RESTAURANT” in the premises of Hotel ‘Sawadia Palace’,  Ward  No.  11,
      Bargarh Municipality over Plot No. 1622, Khata No.  2542/362,  in  the
      district of Bargarh for the remaining period of 2008-09 and  also  the
      memo No. 1161/Ex. dated 2.3.2009 in respect of Beer Parlour “ON”  shop
      licence in favour of Ropan Sahoo over Plot No.  1391/2260,  Khata  No.
      393 in Ward No. 16 of Bargarh Municipality, in the district of Bargarh
      for the remaining period of 2008-09.  The communication that has  been
      made in favour of Mukesh Kumar reads as follows: -

           “In inviting a reference to your letter No. 1214 dt. 19.2.09  on
           the subject cited above, I am directed to say that  Govt.  after
           careful consideration have been pleased to grant IMFL Restaurant
           “ON” shop Licence in favour  of  Sri  Mukesh  Kumar  at  “RASSOI
           RESTAURANT” in the premises of Hotel “Sawadia Palace”, Ward  No.
           11,  Baragarh  Municipality  over  Plot  No.  1622,  Khata   No.
           2542/362, in the district of Baragarh for the  remaining  period
           of 2008-09 by relaxing rule 34 of the Orissa Excise Rules,  1965
           and fixation of MGQ  as  per  Excise  Duty,  Fee  Structure  and
           Guidelines for 2008-09.  The Excise Administration may  be  held
           responsible if the existing nearby excise shops are affected  by
           the new “ON” shop.”

      As far as grant of beer parlour “ON” shop in favour of Ropan Sahoo  is
concerned, the communication vide memo No. 1161/Ex.  dated  2.3.2009  is  as
follows: -

           “In inviting a reference to your letter No. 1380 dt. 25.02.09 on
           the subject cited above, I am directed to say that  Govt.  after
           careful consideration have been pleased to sanction Beer Parlour
           “ON” shop Licence in favour of Sri Ropna  Sahoo  over  Plot  No.
           1391/2260,  Khata  No.  393/330  in  Ward  No.  16  of   Bargarh
           Municipality, in the  district  of  Bargarh  for  the  remaining
           period of 2008-09 subject to condition that the district  excise
           officials will be held responsible if the nearby existing excise
           shops are affected by opening of the new shop.”

  11. As no reasons were assigned, the High Court called for the file.  On a
      perusal of the file the High Court  referred  to  the  recommendations
      and, eventually, opined that no order had  been  passed  relaxing  the
      Rule in respect of the said shops by the Commissioner-cum-Secretary to
      Government, Department of Excise.  The thrust of the matter is whether
      any order has been passed relaxing the  restrictions  imposed  by  the
      Rules and does it contain reasons.  As the first  communication  would
      reveal, it is  clearly  mentioned  therein  that  the  Government  has
      relaxed the restrictions under Rule  34  and  as  far  as  the  second
      communication is concerned, it has been stated that the Government has
      sanctioned grant of licence.  The learned counsel for  the  State  has
      referred to the note sheet to  highlight  that  the  orders  had  been
      passed in consonance with the proviso to Rule 34(1) of the  Rules  and
      on that basis the communications were issued.

  12. We have bestowed our anxious consideration and carefully  perused  the
      note-sheet.  On a studied scrutiny of the same it is luculent that the
      Excise Commissioner, Orissa, Cuttack, had  recommended  the  proposals
      and in support of the same had  furnished  seventeen  documents.   The
      note sheet has referred to the report which states that  the  proposed
      site exist at 350 meters from  Vishnu  Temple,  250  meters  from  the
      petrol pump, 200 meters from the private bus stand and 50 meters  from
      the irrigation canal.  The recommendation which forms part of the note
      sheet reads as follows: -

           “The Collector, Bargarh, in his report at P-84/C has stated that
           the local consumers demand for consumption of liquor within  the
           hotel premises.  Illegal liquor cases have been  booked  in  the
           nearby area and hence, there is demand for the “ON”  shop.   The
           apprehension that the existing IMFL “OFF” shop will be  affected
           after opening of the proposed “ON” shop is  ruled  out,  because
           the consumers of “OFF” shop are different from “ON”  shop.   The
           customers of “ON” shop has to consume liquor  inside  the  Hotel
           premises with peg system and pay service charge, whereas such  a
           facility is  not  available  with  “OFF”  shops.   Besides,  the
           bathing ghat is not nearby as objected.  But only one irrigation
           canal is flowing at a distance of about 50  meters.   Therefore,
           Collector has recommended for relaxation of rule  34  of  Orissa
           Excise Rules, 1965 for sanction of the proposal in the  interest
           of Govt. revenue and to check illegal liquor trade.”

  13. The objections of  A.K.  Sharma  and  that  of  the  Secretary,  Human
      Society, Bargarh have also been  considered.   Thereafter,  the  Joint
      Secretary has recommended thus: -

           “In the above circumstances and in view of recommendation of the
           Excise  Commissioner,  Orissa,  Cuttack,  it   may   kindly   be
           considered to grant IMFL Restaurant “ON” shop licence in  favour
           of Sri Mukesh Kumar at “Rasooi Restaurant” in  the  premises  of
           Hotel “Sawadia Palace” Ward No. 11,  Bargarh  Municipality  over
           Plot No. 1622, Khata No. 2542/362, in the district  of  Bargarh,
           for the remaining period of the year 2008-09 by relaxing rule 34
           of Orissa Excise Rules, 1965 and MGQ fixed  as  per  the  Excise
           Duty, Fee Structure and Guidelines for  2008-09.   The  District
           Excise Administration may be held responsible  if  the  existing
           nearby excise shops are affected by the new “ON” shop.”

  14. The Commissioner-cum-Secretary to Government, Excise  Department,  has
      endorsed the same in the following terms: -

           “Notes from P.10/N explain.  We had  received  a  representation
           from Shri A.K. Sharma, Exclusive Privilege Holder of  IMFL  ‘Off
           Shop’ No. 4 of Bargarh (P.23-22/C) against the proposal received
           from Collector, Bargarh and endorsed by the Excise Commissioner,
           Orissa for opening of IMFL ‘On Shop’ at Rasoi Restaurant in  the
           premises of Hotel Sawadia Palace, Ward No. 11 of  Bargarh.   The
           objections raised by Shri Sharma have been enquired into by  the
           District Administration.  In this regard,  the  letter  received
           from Collector, Bargarh  at  P.34-32/C  may  please  be  glanced
           through.  The objections of Shri Sharma are found to  be  devoid
           of merit.  The report received  from  the  Excise  Commissioner,
           placed below, may also be perused.  The Excise Commissioner  had
           recommended to consider the sanction of IMFL ‘On Shop’ at  Rasoi
           Restaurant in favour  of  Shri  Mukesh  Kumar  situated  in  the
           premises of Hotel Sawadia Palace, Ward No. 11 of  Bargarh.   The
           proposal may kindly be considered and approved.”

  15. The same has been signed  by  the  Minister  of  Excise  and  Tourism,
      Orissa.  As far as the  second  shop  is  concerned,  the  note  sheet
      referred to the recommendations  of  the  Collector,  which  reads  as
      follows: -

           “...the Collector, Bargarh has reported  that  both  the  petrol
           pumps are situated in such a manner that the shops will have  no
           effect at all on the proposed Bar and hence he has suggested for
           relaxation of restrictive provisions of rule-34 of Orissa Excise
           Rules, 1965.

                 The Collector, Bargarh has also reported that the proposed
           Beer Parlour shall cater to the needs of the consuming people of
           the locality besides fetching Govt. revenue and checking illicit
           sale of Beer, since the population of the  area  is  increasing.
           Only 3 (three) IMFL “OFF’ shops, one  IMFL  ‘ON’  and  one  Beer
           Parlour  are  functioning  in  the  entire  town   area   having
           population of more than one  lakh.   There  is  feasibility  and
           potentiality for opening of the Beer Parlour  ‘ON’  shop,  since
           illegal sale of liquor has  been  detected  in  the  area.   The
           proposed shop will check illicit trade of liquor.  He  has  also
           stated that the opening of new Beer Parlour will not affect  the
           nearby IMFL shops in the Municipality.”

  16. The  Joint  Secretary  after  referring  to  the  objections  and  the
      recommendations of the Excise Commissioner has  passed  the  following
      order in the note sheet: -

           “In the above circumstances and in view of recommendation of the
           Excise  Commissioner,  Orissa,  Cuttack,  it   may   kindly   be
           considered to sanction Beer Parlour ‘ON’ shop licence in  favour
           of Sri Ropna Sahu over plot No. 1391/2260, Khata No. 393/330  in
           Ward No.16 of Bargarh Municipality in the  district  of  Bargarh
           for the remaining period of 2008-09 subject  to  condition  that
           the district excise officials will be held  responsible  if  the
           nearby existing shops are affected by opening of the new shop.

                 Government orders may kindly be obtained in the matter.”

  17.  Thereafter,  the  Commissioner-cum-Secretary  to  Government  in  the
      Department of Excise has endorsed the same and  the  Minister,  Excise
      and Tourism has signed in approval thereof and thereafter the movement
      of the file took place.  On the basis  of  the  aforesaid  orders  the
      communications have been sent.

  18. On a keen scrutiny of the entire note sheet we have no  hesitation  in
      our  mind  that  the  Commissioner-cum-Secretary  had   accepted   the
      recommendations of the Collector and the Excise Commissioner, and upon
      perusal of the note sheet of the Joint Secretary had  recommended  for
      consideration and approval by the Minister of Excise and Tourism.  The
      Minister, as stated earlier, has signed and thereafter, the  file  had
      travelled back for  communication.   We  really  fail  to  fathom  the
      reasons ascribed by the High Court that there is no  order  whatsoever
      relaxing the Rules before the order of grant  of  exclusive  privilege
      was passed.  After the Minister had signed on the file on the basis of
      the recommendations sent by the Commissioner-cum-Secretary  which  was
      founded  on  the  recommendations  of  the  Joint  Secretary  who  had
      concurred with the recommendations of the  Collector  and  the  Excise
      Commissioner, communications were made by the  Joint  Secretary.   The
      note sheet clearly indicates application of mind to the relevant facts
      which pertain to the restrictions on the distance  from  the  proposed
      site and the endorsement by the Minister.  In  this  context,  we  may
      refer with profit to the decision in Tafcon Projects (I) (P)  Ltd.  v.
      Union of India and others[1], wherein the  High  Court,  after  taking
      note of the order passed by the Secretary who, in anticipation of  the
      formal approval by the Minister concerned, had allowed the party to go
      ahead for appointing the appellant therein as “Event  Manager”.   This
      Court referred to the earlier order passed by the  Secretary  granting
      permission and the latter order in which he  had  mentioned  that  the
      party may be allowed to go ahead with  the  proposal  for  making  the
      preliminary arrangement in anticipation of the formal approval of  the
      Minister and expressed the view that  the  High  Court  had  erred  in
      coming to hold that the Secretary had not  taken  any  final  decision
      with  regard  to  the  appellant  therein  as   the   Event   Manager.
      Thereafter, the Court adverting to the justification of the conclusion
      of the High Court that  no  final  decision  had  been  taken  by  the
      Minister expressed thus :-

           “12.  It appears also from the  record  as  noted  by  the  High
           Court, that the file had been pending with the Minister for some
           time and despite expressions of urgency, the  Minister  did  not
           sign the file since  he  was  busy  with  “elections  and  other
           important matters”.  What the High Court has overlooked is  that
           the relevant file  was  again  placed  before  the  Minister  on
           30.8.1999 by JS&FA with a note which stated that Tafcon had been
           appointed as the “Event Manager”  for  three  years.   This  was
           signed by the Minister with the endorsement “file returned”.

           13.   The High Court deduced from this signature of the Minister
           that no approval was in fact granted by him to  the  appointment
           of M/s. Tafcon either expressly or impliedly.  We are unable  to
           agree.  Where the Minister has signed the various notes  put  up
           before him seeking his approval, his  signature,  without  more,
           must  mean  that  he  has  approved  the  steps  taken  by   the
           Department.”

  19. Be it noted, in the said case, the Court referred to  Rule  3  of  the
      Transaction of Business Rules, 1961 which provided for all business to
      be conducted on general or  special  directions  of  the  Minister-in-
      charge.

  20. In the case at hand, Rule 7 of the Orissa Government Rules of Business
      made under Article 166 of the Constitution confers the  power  on  the
      Minister to pass an order in respect of a  matter  pertaining  to  his
      portfolio.  The effect of such a delegation has been dealt with  by  a
      three-Judge Bench  in  Narmada  Bachao  Andolan  v.  State  of  Madhya
      Pradesh[2] wherein it has been held that: -

        “The decision of  any  Minister  or  Officer  under  the  Rules  of
        Business made under Articles 77(3) and 166(3) of  the  Constitution
        is the decision of the President or the Governor  respectively  and
        these Articles do not provide for `delegation’.  That  is  to  say,
        that decisions made and actions taken by the  Minister  or  Officer
        under the Rules of  Business  cannot  be  treated  as  exercise  of
        delegated power in real sense, but are deemed to be the actions  of
        the President or Governor, as the case may be, that  are  taken  or
        done by them on the aid and advice of the Council of Ministers.”

  21. The Bench to fructify its opinion has placed reliance on State of U.P.
      & Ors. v. Pradhan Sangh Kshettra Samiti & Ors.[3] and pronouncement by
      the seven-Judge Bench in Shamsher Singh v. State of Punjab  &  Anr.[4]
      For the sake of completeness, we may note with profit  what  has  been
      stated in paragraph 27 of the aforesaid decision:  -

          “27.   In Dattatraya Moreshwar v. The State of Bombay &  Ors.[5],
          a Constitution Bench of this Court held that an omission to  make
          and authenticate an executive decision in the form  mentioned  in
          Article 166 does not make the decision  itself  illegal,  on  the
          basis that its provisions were directory and not mandatory.”

  22. In this regard we may quote a passage from Sethi Auto Service  Station
      and another v. Delhi Development Authority and others[6] : -

           “14.  It is trite to state that notings in a  departmental  file
           do not have the sanction of law to be  an  effective  order.   A
           noting by an officer is an expression of his  viewpoint  on  the
           subject.  It is no more  than  an  opinion  by  an  officer  for
           internal use and consideration of the  other  officials  of  the
           department and for the  benefit  of  the  final  decision-making
           authority.  Needless to add that internal notings are not  meant
           for outside exposure.  Notings in the  file  culminate  into  an
           executable order, affecting the rights of the parties, only when
           it  reaches  the  final   decision-making   authority   in   the
           department,  gets  his  approval  and   the   final   order   is
           communicated to the person concerned.”

  23. In State of West Bengal v. M. R. Mondal and  another[7]  it  has  also
      been held that an order passed on the file and not communicated is non-
      existent in the eye of law.

  24. In the present case it is luminous that the file had travelled to  the
      concerned Joint Secretary  of  department  who  had  communicated  the
      order.
The High Court has opined that there is no order by the  State
      Government relaxing the restrictions enshrined in clauses (d) and  (e)
      of Rule 34(1) of the Rules in relation to the minimum distance between
      the proposed shops and the Vishnu Temple, petrol pump  and  bus  stand
      and at a latter part of the judgment has expressed  the  opinion  that
      there has been infraction of statutory Rule,  namely,  Rule  34  which
      casts a statutory duty on the department to pass on order with reasons
      relaxing the restrictions.  
We are disposed to  think  that  the  High
      Court, as far as the first part of the opinion is concerned, has  been
      guided by  the  factum  that  the  Commissioner-cum-Secretary  in  his
      recommendation  to  the  Minister  of  Excise  and  Tourism  had   not
      specifically referred to clauses (d) and (e)  of  Rule  34(1)  of  the
      Rules.  
It is pertinent to state here that it is perceptible from  the
      note sheet that the Secretary had referred to  the  proposal  received
      from the Collector, endorsement made by the Excise  Commissioner,  the
      objections raised by the objectors and also expressed  the  view  that
      the said objections were devoid of merit and, accordingly, recommended
      for approval.  
The cumulative effect of the note sheet goes a long way
      to show that 
every authority was aware of the distance and recommended
      for relaxation of clauses (d) and (e) of sub-rule (1) of Rule  34  and
      the concerned Minister had endorsed the same. 
 Non-mentioning  of  the
      Rule or sub-rule, in our considered opinion, does  not  tantamount  to
      non-passing of an order.  The dominant test has to be the  application
      of mind to the relevant facts.  The  second  part  of  the  order,  if
      properly appreciated, conveys that no reasons have been ascribed.  
The
      proviso to Rule 34(1) lays a postulate that the distance as  mentioned
      under clauses (d) and (e) may be relaxed by the  State  Government  in
      special circumstances.  
The  recommendations  made  by  the  Collector
      refers to the circumstances,  namely,  that  there  is  a  demand  for
      consumption of liquor within the hotel premises; that  illegal  liquor
      cases have been booked in the nearby area; and that the proposal is in
      the interest of the Government revenue.  
The said recommendations,  as
      is reflectible, have been concurred with  by  the  higher  authorities
      and, hence, there can be no trace of doubt that  they  constitute  the
      special circumstances.

  25. In view of our aforesaid analysis, the appeals  are  allowed  and  the
      order passed by the High Court is set aside.  It is further  clarified
      that if the Government, if so advised, can invoke the power under  the
      proviso to Rule 34(1) of the Rules for the purpose of  relaxation  for
      grant of exclusive privilege and licence pertaining to the said  shops
      in respect of current and subsequent financial years.   In  the  facts
      and circumstances of the case, the parties shall bear their respective
      costs.




                                                             ……………………………….J.
                            [K. S. Radhakrishnan]



                                                             ……………………………….J.
                                                     [Dipak Misra]

New Delhi;
January  22, 2013



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[1]    (2004) 13 SCC 788
[2]    AIR 2011 SC 3199
[3]    AIR 1995 SC 1512
[4]    AIR 1974 SC 2192
[5]    AIR 1952 SC 181
[6]    (2009) 1 SCC 180
[7]    AIR 2001 SC 3471

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