[2017] 3 S.C.R. 239 STATE OF KERALA & ORS. A v. MIS. PALAKKAD HERITAGE HOTELS (Civil Appeal No. 5204of2017) APRIL 13, 2017 B [DIPAK MISRA AND A. M. KllANWILKAR, JJ,) ForeiJ?,11 Liquor Rules, 1974: Application for grant of Beer/Wine Bar FL-11 Licence - For its hotel which was 70 meters from the nearest objectionable c institution - Excise Commissioner recommended grant of sanction for the Licence as per the Rules '- While the said recommendation was pending 'consideralion, Liquor Rules amended on 181" April, 2012 prescribing the minimum distanceji-uin objectionable institution· as 200 meters - Jn view of the amendme/11 of the Rules, the application · 0was rejected - Writ pelition by the applicant cha/lengi11g the decisio11 as also the amendment of lhe Rules - Allowed by Single Judge of High Court holding that since the order sanctioning the grant of licence was prior to amendment, application could nol have been rejected on the basis of the amended Rules - Jn writ appeal as well as in Review, order of Single Judge was affirmed - On appeal, E held: Since the final decision as to grant of the Licence was taken after the Rule was amended, the applica1io11 was required to be considered keeping in view the amended provision - Matter remanded to the Single Judge of High Court to decide afresh on other issues. F

Partly allowing the appeal, the Court HELD: 1.1 The 1>rocessi11g of the apj>licalion for grant of licence commences from the dale of ap1>licalion. The final decision 011 the 1>roposal is re11uired to be taken by the State Government. The date 011 which a formal, final decisio11, is taken G by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail. [Para 11J[248-F-G] H 239 240 SUPREME COURT REPORTS [2017) 3 S.C.R.

A 1.2 In the present case, the Single Judge of High Court has assumed the date on which recommendation was made by the Excise Commissioner i.e. 28'h M3:rch, 2012, as the relevant date. That assumption is untenable. ]<or, that was not the date on which the final decision was t:tken by the competent authority. Whereas, before a final decision could be taken by the competent8 authority on the a1)plication submitted by the Respondent, the Foreign Liquor Rules were amended on 181h April, 2012. The ap1>lication submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on this date. [Para 12)1248-JI; 249-A-B] c 1.3 The a1)plication for grant of J<'L-11 licence submitted by the Respondent was required to be considered by the com11etent authority keeping in mind the amended provisions which came ·into force w.e.f. 18'h April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his D speaking order dated 5'h June, 2012, for invoking the restriction of distance of 200 metres from the objectionable site. [Para 13](249-C-D)

2. Since the Single Judge of the High Court proceeded to decide the writ petition filed by the Respondent merely by E referring to the pronouncement of the Division Bench of the same · High Court in the case of *Ka/hula /lo/els mu/ Resorts, coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18'h April, 2012 as void to the extent it has introduced the restriction of distance of 200 meters from objectionable institutions for getting J<'L-11 licence, it would be F appropriate to relegate the parties before the Single Judge to decide the writ petition afresh, keeping in mind the settled legal position. [Para 14)(249-E-F) *Kallada Hvlels and Resvrls vs. Slate of Kera/a 2012 (2) KLT 167; State vf Kera/a and Ors. v. MP. Shiju G 2014 (2) KUC 343 (DB); The Kera/a Bar Hotels Associalion & Am: V. State of Kera/a & Ors. [2015] SCR 256: AIR 2016 SC 163 - referred to. State of Keralp & Am: v. B.6 Holidays Resorts Pvt. Lid. [20101 3 SCR 1 : 2010 (5) sec 186 - distinguished. H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 241 HOTELS Case J,aw Reference A 2012(2) KLT 167 . referred to Para4 2014 (2) KBC 343 (Dll) referred to Para6 [2015) SCR 256 referred to Para7 [2010) 3 SCR 1 distinguished Para 10 B CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5204 of2017. From the Judgment and Order dated 12.08.2014 of the High Court of Kerala at Ernakulam in W. A. No. 950 of 2014. c.

G. Prakash, Jishnu M. L., Mrs. Priyanka Prakash, Mrs. Beena Prakash, Manu Srinath, Ad vs., for the Appellant. Romy Chacko, Shubham Singh, Varun Mudgal, S. C. Jaidwal, Advs., for the Respondents.

D The Judgment of the Court was delivered by A. M. KllANWILKAR, J. 1. The Respondent constructed a hotel which has been classified as Heritage (Basic) Category for five years (w.e.f. I" March, 2012 till 28'h February, 2017). The Respondent submitted an application for grant of a Beer/Wine Bar FL-11 Licence Eunder the Foreign Liquor Rules. That application was processed by the Deputy Commissioner of Excise, Palakkad. On the basis of the report submitted by the said authority, the Excise Commissioner of Thiruvananthapuram forwarded his recommendation to the· Secretary to Government Taxes Department, Government of Kera la, vide a letter dated 28'h March, 2012. The Excise Commissioner duly recommended F grant of sanction fo.r FL-11 Licens'e to the Respondent as per the rules. While the said recommendation was pending consideration before the State Government, the Foreign Liquor Rules came to be amended on l 8'h April, 2012. The amendment inter alia prescribes the minimum distance of 200 metres from an objectionable institution. The report Gsubmitted by the Deputy Commissioner· of Excise records the distance between the gate of the hotel of the Respondent and the nearest objectionable institution (being Sree Bhagwati Ayappa Temple, Karuvannurthara) as 70 metres only. Consequent to the amendment to the Foreign Liquor Rules, the Government vide letter No. 8028/A2/2012/ H 242 SUPREME COURT REPORTS [2017] 3 S.C.R.

A TD dated 261h April, 2012, called upon the Excise Com1i1issioner, Thiruvananthapuram to examine the proposal of the Respondent. The Excise Commissioner, by a speaking order passed on 5'" Jm1e, 2012, came to the conclusion that the application submitted by the Respondent deserved to be rejected and directed it to be returned to the Deputy Commissioner of Excise, Palakkad.B 2. For answering the controversy at hand, we deem it apposite to reproduce the said communication in its entirety: ''PROCEEDINGS OF THE EXCISE COMMISSIONER. KERA LA c THIRUVANANTHAPURAM (Present: Sri. A. Ajith Kumur IAS) Sub:- Excise- Abkari-Application for FLcJJ licence to Palkkad HeritageHotels, Koduvayo01; Palakkad rejected -orders issued. D Read:- (1) Govt. Letter No. 8028/A2/2012/TD dated 261041 2012 (2) Letter No: CZ3-577/12 duted 19.03.2012 of the Joint Excise Co111missio11er, Central Zone, Emakulam. (3) Letter No. P-6-1611112 dated 16103112 & 2110312012 E of Deputy Co111missioner of Excise, Palakkad. (4) Application dated 0110312012 of Sri. MJ. Thomas (5) GO (Ms) No. 107111/TD dated 17108111

(6) GO (P) No. 7212012/TD dated 18104112 F ORDER NO. XC6-7476/12/K. Dis Dated 05.06.2012 The Joint Excise Co111missio11er, Central Zone, Emakulam has forwarded, vide letter read as ]" above, an application submitted by Sri. M J. Tho111as, Managing Partner. Mis Palakad Heritage Hotels, Eroor P 0. Ernakula11.1 requesting G sanction for FL-JI licence in his name to the Palakkad · Heritage Hotels, Koduvayo01; Palakkad having a valid heritage basic category classification certificate vide order No. 27/HRACC (08)12011 dated 09.03.2012 ofthe Member Secretary (HRACC) Ministry of Tourism, Government of India, H STATE OF KERALA & ORS. v. MIS. PALAKKAD HERITAGE 243 HOTELS [A. M. Kl-IANWILKAR, J.) Chen11ai. The hotel is situated in Re. Sy. No. 67318-1 A Koduvciyoor Village in Chillur Taluk bearing door No. XII 324 of Koduvayoor Grama Panchayat in Palakkad District. The Deputy Co111111isisonerof Excise, Palakkad has reported that the nearest o~jectionable institution is the Sree Bhagavathy Ayyappu Temple, Karuvammrthara which is 70 B meters mwy fi'om the gate 1if t/Je hotel.

Before the amendment made ride Government order read as 6'" above, as per rule 13 (3) of Forensic Liquor Rules, there was a restriction that no FL-3 licence shull be issued to hotels which· are locateij within 200 meters fi'om objectionable site c (educational i11stitutio11; temple. church, mosque (Jr burial ground, schedule caste/schedule tribe colony )but those hotels other than in the privute sector hai·i11g fow; five stm; five star deluxe classification will be exempted from the distance · restrictions in the interest of promotion of tourism and a/so in D the case of hotels iii private sector of above categories and hotels having heritage, heritage grand and heritage classic classijicatio11 is issued by Minisliy <~l Tourism, Government of India, the distance limit was only 50 meters from objectionable site .. Vide Govemment order read as 6'" above, the said rule is modified by deleting the exemption of distance restrictions in t/Je rnse 1~f hotels in private sector of above categories, thereby at present tile distance limit to those hotels in private sector of abore categories, thereby at present the distance limit of those hotel:> in private sector of all categories lrom the objectionable site is 200 meters. F

In the above circumstances a11d us reported by the Joint Excise Commissioner, Central Zone, Executive and Deputy Co111111issio11er of Excise, Palakkud and since the nearest objectionable institution viz. the Sree Blwgavathy Ayyappa Temple, Kanvamwrthara is located only 70 metres away from G the gate of the hotel the application read as 4'" above is hereby rejected and returned to the Deputy Commissioner of Excise, Palakkad. Sdl- Excise Commissioner" 1-1 • 244 SUPREME COURT REPORTS [2017] 3 S.C .R. A 3. Against this decision, the Respondent filed a writ petition before the High CourtofKerala, being Writ Petitioi1 (C) No.14220 of2012 for the following reliefs: · "i) call for the records leading to Ext. P7 and quash the same by issuing_ a. writ of certiorari or other appropriate writ, · B order or'ilirection; ii) declare that petitioner is entitled to get an FL-11 licence as· per Ext. P-2 application. iii) Declare that Ext. P6 amendment to !he extent it introduce distance of 200 meters from objectionable institutions for c getting FL-11 license is discriminalory and without any basis; iv) Declare thul if the hotels located within 200 meters from objectionable institutions are permitted to conduct the licenses, the petilioner is also entitled to ge1 license as per . D Ext. P2 application;

v) Issue a writ of mandamus or other appropriate writ, order or direction commanding the respondelll 1 to 5 to issue an FL-11 license·1111der Rule 13 (J!) of the Foreign Liquor Rules, beer/wine parlour license, vide Ext. P-2 application E on the basis of the rule/law prevailed 011 the date of Ext. · P-5 (28.3.2012); vi) Issue a writ of mandamus or other appropriate writ, order or direction co1111111mding the respondents 1 to 5 not to renew FL-3 and FL-11 licenses, which are conducting F within 200 meters from the objectionable institutions, if the petitioner is denied FL-11 license; and vii) Grant such other and further relief as this Hon 'ble Court ·may deem fit and proper in the inlerest of justice. " 4. The learned Single Judge of the High Court vide Judgment G 111 dated 4 February, 2014, allowed the said writ petition on the finding that the Excise Commissioner had issued an order in favour of the Respondent (writ petitioner) on 281h March, 2012, sanctioning FL-I I licence. The Single Judge then placed reliance on the decision of the Division Bench of the same High Court in the case of Kt11ltult1 Hotels H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 245 HOTELS [A. M. KHANWILKAR, J.]

amt Resorts vs. State 1Jf Kera/a', wherein it was held that the law to be A applied for consideration of the application submitted by the Respondent for grant of licence must be as on the date on which the Excise ·Commissioner made recommendation for grant of licence to the Respondent, as was in force on that date. The appellant herein had pointed out to the learned Single Judge that the said decision was B challenged before this Court by the Government and the same was pending. The learned Single Judge, however, rejected that contention as follows: "6. However, ad111i1tedly. as per the decisions ofthis Court. ·· which stand 11ol1\ when the Excise Commissioner recommends ·c · the application for grant of licence on the basis of a Rule in force on that date, subsequent a111e11d111e11t should not be relied on to assail the same. Viewed in that pro.file, the petitioner is entitled to get the relief as sougl1t j(1r in this writ petition. Therefore, the writ petition is allowed. D Ext. P7 is quashed and respondents I to 5 are directed to issue FL-11 licence to the petitioner under Rule 13(11) of the Foreign Liquor Rules. beer/wine parlour licence vide Ext. P2 applicati.011 on the basis of rule/law prevailed on the date of Ext. P5, i.e., 28.03.2012. E This exercise shall be completed wi1hi11 a period of three months from today. "

· 5. Against this decision, the appellant filed a Writ Appeal being No.950of2014 before the Division Bench of the High Court. The same has been dismissed on 12'h August, 2014, in the following ternis: F "l. Heard the learned Senior Gover11111en1 Pleader and the learned counsel appearing ji>r the respondent/writ petitioner. 2. The impugned judgment has been rendered by a learned Single Judge re(ying 011 1/ie decision of a Division Bench in Ka//(u/" llotel~ ""ti Rt'.mrl.~ 1' State of Kera/a [2012(2) KLT G 167]. That decision notwi1hsta11ding, the fact of the matter remains that even as per the later bench decision in Sttile ti( Kera/a mu/ Others " Jl,f. R Sliiju [201./(2) K.HC 343 {DB)}, the respo11de111/writ petitioner is entitled to succeed, in view I 2012(2) KJ..,T 167 H 246 SUPREME COURT REPORTS [2017] 3 S.C.R. A of the fact that the law has been succinctly slated to the effect that the eligibility has to be considered applying the law as on the date of consideration of the matter by the Excise Commissioner. This being, pointedly, the legal issue involved in this writ appeal, the question raised has, necessarily. to be answered against the State. This appeal, therefore, fails. B In the result, this writ appeal is dismissed No costs."

6. The later decision adve11ed to by the Division Bench in the case of M.P. Sbiju (supra), was challenged by the State Government before this Court by way of SLP(C) No.25780 of 2014. The same was c disposed of on 22"d .July, 2016 in the following terms: "ORDER Learned counsel for the parties are agreed that this petition has become i11ji·ucwous in view of lhe position rendered to this Court in Civil Appeal No. 4157 of 2015. titled as The D Kera/a bar Hotels Association & Anr. V. State of Kera/a & Ors. decided on 29.12.2015. The special leave petition is accordingly disposed of as i11.fructuous. "

7. Sii1ce the said relied upon decision in MP Shiju's case has E been affirmed by this Court, even this appeal must follow the same suit. However, the said SLP has been disposed of by this court on the basis of concession made by the counsel for the parties - that it had become infructuous in view of the judgment of this Court in the case of The . Kertila Bar Hotels Associt1lio11 & Anr. V. !;'lute of Kert1lt1 & Ors2• F · 8. On a bare perusal of the decision in the Kerala liar Hotels Association (supra), it is seen that the question examined by this Com1 was whether the policy to ban the consumption of alcohol in public or exception carved out to the pol icy in favour ofFive Star Hotels violates the rights of the Hotels of Four Star and below classification under G Articles 14 and 19. The other decision considered by the High Court for allowing the writ petition filed by the Respondent is the case of Kallada llotel.s & Resorts (supra).· The correctness of the decision of the Division Bench of the High Court was not in issue before this Court in the case of Kerala Bar Hotels Association (supra). 2 AIR 2016 SC 163 H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 247 HOTELS (A. M. Kl-IANWILKAR, J.] 9. Indeed, the decision of the Division Bench in Kallada Hotels A & Resorts (supra) has been aftirmed by this Court by dismissal of SLP(C) No: 18392 of2012 on 20'h June, 2012 in the following terms: "ORDER B Heard Mr. Ramesh Babu M.R., learned counsel for the petitioners.

In the facts and circumstances of the case, we are not inclined to interfere with the impugned judgment. The Special Leave Petition is, according/y, dismissed. c Question of law is kept open. " Even the review petition filed by the State against the said decision, being Review Pt:tition(C) No.1409 of 2012, came to. be dismissed on I 41h August, 2012. I 0. What is relevant to note is that, in the case of Kallada Hotels D & Resorts (supra), the Division Bench of the High Court hadadve11ed to the decision of this Cou11 in the case of State of Kerala & Am~ v. · B.6 Holidays Resorts Pvt. Lld.3, wherein it has been held that a1i application for grant of liquor licence has to be considered with reference to the rules/law prevailing or in force on the date of consideration of E application by the Excise Authorities and not with reference to the law · as on the date of the application. After noticing the decision of this Court, the Division Bench on the facts of the case before it allowed the Writ Appeal. It will be u·seful to advert to the relevant portion of the Division Bench decision:

F •·4, ~ ......................................... ··' .................. Going by the judgment of the Hon 'ble Supreme Court the la11i applicable is the law that is in force when the Excise authorities at various. levels consider an application for FLJ licence, as is evidenced by the records produced in this case, the application submitted before the Excise Commissioner goes for enquiry to the G Deputy Commissioner who make his recommendations which in turn is endorsed by the Joint Commissioner of Excise. Thereajier the application goes to Government and with the permission of the Government the Excise Co111111issio11er issues '2010 (5) sec 1s6 H 248 . SUPREME COURT REPORTS [2017] 3 S.C.R.

A the licence. 111 this case the initial denial of licence to the appellant was on account of the 111is1uke about the distance from the temple which 11 us wro11gly reported as within the prohibited distance. it is see11 1hu1 within one month of issuance of the first report 11wlll!~l' Ex1. P6 da1ed 2510812011 the Joint Excise Co1i1111issioner corrected the mistake on 221 B 0912011 vide Ext. P9 recommending appellant :S case for issuance of licence. Jf Ext. P6 was issued with cvrrect distance without committing a mistake and at least if the correct report namely Ext. P9 dated 2210912011 was ucted upon in time the appellant would huve got licence even before /he new policy c was introduced. Respondent hus not brought 10 the notice of ihis Court any other objection against enti1le111e11t of the appella11t for licence. We feel appellant ca1111ot be decli11ed licence on accou11t of 1he mistuke commilled by the Excise authorities in Exl. P6 report. Jn any case since by 221091 2011, correct report was submitted vide Ext. P9 we feel theD amended rule which came into force 011 0911212011 cannot be applied to appellanl. So much so, we hold that appellant is entitled to have their app/icutio11 ji11a/ly considered and dfaposed of by the G(1vernment and Excise Commissioner with reference to Rule 13 (3) as it stood prior to the a111end111e11t E introduced to it with e,ffect from 0911212011. According~v the Writ Appeal is allowed vacating the observation of the learned Single Judge in this regard and with a direction to the respondent to consider and pass orders on appellant :S application at the earliest."

F 11. In our view, the question as to what date should be reckoned as the date of consideration of licence has not been squarely dealt with in this decision. Indubitably, the processing of the application for grant oflicence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, G alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail. 12. ln the present case, the learned Single Judge has assumed the H STATE OF KERALA & ORS. v. MIS. PALAKKAD HERITAGE 249 HOTELS [A. M. KHANWILKAR, J.] date on which recommendation was made by the Excise Commissioner A i.e. 28'h March, 2012, as the relevant date. That assumption is untenable. For, that was not the date on which the final decision was taken by the competent authority. Whereas, before a final decision could be taken by the competent authority on the application submitted by the Respondent, the Foreign Liquor Rules were amended on I 81h April, 2012. The Bapplication submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on . this date.

13. A priori, no fault can be found with the State Authority for calling upon the Excise Commissioner to examine the proposal and submit chis fresh recommendation keeping in mind the amended provisions of the Foreign Liquor Rules. In other words, the appl icatio1i for grant of FL-11 licence submitted by the Respondent was required to be considered by the competent authority keeping in mind the amended provisions which came into force w.. e.f. 18"' April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his speaking D order dated S'h June, 2012, for invoking the restriction of distance of200 metres from the objectionable site. 14. Since the learned Single Judge of the High Cou11 proceeded to decide the writ petition filed by the Respondent merely by referring to the pronouncement of the Divis ion Bench of the same High Court in the E case of Kallada Hotels and Resorts (supra), coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18'" April, 2012 as void to the extent it has introduced the restriction of distance of200 meters from objectionable institutions for getting FL-11 licence, we deem it appropriate to relegate the parties before the Flearned Single Judge to decide the writ petition afresh, keeping .in mind the settled legal position.

15.Accordingly, we set aside the impugned judgment of the Division Bench dated 12'" August, 2014 in Writ Appeal No.950 of 2014 as also the judgment of the Single Judge in Writ Petition (c) No.14220of2012 dated 4'h February, 2014. Further, we remand the Writ Petition(C) G No.14220 of 2012 and restore it to the file of the Single Judge of the High Court of Kerala for being decided afresh on other issues in accordance with law. 1-1 250 SUPREME COURT REPORTS [2017) 3 S.C.R. A 16. The appeal is partly allowed in the above terms with no order as to costs. Kallpana K. Tripathy Appeal partly allowed.

[2017] 3 S.C.R. 239 STATE OF KERALA & ORS. A v. MIS. PALAKKAD HERITAGE HOTELS (Civil Appeal No. 5204of2017) APRIL 13, 2017 B [DIPAK MISRA AND A. M. KllANWILKAR, JJ,) ForeiJ?,11 Liquor Rules, 1974: Application for grant of Beer/Wine Bar FL-11 Licence - For its hotel which was 70 meters from the nearest objectionable c institution - Excise Commissioner recommended grant of sanction for the Licence as per the Rules '- While the said recommendation was pending 'consideralion, Liquor Rules amended on 181" April, 2012 prescribing the minimum distanceji-uin objectionable institution· as 200 meters - Jn view of the amendme/11 of the Rules, the application · 0was rejected - Writ pelition by the applicant cha/lengi11g the decisio11 as also the amendment of lhe Rules - Allowed by Single Judge of High Court holding that since the order sanctioning the grant of licence was prior to amendment, application could nol have been rejected on the basis of the amended Rules - Jn writ appeal as well as in Review, order of Single Judge was affirmed - On appeal, E held: Since the final decision as to grant of the Licence was taken after the Rule was amended, the applica1io11 was required to be considered keeping in view the amended provision - Matter remanded to the Single Judge of High Court to decide afresh on other issues. F

Partly allowing the appeal, the Court HELD: 1.1 The 1>rocessi11g of the apj>licalion for grant of licence commences from the dale of ap1>licalion. The final decision 011 the 1>roposal is re11uired to be taken by the State Government. The date 011 which a formal, final decisio11, is taken G by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail. [Para 11J[248-F-G] H 239 240 SUPREME COURT REPORTS [2017) 3 S.C.R.

A 1.2 In the present case, the Single Judge of High Court has assumed the date on which recommendation was made by the Excise Commissioner i.e. 28'h M3:rch, 2012, as the relevant date. That assumption is untenable. ]<or, that was not the date on which the final decision was t:tken by the competent authority. Whereas, before a final decision could be taken by the competent8 authority on the a1)plication submitted by the Respondent, the Foreign Liquor Rules were amended on 181h April, 2012. The ap1>lication submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on this date. [Para 12)1248-JI; 249-A-B] c 1.3 The a1)plication for grant of J<'L-11 licence submitted by the Respondent was required to be considered by the com11etent authority keeping in mind the amended provisions which came ·into force w.e.f. 18'h April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his D speaking order dated 5'h June, 2012, for invoking the restriction of distance of 200 metres from the objectionable site. [Para 13](249-C-D)

2. Since the Single Judge of the High Court proceeded to decide the writ petition filed by the Respondent merely by E referring to the pronouncement of the Division Bench of the same · High Court in the case of *Ka/hula /lo/els mu/ Resorts, coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18'h April, 2012 as void to the extent it has introduced the restriction of distance of 200 meters from objectionable institutions for getting J<'L-11 licence, it would be F appropriate to relegate the parties before the Single Judge to decide the writ petition afresh, keeping in mind the settled legal position. [Para 14)(249-E-F) *Kallada Hvlels and Resvrls vs. Slate of Kera/a 2012 (2) KLT 167; State vf Kera/a and Ors. v. MP. Shiju G 2014 (2) KUC 343 (DB); The Kera/a Bar Hotels Associalion & Am: V. State of Kera/a & Ors. [2015] SCR 256: AIR 2016 SC 163 - referred to. State of Keralp & Am: v. B.6 Holidays Resorts Pvt. Lid. [20101 3 SCR 1 : 2010 (5) sec 186 - distinguished. H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 241 HOTELS Case J,aw Reference A 2012(2) KLT 167 . referred to Para4 2014 (2) KBC 343 (Dll) referred to Para6 [2015) SCR 256 referred to Para7 [2010) 3 SCR 1 distinguished Para 10 B CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5204 of2017. From the Judgment and Order dated 12.08.2014 of the High Court of Kerala at Ernakulam in W. A. No. 950 of 2014. c.

G. Prakash, Jishnu M. L., Mrs. Priyanka Prakash, Mrs. Beena Prakash, Manu Srinath, Ad vs., for the Appellant. Romy Chacko, Shubham Singh, Varun Mudgal, S. C. Jaidwal, Advs., for the Respondents.

D The Judgment of the Court was delivered by A. M. KllANWILKAR, J. 1. The Respondent constructed a hotel which has been classified as Heritage (Basic) Category for five years (w.e.f. I" March, 2012 till 28'h February, 2017). The Respondent submitted an application for grant of a Beer/Wine Bar FL-11 Licence Eunder the Foreign Liquor Rules. That application was processed by the Deputy Commissioner of Excise, Palakkad. On the basis of the report submitted by the said authority, the Excise Commissioner of Thiruvananthapuram forwarded his recommendation to the· Secretary to Government Taxes Department, Government of Kera la, vide a letter dated 28'h March, 2012. The Excise Commissioner duly recommended F grant of sanction fo.r FL-11 Licens'e to the Respondent as per the rules. While the said recommendation was pending consideration before the State Government, the Foreign Liquor Rules came to be amended on l 8'h April, 2012. The amendment inter alia prescribes the minimum distance of 200 metres from an objectionable institution. The report Gsubmitted by the Deputy Commissioner· of Excise records the distance between the gate of the hotel of the Respondent and the nearest objectionable institution (being Sree Bhagwati Ayappa Temple, Karuvannurthara) as 70 metres only. Consequent to the amendment to the Foreign Liquor Rules, the Government vide letter No. 8028/A2/2012/ H 242 SUPREME COURT REPORTS [2017] 3 S.C.R.

A TD dated 261h April, 2012, called upon the Excise Com1i1issioner, Thiruvananthapuram to examine the proposal of the Respondent. The Excise Commissioner, by a speaking order passed on 5'" Jm1e, 2012, came to the conclusion that the application submitted by the Respondent deserved to be rejected and directed it to be returned to the Deputy Commissioner of Excise, Palakkad.B 2. For answering the controversy at hand, we deem it apposite to reproduce the said communication in its entirety: ''PROCEEDINGS OF THE EXCISE COMMISSIONER. KERA LA c THIRUVANANTHAPURAM (Present: Sri. A. Ajith Kumur IAS) Sub:- Excise- Abkari-Application for FLcJJ licence to Palkkad HeritageHotels, Koduvayo01; Palakkad rejected -orders issued. D Read:- (1) Govt. Letter No. 8028/A2/2012/TD dated 261041 2012 (2) Letter No: CZ3-577/12 duted 19.03.2012 of the Joint Excise Co111missio11er, Central Zone, Emakulam. (3) Letter No. P-6-1611112 dated 16103112 & 2110312012 E of Deputy Co111missioner of Excise, Palakkad. (4) Application dated 0110312012 of Sri. MJ. Thomas (5) GO (Ms) No. 107111/TD dated 17108111

(6) GO (P) No. 7212012/TD dated 18104112 F ORDER NO. XC6-7476/12/K. Dis Dated 05.06.2012 The Joint Excise Co111missio11er, Central Zone, Emakulam has forwarded, vide letter read as ]" above, an application submitted by Sri. M J. Tho111as, Managing Partner. Mis Palakad Heritage Hotels, Eroor P 0. Ernakula11.1 requesting G sanction for FL-JI licence in his name to the Palakkad · Heritage Hotels, Koduvayo01; Palakkad having a valid heritage basic category classification certificate vide order No. 27/HRACC (08)12011 dated 09.03.2012 ofthe Member Secretary (HRACC) Ministry of Tourism, Government of India, H STATE OF KERALA & ORS. v. MIS. PALAKKAD HERITAGE 243 HOTELS [A. M. Kl-IANWILKAR, J.) Chen11ai. The hotel is situated in Re. Sy. No. 67318-1 A Koduvciyoor Village in Chillur Taluk bearing door No. XII 324 of Koduvayoor Grama Panchayat in Palakkad District. The Deputy Co111111isisonerof Excise, Palakkad has reported that the nearest o~jectionable institution is the Sree Bhagavathy Ayyappu Temple, Karuvammrthara which is 70 B meters mwy fi'om the gate 1if t/Je hotel.

Before the amendment made ride Government order read as 6'" above, as per rule 13 (3) of Forensic Liquor Rules, there was a restriction that no FL-3 licence shull be issued to hotels which· are locateij within 200 meters fi'om objectionable site c (educational i11stitutio11; temple. church, mosque (Jr burial ground, schedule caste/schedule tribe colony )but those hotels other than in the privute sector hai·i11g fow; five stm; five star deluxe classification will be exempted from the distance · restrictions in the interest of promotion of tourism and a/so in D the case of hotels iii private sector of above categories and hotels having heritage, heritage grand and heritage classic classijicatio11 is issued by Minisliy <~l Tourism, Government of India, the distance limit was only 50 meters from objectionable site .. Vide Govemment order read as 6'" above, the said rule is modified by deleting the exemption of distance restrictions in t/Je rnse 1~f hotels in private sector of above categories, thereby at present tile distance limit to those hotels in private sector of abore categories, thereby at present the distance limit of those hotel:> in private sector of all categories lrom the objectionable site is 200 meters. F

In the above circumstances a11d us reported by the Joint Excise Commissioner, Central Zone, Executive and Deputy Co111111issio11er of Excise, Palakkud and since the nearest objectionable institution viz. the Sree Blwgavathy Ayyappa Temple, Kanvamwrthara is located only 70 metres away from G the gate of the hotel the application read as 4'" above is hereby rejected and returned to the Deputy Commissioner of Excise, Palakkad. Sdl- Excise Commissioner" 1-1 • 244 SUPREME COURT REPORTS [2017] 3 S.C .R. A 3. Against this decision, the Respondent filed a writ petition before the High CourtofKerala, being Writ Petitioi1 (C) No.14220 of2012 for the following reliefs: · "i) call for the records leading to Ext. P7 and quash the same by issuing_ a. writ of certiorari or other appropriate writ, · B order or'ilirection; ii) declare that petitioner is entitled to get an FL-11 licence as· per Ext. P-2 application. iii) Declare that Ext. P6 amendment to !he extent it introduce distance of 200 meters from objectionable institutions for c getting FL-11 license is discriminalory and without any basis; iv) Declare thul if the hotels located within 200 meters from objectionable institutions are permitted to conduct the licenses, the petilioner is also entitled to ge1 license as per . D Ext. P2 application;

v) Issue a writ of mandamus or other appropriate writ, order or direction commanding the respondelll 1 to 5 to issue an FL-11 license·1111der Rule 13 (J!) of the Foreign Liquor Rules, beer/wine parlour license, vide Ext. P-2 application E on the basis of the rule/law prevailed 011 the date of Ext. · P-5 (28.3.2012); vi) Issue a writ of mandamus or other appropriate writ, order or direction co1111111mding the respondents 1 to 5 not to renew FL-3 and FL-11 licenses, which are conducting F within 200 meters from the objectionable institutions, if the petitioner is denied FL-11 license; and vii) Grant such other and further relief as this Hon 'ble Court ·may deem fit and proper in the inlerest of justice. " 4. The learned Single Judge of the High Court vide Judgment G 111 dated 4 February, 2014, allowed the said writ petition on the finding that the Excise Commissioner had issued an order in favour of the Respondent (writ petitioner) on 281h March, 2012, sanctioning FL-I I licence. The Single Judge then placed reliance on the decision of the Division Bench of the same High Court in the case of Kt11ltult1 Hotels H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 245 HOTELS [A. M. KHANWILKAR, J.]

amt Resorts vs. State 1Jf Kera/a', wherein it was held that the law to be A applied for consideration of the application submitted by the Respondent for grant of licence must be as on the date on which the Excise ·Commissioner made recommendation for grant of licence to the Respondent, as was in force on that date. The appellant herein had pointed out to the learned Single Judge that the said decision was B challenged before this Court by the Government and the same was pending. The learned Single Judge, however, rejected that contention as follows: "6. However, ad111i1tedly. as per the decisions ofthis Court. ·· which stand 11ol1\ when the Excise Commissioner recommends ·c · the application for grant of licence on the basis of a Rule in force on that date, subsequent a111e11d111e11t should not be relied on to assail the same. Viewed in that pro.file, the petitioner is entitled to get the relief as sougl1t j(1r in this writ petition. Therefore, the writ petition is allowed. D Ext. P7 is quashed and respondents I to 5 are directed to issue FL-11 licence to the petitioner under Rule 13(11) of the Foreign Liquor Rules. beer/wine parlour licence vide Ext. P2 applicati.011 on the basis of rule/law prevailed on the date of Ext. P5, i.e., 28.03.2012. E This exercise shall be completed wi1hi11 a period of three months from today. "

· 5. Against this decision, the appellant filed a Writ Appeal being No.950of2014 before the Division Bench of the High Court. The same has been dismissed on 12'h August, 2014, in the following ternis: F "l. Heard the learned Senior Gover11111en1 Pleader and the learned counsel appearing ji>r the respondent/writ petitioner. 2. The impugned judgment has been rendered by a learned Single Judge re(ying 011 1/ie decision of a Division Bench in Ka//(u/" llotel~ ""ti Rt'.mrl.~ 1' State of Kera/a [2012(2) KLT G 167]. That decision notwi1hsta11ding, the fact of the matter remains that even as per the later bench decision in Sttile ti( Kera/a mu/ Others " Jl,f. R Sliiju [201./(2) K.HC 343 {DB)}, the respo11de111/writ petitioner is entitled to succeed, in view I 2012(2) KJ..,T 167 H 246 SUPREME COURT REPORTS [2017] 3 S.C.R. A of the fact that the law has been succinctly slated to the effect that the eligibility has to be considered applying the law as on the date of consideration of the matter by the Excise Commissioner. This being, pointedly, the legal issue involved in this writ appeal, the question raised has, necessarily. to be answered against the State. This appeal, therefore, fails. B In the result, this writ appeal is dismissed No costs."

6. The later decision adve11ed to by the Division Bench in the case of M.P. Sbiju (supra), was challenged by the State Government before this Court by way of SLP(C) No.25780 of 2014. The same was c disposed of on 22"d .July, 2016 in the following terms: "ORDER Learned counsel for the parties are agreed that this petition has become i11ji·ucwous in view of lhe position rendered to this Court in Civil Appeal No. 4157 of 2015. titled as The D Kera/a bar Hotels Association & Anr. V. State of Kera/a & Ors. decided on 29.12.2015. The special leave petition is accordingly disposed of as i11.fructuous. "

7. Sii1ce the said relied upon decision in MP Shiju's case has E been affirmed by this Court, even this appeal must follow the same suit. However, the said SLP has been disposed of by this court on the basis of concession made by the counsel for the parties - that it had become infructuous in view of the judgment of this Court in the case of The . Kertila Bar Hotels Associt1lio11 & Anr. V. !;'lute of Kert1lt1 & Ors2• F · 8. On a bare perusal of the decision in the Kerala liar Hotels Association (supra), it is seen that the question examined by this Com1 was whether the policy to ban the consumption of alcohol in public or exception carved out to the pol icy in favour ofFive Star Hotels violates the rights of the Hotels of Four Star and below classification under G Articles 14 and 19. The other decision considered by the High Court for allowing the writ petition filed by the Respondent is the case of Kallada llotel.s & Resorts (supra).· The correctness of the decision of the Division Bench of the High Court was not in issue before this Court in the case of Kerala Bar Hotels Association (supra). 2 AIR 2016 SC 163 H STATE OF KERALA & ORS. v. M/S. PALAKKAD HERITAGE 247 HOTELS (A. M. Kl-IANWILKAR, J.] 9. Indeed, the decision of the Division Bench in Kallada Hotels A & Resorts (supra) has been aftirmed by this Court by dismissal of SLP(C) No: 18392 of2012 on 20'h June, 2012 in the following terms: "ORDER B Heard Mr. Ramesh Babu M.R., learned counsel for the petitioners.

In the facts and circumstances of the case, we are not inclined to interfere with the impugned judgment. The Special Leave Petition is, according/y, dismissed. c Question of law is kept open. " Even the review petition filed by the State against the said decision, being Review Pt:tition(C) No.1409 of 2012, came to. be dismissed on I 41h August, 2012. I 0. What is relevant to note is that, in the case of Kallada Hotels D & Resorts (supra), the Division Bench of the High Court hadadve11ed to the decision of this Cou11 in the case of State of Kerala & Am~ v. · B.6 Holidays Resorts Pvt. Lld.3, wherein it has been held that a1i application for grant of liquor licence has to be considered with reference to the rules/law prevailing or in force on the date of consideration of E application by the Excise Authorities and not with reference to the law · as on the date of the application. After noticing the decision of this Court, the Division Bench on the facts of the case before it allowed the Writ Appeal. It will be u·seful to advert to the relevant portion of the Division Bench decision:

F •·4, ~ ......................................... ··' .................. Going by the judgment of the Hon 'ble Supreme Court the la11i applicable is the law that is in force when the Excise authorities at various. levels consider an application for FLJ licence, as is evidenced by the records produced in this case, the application submitted before the Excise Commissioner goes for enquiry to the G Deputy Commissioner who make his recommendations which in turn is endorsed by the Joint Commissioner of Excise. Thereajier the application goes to Government and with the permission of the Government the Excise Co111111issio11er issues '2010 (5) sec 1s6 H 248 . SUPREME COURT REPORTS [2017] 3 S.C.R.

A the licence. 111 this case the initial denial of licence to the appellant was on account of the 111is1uke about the distance from the temple which 11 us wro11gly reported as within the prohibited distance. it is see11 1hu1 within one month of issuance of the first report 11wlll!~l' Ex1. P6 da1ed 2510812011 the Joint Excise Co1i1111issioner corrected the mistake on 221 B 0912011 vide Ext. P9 recommending appellant :S case for issuance of licence. Jf Ext. P6 was issued with cvrrect distance without committing a mistake and at least if the correct report namely Ext. P9 dated 2210912011 was ucted upon in time the appellant would huve got licence even before /he new policy c was introduced. Respondent hus not brought 10 the notice of ihis Court any other objection against enti1le111e11t of the appella11t for licence. We feel appellant ca1111ot be decli11ed licence on accou11t of 1he mistuke commilled by the Excise authorities in Exl. P6 report. Jn any case since by 221091 2011, correct report was submitted vide Ext. P9 we feel theD amended rule which came into force 011 0911212011 cannot be applied to appellanl. So much so, we hold that appellant is entitled to have their app/icutio11 ji11a/ly considered and dfaposed of by the G(1vernment and Excise Commissioner with reference to Rule 13 (3) as it stood prior to the a111end111e11t E introduced to it with e,ffect from 0911212011. According~v the Writ Appeal is allowed vacating the observation of the learned Single Judge in this regard and with a direction to the respondent to consider and pass orders on appellant :S application at the earliest."

F 11. In our view, the question as to what date should be reckoned as the date of consideration of licence has not been squarely dealt with in this decision. Indubitably, the processing of the application for grant oflicence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, G alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail. 12. ln the present case, the learned Single Judge has assumed the H STATE OF KERALA & ORS. v. MIS. PALAKKAD HERITAGE 249 HOTELS [A. M. KHANWILKAR, J.] date on which recommendation was made by the Excise Commissioner A i.e. 28'h March, 2012, as the relevant date. That assumption is untenable. For, that was not the date on which the final decision was taken by the competent authority. Whereas, before a final decision could be taken by the competent authority on the application submitted by the Respondent, the Foreign Liquor Rules were amended on I 81h April, 2012. The Bapplication submitted by the Respondent for grant of licence, unquestionably, must be treated as pending and under consideration on . this date.

13. A priori, no fault can be found with the State Authority for calling upon the Excise Commissioner to examine the proposal and submit chis fresh recommendation keeping in mind the amended provisions of the Foreign Liquor Rules. In other words, the appl icatio1i for grant of FL-11 licence submitted by the Respondent was required to be considered by the competent authority keeping in mind the amended provisions which came into force w.. e.f. 18"' April, 2012. That is precisely what has been done by the Excise Commissioner, as can be discerned from his speaking D order dated S'h June, 2012, for invoking the restriction of distance of200 metres from the objectionable site. 14. Since the learned Single Judge of the High Cou11 proceeded to decide the writ petition filed by the Respondent merely by referring to the pronouncement of the Divis ion Bench of the same High Court in the E case of Kallada Hotels and Resorts (supra), coupled with the fact that the Respondent had asked for a wider relief to declare the amendment of 18'" April, 2012 as void to the extent it has introduced the restriction of distance of200 meters from objectionable institutions for getting FL-11 licence, we deem it appropriate to relegate the parties before the Flearned Single Judge to decide the writ petition afresh, keeping .in mind the settled legal position.

15.Accordingly, we set aside the impugned judgment of the Division Bench dated 12'" August, 2014 in Writ Appeal No.950 of 2014 as also the judgment of the Single Judge in Writ Petition (c) No.14220of2012 dated 4'h February, 2014. Further, we remand the Writ Petition(C) G No.14220 of 2012 and restore it to the file of the Single Judge of the High Court of Kerala for being decided afresh on other issues in accordance with law. 1-1 250 SUPREME COURT REPORTS [2017) 3 S.C.R. A 16. The appeal is partly allowed in the above terms with no order as to costs. Kallpana K. Tripathy Appeal partly allowed.