High Court of KeralaSingle Judge2014-12-09Writ petition allowed; directions to consider t...

Hotel Midhuna International v. State of Kerala and Others

Case / Petition Number:WP(C).No. 29380 of 2014 (V)

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: K. Surendra Mohan
Judgment Date: 2014-12-09
Court Decision / Holding: Writ petition allowed. The Excise Commissioner and the State of Kerala are directed to accept the FL-3 licence application submitted by the petitioner, provided he has a subsisting Four Star classification, and to consider it in accordance with law, passing appropriate orders expeditiously and within two months from today, subject to meeting all other eligibility conditions.
Final Disposition: Writ petition allowed; directions to consider the FL-3 licence application within two months subject to eligibility and continued Four Star classification.

Parties to the Case

Appellants / Petitioners

Hotel Midhuna International, Enathu, M.C Road, Pathanamthitta

Respondents

State of Kerala
Secretary, Taxes (G) Department, Government Secretariat, Thiruvananthapuram
The Excise Commissioner, Commissionerate of Excise, Thiruvananthapuram

Legal Representation & Advocates

Counsels for Petitioners

• Sri. Dinesh R. Shenoy
• Smt. K.K. Jyothilakshmy
• Sri. Sanil Jose
• Smt. S. Soumya Isaac

Case Synopsis & Summary

Hotel Midhuna International, Enathu, Pathanamthitta, a Four Star hotel classified by the Ministry of Tourism, sought an FL-3 liquor licence under the Abkari Act, 1077 and Foreign Liquor Rules. The petitioner contends that he fulfils all eligibility criteria and should not be barred by the Abkari Policy 2014-2015, which excludes Four Star and Heritage hotels from obtaining FL-3 licences. The State and the Excise Department argued that licensing is governed by the policy, and the exclusion is valid, whereas the Division Bench in Xavier’s Residency v. State of Kerala (2014) had already held that excluding Four Star hotels is arbitrary and violative of Article 14, directing reconsideration of the policy in that respect. The High Court, applying the Xaviers Residency principle, held that Four Star hotels are eligible to seek FL-3 licences, provided they meet all other prerequisites. The court directed the Excise Commissioner and the State to accept the petitioner’s FL-3 application and to consider it in accordance with law, subject to the hotel maintaining subsisting Four Star classification, and to pass orders expeditiously within two months. The judgment also acknowledges and corrects certain statements in the prior order. Overall, the decision aligns with the Xaviers Residency precedent and clarifies eligibility for Four Star hotels under the Abkari Policy 2014-2015.

Provisions of Law Cited

Abkari Act, 1077Foreign Liquor RulesAbkari Policy 2014-2015Article 14 of the Constitution of IndiaG.O.(MS) No.56/2014/TDG.O.(P).No.141/2014/TDSection 25 of the Payment and Settlement Systems Act, 2007FSS Act 2006

Legal Doctrines & Maxims

Arbitrary classification under Article 14 of the Constitution of India (violation of equality before law)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends that a Four Star hotel classified by the Ministry of Tourism satisfies all eligibility criteria under the Abkari Act, 1077 and Foreign Liquor Rules for FL-3 licences. Despite meeting prerequisites and holding necessary licenses, his FL-3 application was rejected solely due to the Abkari Policy 2014-2015 which excludes Four Star and Heritage hotels. He relies on Xavier’s Residency v. State of Kerala (2014) where the court held that exclusion of Four Star hotels is arbitrary and violates Article 14, urging the policy to be interpreted or modified to permit consideration of his application on its merits.

Contentions of Respondents

The State and Excise Department counter that licensing follows the Abkari Policy 2014-2015, which excludes certain categories; the policy governs licensing and cannot be overridden by this petition. They contend that Four Star hotels should be treated in line with policy and that disposition of this application should await final orders in related appeals.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Xaviers Residency v. State of Kerala	2014(4) KLT 419	Positive	The court relied on Xavier's Residency to hold that excluding Four Star hotels from FL-3 licences is arbitrary and violates Article 14, thereby permitting the petitioner to pursue FL-3 licensing.

Diagnostic Tool

Beta

Does this judgment govern your specific facts?

Don't risk relying on a distinguishable precedent. Enter your facts or proposition below. We will test it against Hotel Midhuna International v. State of Kerala and Others and instantly map out authorities that support, challenge, or govern your position.

Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** ## **THE HONOURABLE MR.JUSTICE K.SURENDRA MOHAN** **TUESDAY, THE 9TH DAY OF DECEMBER 2014/18TH AGRAHAYANA, 1936** ## **WP(C).No. 29380 of 2014 (V)** **----------------------------** ## **PETITIONER:** - **-------------------** **HOTEL MIDHUNA INTERNATIONAL, ENATHU, M.C.ROAD, PATHANAMTHITTA - 681 526, REP. BY ITS PROPRIETOR S.SANTHOSH.** **BY ADVS.SRI.DINESH R.SHENOY SMT.K.K.JYOTHILAKSHMY SRI.SANIL JOSE SMT.S.SOUMYA ISSAC** **RESPONDENT(S): --------------------------** ## **1. STATE OF KERALA,** - **REP. BY THE SECRETARY TO GOVERNMENT, DEPARTMENT OF TOURISM, PARK VIEW, THIRUVANANTHAPURAM - 695 033.** **2. THE SECRETARY, TAXES (G) DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM, PIN - 695 001.** **3. THE EXCISE COMMISSIONER, COMMISSIONERATE OF EXCISE, THIRUVANANTHAPURAM - 695 001.** **BY GOVERNMENT PLEADER** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 09-12-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **mbr/** ## **WP(C).No. 29380 of 2014 (V)** ## **---------------------------------------** ## **APPENDIX** **PETITIONER(S)' EXHIBITS: -------------------------------------** - **EXT.P-1: TRUE PHOTOCOPY OF RESTAURANT APPROVAL ORDER DATED 31.3.2000 ISSUED BY THE REGIONAL DIRECTOR, GOVERNMENT OF INDIA, TOURISM OFFICE.** - **EXT.P-2: TRUE PHOTOCOPY OF LICENSE NO.PTA/16/2002-03 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT DATED 25.2.2003, PERIODICALLY RENEWED UPTO 31.3.2014.** - **EXT.P-3: TRUE PHOTOCOPY OF CERTIFICATE DATED 16.5.2008 ISSUED BY THE DIRECTOR, DEPARTMENT OF TOURISM, GOVERNMENT OF KERALA.** - **EXT.P-4: TRUE PHOTOCOPY OF BUILDING PERMIT DATED 24.11.2011 ISSUED BY THE SECRETARY, EZHAMKULAM GRAMA PANCHAYATH.** - **EXT.P-5: TRUE PHOTOCOPY OF ORDER DATED 24.12.2011 ISSUED BY THE 3RD RESPONDENT.** - **EXT.P-6: TRUE PHOTOCOPY OF LETTER DATED 19.7.2012 ISSUED BY THE 3RD RESPONDENT.** - **EXT.P-7: TRUE PHOTOCOPY OF THE PROCEEDINGS OF THE 3RD RESPONDENT DATED 25.8.2012.** - **EXT.P-8: TRUE PHOTOCOPY OF THE PROCEEDINGS OF THE 3RD RESPONDENT DATED 23.10.2013.** - **EXT.P-9: TRUE PHOTOCOPY OF THE G.O(MS) NO.56/2014/TD DATED 2.4.2014. EXT.P-10: TRUE PHOTOCOPY OF PROCEEDINGS OF THE DIRECTOR, DEPARTMENT OF TOURISM, THIRUVANANTHAPURAM DATED 11.4.2014.** - **EXT.P-11: TRUE PHOTOCOPY OF LETTER DATED 11.4.2014 ISSUED BY THE DIRECTOR, DEPARTMENT OF TOURISM.** - **EXT.P-12: TRUE PHOTOCOPY OF CERTIFICATE DATED 11.4.2014 ISSUED BY THE DIRECTOR, DEPARTMENT OF TOURISM, GOVERNMENT OF KERALA.** - **EXT.P-13: TRUE PHOTOCOPY OF APPLICATION DATED 16.4.2014 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **EXT.P-14: TRUE PHOTOCOPY OF CONSENT TO OPERATE ISSUED TO THE PETITIONER BY THE KERALA STATE POLLUTION CONTROL BOARD DATED 10.6.2014.** - **EXT.P-15: TRUE PHOTOCOPY OF LICENSE ISSUED BY THE EZHAMKULAM GRAMA PANCHAYATH DATED 4.4.2014.** **--2--** **WP(C).No. 29380 of 2014 (V)** ## **--2--** **---------------------------------------** |**EXT.P-16:**|**TRUE PHOTOCOPY OF LICENSE UNDER THE FSS ACT 2006 ISSUED TO**| |---|---| ||**THE PETITIONER FOR BAR ATTACHED HOTEL RENEWED UPTO**| ||**31.3.2016.**| |**EXT.P-17:**|**TRUE PHOTOCOPY OF SANITATION CERTIFICATE DATED 2.4.2014**| ||**ISSUED BYTHE HEALTH INSPECTOR, PRIMARY HEALTH CENTRE,**| ||**EZHAMKULAM.**| |**EXT.P-18:**|**TRUE PHOTOCOPY OF OCCUPANCY CERTIFICATE 29.3.2014 ISSUED**| ||**BY THE SECRETARY, EZHAMKULAM GRAMA PANCHAYATH.**| |**EXT.P-19:**|**PHOTOGRAPHS 10 IN NUMBERS.**| |**EXT.P-20:**|**TRUE PHOTOCOPY OF THE COMMON ORDER DATED 14.8.2014**| ||**PASSED BY THIS HONOURABLE COURT IN W.A.NO.1122/2014 AND**| ||**CONNECTED WRIT APPEALS.**| |**EXT.P-21:**|**TRUE PHOTOCOPY OF THE G.O(MS) NO.139/2014 TD DATED 22.8.2014**| ||**ISSUED BY THE GOVERNMENT OF KERALA.**| |**EXT.P-22:**|**TRUE PHOTOCOPY OF NOTICE DATED 27.8.2014 ISSUED BY TH**| ||**3RD RESPONDENT.**| |**EXT.P-23:**|**TRUE PHOTOCOPY OF GAZETTE NOTIFICATION DATED 27.8.2014**| ||**G.O(P).NO.141/2014/TD.**| |**EXT.P-24:**|**TRUE PHOTOCOPY OF NOTICE DATED 27.8.2014 ISSUED BY THE**| ||**3RD RESPONDENT.**| |**EXT.P-25:**|**TRUE PHOTOCOPY OF LETTER DATED 28.8.2014 ISSUED BY THE**| ||**INDIAN OVERSEAS BANK TO THE PETITIONER.**| |**EXT.P-26:**|**TRUE PHOTOCOPY OF LETTER DATED 28.8.2014 ISSUED BY THE**| ||**INDIAN OVERSEAS BANK TO THE PETITIONER.**| |**EXT.P-27:**|**TRUE PHOTOCOPY OF THE NOTICE DATED 16.10.2014 ISSUED TO THE**| ||**PETITIONER UNDER SECTION 25 OF THE PAYMENT AND SETTLEMENT**| ||**SYSTEMS ACT 2007.**| |**EXT.P-28:**|**TRUE PHOTOCOPY OF INTERIM ORDER 31.10.2014 PASSED IN**| ||**WA NO.1563/2014 (ARISING FROM WP 24109/2014), HIGH COURT OF**| ||**KERALA.**| |**RESPONDENT(S)' EXHIBITS:**<br>**-**<br>**NIL**|| |**---------------------------------------**|| **/TRUE COPY/** **mbr/** **P.S. TO JUDGE** ## **K.SURENDRA MOHAN, J. --------------------------------------------W.P.(C) No.29380 of 2014-V ---------------------------------------------Dated this the 9[th] day of December, 2014** ## **J U D G M E N T** The petitioner is the proprietor of a hotel with Four Star classification issued by the Ministry of Tourism, Government of India. He has not been granted licence to conduct a Bar for the reason that, Four Star hotels are not eligible to apply for the grant of Bar licences as per the Abkari Policy, 2014-2015 of the State. Though the petitioner had tried to submit an application for the grant of a Bar licence (FL-3 licence), his application was not accepted in view of the Abkari Policy 2014-15. 2. As already noticed above, the petitioner is conducting a hotel classified as Four Star by the Ministry of Tourism, Government of India. He has obtained all the other necessary certificates from the concerned authorities and has acquired eligibility for the grant of an FL-3 licence. It is his contention that, he satisfies all the necessary -:2:- ## W.P.(C) No.29380 of 2014-V conditions and parameters stipulated by the Abkari Act,1077 as well as the Foreign Liquor Rules, for the purpose of being granted the privilege of conducting a Bar in his hotel. His application has not been accepted or considered for the sole reason that, he has been held to be ineligible to apply for such licences by the Abkari Policy, 2014-2015. The counsel places reliance on the decision in **Xaviers Residency v. State of Kerala [2014(4) KLT 419]** where a batch of writ petitions challenging the Abkari Policy 2014-2015 were disposed of with the following directions:- “In the result, it is ordered as follows:- 1. The challenge against the Abkari Policy 2014-2015, by the hotels classified as two star, three star and by hotels having no classification fails. The writ petitions filed by them are therefore dismissed. 2) The Abkari Policy 2014-2015, to the extent, it excludes hotels having Four Star and Heritage category hotels from the eligibility to be granted FL-3 licences under the Foreign Liquor Rules is set aside, being arbitrary and violative of Art.14 of the Constitution. The consequential amendments to the Foreign Liquor ## -:3:- ## W.P.(C) No.29380 of 2014-V Rules as well as the proceedings of the Excise Commissioner cancelling the licences of such hotels are also set aside. The writ petitions filed by them are allowed as above. 3) The Abkari Policy 2014-2015 is sustained in all other respects, except to the extent indicated above.” Appeals have been filed against the said judgment by the State as well as petitioners in the said writ petitions. All the appeals are pending consideration of the Division Bench. It is submitted by Shri. Dinesh R.Shenoy, the learned Counsel who appears for the petitioner that though the appeal of the State has been admitted, the prayer for stay of operation of the judgment has been declined by the Division Bench, after hearing. Therefore, according to the counsel for the petitioner, the petitioner herein is entitled to the benefit of the dictum in the judgment referred to above. In view of the above, he seeks the issue of a direction to the State as well as the Excise Commissioner to accept his applications and to consider the same in accordance with law, within a stipulated time. ## -:4:- ## W.P.(C) No.29380 of 2014-V 3. I have heard the counsel appearing for the petitioner as well as the learned Government Pleader who represents the State. 4. In view of the dictum laid down by the judgment in **Xaviers Residency v. State of Kerala (supra)** that exclusion of Four Star hotels from the category of hotels eligible to seek the issue of FL-3 licences by the Abkari Policy 2014-2015 is bad, the petitioner is justified in his contentions. The petitioner is certainly entitled to seek the benefit of the dictum laid down by this Court, the operative portion of which I have already extracted above. In the light of the finding that hotels with Four Star classification are also eligible to be granted FL-3 licences, it is only appropriate that the application submitted by the petitioner herein is accepted by the Excise Authorities and considered in accordance with law. In view of the above, this writ petition is allowed. The Excise Commissioner as well as the State of Kerala are -:5:- ## W.P.(C) No.29380 of 2014-V directed to accept the application for FL-3 licence submitted by the petitioner in this writ petition provided, he has a subsisting Four Star classification, subject to his satisfying all other prescribed conditions of eligibility. The application shall be considered and appropriate orders shall be passed thereon in accordance with law, as expeditiously as possible and at any rate, within a period of two months from today. ## **Sd/K.SURENDRA MOHAN, JUDGE** kkj The first sentence in the judgment is corrected and substituted as follows, “The petitioner is the proprietor of a hotel from which, he is conducting a restaurant that has been classified as a Four Star restaurant by the Department of Tourism, Government of Kerala.” The first sentence in paragraph 2 of the judgment is corrected and substituted as follows: “As already noticed above, the petitioner is conducting a hotel which is a restaurant that has been classified as Four star by the Department of Tourism, Government of Kerala.” Vide order dated 20.1.2015 in I.A.No.541/2015 in W.P.(C) No.29380/2014: Sd/Registrar (Judicial)