St. Mary's Hotels Private Limited and T.O. Aleyas v. Commissioner of Excise, Thiruvananthapuram and Deputy Excise Commissioner, Kottayam

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** # **MONDAY, THE 17TH DAY OF JULY 2017/26TH ASHADHA, 1939** ## **WP(C).No. 22133 of 2017 (N)** **-------------------------------------------** **PETITIONER(S) : -------------------------** **1. ST. MARYS HOTELS PRIVATE LIMITED, ST.MARYS GROUP TOWERS, MUTHOOR P.O., THIRUVALLA - 689 107, REPRESENTED BY ITS MANAGING DIRECTOR, MR. T.O. ALEYAS.** **2. T.O. ALEYAS, THOTTATHIL HOUSE, MUTHOOR P.O., THIRUVALLA - 689 107.** **BY SRI.JOSEPH KODIANTHARA (SENIOR ADVOCATE) ADVS. SRI.V.ABRAHAM MARKOS** **SRI.ABRAHAM JOSEPH MARKOS SRI.ISAAC THOMAS SRI.HARAN THOMAS GEORGE** **RESPONDENT(S) :** - **----------------------------** **1. THE COMMISSIONER OF EXCISE, THIRUVANANTHAPURAM - 695 001.** **2. DEPUTY EXCISE COMMISSIONER, EXCISE DIVISION OFFICE, KOTTAYAM - 686 001.** ## **BY SR. GOVERNMENT PLEADER SRI. V.MANU** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17-07-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** Msd. **WP(C).No. 22133 of 2017 (N) ------------------------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS :** **EXHIBIT P1 TRUE COPY OF FL3 LICENSE NO. KT/53/2001-02 DATED 12.04.2001.** **EXHIBIT P2 TRUE COPY OF 4-STAR CLASSIFICATION LICENSE ISSUED BY THE TOURISM DEPARTMENT DATED 18.09.2015.** - **EXHIBIT P3 (A) TRUE COPY OF THE CERTIFICATE DATED 24.05.2014 ISSUED BY THE VILLAGE OFFICE, NATTAKOM, KOTTAYAM.** - **EXHIBIT P3 (B) TRUE COPY OF THE CERTIFICATE DATED 24.05.2014 ISSUED BY THE KOTTAYAM MUNICIPALITY.** - **EXHIBIT P3 (C) TRUE COPY OF CERTIFICATE DATED 21.07.2014 ISSUED BY THE MUNICIPAL CHAIRMAN, KOTTAYAM MUNICIPALITY.** - **EXHIBIT P4 TRUE COPY OF FL 11 LICENSE.** - **EXHIBIT P5 TRUE COPY OF JUDGMENT DATED 08.06.2017 OF THIS HONOURABLE COURT IN W.P.(C) NO. 18002/2017.** - **EXHIBIT P6 TRUE COPY OF THE COMMUNICATION DATED 23.06.2017 ISSUED BY THE 1ST RESPONDENT TO THE 2ND RESPONDENT.** - **EXHIBIT P7 TRUE COPY OF SITE VERIFICATION APPLICATION DATED 23.06.2017 ALONG WITH SITE PLAN OF THE LICENSED PREMISES.** - **EXHIBIT P8 TRUE COPY OF THE COMMUNICATION DATED 28.06.2017 ISSUED BY THE 2ND RESPONDENT.** - **EXHIBIT P9 TRUE COPY OF THE PETITION DATED 28.06.2017 ADDRESSED TO THE 2ND RESPONDENT.** - **EXHIBIT P10 TRUE COPY OF LETTER NO. KR.5/2017 DATED 10.07.2017 ISSUED BY THE EXCISE INSPECTOR, EXCISE RANGE OFFICE, KOTTAYAM TO THE EXCISE DEPUTY COMMISSIONER KOTTAYAM (ALONG WITH ENGLISH TRANSLATION).** ## **RESPONDENT(S)' EXHIBITS & ANNEXURES :** **ANNEXURE R2(A): A TRUE PHOTO COPY OF THE SKETCH PREPARED IN ACCORDANCE WITH THE APPROVED PLAN TO THE HOTEL OF THE PETITIONER.** **//TRUE COPY//** **P.S.TO JUDGE.** Msd. ## **SHAJI P. CHALY, J.** ## ----------------------------------------------- **W.P.(C). No.22133 of 2017 ----------------------------------------------Dated this the 17[th] day of July, 2017** ## **JUDGMENT** This writ petition is filed by the 1[st] petitioner, a company registered under the Indian Companies Act, 1956 and the 2[nd] petitioner allegedly its Managing Director seeking to quash Ext.P8 order passed by the 2[nd] respondent, the Deputy Excise Commissioner, Kottayam dated 28.6.2017 declining renewal of FL-11 licence in the name of 2[nd] petitioner and for other related reliefs. 2. Material facts for the disposal of the writ petition are as follows; 1[st] petitioner herein owns and runs a hotel in the name and style of 'The Windsor Castle Hotel' located at Kodimatha, Kottayam District. Second petitioner is the Managing Director of the 1[st] petitioner company. The hotel is situated allegedly in an extent of about 11 acres of land having a length of about 1 K.M. Its eastern boundary is M.C. Road, a State Highway and the western boundary is W.P.(C). No.22133 of 2017 2 Kodoor river. The hotel comprises of building Nos.285A to 285U in Ward No.XIV of Kottayam Municipality. The hotel started its operation in the year 2000. Originally it was classified as 3-star hotel and had then applied for FL-3 licence before the 1[st] respondent. On 20.1.2001 FL-3 licence was issued to the hotel as a licensed premises. In Ext.P1 FL-3 licence, eastern boundary is MC Road. The licence was being renewed every year till 31.3.2015. 3. Consequent to the new policy brought into force, only 5-star hotels became eligible for FL-3 licence. According to the petitioners, the application was filed before the Tourism Department, Government of India for upgrading classification of licensed premises. Thereupon, Ext.P2 classification was issued on 18.9.2015, by which petitioner has secured 4-star category. Since the State Government decided to restrict FL-3 licence to 5-star hotels alone, it was decided to issue FL-11 licence to hotels which had FL-3 licences and accordingly 1[st] petitioner has secured FL-11 licence, evident from Ext.P4, which expired on 31.3.2017. Thereupon, an application was filed before the 2[nd] W.P.(C). No.22133 of 2017 3 respondent to renew the FL-11 licence in the name of 2[nd] petitioner, however, the same was not considered favourably due to pendency of certain disputes by and between the Directors of the Company and the dispute is pending before the Tribunal at Chennai. 4. Thereupon, petitioners have preferred W.P.(C) No.18002 of 2017 before this court and secured Ext.P5 judgment, whereby a direction was issued to re-consider the renewal application in the name of the 2[nd] petitioner especially due to the fact that, consequent to the orders passed by the Tribunal, certain developments had taken place, whereby the 2[nd] petitioner was extended with certain powers to manage the affairs of the hotel in question. Pursuant to Ext.P5 judgment, Ext.P6 communication was issued by the 1[st] respondent to the 2[nd] respondent to comply with the directives contained in Ext.P5 judgment, evident from Ext.P6. Petitioners have also submitted Ext.P7 letter dated 23.6.2017 to the 2[nd] respondent stating that, the vending room is 500 meters away from the State Highway, which is not visible from the Highway and it is also not W.P.(C). No.22133 of 2017 4 having direct access from the Highway. It is also stated therein that, there is no inhibition created consequent to the judgment of the Apex Court in **'State of Tamil Nadu and others v. K. Balu and another'** [2017 (1) KHC 26 (SC)]. 5. Any how after considering the entire aspects, Ext.P8 order is passed by the 2[nd] respondent, wherein it is stated that, the gate of the hotel is situated only 15 meters away from the outer edge of M.C. Road i.e.. State Highway No.1. Therefore, the hotel is situated within the prohibited distance. That apart it is found that, FL-11 licence of the hotel was temporarily stopped by the Excise Department on 30.11.2016 as requested by the erstwhile licensee, that is the additional 3[rd] respondent in Ext.P5 judgment i.e., T.O. Abraham and that the licence has already expired on 31.3.2017. Thereafter, no formal application for renewal along with remittance of prescribed licence fee was submitted either by the erstwhile licensee or by the 2[nd] petitioner. The 2[nd] respondent is empowered only to consider the application for renewal of the existing valid licence in the name of an individual for the next year. The W.P.(C). No.22133 of 2017 5 2[nd] respondent is also not vested with power to consider the application for transfer of the licence from the name of one individual to the name of another individual, Partner or Director consequent to the prohibition contained under rule 19 of the Foreign Liquor Rules. On 28.6.2017, it seems petitioners have submitted a letter to the 2[nd] respondent with a request to re-validate the licence in the name of 2[nd] petitioner so as to make an application for FL-3 licence by online. These are the background facts projected by the petitioners in this writ petition. 6. A statement is also filed for and on behalf of the 2[nd] respondent, justifying Ext.P8 order passed by the 2[nd] respondent. Among other contentions, it is stated that, as per rule 13(3) of the Foreign Liquor Rules, FL-3 licence is issued to a hotel. Likewise in the case of FL-11 licence issued in terms of rule 13(11) of the Foreign Liquor Rules, license is issued to a hotel. Rule 13(11B) of Foreign Liquor Rules enables grant of FL-11 licence to hotels wherein an FL-3 licence granted was in force as on 31.3.2014. According to the 2[nd] respondent, as per Rules 13(3), 13(11) W.P.(C). No.22133 of 2017 6 and 13(11B), liences are issued to hotels and not to bar rooms as such. It is also stated that, as provided under rule 13(3), the distance is calculated from gate of the concerned institutions. According to the 2[nd] respondent, the distance has to be measured from the outer edge of the State Highway to the gate of the hotel. That apart it is stated that, the bar room now shown in Ext.P7 sketch is only a figment of imagination of the concerned officials of the 1[st] petitioner company. There is no such bar room as per the approved plan. The bar room presently shown in the plan is fixed according to the whims and fancies of the officials of the 1[st] petitioner company. The room that is now been projected as a bar room is not the bar room as per the approved plan. It is submitted that the bar room as per approved plan is situated abutting the eastern boundary wall of the hotel property which at a distance of 15 meters from the western outer edge of M.C.Road (State Highway No.1). Even otherwise, an FL-3 licence entails with it permission to serve liquor to residents of the hotel in the room where they reside or in the restaurants where they W.P.(C). No.22133 of 2017 7 partake food. Further, on payment of additional amounts, liquor could be served with meals by the side of the swimming pool, in lawns and roof gardens of the hotel. Therefore, according to the 2[nd] respondent, there are no legal infirmities justifying interference with Ext.P8 order. 7. A reply affidavit is filed by the petitioners reiterating the stand adopted in the writ petition, especially with respect to the building where the bar room is situated at a distance of 586 meters away from the outer edge of the State Highway No.1. 8. Heard learned Senior Counsel for the petitioner, Sri.Joseph Kodianthara, learned Senior Government Pleader, Sri. V. Manu and perused the pleadings and the documents on record. 9. The sole question to be decided is whether any manner of interference is warranted to Ext.P8 order passed by the 2[nd] respondent. Renewal of the licence was declined as per Ext.P8 order mainly on two grounds. The first ground is based on the proposition of law laid down by the Apex Court in the judgment in **'State of Tamil Nadu and others** W.P.(C). No.22133 of 2017 8 **v. K. Balu and another'** [2017 (1) KHC 26 (SC)], wherein a 500 meters distance is prescribed from the outer edge of State or National Highway or their service roads to a liquor vends in question. According to the learned Senior Counsel for the petitioner, by the term “Liquor vend” Apex Court meant the place where actually the liquor is served to the customers. However, in Ext.P1, the eastern boundary of the licensed premises is shown as MC Road i.e., the State Highway No.1. The licence was granted to serve liquor in the restaurant, in the lawn area, by the side of the swimming pool etc. etc. It is also seen that, additional fees is paid by the licensee in order to secure permission to serve Liquor in restaurant and other areas of the hotel premises continuously upto 2014 to 2015. The parameters so provided to FL-3 licences with respect to serving of liquor will apply to FL-11 licences also in view of the proviso to rule 13(11) of the Foreign Liquor Rules, 1953. Therefore, it can be seen that, the entire area of the hotel premises is licensed to server liquor. Therefore, the contention advanced by the learned senior counsel for petitioner that, the liquor vend is W.P.(C). No.22133 of 2017 9 situated 586 meters away from the outer edge of the State Highway cannot be sustained. That apart the Apex Court in **K. Balu** supra categorically specified, apart from the 500 meters distance rule that, the same should not have a direct access from such roads and it should not be visible. Therefore, viewed in that circumstances also, I am of the considered opinion that, licensed premises in question is having a direct access from State Highway No.1, which is not at all disputed by the petitioners, even if there is no visibility as contended by the petitioners. Now turning to the contention of the respondents with respect to the bar room as per the licence, there is a categoric assertion made that, the approved bar room is situated at the entrance of the hotel, there is no contrary established facts to think otherwise. 10. So also yet another reason assigned to decline renewal is that licence is in the name of the 3[rd] additional respondent in Ext.P5 judgment viz., T.O. Abraham and there is no application submitted by the petitioners to change the licence in the name of he 2[nd] petitioner to the W.P.(C). No.22133 of 2017 10 authority concerned viz., 1[st] respondent. I find force in the said contention since rule 19 of the Foreign Liquor Rules, 1953 mandates certain parameters in order to transfer licence, which is also apparently not undertaken by the petitioners. Therefore, taking into account the factual circumstances and reckoning the law it cannot be said that, Ext.P8 order passed by the 2[nd] respondent is suffering from any illegality, vice of arbitrariness or any other legal infirmities justifying interference of this court under Article 226 of the Constitution of India. Resultantly writ petition fails, accordingly it is dismissed. **SHAJI P. CHALY JUDGE** smv 17.7.2017