DOONGAJI AND CO. v. STATE OF MADHYA PRADESH AND ORS. AUGUST 9, 1991 [N.M. KASLIWAL AND K. RAMASWAMY, JJ.] Madhya Pradesh Excise.Act, 1915-Sections 13 and 14-Licerice to distil rectified spirit or. denatured spirit or liquor-Clause 50'- lnterpretation of. Valuation of the materials such as plants & machinery etc. of the distillery and payment thereof to outgning licensee before handing over possession to the incoming licensee-Held to be neither C mandatory nor a condition precedent.
The appellants and its predecessors continuously held licences under Sections 13 and 14 of the Madhya Pradesh Excise Act to distil rectified spirit or denatured spirit or liquor. The last of such licence which the appellant had related to the period from 1.4.1977 to 31.3.1981. The next licensing period commenced from 1.4.1981 to 31.3.1986 and the respondent Rajdhani Distilleries Corporation became the successful tenderer in respect thereof which the appellant impugned by means of a writ petition before the High Court but failed both before the High Court as also in this Court in a special leave petition. Thereupon the appellant was called upon twice to be present to deliver the possession of the distiller) to the resp\lndent but the appel- lant did not co-operate. Likewise the appellant did not co-operate in fixing the value of the plant and machinery of the distillery and warehouses as a result of which a committee was appointed in terms of the licence which fixed a sum of Rs. 10,53,016.45 p. as the total value payable to the appellant. Due to the non-cooperation of the appellant, the Excise Department took over the possession of the distillery after m?.king inventory of stock in hand in the presence of the witnesses and ' the same was banded over to the respondent. The appellant thereafter demanded redelivery of the distillery and on his failure to get the same it filed a writ petition in the High Court praying for a writ of mandamus seeking inter alia restitution of the distillery and the warehouses etc., challenging the quantum of valuation fixed. The High Court dismissed the writ petition. The High Court found that the appellant had no exclusive possession which always remained with the excise Depart- ment; the appellant worked out the contract of manufacturing rectified spirit etc. and that due to non-cooperation of the appellant, possession was taken and delivered to the incoming licensee as per rules and the ….
[ 1991] 3 S.C.R. appellant was not entitled to restitution. Hence this appeal by special leave. It is contended on behalf of the appellant that clause SO enjoins the State to fix the valuation of all the materials belonging to the appel- lant and pay the same to it as an outgoing licensee, before taking over …. ..
possession and handing over the distillery and the attached warehouses to the respondents. According to it, it is a condition precedent under clause SO to dispossess the appellant and start the operation of the contract by the respondent which admittedly were not done. This is a contravention of the mandallory conditions of the licence and the rules. The respondents on the other hand contend that the appellant is not entitled to restitution as it was due to its non-cooperation, possession was taken. According to them prior valuation and payment are not c condition precedent to work out the licence.
Partly allowing the appeal, this Court, HELD: In the light of the scheme of valuation of the plant and machinery of the distillery, or the apparatus in the warehouses and the D stock in trade, the Court lileld that strict construction (of clause SO) would lead to innumerable complications and loss of public revenue. We are inclined to hold that before the expiry of the licence, if the ' ..
outgoing licensee cooperat1!S, the value can be fixed with consensus, payment should also be made within the time stipulated. In all other cases it could be done even after the expiry of the stipulated period. In that perspective the Court had no hesitation to hold that prior valuation of plant and machinery in the distillery, stock in trade therein or the value of the machinery in the warehouses and stock of the liquor stored therein and payment thereof before taking possession and handing them over to the incoming licensee is not a mandatory, nor a condition ,. •
precedent. Therefore, taking over possession from the appellant on August 28, 1981 and handing over the plant and machinery, etc. to the respondent is not illegal. [490C-E] In this case admittedly the conditions of licence are not ques- tioned, but expressly given op in the High Court. Even before us the validity of the valuation has not been questioned. It cannot cut the branch on which appellant sits to assail the constitutional validity of the I- •
conditions of the licence. Accordingly we have no hesitation to hold that the appellant is not entitled to the restitution of the plant and machinery of the distillery at Ujjain and the attached warehouses. [491A-B] It is open to the appellant to make a representation to Govern- ment and any officer not below a Secretary preferably of the concerned DOONGAJI v. STATE OF M.P. !RAMASWAMY, J.I
Department wonld go into the matter and decide the valne as per the material on record. It is open to the appellant to place all its material. It is also open to the respondent to place its material and the authority wonld consider after giving an opportnuity of hearing through counsel, if asked for, and decide the value accordingly. [491D]
Godhra Electricity Co. Ltd. and Anr. v. State of Gujarat and Ors., [1975] 2 SCR 42; Har Shankar & Ors. v. Dy. Excise & Taxation Commissioner and Ors., [1975] 2 SCR 254 and State of M.P. v. Nandlal Jaiswa/, [1987] 1SCR1, Referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5483 of 1983. From the Judgment and Order dated 7.10.1982 of the Madhya Pradesh High Court in M.P. No. 169 of 1982. R.F. Nariman and P.H. Parekh for the Appellants.
V.N. Ganpule, V.M. Tarkunde, S.K. Agnihotri, S.K. Sinha. c -1 Rajinder Narain, R.S. Singh, and Rameshwar Nath for the Respondents. – … The Judgrnent of the Court was delivered by
K. RAMASWAMY, J. This appeal by special leave arises against the judgment of the Division Bench of the Madhya Pradesh High Court, Indore Bench dismissing M.P. No. 169 of 1982 dated October 7, 1982. The appellant, a partnership firm filed the writ peti- tion seeking writ of mandamus and other direction to remove Rajdhani Distilleries Corporation, the 7th respondent in the writ peti- tion in the High Court and 6th respondent in this appeal for short 'respondent' or his 'servants' or 'agents' and to deliver vacant and peaceful possession of Ujjain Distillery and warehouses attached to it and the plant and machinery mentioned in the schedule Annexure P-3 to the writ petition. It also sought for mandamus or other order to have the valuation of the plant and machinery in Annexure P-3 assessed or direction to return the goods or things described in Annexure P-7 or on its failure to pay a sum of of Rs.8,48, 179.28 and a mandamus directing the State Govt. to terminate the licence granted on August 25, 1981 to the respondent and to issue licence to the appellant under s. 13 of the M.P. Excise Act, 1915, for short 'the Act', etc. Thus this appeal. The material facts, to dispose of the point arose in this appeal, lie c
[199H 3 S.C.R. in a short compass as stated hereunder: In the State of Madhya Pradesh nine distilleries for the manufacture of spirit were established and one of which was situated at Ujjain. The appellant and its predecessors continuously had licence under ss. 13 and 14 of the Act in form D-2 to distil rectified spirit or denatured spirit or liquor and D-1 licence for wholesale supply of country made liquor in the distillery to retail vendors in the area attached to the distillery. The licence was for a period of 5 years. The last licence of which was for the period from April 1, 1977 to March 31. 1981. The normal procedure in vogue was to call for tenders and the lowest was being accepted, though sometimes highest was also prefer- red. Next licensing period commenced from April I, 1981 to March 31, 1986 and the respondent became the successful tenderer which the appellant impugned in Misc. Petition No. 701/81 and obtained stay of dispossession from the distillery and the attached warehouses. The interim stay was later vacated and the petition was dismissed on August 20, 1981. We may also mention here that the writ petition was also dismissed and the special leave petition was dismissed by this court. Thus grant of licence to the respondent under D-1 and D-2 licences became final. On August 21, 1981 the Officer-in-Charge of the distillery wrote a letter to the appellant calling upon them to be present on August 22, 1981 to deliver the distillery, plant, machinery, etc. to the respondent. The appellant neither received it nor coope- rated to deliver possessipn of the distillery, etc. to the respondent. Instead it locked the distillery and went away. In the meanwhile the Excise Department also put their locks on the distillery etc. On August 27, 1981 the District Excise Officer again called upon the appellant to be present on August 28, 1981 to deliver possession of the distillery, etc. to the respondent. But the appellant remained absent. Conse- quently possession was taken of the distillery and warehouses, after taking inventory of stock in hand in the presence of the witnesses and the same were handed over to the respondent on August 28, 1981. The appellant sent a letter on February 23, 1982 valuing the goods taken possession of at Rs.8,36,988.61. On August 8, 1982 the appellant demanded redelivery of the distillery, plant and machinery and warehouses and the value of the stock in trade or pay the amount. On March 16, 1982 the appellant filed the writ petition in the High Court but was dismissed.
The appellant contended in the High Court that it had been in exclusive possession of the distillery, plant and machinery at Ujjain and the attached warehouses and dispossession was unlawful and that, . .,,
"' 1 DOONGAJI v. STATE OF M.P. [RAMASWAMY, J.J therefore, the appellant was entitled to restitution of the plant and machinery and also to the grant of licence after cancellation of the fl.
licence granted to the respondent. The High Court found that the appellant had no exclusive possession which always remained with the Excise Department. The appellant worked out the contract of manufacturing rectified spirit or spirit (country made liquor) in the distillery and wholesale supply to the retail vendors within the area attached to the distillery. Due to non-cooperation of the appellant possession was taken and delivered to the incoming licensee, the respondent, as per rules and the appellant was not entitled to restitu- tion. The other findings are not necessary as they are not pressed before this court. The appellant had given up the reliefs of valuation of the plant and machinery and stock in trade. During the pendency of the appeal on an application made by the appellant this court directed the state to make over payment of a sum of Rs.10 lacs deposited by the respondent with the State Govt. and also further directed the respon- dc~t to deposit· a sum of Rs.5 lacs in .the Registry of this court and directed the Registry to keep that amount in fixed deposit to earn interest thereon subj?ct to adjustment at the final hearing. Despite issuance of several notices by the department, the appel- lant did not cooperate in the estimate of the value of the plant and machinery of the distillery and warehouses. the Committee appointed in terms of the conditions of the licence, fixed a sum of
Rs.10,53,016.45 as total value payable to the appellant. Since a sum of E Rs.10 lacs had already been paid, the appellant is still entitled to the balance amount of Rs.53,016.45. Sri. R.F. Nariman, learned counsel for the· appellant, in his thorough and analytical arguments based on record made a shift in the stand and now contended that on a reading of several clauses in the licence Ex. P-2, in particular, clause 50 enjoins the state to fix the valuation of all materials like buildings, still, machinery, etc. belong- ing to the appellant as an outgoing licensee; should be purchased by the respondent before the expiry of the contract and commencement of the succeeding contract of the respondent; the Committee appoin- ted by the Excise Department in this behalf should estimate fair valua- tion and payment thereto be made to the appellant before taking over possession and handing over the plant and machinery of the distillery and the attached warehouses to the respondents as a condition prece- dent to dispossess the appellant and start the ->peration of the contract by the respondent which admittedly were not done. This is in contra- vention of the mandatory conditions of the licence and the rules. The c
[ 1991) 3 S.C.R. appellant, therefore, is entitled to restitution of the plant and machi- nery of the distillery and the attached warehouses illegally taken pos- session of by the respondent and the state. In support thereof he placed strong reliance in Godhra Electricity Co. Ltd. & Anr. v. State of Gujarat & Ors., [1975) 2 SCR 42. He also referred to us in support of his contention various documents. In our view it is not necessary to dwelve deep into them. Sri Ganpule and Sri Tarkunde, the learned senior counsel for the State and the respondent, contended that the appellant was requested twice to·be present for delivery of the plant and machinery in the distillery and warehouses to the respondent and due to its non-cooperation possession was taken. Even for the assess· ment of the valuation, before the expiry of the contract, the appellant was given several notices requesting it to furnish the evidence of the value of the plant and machinery stock in trade, etc., and due to its non-cooperation. the valuation could not be made. Prior valuation and payment are not condition precedent to work out the licence. The appellant has no right to the restitution after the expiry of the licence. Sri Tarkunde, in particular, emphasised that the restitution prayed for became infructuous on account of the subsequent events, namely, pursuant to December 1984 Govt. policy the respondents established their distillery at Ujjain at their own expenses.
The second period of licence also expired in 1991. There was further change in the policy of the Govt., namely each District was made a supply area under a separate licence for two years. Under these circumstances the appellant is not entitled to any reliefs. It is also further contended that the conditions in the licence in Ex. P-2 marked in the High Court should be read harmoniously. It is clear that prior fixation of the valuation and the payment of the price is not a condition precedent. The ratio in Godhra Eletricity Co. Ltd. case is inapplicable to the facts of this case.
The sole question is whether fixation of the price of the plants and machinery at Ujjain and the attached warehouses and stock in trade and payment thereof to the appellant is a condition precedent to take possession and delivery thereof to the respondent on August 28, 1981. At the outset we may make it clear that, though Sri Nariman contended that the grant of licence to the respondent was in gross violation of the conditions of the tender as the respondent did not comply with any of the mandatory conditions stipulated therein and the delivery of the possession of the distillery in pursuance of the illegal contract is without jurisdiction, we decline to go into this ques- tion, though prima facie may be plausible to be countenanced, for the . …..
,. . • i DOONGAJI v. STATE OF M.P. !RAMASWAMY, J.] reasons that tne grant of licence for the period of 1981 to 1986 to the A respondent became final and expired by efflux of time. It was also contended by Sri Nariman that the valuation made at Rs.10,53,016.45 was not proper and contrary to the tender's conditions which stipu- lated deposit of a minimum of Rs.19 lacs by the respondent as a condi- tion to grant licence, and that, therefore, the appellant is entitled to valuation of at least Rs.19 lacs. We decline to go into that question also since the relief of valuation was given up in the High Court. It is also clear from the record that the appellant had not cooperated in estimating the value and the Committee of designated officers, namely the Addi. C_ollector, the District Excise Officer, Astt. Commissioner of Excise and Accounts Officers was compelled to go into the question and made an assessment of the value on January 5, 1984. That valua- tion was also not questioned in the writ petition.
To find whether it is a condition precedent to fix the valuation of the plants and machinery of the distillery and the warehouses and the stock in trade and payment thereof before taking over possession and handing over the same to the incoming licencee, the material clause 50 D to be looked into reads thus:
"All the materials like buidings, still, machinery, drums, wood fuel, coal, mahua, bottling, machinery, bottles, spices, red sealing wax, coaltar, pilfer proof seals, crown corks, alongwith alu capsules, etc. belonging to the outgo- ing licensee purchased for the use of distillery and ware- houses attached thereto, shall be valued before the expiry of the old contract and the commencement of the new one
by a committee appointed by the Excise Department in this behalf. The committee aforesaid shall be appointed by the Excise Commissioner under the previous sanction of the Government (Separate Revenue Department) and it shall
consist of five members, namely (1) Collector or Addi- tional Collector-convenor, (2) Assistant Commissioner of Excise of the Division concerned member (3) Executive Engineer-Technical member, (4) Accounts Officer of the
Excise Department-Member, and (5) Representative of G the licensee-Member. If the representative of the licensee remains absent in the committee at the appointed time, the remaining four members shall begin their work in his
absence and no objection of the licensee in this respect shall be heard. The valuation made and agreed upon by the Committee shall be sanctioned by the Excise Commis- c (1991] 3 S.C.R.
sioner with such necessary changes as he deems fit and in case of dirference of opinion amongst the members, the Excise Commissioner shall pass orders relating to disputed valuation. The orders of Excise Commissioner shall be
final and binding upon the licensee. Note: The valuation of sanctioned plant at the warehouses may be done by a committee consisting of some of the members of the above referred committee,
subject to the orders of the Excise Commissioner, which shall be final and binding on the licensee. Prima facie, if the clause by itself is read in isolation, it would indicate that prior fixation of the value and payment is a condition precedent. But in our view all the conditions of the licence, policy of the Act and Rule of the possession, manufacture, supply, sale and distribution of the rectifiecl spirit or denatured spirit or liquor from the stage of manufacture in Distillery till retail sale to the consumer be viewed as an integrated whole and the human behaviour of the outgo- ing licensee also has to be kept in view. Any other view would disrupt smooth transition from the outgoing to the incoming licensee; hampers the continuity of supply and sale of intoxicants and cause collosal loss of public revenue. So let us consider the relevant propositions from this background.
Section 13 of the Act requires a licensee to manufacture intoxicants: (a) Licence is required for manufacture, etc. of intoxicants; (b) No intoxicant shall be manufactured or collected
(f) No person shall induce, keep in his possession any material ………… for the purpose of manufacture of intoxi- cants, other than tari, except under the authority and subject to the terms and conditions of the licence granted in that behalf. Section 14 provides that:
(a) establish a distillery in which spirit may be manufac- tured under licence granted under s. 13 on such conditions as the Govt. may impose ….. . …. DOONGAJI v. STATE OF M.P. [RAMASWAMY, J.J
\c) license on such conditions as the State Govt. may impose the construction and working of the distillery and brewery; (c) establish or licence warehouses wherein any intoxicant may be deposited and kept without payment of duty, subject to payment of such fee as the State Govt. may direct …..
Section 17 provides inter alia that no intoxicant shall be sold except under the authority and subject to the terms and conditions of licence granted in that behalf. Thus it is clear that establishment of a distillery or a warehouse; manufacture of intoxicants, spirit (country made liquor), the posses- sion and distribution and sale thereof are regulated under the Act. The Govt. in exercise oUts power under s. 62 of the Act made rules regulating the control of distilleries and warehouses by Officers of the Excise Department, especially appointed by the Excise Com- missioner for that purpose. Therefore, any licensee, under the Act and the Rules, be it incoming or outgoing, should have D-2 and D-1 licences for establishment of distillery and warehouses, possession of raw materials, manufacture of liquor or rectified spirit or denatured spirit and supply to the retail vendors of the area attached to the distillery. Any infraction is an offence.
It is settled law by several decisions of this court that there is no fundamental right to a citizen to carry on trade or business in liquor. The state under its regulatory power, has power to prohibit absolutely any form of activity in relation to an intoxicant, its manufacture, pos- session, import and export. No-one can claim, as against the state, the right to carry on trade or business in any intoxicants, nor the state be compelled to part with its exclusive right or privilege of manufac- ture, sale, stora5e of liquor. Further when the state has decided to part with such right or privilege to the others, then state can regulate con- sistent with the principles of equality enshrined under Art. 14 and any infraction in this behalf at its pleasure are arbitrary violating Article G 14. Therefore, the exclusive right or privilege of manufacture, storage, sale, import and export of the liquor through any agency other than the state would be subject to rigour of Article 14. Vide Har Shankar & Ors. v .. Dy. Excise & Taxation Commissioner & Ors., [1975] 2 SCR 254 and State of M.P. v. Nand/a!Jaiswa/., [1987] 1SCR1.
[1991) 3 S.C.R. When the state was dealing with the grant of the privilege of establishing or manufacturing intoxicants, rectified spirit or denatured spirit, spirit (country made liquor) in a distillery owned or regulated by it, and invites tenders in this regard it should conform to the rigour of Art. 14 of the Constitution. Admittedly, the licence of the appellant expired on March 31, 1981 and thereafter it had no right to manu- facture and store at distillery in U jjain and distribution as wholesaler of the country made liquor from the attached warehouses to the retail vendors within that area granted to the respondent. But for the stay granted by the High Court the operation of the respondent's licence was to begin on April 1, 1981. The outgoing licensee, the appellant, had to hand it over to the respondent on that date. The conditions in the licence P-2 postulate of mutual rights and obligations between the nutgoing licensee to sell and the incoming licensee to purchase the plant and machinery of the distillery, stock in trade and also the machinery in the warehouse including the apparatus, etc. enumerated in the conditions either at the price fixed or agreed directly between the parties or fixed by the committee of the designated officers. In case D of any difference in the valuation between the members, the Commis- sioner of the Excise or the State Govt. would fix the valuation, which was made final. The Committee designated was to be constituted with p~ior approval of the Govt. as per condition 50 to evaluate the plant and machinery of the distillery and some of them of the warehouses. Outgoing licensee also is entitled to represent in the Committee. On E his non-cooperation the rest of the four members of the Committee are empowered to determine the value.
Clause 23(iii) provides that any dispute relating to valuation of the sanctioned plant shall be referred to the State Government and the decision of the State Govt. shall be final and binding on the parties to the dispute. Clause 2 thereof refers that the licensee shall made over the said distillery and warehouses buildings on the termination of the licence in as good condition as they were at the commencement hereof excluding reasonable wear and tear. Clause 36(4) provides that any dispute relating to the sale of spirit or plant by the licensee or the valuation of the plant shall be referred to the State Govt. and the decision of the State Govt. shall be final and binding. Clause 39(1) in particular, mentions that at the commencement of the term of this licence, the licensee shall buy all sanctioned plant at the Ujjain distillery including spare parts, furnitur,e, motor trucks and fittings at a price to be fixed by the State Government. Licensee shall pay the price thereof within 30 days of the communication. Similarly, clause 41, 42(1) and H clause 4·1 provide that the incoming licensee shall take on lease all DOONGAJI v. STATE OF M.P. [RAMASWAMY, J.J
other bulidings structures attached to the distillery at Ujjain on such conditions and terms as per Public Works Department Manual Vol. II within a period of one month of the intimation of the acceptance of the tender. Then comes clause 50 quoted hereinabove. The incoming licensee shall make payment within 30 days from the date of.communi- cation of the value.
Therefore, the courts should adopt realism, pragmatism, practi- cality and the purpose envisaged under the Act and the rules in con- struing the relevant clauses in the licence. The purpose of the Act and the rules made therein is to regulate the manufacture, distribution, sale of the intoxicants, rectified spirit or denatured spirit, liquor, sale to consumers within the state of Madhya Pradesh. It is an on going process conducted through the licensing system, an exclusive privilege of the state through the licences granted under form D-1 and D-2 in this behalf. The duration of the licence is fixed one. On expiry of the licence the outgoing licensee shall be bound to handover the distillery, plant and machinery therein, and warehouses attached thereto, the stock in trade and other apparatus and goods used for the manufac- ture, storage and distribution. The outgoing contractor is entitled to continue his business activity till the last date of the licence, namely March 31, of the ending year. The succeeding licensee would take over the business from the outgoing licensee on April 1 of the year of licence. Thus there should be no hiatus between taking over and hanr: · ing over the manufacture, possession, storage of the wholesale busi- ness of the spirit (country made liquor) or rectified spirit or denatured spirit. Under these circumstances it will well-nigh be impossible to assess the valuation of the entire stock in trade or plant and machinery in the distillery or the warehouses till the last date. In addition the coopera- tion of the outgoing licensee is also necessary and expected as he would be in possesssion of the records of the previous purchases of the materials, or plant or machinery if any new additions are made etc. Unless they are made available, it is not possible to assess the value after giving due rebate or depreciation, etc. to the incoming licensee. The human nature and conduct would be such that the outgoing licensee, being the unsuccessful tenderer, would not cooperate in handing over possession of the distillery and stock in trade and would approach the High Court under Art. 226 of the Constitution as was done in this case. The incoming licensee has time of thirty days in case of stock in trade or three months in the case of plant and machinery from the date of communication to him to pay the value to the outgo- ing licensee. Keeping those circumstances at the back of our mind we decline to adopt lexographic strict construction of clause 50 which c
c [1991) 3 S.C.R. would thwart continuity; create hiatus in smooth operation of manufacture, storage, distribution and sales of the intoxicants. Moreover, after the assessment is made and in case of any difference of opinion in the valuation or the outgoing licensee claims higher value the final arbiter would be in some cases like stock in trade, the Com- missioner of Excise and in case of plant and machinery or warehouses the State Govt. After the decision of the Commissioner or the State Government, it shall be communicated to the succeeding licensee, wh,, has been given maximum period of three months to make payment tc the outgoing licensee. In the light of the scheme of valuation of the plant and machinery of the distillery, or the apparatus in the warehouses and the stock in trade, we hold that strict construction would lead to innumerable complications and loss of public revenue. We are inclined to hold that before the expiry of the licence, if the outgoing licensee coopeates, the value can be fixed with consensus, payment should also be made within the time stipulated. In all other cases it could be done even after the expiry of the stipulated period. In that perspective we have no hesitation to hold that prior valuation of plant and machinery in the distillery, stock in trade therein or the value of the machinery in the warehouses and stock of the liquor stored therein and payment thereof before taking possession and handing them over to the incoming licensee is not a mandatory, nor a condition precedent. Therefore, taking over possession from the appellant on August 28, 1981 and handing over the plant and machi- nery, etc. to the respondent is not illegal.
Undoubtedly this court, in Godhra Electricity case held that it is mandatory that a person who is deprived of his property, before its taking over, the value should be estimated and the payment made or else it is illegal. But the ratio would be considered in the light of the f
setting therein. The licence granted under s. 6 of the Indian Electricity Act. 1910 as amended in 1959 to produce electrical energy was acquired by the Electricity Board. Section 6(6) provides that where a. notice exercising the option of purchasing the undertaking has been served upon the licence, the licensee shall deliver the undertaking to the State Electricity Board on expiry of the relevant period referred to in s. 6( 1). Jn that case the constitutional validity of s. 6(6) was questioned which did not provide for payment before taking over of the undertaking as offending Article 19( l)(f) and (g) and Art. 14 of the constitution. While considering the constitutional validity of s. 6(6) this court held that valuation and payment is a condition precedent since the Act did not envisage any payl'1ent of interest subsequent thereto. Accordingly this court directed redelivery of the undertaking ….
DOONGAJI v. STATE OF M.P. !RAMASWAMY, J.] to the licensee subject to follow the procedure as per law laid down therein. In this case admittedly the conditions of licence are not questioned, but expressly given up in the High Court. Even before us the validity of the valuation has not been questioned. It cannot cut the branch on which the appellant sits to assail the constitutional validity of the conditions of the licence. Accordingly we have no hesitation to hold that the appellant is not entitled to the restitution of the plant and machinery of the distillery at U jjain and the attached warehouses. The appellant though claimed that the value of the plant and machinery was too low, contrary ·to the specification in this behalf in tender condition and though we decline to go into the question, the appellant appeared to have smarted under apprehension that it had to face the plea of acquiescence, if it were to cooperate earlier. So it is open to the appellant to make a representation to the Govt. and any officer not below a Secretary preferably of the concerned Department would go into the matter and decide the value as per the material on record. It is open to the appellant to place all its material. It is also open to the respondent to place its material and the authority would consider after giving an opportunity of hearing through counsel, if asked for, and decide the value accordingly. As regards deposit now made in the Registry of this Court, the Registry is directed to make payment of a sum of Rs.53,016.45 and interest accrued thereon to the appellant and the balance amount and the interest accrued on the residual to the respondent and the respondent's liability would be subject to the decision by the Secretary as indicated in the j·udgment. The appeal is accordingly allowed to the above extent and since the appellant substantially failed there would be no order as to costs. Y.L.
Appeal partly allowed. c