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PETITIONER: M. R. PATEL

       Vs.

RESPONDENT: STATE OF BIHAR AND OTHERS

DATE OF JUDGMENT: 05/01/1965

BENCH: BACHAWAT, R.S. BENCH: BACHAWAT, R.S. GAJENDRAGADKAR, P.B. (CJ) HIDAYATULLAH, M. SHAH, J.C. SIKRI, S.M.

CITATION:  1966 AIR  343            1965 SCR  (2) 693

ACT: Bihar and Orissa Excise Act, 1915 (Bihar and Orissa Act 2 of 1915),  ss.  8,  35,  38 to  91-Board  of  Revenue-Issue  of Directions-Whether could increase security deposit-Powers of Revision-If exercisable suo motu-Limitation.

HEADNOTE: Consequent upon a direction by the Board of Revenue,  Bihar, fixing the security deposit of Excise shops working under  a certain   system,  the  Commissioner  of   Excise   directed realisation  of the defecit in the security deposit  of  the appellant’s shops.  The appellant moved the Board of Revenue for revision   of  the  Excise  Commissioner’s  order.   The Board of Revenue held that it was  open to the appellant  to move the Excise Commissioner for relief.     Subsequently on the   appellant’s   motion  the   Excise   Commissioner   in supersession  of  his previous order, directed that  in  the special  circumstances of the case, the security  depoit  in respect  of the appellant’s shop need not be increased.   In spite  of a representation made by the Deputy  Commissioner, the Excise Commissioner refused to revise his order.  At the request  of the Deputy Commissioner the Commissioner of  the Division referred the matter to the Board of Revenue.  After hearing the appellant, in exercise of its powers of revision under  s.  8 of the Act the Board, suo motu, set  aside  the order  of  the Excise Commissioner with the  direction  that until  the expiry of the current licences there would be  no change  in  the amount of security, but proper  security  in terms  of  the  general directions by the  Board  should  be demanded  from the appellant at the time of the  renewal  of the licenses.  In appeal, HELD  :  (i) Neither the orginal order  nor  the  subsequent order was passed by the Excise Commissioner under s. 35 on a consideration  of the matters referred to in  that  section. The finality of s. 35 did not attach to these orders and the Board of Revenue had ample power to revise them under s.  8. [696 B-C] (ii) On a true construction of ss. 38 and 91 of the Act, the Board in exercise of its powers under s. 38 read with s.  91

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could from time to time issue general directions with regard to  the  conditions  of any licence granted  under  the  Act including  the  amount of security to be  deposited  by  the licensee. [696 G-H] (iii)     Instruction  No. 101 (10) of the Board of  Revenue at  p.  30  of  Vol.  III of the  Bihar  and  Orissa  Excise Mannuall 1955 Ed. read with Board’s circular letter No. 8624 dated  September  9,  1956 did not  prevent  enhancement  of security at the time of the renewal of license. [697 C-D] (iv) The  Board  of  Revenue  may  exercise  its  powers  of revision under a.   8(3) suo motu. [697 E-F] (v)  In  a  case  where the Board  exercises  its  power  of revision  of  its  own motion,  no  question  of  limitation arises. [697 H]

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 331 of 1962. 694 Appeal by special leave from the Resolution dated October 4, 1959 of the Board of Revenue, Bihar, in Case No. 124 of 1959 Rajeswari Prasad and S. P. Varma, for the appellant. C.   K. Daphtary, Attorney-General, R. K. Garg, S. C.  Agar- wala and D. P. Singh, for the respondents. The Judgment of the Court was delivered by Bachawat,  J.  The appellant holds yearly licenses  for  the retail sale of country spirit in respect of six shops in the town  of Jamshedpur working under the sliding  scale  system under  the  Bihar  and Orissa Excise Act,  1915  (Bihar  and Orissa Act 2 of 1915) hereinafter referred to as the Act.  A total sum of Rs. 11,099 was demanded and paid as security in respect  of  all  the licenses.  The  original  licenses  in respect  of  the  six shops were issued long  ago  and  were renewed from year to year.  By an order dated June 27, 1956, the  Board  of Revenue, Bihar directed  that  "the  security deposit  of an Excise shop working under the  sliding  scale system is hereby fixed as equivalent to two months’  average license  fees of the shop." The security deposit payable  by the appellant on the basis of this direction would amount to about Rs. 68,000.  On November 14, 1956, the Commissioner of Excise, Bihar directed the Deputy Commissioner, Singhbhum to realise  from  the  appellant the deficit  in  the  security deposits  of his shops.  This order was communicated to  the appellant  on  December 7, 1956.  On January  9,  1957,  the appellant  filed  a petition before the  Board  of  Revenue, praying   for  a  revision  of  the  order  of  the   Excise Commissioner dated November 14, 1956.  By order dated  March 20,  1957, the Board of Revenue held that the merits of  the appellant’s  case  need not be examined at that  stage,  and observed  that  the order of the Excise  Commissioner  would constitute  no bar to the appellant moving the  Commissioner for  considering the special circumstances, if any,  of  his case  on merits and, for this purpose, it would be  open  to the  appellant  to move the Commissioner in  an  appropriate manner.   Subsequently,  the  appellant  moved  the   Excise Commissioner  for reconsideration and setting aside  of  his previous order dated November 14, 1956.  By his order  dated March  5, 1958, the Commissioner of Excise, in  supersession of  his  previous  order,  directed  that  in  the   special circumstances  of the case, the security deposit in  respect of  the  appellant’s  shops need not be  increased  and  the appellant could continue to manage the shops on the existing total  security  of Rs. 11,099 only.  In spite of  a  repre- sentation made by the Deputy Commissioner, Singhbhum, the

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695 Excise  Commissioner refused to revise this order.  On  June 27,  1958,  at  the  request  of  the  Deputy  Commissioner, Singhbhum, the Commissioner, Chotanagpur Division,  referred the matter to the Board of Revenue.  On April 24, 1959,  the Board  of  Revenue  directed the issue of a  notice  to  the appellant  asking  him to show cause why he  should  not  be ordered  to  pay  the  difference  between  the   prescribed security  deposit  and the amount already deposited.   By  a petition  dated July 30, 1959, the appellant  showed  cause. At the hearing of the case before the Board of Revenue,  the appellant  was  represented by counsel.  By an  order  dated October  4, 1959, the Board of Revenue, in exercise  of  its powers  of  revision under s. 8 of the Act,  set  aside  the order  of  the Commissioner of Excise dated March  5,  1958, with  the  direction that until the expiry  of  the  current licenses  on March 31, 1960 there would be no change in  the amount of security, but the proper security in terms of  the general  directions issued by the Board should  be  demanded from  the  licensee  at  the time  of  the  renewal  of  the licenses,  with  effect from the next licensing  year.   The appellant  now  appeals  to this Court from  this  order  by special leave. On behalf of the appellant, Mr. Rajeshwari Prasad  contended that in view of S. 35 of the Act, the Board of Revenue could not  under  s. 8 of the Act revise the order of  the  Excise Commissioner dated March 5, 1958.  There is no substance  in this contention.  Section 8 (3) provides that the Board  may revise any order passed by the Excise Commissioner.  Section 35   provides  that  the  Excise  Commissioner  may,  on   a consideration  of the list, objections and opinions sent  to him by the Collector under s. 34, modify or annul any  order passed  or  any  license  granted  by  the  Collector,   and notwithstanding anything contained in S. 8, his orders shall be  final.  The Excise Commissioner did not pass  the  order dated  March 5, 1958 in exercise of his powers under s.  35, on a consideration of the list, objections and opinions sent to him under s. 34.  He passed the order in exercise of  his general powers of control over the collector and the  Excise Department under ss. 8 and 7(2) (a) read with S. 2(7) of the Act.   During  the currency of the licenses  issued  to  the appellant for the year 1956-57, a question arose whether the additional security should be demanded from the appellant in view  of  the  general directions issued  by  the  Board  of Revenue  on June 27, 1956.  By his order dated November  14, 1956,  the Excise Commissioner directed that the  additional security  should  be  realised from  the  appellant.   On  a revision  petition  filed by the appellant under S.  8,  the Board of 696 Revenue  by  its order dated March 20, 1957,  permitted  the appellant    to   move   the   Excise    Commissioner    for reconsideration  of his order dated November 14,  1956.   On being moved by the appellant under the liberty so granted by the  Board of Revenue, the Excise Commissioner by his  order dated  March  5, 1958 reviewed and set  aside  his  previous order on a consideration of the general directions issued by the Board of Revenue, the Board’s order dated March 20, 1957 and  the  special circumstances of the  case.   Neither  the original  order dated November 14, 1956 nor  the  subsequent order  dated  March  5,  1958  was  passed  by  the   Excise Commissioner  under S. 35 on a consideration of the  matters referred to in that section.  The finality of s. 35 did  not attach  to these orders and the Board of Revenue  had  ample power to revise them under s. 8.

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Mr.  Prasad  next referred us to S. 40 of the  Act  and  the standard  form  of license for the retail  vend  of  country spirit,  and contended that only the authority granting  the license could fix the amount of the security, and one of the conditions  of  the license was that the licensee  would  be required  to deposit only the amount so fixed but the  Board of Revenue by its order dated October 4, 1959 illegally  and in  excess of its powers altered the amount of the  security so fixed and the corresponding condition in the license  for the  deposit  of the amount.  This argument is  based  on  a misreading  of  the order of October 4, 1959,  and  must  be rejected.  By that order, the Board expressly directed  that the would be no change in the amount of the security  during the  currency  of  the license.  The licenses  were  due  to expire  on March 31, 1960.  The Board directed that  if  and when  the  licenses were renewed with effect from  the  next licensing year, the proper security should be demanded  from the  licensee as a condition of the renewal.   No  exception can be taken to this direction.  The licensee had no  vested right  to a renewal of the license.  Section 45 of  the  Act provides  that he shall have no claim to its  renewal.   The licensing authority was not bound to renew the license.  If, in  its discretion, it granted a renewal, it  could  require the  licensee to give proper security as a condition of  the renewal.  On a true construction of ss. 38 and 91 of the Act it  must be held that the Board, in exercise of  its  powers under  s. 38 read with S. 91, could from time to time  issue general  directions  with regard to the  conditions  of  any license  granted under the Act including the amount  of  the security  to be deposited by the licensee.  In  exercise  of its  powers  under ss. 38 and 91, the Board  had  fixed  the security deposit of an Excise shop 697 working under the sliding scale system as equivalent to  two months’ average license fees of the shop.  The Board was en- titled  to direct, as it did by the order dated  October  4, 1961, that the general directions issued by it under ss.  38 and  91 should be observed and carried out by the  licensing authority  and the proper security in accordance with  those directions should be demanded if and when the licenses  were next renewed. Mr.  Prasad  next  contended  that  the  direction  for  the increase  of the security at the time of the renewal of  the licenses is contrary to the instruction No. 101 (10) of  the Board  of  Revenue at p. 39 of Vol.  III of  the  Bihar  and Orissa  Excise Manual, 1955 Edn.  ’Mere is no  substance  in this  contention.  In its order dated October 4,  1959,  the Board  of  Revenue exhaustively reviewed  all  the  relevant instructions  issued  by it from time to time,  and  rightly pointed  out  that  instruction No. 101(10)  read  with  the Board’s circular letter No. 8624 dated September 9, 1956 did not prevent of the security at the time of the renewal of the  licenses. s.   8  (3)  of the Act could be exercised by the  Board  of Revenue  only on an application by an aggrieved  party,  and (b)  the  proceedings in revision in the instant  case  were barred  by  limitation.   There is  no  substance  in  these contentions.   The Board of Revenue may exercise its  powers of  revision  under  s.  8  (3)  suo  motu.   No  period  of limitation  is  prescribed by the Act for  exercise  of  the power  of  revision  under s. 8 (3).  Mr.  Prasad  drew  our attention to paragraph 71, Chap.  V of Part HI of the  Bihar Practice  and Procedure Manual, 1958, pp. 99 and 100,  which provides  that where there is no provision of law as to  the period  within  which  an application for  revision  may  be

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allowed,  the application for revision should  be  preferred within  one  month of the date of the  Commissioner’s  order deducting  the  time  occupied in obtaining a  copy  of  the order,  but  the  Board  has  a  discretion  to  admit   the application for revision preferred after one month.  In  the instant case, in its order dated October 4, 1959, the  Board stated  that  it would exercise its powers of  revision  suo motu.   In  a case where the Board exercises  its  power  of revision  of  its  own motion,  no  question  of  limitation arises.   Moreover, the Board held that this was a fit  case for  interference  even  after the expiry  of  the  ordinary period of limitation. No  other  arguments  were advanced before us.   We  see  no reason  to  interfere with the Board’s order.   The  learned Attorney- 698 General   raised   a  preliminary  objection   as   to   the maintainability  of the appeal on the ground that the  Board is  not  a tribunal within the meaning of Art.  136  of  the Constitution.  In view of our conclusion that the  appellant has  no case on the merits, we do not think it necessary  to express any opinion on the preliminary objection. In the result, the appeal is dismissed with costs.                           Appeal dismissed. 699