- 1 - NC: 2025:KHC:1615 WP No. 12671 of 2021 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 12671 OF 2021 (EXCISE) BETWEEN: 1. DAKSHINA KANNADA WINE MERCHANTS' ASSOCIATION (REGD.) AS ASSOCIATION OF PEOPLE, REGISTERED UNDER KARNATAKA SOCIETIES REGISTRATION ACT, MANGALA HEALTH CENTRE BUILDING, PADIL, MANGALORE - 575007, REP. BY ITS SECRETARY, C.N.APPACHU, S/O C A NANJAPPA, AGED ABOUT 68 YEARS (SENIOR CITIZENSHIP NOT CLAIMED) (PETITIONER NO.1 DELETED WITH LEAVE OF HON'BLE COURT AS PER ORDER DATED 02.08.2021). 2. M/S WINE "N" DINE, A REGISTERED PARTNERSHIP FIRM, CL-9 LICENSEE, NO.23-63.10(1)(2)(3), KAPIKARD, THOKKATTU, MANGALORE-575007, DAKSHINA KANNADA DISTRICT, BY ITS PARTNERS JOACHIM LOUIS PINTO, FINANCE DEPARTMENT, VIDHANA SOUDHA, BENGALURU - 560 001. …PETITIONERS (BY SRI G.K.BHAT, SENIOR COUNSEL A/W SMT SUDHA D, ADVOCATE) AND: 1. THE STATE OF KARNATAKA, Digitally signed by PRAMILA G V Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:1615 WP No. 12671 of 2021 BY ITS ADDITIONAL CHIEF SECRETARY, FINANCE DEPARTMENT, VIDHANA SOUDHA, BENGALURU - 560001. 2. THE EXCISE COMMISSIONER IN KARNATAKA, 2ND FLOOR, TTMC A BLOCK, BMTC BUILDING, SHANTINAGAR, BENGALURU - 560027. 3. THE DEPUTY COMMISSIONER DAKSHINA KANNADA DISTRICT, MANGALORE - 574142, DAKSHINA KANNADA. 4. THE DEPUTY COMMISSIONER OF EXCISE, DAKSHINA KANNADA DISTRICT, MANGALORE 574142, DAKSHINA KANNADA. …RESPONDENTS (BY SMT RASHMI RAO, HCGP) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER OR DIRECTIONS QUASHING THE IMPUGNED DEMAND DT 15.06.2020 AS PER ANNEXURE-E ISSUED BY THE R4. DECLARE THAT THE RESPONDENTS AUTHORITIES ARE NOT COMPETENT TO DEMAND AND COLLECT THE LICENSE FEE AND ADDITIONAL FEE ON ACCOUNT OF UP GRADATION OF ANY LOCAL BODY FOR THE YEAR, WHEN THE IS ALREADY RENEWED BY ACCEPTING THE PRESCRIBED LICENSE FEE AS ON THE DATE OF RENEWAL. THIS PETITION, COMING ON FOR FURTHER HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE ANANT RAMANATH HEGDE ORAL ORDER Heard the learned senior counsel appearing for the petitioner and the learned High Court Government Pleader appearing for the respondents. - 3 - NC: 2025:KHC:1615 WP No. 12671 of 2021 2. This petition is filed to quash the order dated 15.06.2020 marked at Annexure-E wherein, 4th respondent has demanded Rs.50,600/- as arrears of licence fee payable by the petitioner. The consequential relief is also sought to restrain the respondents from demanding licence fee in excess of what is already paid by the petitioner pursuant to licence granted on 01.07.2014. 3. Learned senior counsel appearing for the petitioner adverting to the facts of the case would submit that the petitioner applied for CL-9 licence under the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968 ('Rules, 1968' for short). The licence was issued on 01.07.2014 in respect of an area within the limits of Ullal Town Municipal Council. It is further stated that with effect from 09.12.2004, Ullal was converted as City Municipality. Admittedly, the licence fee payable in respect of CL-9 licence for Town Municipality is less than the licence fee paid in respect of City Municipality. The licence issued earlier on 01.07.2014 was valid till 30.06.2015. Noticing the fact that Ullal is upgraded as City Municipality, the respondents - 4 - NC: 2025:KHC:1615 WP No. 12671 of 2021 demanded higher licence fee in respect of licence issued in favour of the petitioner with effect from 09.12.2004 till 30.06.2015. Learned senior counsel appearing for the petitioner would contend that the said demand at Annexure- E is illegal and contrary to the law laid down by the co- ordinate Bench of this Court in the case of H. Ibrahim and Others vs. State of Karnataka and Others1. Learned senior counsel would also refer to Rule 7 of the Rules, 1968. Said Rule 7 reads as under:- "Duration of licence- All licences other than "special licences" and "occasional licences" granted or renewed shall be valid for the year or where a licence is granted or renewed on any date after the 1st July until 30th June thereafter". 4. The aforementioned Rule would clearly reveal that the licence once granted shall be valid for the year or if it is renewed, on any date after 1st July, then the licence will be valid till 30th June thereafter. The plain reading of aforementioned Rule would indicate that the licence is valid for one year or till 30th of June if it is issued after 30th June as enumerated in Rule 7 of the Rules, 1968. 1 1996 (5) Kar.L.J. 678 - 5 - NC: 2025:KHC:1615 WP No. 12671 of 2021 5. Merely because Rule 8 provides for different fee structure depending upon the nature of the locality, Rule 7 does not enable the State to demand higher licence fee in case, the locality is upgraded during the currency of the licence. The co-ordinate Bench of this Court in the aforementioned judgment has also taken the view. Under these circumstances, the demand made by the respondents in terms of Annexure-E is contrary to the law and same has to be quashed. Accordingly, the same is quashed. Hence, the following:- ORDER i) The writ petition is allowed. ii) Impugned Annexure-E dated 15.06.2020 issued by respondent No.4 is quashed. Sd/- (ANANT RAMANATH HEGDE) JUDGE CHS List No.: 1 Sl No.: 30