Validity of K'taka excise amendment rules upheld

Bangalore, Aug 16 (UNI) The Karnataka High Court today upheld the validity of the Karnataka Excise (Sale of Indian and Foreign Liquor) Amendment Rules 2006, which provided for abolishing wholesale trade in liquor through licencees.

Mr Justice V Gopala Gowda and Mr Justice Kumaraswamy upheld the amendment, while dismissing a batch of writ petitions, filed by M/s Kanakadurga Agency of Raichur, Devaraj and Company of Raichur and 28 other licencees, after considering all the contentions in detail vis-a-vis the rulings of several courts.

The petitioners challenged Rule 3 of the amendment, which came into effect from July one, 2006, and the subsequent notifications issued, whereby retailers were required to obtain supplies from the Karnataka Beverages Company.

They contended that the impugned amendments were illegal and unconstitutional. There were 183 wholesale licencees, providing employment to about 10,000 people. They had been granted license as per law, which was valid up to the end of the excise year -- July one, 2006.

The licenses, granted for an year, were generally renewed automatically, subject to payment of the prescribed licence fee. The impugned rules would in effect throw the 10,000 employees out of jobs and as the Government had not provided any scheme for rehabilitation of the employees, the impugned rules were ultra vires of Articles 21, 14 and 19 of the Constitution, they submitted.

The Government defended the amendments on the ground that it was intended to overcome the large scale illegal trade in ''seconds'' and augment revenue to the State exchequer. It had resulted in a revenue income of Rs 135 crore and the petitioners had no fundamental right to trade in liquor, it submitted.

UNI XR GD MSJ RAI2044