High Court declines to stay liquor vend cancellation

Less than 10 days after liquor vend allottees, among other things, sought stay on the orders cancelling the licences granted to them, the Punjab and Haryana High Court has refused to grant the relief.

“This court does not deem it fit and proper to pass any such interim order at this stage for the staying of the cancellation of the licences,” the Bench of Justice Jasgurpreet Singh Puri and Justice HS Grewal ruled.

The Bench, at the same time, held that the Chandigarh Administration’s decision to debar liquor vend allottees from participating in “any of the future allotments during Excise Policy 2025-26” without issuing a prior notice would prima facie not be in accordance with law.

“We are of the considered view that only as an interim measure, it will be just and proper to direct that in the meanwhile, the operation of the impugned order dated April 9 only to a limited extent of debarment shall be kept in abeyance qua the present petitioners,” the Bench asserted.

It added that the petitioners would be provisionally permitted to participate in the auction process scheduled to be held on April 21. But mere participation would not create any “equity or equitable” right in the petitioners’ favour at the time of final disposal. “The outcome of the aforesaid auction to be held on April 21, if any, shall be subject to the final outcome of the present petitions,” the Bench said, adding that the principle of “audi alteram partem” or the right to be heard was required to be followed in such cases, especially since debarment carried civil consequences.

The Bench was assisted in the matter by senior advocates DS Patwalia, Chetan Mittal, Gurminder Singh, Puneet Bali and Ashok Aggarwal. Advocates BS Patwalia and Kunal Mulwani, among others, also rendered assistance.

The UT senior standing counsel, Amit Jhanji, along with additional standing counsel Sumeet Jain, submitted that a plain reading of a clause made it clear that 15 per cent of the bid amount — comprising 8 per cent security deposit and 7 per cent bank guarantee — was required to be deposited within seven bank working days from the allotment.

The petitioners deposited the security amount in time but failed to furnish the 7 per cent bank guarantee within the stipulated period. There was, as such, no option but to cancel the allotment. The seven-day period, he maintained, was to be counted from the date of allotment, March 21.

The court observed: “Prima facie as per clause-21 of the policy, a total of 15 per cent of bid money comprising two components — 8 per cent security deposit and 7 per cent bank guarantee — was is to be deposited within seven bank working days. As to whether both the components can be segregated or not for the purposes of its effect disqualifying the allottees also has to be considered in detail during final hearing.”

Chandigarh