Bar & Bench ( IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : CORAM

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1 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : CORAM The HON'BLE MS.INDIRA BANERJEE, CHIEF JUSTICE AND The HON'BLE MR.JUSTICE ABDUL QUDDHOSE W.P.No of 2017 K. Balu President, Advocates Forum for Social Justice, No.156, Thambu Chetty Street, Chennai Petitioner vs. 1 The State of Tamilnadu, Rep. by the Chief Secretary to Government, Secretariat, Fort St. George, Chennai The Principal Secretary to the Government, Home Prohibition & Excise Department, Secretariat, Fort St. George, Chennai The Commissioner, Prohibition and Excise Department, Chepauk, Chennai TASMAC Ltd. Rep. by its Managing Director, 4th Floor, CMDA Tower, Gandhi Irwin Bridge, Egmore, Chennai

2 (2) 5 The Union of India Rep. by its Secretary to the Government, Ministry of Road Transport and Highways, Transport Bhawan, Parliament street, New Delhi The Project Director, National Highways Authority of India, Sri Tower, 3rd Floor, DP 34 (SP) Industrial Estate, Guindy, Chennai Tamil Nadu Bars and Club Owners Association, rep. by its President Dr.Benze Saravanan, No.781, Rayala Towers, 2 nd Floor, Anna Salai, Chennai South India Hotels and Restaurants Association, rep. by its executive Committee Member R.Srinivasan, No.3, 6 th Floor, Seethakathi Business Centre, Anna Salai, Chennai-2... Respondents (R7 impleaded as per order dt in WMP.No of 2017) (R8 impleaded as per order dt in WMP.No of 2017) PRAYER : Writ Petition filed under Article 226 of the Constitution of India for issuance of a writ of certiorari, calling for the records relating to the impugned Letter No. P & E2(4)/12740/2016 dated issued by the 3rd respondent and quash the same.

3 (3) For Petitioner For Respondents : Mr.N.L.Rajah Senior Counsel for M.R.Jothimanian : Mr.T.N.Rajagopalan Government Pleader for respondent Nos.1 to 3 Mr.Vijaynarayan Advocate General for Mr.John Kennedy for respondent No.4 Mr.D.Simon for respondent No.5 Mr.P.Wilson Senior Counsel for M/s.P.Wilson Associates for respondent No.6 Mr.K.Venkatesan for respondent No.7 Mr.P.S.Raman Senior Counsel for Mr.Seethapathy for respondent No.8 ORDER (Order was made by Ms.Indira Banerjee, Chief Justice) The petitioner, a practising Advocate and the President of Advocates' Forum for Social Justice, an organization which gives free legal aid and legal education and conducts seminars, workshops,

4 (4) debates and interviews for the cause of social justice, has filed this writ petition, in public interest, challening Letter No.P&E.II(4)/12740/2016 dated issued by the Commissioner, Prohibition and Excise Department, being respondent No.3 herein, directing the District Collectors to permit all F.L.I to F.L.II (Foreign Liquor) Licensed shops within the limits of Municipal Corporations, Municipalities and Town Panchayats, pursuant to which 1700 liquor shops have allegedly been opened all over Tamil Nadu. 2. The short question before this Court is whether the direction on District Collectors to permit all F.L.I to F.L.II Licensed shops, which are located within the limits of Municipal Corporations, Municipalities and Town Panchayats to function with immediate effect contravenes the judgment and order dated of the Hon'ble Supreme Court in State of Tamil Nadu, represented by its Secretary, Home, Prohibition and Excise Department and others v. K.Balu and another, reported in (2017) 2 SCC 281 or Rule 8 of the Tamil Nadu Liquor Retail Vending (In shops and Bars) Rules, 2003, hereinafter referred to as 'the Rules'). 3. Rule 8 of the Rules is set out herein below for convenience: 8. Location of shop. (1) No shop shall be

5 (5) established in Municipal Corporations and Municipalities within a distance of 50 (fifty) metres and in other areas 100 (hundred) metres from any place of worship or educational institutions : Provided that the distance restriction shall not apply in areas designated as "Commercial" or "Industrial" by the Development or Town Planning Authorities : Provided further that no shop shall be established within the premises of any hotel : Provided also that if any place of worship, educational institution comes into existence subsequent to the establishment of the shop, the provisions of this rule shall not apply : Provided also that no liquor shops shall be established in any tribal areas covered under Integrated Tribal Development Project and Hill Area Development Project in the Hill area of Vellore, Salem, Namakkal, Dindigul, Tirunelveli and Kanniyakumari districts. (2) Every shop shall be housed in a pucka building and no part of the shops shall be thatched either on the sides or on the roof. (3) The shop shall be in the location approved by the Collector before commencing the business in the shops. 4. Under Rule 8 of the Rules, no shop is to be established in Municipal Corporations and Municipalities within a distance of 50 mtrs and in other areas 100 meters from any place of worship or

6 (6) educational institutions. The first proviso also clarifies that the distance restriction is not to apply in areas designated as "Commercial" or "Industrial" by the Development or Town Planning Authorities. The third proviso provides that if any place of worship or any educational institution comes into existence subsequent to the establishment of the shop, the bar imposed by the Rule would not apply. 5. In our view, educational institution in Rule 8 contemplates recognised educational institutions such as Schools, Colleges, Universities, including recognised technical institutions like Medical Colleges, Engineering Colleges, etc., but not coaching centres or unrecognised institutions. Furthermore, as observed above, the third proviso to Rule 8 clearly excludes institutions which come into existence after establishment of the TASMAC Shop. 6. In the State of Tamil Nadu and other v. K.Balu and another, supra, being an appeal from an order in a public interest litigation initiated by the petitioner, the Supreme Court took note of accidents on highways on account of liquor consumption causing irreparable trauma of loss, pain, suffering and death, and issued the following directions:

7 (7) All States and Union Territories shall forthwith cease and desist from granting licences for the sale of liquor along National and State highways; The prohibition contained in Para 29.1 above shall extend to and include stretches of such highways which fall within the limits of a municipal corporation, city, town or local authority; The existing licences which have already been renewed prior to the date of this order shall continue until the term of the licence expires but no later than ; All signage and advertisements of the availability of liquor shall be prohibited and existing ones removed forthwith both on National and State highways; No shop for the sale of liquor shall be (i) visible from a national or State highway; (ii) directly accessible from a national or State highway; and (iii) situated within a distance of 500 m of the outer edge of the national or State highway or of a service lane along the highway All States and Union Territories are mandated to strictly enforce the above directions. The Chief Secretaries and Directors General of Police shall within one month chalk out a plan for enforcement in consultation with the State Revenue and Home Departments. Responsibility shall be assigned, inter alia, to District Collectors and Superintendents of Police and other competent authorities. Compliance shall be strictly monitored by calling for fortnightly reports on

8 (8) action taken These directions issue under Article 142 of the Constitution. 7. Learned Advocate General appearing on behalf of the fourth respondent/tasmac as also learned Government Pleader appearing on behalf of the State authorities and learned counsel for the private respondents submitted that the initial judgment and order of the Supreme Court in the State of Tamil Nadu vs. Balu (supra) has been modified and now clarified by the order of the Supreme Court dated in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another, reported in 2017 SCC Online SC Municipal areas have been exempted from the restrictions on the ground of licence for the sale of liquor along National and State Highways. 8. In Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra), what was in issue was the action of the Union Territory of Chandigarh in denotifying certain roads which were earlier catagorised as State Highways. The Supreme Court found that those roads categorised as V1,V2 and V3 are essentially roads within the city. They had been categorised as Highways by an administrative decision of primarily with a

9 (9) view to ensure their maintenance and development by availing of funds available from the Central Road Fund. 9. The Supreme Court further observed that alteration in the nomenclature of certain roads, by the subsequent notification dated 16 March 2017, had left unaffected National Highway No.21 which passed through the city and Madhya Marg which connected the States of Haryana and Punjab. In the afore-said factual matrix, where roads catagorised as V1,V2 and V3, which were essentially roads within the city which connected different sectors, but catagorised as Highways for administrative convenience and adjustment of funds, were de-notified and de-classified. 10. The Supreme Court further observed that the judgment and order dated prohibited the grant of licenses for the sale of liquor along and in proximity of the National and State Highways, including those falling within the limits of municipal corporations, cities, towns or local authorities and the directions (i) and (ii) contained in the order of the Supreme Court dated did not prevent the administration from reclassifying inter-sectoral roads within the city from State Highways to major district roads. The exercise carried out by Chandigarh Administration does not breach the directions issued by

10 the Supreme Court. (10) 11. Elaborating on this aspect, the Supreme Court said that the purpose of the directions contained in the order dated was to stop the sale of liquor along and in proximity of the National and State Highways, which provide connectivity between cities, towns and villages, as properly understood. The Order did not prohibit licensed establishments within municipal areas. This clarification issued by the Supreme Court would govern other Municipal areas as well. 12. When this writ petition was first taken up for hearing some time in September, 2017, this Court expressed the view that the judgment of the Supreme Court in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra), did not permit and/or allow liquor shops along or in proximity of National and State Highways passing through the limits of Municipal corporations, cities, towns or local authorities. What was in issue before the Supreme Court was the denotification of a road from a State Highway to a District road. In the facts of that case where the roads were essentially within the city connecting sectors but catagorised as a Highway for a specific purpose, i.e., utilisation of funds for

11 (11) maintenance, the Supreme Court was of the view that such roads would not attract the bar of setting up of liquor shops in terms of its earlier order and judgment dated It is obvious that the law laid down by the Supreme Court in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra) would apply all over India, including the State of Tamil Nadu. This Court expressed doubts as to whether the said judgment would exempt liquor shops along and/or in proximity of National and State Highways passing through the city of Chennai and other cities and towns. 13. In view of the observations made by this Court in open Court with regard to the implications of the judgment in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra), the State filed an application in the Supreme Court for clarification. 14. By order dated passed in I.A.Nos of 2017 in Civil Appeal Nos of 2016 (State of Tamil Nadu v. K.Balu and another), the Supreme Court clarified as under: 7. The above observations make it clear that the purport of the judgment dated 15 December 2016 is to

12 (12) prohibit the sale of liquor along and in proximity of highways which provide connectivity between cities, towns and villages. In other words, this will not operate to prohibit licenced establishments within municipal areas. The clarification to the effect that it shall govern other municipal areas as well is clearly intended to set the matter at rest in relation to other parts of the country so as to obviate the need for repeated applications before this Court. The expression other municipal areas will apply to all municipal areas, wherever situated. 15. Thereafter, by another order dated passed in M.A.Nos of 2018, etc. batch in Civil Appeal Nos of 2016, the Supreme Court held: 7. In the order passed by this Court on 11 July 2017, it was observed that the purpose of the directions contained in the order dated 15 December 2016 is to deal with the sale of liquor along and in the proximity of highways properly understood, which provide connectivity between cities, towns and villages. Having regard to this object it was noted that the order does not prohibit licensed establishments within municipal areas. Indeed, in order to ensure that the order is uniformly understood across the country, this Court clarified that it will govern other municipal areas as well. In the subsequent order of this Court dated 13 December 2017, liberty has been granted to the

13 (13) licence holders to submit a representation to the state government that the same principle should apply to the licensed establishments of the petitioners, as they apply to municipal areas/midc developed areas (in relation to the 5 Special Leave Petition (C) No 19845/2017 State of Maharashtra). 8 Having regard to these directions, we are of the view that the state governments would not be precluded from determining whether the principle which has been laid down by this Court in the order dated 11 July 2017 in Arrive Safe Society (supra) should also apply to areas covered by local self- governing bodies and statutory development authorities. We are inclined to allow the state governments to make this determination since it is a question of fact as to whether an area covered by a local self-governing body is proximate to a municipal agglomeration or is sufficiently developed as to warrant the application of the same principle. In deciding as to whether the principle which has been set down in the order dated 11 July 2017 should be extended to a local selfgoverning body (or statutory development authority) the state governments would take recourse to all relevant circumstances including the nature and extent of development in the area and the object underlying the direction prohibiting the sale of liquor on national and the state highways. The use of the expression municipal areas in the order dated 11 July 2017 does

14 (14) not prevent the state governments from making that determination and from taking appropriate decisions consistent with the object of the orders passed by this Court. We leave it open to individual licensees to submit their representations to the competent authorities in the state governments if they are so advised upon which appropriate decisions may be taken by the state governments. We have issued this general direction to obviate both litigation before the High Courts and repeated recourse to applications to this Court. 16. By the order dated , referred to above, the Supreme Court did not waive the prohibition imposed by its judgment to granting licenses for sale of liquor along stretches of National and State Highways which fall within the limits of a Municipal Corporation, City, Town or Local Authority. The Supreme Court gave liberty to licence holders of licensed establishments to submit a representation to the State contending that the principle enunciated in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra) should apply to the licensed establishments of the petitioners therein. 17. The Supreme Court also expressed the view that the State Governments would not be precluded from determining whether the

15 (15) principle which had been laid down by the Supreme Court in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra) would also apply to areas covered by local selfgoverning bodies and statutory development authorities. 18. The Supreme Court, by its order dated , referred to above, left it open to individual licensees to submit their representations to the competent authorities in the State Governments, which were obviously to be decided on a case to case basis. 19. In our view, the impugned communication is not in accordance with the judgments and/or orders of the Supreme Court, referred to above, insofar as the same directs the District Collectors to permit all F.L.I to F.L.II licensed shops which are located within the limits of Municipal Corporations, Municipalities and Town Panchayats to function with immediate effect. Representations could only have been decided on a case to case basis by the State Government taking into account all relevant factors as per the judgments and/or orders, referred to above.

16 (16) 20. In our view, the clarification that the intent of the order in the State of Tamil Nadu and other v. K.Balu and another, supra, as modified in Arrive Safe Society of Chandigarh Vs. The Union Territory of Chandigarh and another (supra) was not to prohibit licensed establishments within the municipal areas, would have to harmoniously be interpreted with the bar on liquor shops along stretches of National and State Highways which fall within the limits of a Municipal Corporation, City, Town or Local Authority, and decision in this regard would have to be taken on a case to case basis and would perhaps not apply to licensed clubs and hotels in urban agglomerations which are not easily and/or ordinarily accessible to drivers of motor vehicles. 21. In our view, the impugned notice cannot be sustained to the extent it directs the District Collectors to permit all FL.I and F.L.II licensed shops which are located within the limits of Municipal Corporations, Municipalities and Town Panchayats to function with immediate effect. The State authorities will have to carry out the exercise of determining if any liquor shop set up or proposed to be set up and/or re-opened was covered by the order of the Supreme Court dated in Arrive Safe Society of Chandigarh (supra), on a case to case basis.

17 (17) 22. The Governments would have to take recourse to all relevant factors, including the nature and extent of development in the area and the object underlying the direction prohibiting the sale of liquor on National and State Highways. The writ petition is allowed with the above observations. No costs. Consequently, W.M.P.Nos and of 2017 are closed. (I.B., CJ.) (A.Q., J.) Index : Yes / No Internet : Yes / No bbr To: 1 The Chief Secretary to Government, State of Tamilnadu, Secretariat, Fort St. George, Chennai The Principal Secretary to the Government, Home Prohibition & Excise Department, Secretariat, Fort St. George, Chennai The Commissioner, Prohibition and Excise Department, Chepauk, Chennai The Managing Director, TASMAC Ltd. Rep. by its 4th Floor, CMDA Tower, Gandhi Irwin Bridge, Egmore, Chennai

18 (18) 5 The Secretary to the Government, Union of India Ministry of Road Transport and Highways, Transport Bhawan, Parliament street, New Delhi The Project Director, National Highways Authority of India, Sri Tower, 3rd Floor, DP 34 (SP) Industrial Estate, Guindy, Chennai Tamil Nadu Bars and Club Owners Association, rep. by its President Dr.Benze Saravanan, No.781, Rayala Towers, 2 nd Floor, Anna Salai, Chennai South India Hotels and Restaurants Association, rep. by its Executive Committee Member R.Srinivasan, No.3, 6 th Floor, Seethakathi Business Centre, Anna Salai, Chennai-2.

19 (19) THE HON'BLE CHIEF JUSTICE AND ABDUL QUDDHOSE.J bbr W.P.No of 2017

20 (20)