Kerala High Court
The Excise Commissioner vs The Excise Commissioner on 10 February, 2021
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2451 OF 2018
AGAINST THE JUDGMENT IN WP(C) 3969/2018(U) OF HIGH COURT
OF KERALA
APPELLANTS/RESPONDENTS IN THE WRIT PETITION:
1 THE EXCISE COMMISSIONER
COMMISSIONERATE OF EXCISE,
THIRUVANANTHAPURAM-695 033.
2 THE DEPUTY COMMISSIONER OF EXCISE,
KOZHIKODE - 673 020.
SRI.V.MANU, SENIOR GOVT. PLEADER
RESPONDENT/PETITIONER IN THE WRIT PETITION:
K.SRIDHARAN
S/O.KANNAN NAIR, KURUMANNIL HOUSE,
PAYYOLI VILLAGE, KIZHOOR DESOM,
KOYILANDI THALUK, KOZHIKODE DISTRICT-673 522.
BY ADV. SRI.A.SUDHI VASUDEVAN (SR.)
BY ADV. SRI.JOSE JONES JOSEPH
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2452/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 2
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2452 OF 2018
AGAINST THE JUDGMENT IN WP(C) 16059/2018(F) OF HIGH COURT
OF KERALA
APPELLANTS/ RESPONDENTS IN THE WRIT PETITION:
1 STATE OF KERALA,REPRESENTED BY SECRETARY,
DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
2 COMMISSIONER OF EXCISE,
KERALA, BAKERY JUNCTION ROAD, NANDAVANAM,
PALAYAM, THIRUVANANTHAPURAM-695 033.
3 DEPUTY EXCISE COMMISSIONER
WAYANAD, MEENANGADI - 673 122.
SRI.V.MANU, SENIOR GOVT. PLEADER
RESPONDENT/PETITIONER IN THE WRIT PETITION
1 K.V. VISWANATHAN
S/O.KUNHIRAMAN, KULANGARAKANDI HOUSE,
MELUMURINGODI P.O., IRITTY TALUK,
KANNUR DISTRICT, PIN - 670 673.
ADV.SRI.MATHEW KURIAKOSE
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2451/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2453 OF 2018
AGAINST THE JUDGMENT IN WP(C) 6308/2018(K) OF HIGH COURT
OF KERALA
APPELLANTS/RESPONDENTS IN THE WRIT PETITION::
1 STATE OF KERALA,REPRESENTED BY CHIEF SECRETARY,
GOVERNMENT OF KERALA, SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
2 EXCISE COMMISSIONER
COMMISSIONERATE OF EXCISE,
THIRUVANANTHAPURAM-695 033.
3 DEPUTY COMMISSIONER OF EXCISE
CIVIL STATION, KOZHIKODE-673 020.
4 EXCISE INSPECTOR
EXCISE RANGE OFFICE, VADAKARA - 673 101,
KOZHIKODE DISTRICT
SRI.V.MANU, SENIOR GOVT. PLEADER
W.A.2451/2018 & Conn. 4
RESPONDENT/PETITIONER IN THE WRIT PETITION
1 T.H.RAJAN,
S/O.KUMARAN, KOYILOTH MEETHAL HOUSE,
VADAKARA VILLAGE, VADAKARA THALUK,
KOZHIKODE DISTRICT.
2 G.PRABHAKARAN
S/O.RAMMUNI, VALLIYA KAYYIL HOUSE,
NADAKUTHAZHA VILLAGE, PUTHUPANNAN,
VADAKARA THALUK, KOZHIKODE DISTRICT.
ADV. SRI.A.SUDHI VASUDEVAN (SR.)
ADV. SRI.JOSE JONES JOSEPH
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2451/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 5
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2454 OF 2018
AGAINST THE JUDGMENT IN WP(C) 3326/2018(M)
APPELLANTS/RESPONDENTS IN THE WRIT PETITION:
1 COMMISSIONER OF EXCISE
OFFICE OF THE COMMISSIONER OF EXCISE,
THIRUVANANTHAPURAM, KERALA - 695 033.
2 DEPUTY COMMISSIONER OF EXCISE
CIVIL STATION (P.O.), KOZHIKODE - 673 020.
3 EXCISE CIRCLE INSPECTOR
CIVIL STATION (P.O.), KOZHIKODE - 673 020.
4 STATE OF KERALA,REPRESENTED BY ITS SECRETARY,
TAXES DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
SRI.V.MANU, SENIOR GOVT. PLEADER
RESPONDENT/PETITIONER IN THE WRIT PETITION:
V.P.ASOKAN,S/O.PERAVAKUTTY, DEEPAK NIVAS,
KARANTHOOR P.O., KOZHIKODE DISTRICT - 673 571.
BY ADV. SRI.MILLU DANDAPANI
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2451/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 6
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2455 OF 2018
AGAINST THE JUDGMENT IN WP(C) 4910/2018(K) OF HIGH COURT
OF KERALA
APPELLANTS/RESPONDENTS IN THE WRIT PETITION:
1 STATE OF KERALA
REPRESENTED BY ITS SECRETARY,
TAXES (A) DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
2 THE EXCISE COMMISSIONER
COMMISSIONERATE OF EXCISE,
THIRUVANANTHAPURAM-695 033.
3 THE DEPUTY COMMISSIONER OF EXCISE
KASARAGOD - 673 001.
4 THE EXCISE INSPECTOR
HOSDURG EXCISE RANGE,
KASARAGOD DISTRICT-671 315.
SRI.V.MANU, SENIOR GOVT. PLEADER
W.A.2451/2018 & Conn. 7
RESPONDENTS/PETITIONERS IN THE WRIT PETITION:
1 C.V.DAMODHARAN,
S/O.AMBADI, THATTUMMAL EZHAMMAYIL HOUSE
ADENGANAM, KODOM VILLAGE, VELLARIKUNDU TALUK
2 SHAJI E.K.
S/O.E.V.KARUNANKARAN, ERIYODATH,
ELAVAMKUNNEL HOUSE, PULLUR VILLAGE,
HOSDURG TALUK, KASARGOD DISTRICT.
ADV.SRI.M.G.KARTHIKEYAN
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2451/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 8
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR
&
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 10TH DAY OF FEBRUARY 2021 / 21ST MAGHA,1942
WA.No.2456 OF 2018
AGAINST THE JUDGMENT IN WP(C) 4811/2018(B) OF HIGH COURT
OF KERALA
APPELLANTS/RESPONDENTS IN THE WRIT PETITION:
1 STATE OF KERALA
REPRESENTED BY ITS SECRETARY,
TAXES (A) DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
2 THE EXCISE COMMISSIONER
COMMISSIONERATE OF EXCISE,
THIRUVANANTHAPURAM-695 033.
3 THE DEPUTY COMMISSIONER OF EXCISE
KASARAGOD - 673 001.
4 THE EXCISE INSPECTOR
NEELESWARAM EXCISE RANGE,
KASARAGOD DISTRICT-673 572.
SRI.V.MANU, SENIOR GOVT. PLEADER
RESPONDENTS/PETITIONERS IN THE WRIT PETITION:
1 RAJAN T.V.
S/O.AMBOONI, KOTTUMPURAM DESOM,
NEELESWARAM VILLAGE, KASARAGOD DISTRICT-671314
W.A.2451/2018 & Conn. 9
2 T.K.MUKUNDAN
S/O.KUTTAPPAN, PATTENA DESOM, PEROL VILLAGE,
HOSDURG TALUK, KASARAGOD DISTRICT-671315
3 K.SUKUMARAN
S/O.V.V.AMBOONJI, PALLIKKARA DESOM,
NEELESWARAM VILLAGE, HOSDURG TALUK,
KASARAGOD DISTRICT-671315
ADV.SRI. A.SUDHI VASUDEVAN (SR.)
ADV.SRI. JOSE JONES JOSEPH
ADV.SRI.M.G.KARTHIKEYAN
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON
24.6.2020, ALONG WITH WA.2451/2018 AND CONNECTED CASES,
THE COURT ON 10.2.2021 DELIVERED THE FOLLOWING:
W.A.2451/2018 & Conn. 10
"C.R"
JUDGMENT
Ravikumar, J.
The captioned writ appeals are directed against a common
judgment dated 25.10.2018 in W.P.(C)Nos.16509/2018, 3969/2018,
6308/2018, 4910/2018, 4811/2018 & 3326/2016. The State of
Kerala and its officers who were respondents in the writ petitions are
the appellants. The respondents herein/the writ petitioners were
licensees/workers of toddy shops under different groups in different
Excise Ranges. The licensees were permitted to vend toddy through
the respective shops up to 31.3.2018. During the currency of their
licences, samples of toddy were taken from their respective shops by
the competent officers and on analysis, they were found to be
adulterated with foreign materials and in the admixture presence of
starch was found. Consequently, crime and occurrence reports were
registered against the respondents herein, prior to 21.12.2017, under
Section 57(a) of the Abkari Act, 1077. Upon registration of abkari
offences against them under Section 57(a) of the Abkari Act, the
respective licensees were issued with show cause notices as to why
licences issued to them to vend toddy, should not be cancelled.
Pending proceedings, the licences and privileges were suspended by
the Deputy Commissioner concerned. Later, in terms of the
provisions under Section 26 of the Abkari Act, their licences were
cancelled. Still later, orders for resale of such shops were also issued.
Though they approached the authorities for compounding the
offences, the representations submitted therefor, were rejected. It is
the said circumstances that constrained the respondents herein/writ
petitioners to approach this Court by filing the above mentioned writ
petitions.
2. The learned Single Judge, after considering the rival
contentions set aside the impugned orders of suspension/cancellation
and disposed of the writ petitions as per common judgment
25.10.2018 with the following findings and directions:-
"17. The impugned orders of
suspension/cancellation of licence are therefore set aside.
There will be a direction to the competent among the
respondents to first consider the application for
composition preferred by the petitioners in terms of
Section 67A(1) of the Abkari Act and to pass appropriate
orders in accordance with law on the said applications. It
is clear from the language of the provisions that a
compounding under Section 67A would amount to
absolving the accused persons of all liabilities in respect
of any penal provision in terms of the Abkari Act or the
Rules made thereunder. In the above view of the matter,
the reconsideration of the issue of necessity for
cancellation of licences has to 17 be made by the
competent among the respondents after the application
for compounding is duly considered and disposed of. In
case the compounding applications preferred by the
petitioners are allowed, the issue of cancellation of
licences will be taken up and decided taking note of the
fact that the petitioners stand absolved of all liabilities in
respect of the offences alleged against them in terms of
Section 57(aa) of the Act. Needful shall be done by the
respondents within a period of two months from the date
of receipt of a copy of this judgment."
(Underline supplied)
It is feeling aggrieved by the setting aside of the orders of
suspension/cancellation of the licences issued to the respondents
herein/writ petitioners and the further consequential findings and
directions that the captioned appeals are filed.
3. Heard the learned Senior Government Pleader as also the
learned counsel appearing for the respondents/writ petitioners.
4. Both sides were heard at length. From the rival contentions,
various points germane for consideration. In view of the
commonness of the issues as also the contentions, for the purpose of
disposal of the appeals, it is absolutely unnecessary for us to take
note of the factual aspects involved in the individual cases. As a
matter of fact, it is submitted by both sides that the factual position
obtained in each of the cases need not be gone into and what calls
for in these appeals is only resolution of legal issues raised based on
the amendments made in the Abkari Act by substituting the words
"any ingredient, other than starch" for the words "any ingredient" in
Section 57(a), by inserting the words "mixes or permits to be mixed
with starch in the liquor sold or manufactured by him; or" as clause
(aa), after clause (a) of section 57, by substituting the following
words, figures, symbols and brackets:-
"shall, on conviction before a competent court, be punished,--
(i) for the offences, other than an offence falling under clause
(aa), with imprisonment for a term which may extend to five
years or with fine which may extend to fifty thousand rupees
or with both;
(ii) for an offence falling under clause (aa), with imprisonment
for a term which may extend to six months or with fine which
shall not be less than twenty five thousand rupees", after
clause (d), for the words "shall, on conviction before a
competent court, be punished for each such offence with
imprisonment for a term which may extend to five years or
with fine which may extend to fifty thousand rupees, or with
both" in section 57 and after the existing entries under
columns (1), (2) and (3), inserting the following entries,
respectively namely:-
"Mixing starch with liquor 57(aa) 25,000",
in the table under section 67A, as per the Abkari (Amendment)
Ordinance, 2017 (Ordinance No.38 of 2017) with effect from
21.12.2017, the date of its promulgation. As a matter of fact,
subsequently, all these amendments were brought into the
Principal Act viz., the Abkari Act as per the Abkari
(Amendment) Act, 2018 (Act 25 of 2018) published in Kerala
Gazette Extraordinary No.1812 dated 6.7.2018,with effect
from 21.12.2017
5. Hereafter in this judgment, the parties are referred to in
accordance with their status in these appeals. As noticed
hereinbefore, in all these cases, the respondents were all
licensees/workers of toddy shops and against them abkari offences
under Section 57(a) of the Abkari Act were registered, prior to
21.12.2017 as in the samples of toddy collected from their respective
shops presence of starch was found. Obviously, the aforesaid
amendments brought in as per Ordinance No.38 of 2017 in the Abkari
Act prompted the respondents to approach the Deputy Excise
Commissioner concerned with request in writing to permit them to
compound the offences. Such requests were declined on the ground
that the said amendments took effect only from 21.12.2017 and in
the cases on hand, samples were collected and crimes were
registered against the respondents, consequent to the detection of
starch in the samples, prior to 21.12.2017. Meanwhile, pursuant to
the registration of the Abkari offence under Section 57(a) of the
Abkari Act, show cause notices were issued to the respondents who
were licensees of different toddy shops and thereafter their licences
were suspended and still later, they were cancelled. Consequent to
cancellation of their licences, orders were also issued for resale of
their respective shops.
6. Written argument note was submitted on behalf of the
appellants. On behalf of the respondents in W.A.Nos.2451/2018,
2453/2018 and 2456/2018 also written argument note was filed.
Virtually, the respondents in the other appeals also endorsed the
contentions raised by the respondents in the aforesaid appeals. The
contentions of the appellants as also the respondents, as revealed
from their respective argument notes, are nothing but the
transcription of their oral arguments advanced before us. The
appellants contended thus:-
Rule 9(2) of the Kerala Abkari Shops Disposal Rules, 2002 (for
short 'the Disposal Rules') mandates that all toddy kept or offered for
sale shall be natural and conforming to such specifications and
complying to such restrictions as may be notified by Government
under clause (n) of Rule 2 of the Disposal Rules. It also mandates
that nothing shall be added to it to increase its intoxicating quality or
strength or to alter its natural composition or for any other purposes.
Specifications and restrictions to be complied with, inter alia,
mandating that toddy shall be free from starch were issued by the
Government under G.O.(P)No.25/2007/TD dated 14.2.2007.
Consequently, mixing starch with toddy also attracted the offence
under Section 57(a) of the Abkari Act and became punishable with
imprisonment for a term which may extend to five years or with fine
which may extend to fifty thousand rupees or with both. Later, an
extenuatory amendment was made as per Ordinance No.38 of 2017
dated 21.12.2017 and the offence of mixing or permitting to mix
starch with liquor (which expression is inclusive of toddy as well) sold
or manufactured by a licensee was made a separate offence with a
reduced penalty, as revealed from the amendments brought in as per
Ordinance No.38 of 2017, extracted hereinbefore. That apart, in and
vide the very same ordinance, in the Table of compoundable offences
given under Section 67A an amendment was effected whereby after
the existing entries under columns 1 (offence), 2 (corresponding
section in the Act) and 3 (compounding fee in rupees), the following
entries were respectively inserted:-
Offence Corresponding Corresponding
section in the Act fee in rupees
Mixing starch with 57(aa) 25000
liquor
In fact, the impact of the aforesaid amendments in respect of an
offence committed under the erstwhile Section 57(a) viz., mixing of
starch with toddy, prior to 27.12.2017, is the bone of contention in
these appeals. As already noticed, later the Abkari (Amendment) Act,
2018 (Act 25 of 2018) was published in Kerala Gazette Extra ordinary
No.1812 dated 6.7.2018 and thereby all the amendments to the
aforesaid sections, were brought into the Principal Act with effect
from 21.12.2017, the date on which Ordinance No.38 of 2017 was
promulgated. The appellants would contend that the aforesaid
amendments are impact-less as relates commission of offence under
the erstwhile Section 57(a) id est, mixing of starch with liquor, which
includes toddy, prior to 21.12.2017. It is their further contention
that in such circumstances the offenders are to be prosecuted under
the 'law in force', at the time of occurrence and at any rate, as a
matter of right, they could not seek for composition of the offence
registered against them.
7. Further it is submitted that even on compounding of the
offence of mixing of starch prior to 27.12.2017, if it is permissible
under Section 67A(1) of the Abkari Act, the respondents would not
be entitled to contend that composition of the offence should be
treated as an 'acquittal' which should operate as a complete bar to
any further proceedings against them. Relying on Ordinance No.26
of 2009, which got lapsed as the bill could not be piloted during the
next session of the Kerala Legislative Assembly and the malayalam
version of the subsequently, promulgated Ordinance viz., Ordinance
No.6 of 2010, it is contended that they would reveal the legislative
intention behind the usage of the words 'the accused person, if in
custody, shall be discharged' employed under Section 67 A(3). It is
further contended that the aforesaid ordinances finally culminated in
Abkari (Amendment) Act, 2010 (Act 3 of 2010) and its malayalam
version would also reveal the meaning of the words 'the accused
person, if in custody, shall be discharged', employed in section
67A(3) of the Abkari Act. The learned Government Pleader drew our
attention to Chapter XIV of the Rules of Procedure and Conduct of
Business in the Kerala Legislative Assembly, framed in terms of
Article 208(1) of the Constitution of India. As per Rule 69(2) therein,
all Bills, except amendment Bills, the present Act of which was
enacted in English, shall be introduced only in Malayalam version. All
the aforesaid contentions are taken, evidently, to canvass the
position that the words 'the accused person, if in custody, shall be
discharged' used in Section 67A(3) of the Abkari Act shall be
understood and interpreted only as 'the accused person, if in custody,
shall be released' in the sense that the period of detention will have
to be terminated and the word 'discharged' used therein shall not be
given the meaning 'acquitted'. To buttress the said contention, the
learned Government Pleader relied on the decision in State of
Rajasthan v. Ram Chandra reported in (2005) 5 SCC 151. In
short, it is contended that if at all composition is permissible in view
of the aforementioned amended provisions, the composition could
not have the impact of 'acquittal'. When once it is found that the
accused person concerned mixed starch with toddy or permitted
mixing of starch with toddy, his action should be taken as an act
committed in violation of Rule 9(2) read with Rule 2(n) of the
Disposal Rules attracting the erstwhile Section 57(a) of the Abkari
Act and in such eventuality, there is no illegality in invocation of the
power under Section 26(b) of the Act by the Commissioner of Excise
to cancel the licence as the said provision empowers him to cancel
licences in the event of breach of licences, it is contended. The
learned Government Pleader also relied on the decision of the Hon'ble
Apex Court in Biswabahan Das v. Gopen Chandra Hazarika
reported in AIR 1967 SC 895 to contend that if the effect of
composition is not expressly provided as acquittal in the relevant
statute, the composition would not be having the impact of acquittal.
It is submitted that the Apex Court as per the said decision laid down
the law that if composition of an offence is permissible under any
particular law, the effect of such composition would depend upon
what the said law provides for and furthermore that if the effect of
composition is to amount an acquittal then it may be said that no
stigma should attach to the character of the person. The learned
Government Pleader also relied on a Division Bench decision in
Sanjayan v. Tahsildar (2007 (4) KLT 597) to drive home the
point that 'compounding' would necessarily mean that the person
compounded the offence concerned would admit his liability as also
his culpability.
8. The nub of the contentions of the respondents is that though
at the time of the alleged commission of offence of mixing of starch
with liquor was falling under Section 57(a) of the Abkari Act and was
a serious offence amerciable with a greater penalty by virtue of the
amendments brought to Sections 57 and 67A of the Abkari Act, it was
made a separate offence under Section 57(aa); rigour of the
sentence therefor was reduced and it was made a compoundable
offence. Therefore, according to the respondents, they are entitled to
the benefits of the amendments brought to Sections 57 and 67A, as
afore-mentioned, despite the fact that the date of occurrence of the
alleged commission of offence of mixing starch with liquor and the
date of registration of abkari offences against them under section
57(a) of the Abkari Act were prior to 21.12.2017. To be precise and
succinct, the respondents would contend that though the alleged
commission of offence of mixing of starch with liquor (in the instant
cases with toddy) was under the erstwhile Section 57(a) and the
dates of registration of the said offence against them were prior to
21.12.2017, it is compoundable by virtue of the amendment of
Section 67A of the Abkari Act and the composition as also the
consequential 'discharge' should have the effect of 'acquittal' as
according to them, the rule of beneficial construction requires that an
'ex post facto law' which reduces the punishment of any particular
offence should be applied to an accused charged for the same offence
under the previous law, to mitigate the rigour of the law. Relying on
the decisions of this Court in Sivapalan v. R.T.O, Kollam (1996 (2)
KLT 632) and Mathew N.J v. State of Kerala and others (2011
(3) KLT 1), it is contended that pendency of the case before a court
of law would not take away the power of the officer empowered to
compound the offence and in such cases, in the event of composition
of the offence what is required is only to give a report to the court
concerned, of the action taken, to close the case. The further
contention is that the effect of such composition is that it would
operate as a complete bar to any further proceedings as if the
offender had been acquitted. It is also their contention that as a
necessary sequel of composition and discharge, the preference
contemplated under Rule 5(1) of the Disposal Rules could not be
denied to the offender if he was a licensee. Raising, inter alia, such
contentions, they resisted the appeals and contended that the
impugned common judgment calls for no appellate interference and
the appeals are liable to be dismissed. In support of their
contentions, they also relied on a judgment of the Hon'ble Apex Court
in T.Barai v. Henry Ah Hoe and another reported in (1983) 1
SCC 177.
9. The following main questions pose for consideration in view
of the factual and legal contentions:-
1. Whether the offence of 'mixing or permitting to mix starch
with liquor' is non-compoundable even after the amendments brought
into Sections 57 and 67A of the Abkari Act as per Act 25 of 2018,
solely because it was committed prior to 21.12.2017 when the said
offence was falling under Section 57(a) of the Abkari Act?
2. If it is compoundable what is the effect of composition in
terms of the provisions under Section 67A of the Act?
3. Whether composition of the offence in terms of the
provisions under Section 67A of the Abkari Act would absolve the
compounder from the civil liabilities under the Abkari Act which
should otherwise visit a licensee by virtue of the provisions under
Section 26 of the Abkari Act?
The above and other allied questions require to be resolved in
the captioned appeals.
10. For a proper appreciation of the rival contentions and also
to decide the questions of seminal importance involved, it is only
appropriate to refer to the following provisions:-
"57. For adulteration, etc., by licensed
vendor or manufacturer.- Whoever being the
holder of a license for the sale or manufacture of
liquor or of any intoxicating drug under this Act,
(a) mixes or permits to be mixed with the
liquor or intoxicating drug, sold or manufactured by
him, any drug, other than a noxious drug or any
ingredient, other than starch, likely to add to its
actual or apparent intoxicating quality or strength,
or any article prohibited other than an article which
the Government shall deem to be noxious by any
rule made under section 29, clause (k), when such
admixture shall not amount to the offence of
adulteration under section 272 of the Indian Penal
Code; or
(aa) mixes or permits to be mixed with starch
in the liquor sold or manufactured by him; or
(d) sells or keeps or exposes for sale any
country liquor in a bottle, case, package or other
receptacle with any mark thereon or on the cork
thereof with the intention of causing it to be
believed that such bottle, case, package or other
receptacle contains foreign liquor, when such act
shall not amount to the offence of selling goods to
which a false trade mark or false trade description is
applied under, Section 79 of the Trade and
Merchandise Marks Act, 1958 shall, on conviction
before a competent court, be punished,-
(i).....................................................................
.
(ii) for an offence falling under clause (aa), with
imprisonment for a term which may extend to six
months or with fine which shall not be less than
twenty five thousand rupees.
"67A. Power to compound offences.- (1)
The Commissioner of Excise or the Deputy
Commissioner of Excise of the District concerned or
any Abkari Officer specially empowered by the
Government in this behalf by notification in the
Gazette, may accept, from any person reasonably
suspected of having committed any of the offences
specified in column (1), a sum of money as specified
in column (3) of the Table below by way of
composition for the offence which may have been
committed and where any property has been seized,
the same shall be confiscated to Government or
disposed of in such manner as may be prescribed.
(2) Where any case involving an offence specified
under subsection (1) is pending before a court of
law, such offence may be compounded with the
permission of such court and a report of the action
taken thereon shall be filed before the court.
(3) On payment of such sum of money or such
value or both, as the case may be, to such officer
empowered for the purpose under sub-section (1),
the accused person, if in custody, shall be
discharged."
Explanation:- for the purpose of this section, the
word "compound" means compounding of offences.
11. We will consider the first question, now. The common case
is that prior to and subsequent to, amendments to Section 57 of the
Abkari Act, 'mixing of starch with liquor', which, expression viz.,
'liquor' will take in toddy as well by virtue of the definition under
section 3(10), constituted/constitutes an abkari offence. There can be
no doubt with respect to the position that what decides whether an
act or omission is an 'offence' is the ingredients to constitute the
offence as per the relevant statute. Hence, according to us, the
position that the offence of 'mixing of starch with liquor' was falling
under Section 57(a) prior to the amendment and it now falls under
Section 57(aa), of the Abkari Act after the amendment cannot have
much relevance or consequence as relates the questions in issue. We
have already referred to the pre-amended and post amended position
of the different sub sections of Section 57 of the Abkari Act. It is
common ground that the offence of 'mixing of starch with liquor', with
which the respondents herein are charged, alleged to have been
committed at a time when for the commission of the said offence of
'mixing of starch with liquor' a graver penalty of imprisonment for a
term which may extend to five years or with fine which may extend
to fifty thousand rupees or with both, was awardable on conviction by
a competent court of law and after the amendment to Section 57
brought in as per Ordinance No.38 of 2017 which ultimately
culminated in Abkari (Amendment) Act, 2018 (Act 25 of 2018) with
effect from 21.12.2017, only a reduced penalty is awardable for the
very same offence of 'mixing of starch with liquor' under Section
57(aa), in terms of Section 57(d)(ii). As per the said amended
provision of Section 57(d)(ii), for the offence of 57(aa), imprisonment
for a term which may extend to six months or with fine which shall
not be less than twenty five thousand rupees, is awardable. It is in
the said indisputable change of position obtained that the question
whether the respondents are entitled to apply for compounding the
offence of 'mixing of starch with liquor' has to be considered.
12.Obviously, the respondents herein rely on the rule of
beneficial construction of 'ex post facto law' to canvass the position
that they are entitled to get the offence compounded by virtue of the
amendment brought to Section 67A of the Abkari Act with effect from
27.12.2017. 'Ex post facto' means 'arising or enacted after the fact
but retroacting upon it; retroactive, retrospective etc. In this context,
before considering the tenability of the contentions based on the rule
of beneficial construction in the event of ex post facto law, it is only
worthy to refer to Article 20(1) of the Constitution of India. Article
20(1) of the Constitution of India reads thus:-
" No person shall be convicted of any offence
except for violation of a law in force at the time of
the commission of the act charged as an offence,
nor be subjected to a penalty greater than that
which might have been inflicted under the law in
force at the time of the commission of the
offence".
13. The word 'offence' used in Article 20 is not defined in the
Constitution. Therefore, it has to be understood in view of Section
3(38) of the General Clauses Act that defines 'offence' as any act or
omission made punishable by any law for the time being in force.
Article 20(1) prohibits all convictions or subjections to penalty after
the constitution, in respect of an ex post facto law whether such a law
was post constitution or pre-constitution law (see Rao Shiv Bahadur
Singh v. State of Vindhya Pradesh reported in AIR 1953 SC
394). The second part of Article 20(1) guarantees that no person
shall be subjected to a penalty greater than that which might have
been inflicted under the law in force at the time of commission of the
offence. In short, what is prohibited under Article 20(1) based on the
application of ex post facto law is application of every law which
creates or aggravate the crime or increase the punishment or change
the rule of evidence for the purpose of conviction. However, the
application of an ex post facto law that mollifies the rigour of criminal
law is different and it will not fall within the prohibition under Article
20(1) of the Constitution of India. In the decision in Ratan Lal v.
State of Punjab (AIR 1965 SC 444), the Apex Court illustrated the
aforesaid preposition. That was a case where a boy, aged 16 years,
was found guilty and was handed down a sentence of rigorous
imprisonment for six months and also a fine, on 31.5.1962. His
appeal was dismissed by the Sessions Court on 22.9.1962 and the
High Court dismissed the challenge against the same on 27.9.1962.
In fact, in the meantime, the Probation of Offenders Act came into
force on 1.9.1962. Later, he filed an appeal before the Supreme Court
by special leave and took up a contention that he should be given the
benefit of the Act. It was resisted by the State contending that the
offence was committed before the Act came into force and that the
Act is not retrospective. The Apex Court held that the rule of
beneficial construction required that even an ex post facto law of the
type involved ought to be applied to reduce the punishment of the
young offender. The rule of beneficial construction requires that an
ex post facto law which reduces the punishment should be made
available to an accused irrespective of the fact that the action that
constitutes the offence was committed prior to the amendment of the
existing law or an existing statute was repealed by a new enactment
which also carry provisions to constitute the same action as an
offence but with lesser punishment. Evidently, it is this principle
deducible from Article 20(1) that found recognition in the decision in
T.Barai's case (supra). The question posed for consideration in that
case was regarding the applicability of Section 16A of the Prevention
of Food Adulteration Act, 1954 as inserted by Prevention of Food
Adulteration (Amendment Act 1976) with respect to the prosecution
launched under Section 15(1)(a) read with Section 7 of the Act in the
State of West Bengal between the period from April 29, 1974 to April
1, 1976. The Prevention of Food Adulteration (Amendment) Act was
a Central Amendment Act. It is also relevant to note that such
offences, according to law then in force, i.e., the Act as amended by
the Prevention of Adulteration of Food, Drugs and Cosmetics (West
Bengal Amendment, Act 1973), were punishable with imprisonment
for life and therefore triable by the Court of Session. The Apex Court
found that the Central Amendment Act did not create new offence
under Section 16(1)(a), but enacted the same offence by providing a
reduced punishment and in such circumstances, question of
applicability of Article 20(1) did not arise as it is only retroactive
criminal legislation that is prohibited under Article 20 (1).
Furthermore, it was held therein that in such circumstances the
accused should not be denied the benefits of such reduced
punishment. The Apex Court held that the earlier law creating an
offence is impliedly repealed if a latter law provides a lesser sentence
for the same offence and in such circumstances, the rule of beneficial
construction requires that even such a type of ex post facto law
should be applied to mitigate the rule of law. Paragraph 17 of the
said decision would reveal that in such situations the prosecutor got
no right to insist upon that the accused be subjected to an enhanced
punishment under the repealed act. Applying the law laid down by
the Apex Court in T.Barai's case (supra) and considering the non-
applicability of the prohibition contained in Article 20(1) of the
Constitution of India on an ex post facto law that mollifies the rigour
of the previous law, we have no hesitation to hold that the 'offence of
mixing or permitting to mix starch with liquor, be it under 57(a) or
57(aa), is compoundable in terms of amendments brought in to
Sections 57 and 67A and therefore, the respondents are entitled to
apply for compounding the offence in terms of the amendment. In
the context, it is to be noted that the learned Single Judge had
directed only for re-consideration of the representation for
composition of the offence, in terms of Section 67 A(1) of the Abkari
Act and to pass appropriate orders in accordance with law. Even
while, upholding the finding and direction in that regard of the
learned Single Judge, we think it only appropriate to go into certain
other aspects of the issue. In view of Section 67 A(2) of the Abkari
Act, it would have been befitting for the writ court to leave the
respondents to approach the Court concerned to obtain permission
for composition and to consider the application in accordance with
law.
14. Now, the question whether the pendency of the case
registered for commission of the offence of mixing or permit mixing
of starch with liquor in respect of an offender concerned arising out of
an occurrence prior to 27.12.2017 before a court of law can be a
reason to take away the power of the empowered officer to
compound that offence? Relying on the decision of this Court in
Sivapalan's case (supra) as also the decision in Mathew's case
(supra), the respondents would contend that it could not be a legal
impediment for composition of such offences. In Mathews' case, a
learned Single Judge of this Court held that pendency of the case
before a court would not take away the power of the empowered
officer to compound the offence involved in the pending case and in
such circumstances, what is to be done by the empowered officer
compounding the offence is to give a report to that effect to the court
concerned to enable the court to close the case and to discharge the
accused, if he is in custody. In regard to Abkari offences, no
discussion is required in respect of the power of the officer
empowered to compound offences specified in the table under sub-
section(1) of Section 67A, even in cases pending before a court of
law, in the light of the specific provision in Section 67A(2) of the
Abkari Act. In view of the specific provision thereunder, despite the
pendency of a case involving any of the offences specified under sub-
section (1) of Section 67A, such offence could be compounded with
the permission of court concerned and a report of the action taken
thereon shall be filed before that court by the officer empowered to
compound the offence. Thus, it is clear that if the cases registered
against the respondents are pending before any court, in terms of the
provisions under Section 67A(2) of the Abkari Act, with the
permission of the court concerned it could be compounded in
accordance with law and consequent to the composition of the
offence, the officer empowered shall have to file a report of the action
taken, before the said court. It is to be noted that admittedly, after
the impugned judgment, the respondents in W.A Nos. 2451/2018 and
2453/2018 approached the Court concerned and on being permitted
for consideration of the question of composition in respect of the
respondents therein, the Deputy Commissioner of Excise, Kozhikode
compounded the offence of 'mixing starch with liquor' on payment of
Rs. 25,000/- each by the said respondent towards the compounding
fee. In such circumstances, it will be open to the respondents in other
cases who are accused of commission of the offence of
mixing/permitted to mix, starch with liquor, to approach the Court
concerned, in terms of Section 67A(2) for composition of the offence,
in accordance with law.
15. Now, the next question is what exactly is the effect of
compounding of such an offence under 67A(1) by the Excise
Commissioner or the Deputy Commissioner of Excise of the District or
any Abkari Officer specifically empowered officer before the matter
reaches the court and also in respect of a case involving an offence
specified under 67A(1) but pending before the court of law and
compounded with the permission of that court? Relying on the
decision in Sivapalan's case (supra) and Mathew's case (supra), it
is contended by the respondents that such composition should have
the effect of an acquittal and therefore, it should operate as a
complete bar to any further proceedings against the offender
concerned. It is further contended, based on the said decisions, that
such composition got the effect of precluding the authority who
initiated the proceedings against the offender from proceeding
further. The learned Single Judge, as per the impugned judgment
held :- 'It is clear from the language of the provisions that a
compounding under Section 67A would amount to absolving the
accused persons of all liabilities in respect of any penal provision in
terms of the Abkari Act or the Rules made thereunder'. Evidently, the
said finding of the learned Single Judge is under attack in these
appeals and to buttress the said contention, the appellants relied on
the decision of this Court in Sanjayan's case and of the Hon'ble Apex
Court in Biswabahan Das' case. In Biswabahan Das' case
(supra), the Apex Court held:-
"If composition of an offence was permissible under the
law the effect of such composition would depend on what
the law provided for. If the effect of composition is to
amount to an acquittal then it may be said that no stigma
should attach to the character of the person, but unless
that is expressly provided for, the mere rendering of
compensation would not amount to the vindication of the
character of the person charged with the offence."
(underline supplied)
It is thus obvious that the exposition of law by the Hon'ble Apex
Court in Biswabahan Das' case (supra) in regard to the issue is that
wherever composition of an offence is permissible under any law, the
effect of such composition would depend upon what the said law
provides for. True that, if it is specifically stated that such
composition would amount to an acquittal, then, no stigma should
attach to the character of the person concerned. Unless it is so
expressly provided the mere composition of offence would not
amount to exoneration or acquittal. We are of the view that where
the effect of composition is specifically held as amounting to
acquittal, then it could be said that such composition should operate
as a complete bar to any further proceedings. It be so, when
regarding the impact of composition of an offence permissible to be
compounded under any particular law in the absence of specific
provision in the law concerned regarding the effect of such
composition, it cannot be said that it should have the effect of
acquittal and thereby the composition should operate as a complete
bar to any further proceedings. We have already extracted the
relevant provisions under the Abkari Act under Section 67A that deals
with compounding of offences. Virtually, the said provision or in that
matter any other provision under the Abkari Act did not specifically
provide the effect of composition of an offence specified in Sub
section (1) of Section 67A as one amounting to 'acquittal' or as
exoneration of the compounder of the offence. Obviously, the entire
contentions regarding the consequence or impact of such composition
as acquittal were made by the respondents based on sub-section (3)
of Section 67A which provides that on payment of such sum of
money evidently, referring to the compounding fee prescribed in the
table given under Section 67A(1) or such value or both to the
empowered officer the accused person, if in custody, shall be
discharged. We may hasten to state here that conspicuously, the
learned Single Judge did not specifically hold that compounding of
offence under Section 67A would amount to 'acquittal', but at the
same, evidently, it was held that it would amount to absolving the
accused persons of all liabilities in respect of any penal provision in
terms of the Abkari Act or the Rules made thereunder. At the same
time, after holding thus, the learned Single Judge has further
observed and directed that in case the compounding applications
preferred by the petitioners (the respondents herein) are allowed, the
issue of cancellation of licences will be taken up and decided taking
note of the fact that the petitioners stand absolved of all liabilities in
respect of the offences alleged against them in terms of Section
57(aa) of the Abkari Act and the needful shall be done by the
respondents within a period of two months from the date of receipt of
a copy of the judgment. Obviously, the import of the words 'the
accused person, if in custody, shall be discharged' was not gone into
by the Writ Court. Still, it appears that the aforesaid words must have
been the reason that persuaded the Writ Court to make the aforesaid
direction to take up and decide the issue of cancellation of licences
taking note of the fact that the petitioners stand absolved of all
liabilities in respect of the offences alleged against them in terms of
Section 57(aa) of the Abkari Act. It is also relevant to note that the
learned Single Judge initially observed only about the liability in
respect of any penal provision in terms of the Abkari Act and the
Rules made thereunder and did not make any observation as relates
'civil liability', if any, arising even after composition of the offence.
But, then it was directed thereafter that the issue of cancellation of
licences should be decided by taking note of the fact that the
petitioners (respondents herein) stand absolved of all liabilities in
respect of the offences alleged against them in terms of Section
57(aa) of the Act. Therefore, a question has to be answered as to
whether it could be said upon composition that the petitioners would
stand absolved of all liabilities in respect of the offences alleged
against them in terms of Section 57(aa) of the Abkari Act?
16. In Sivapalan's case (supra), while considering the effect
of compounding of the offence, the aforesaid binding decision of the
Hon'ble Apex Court in Biswabahan Das' case escaped consideration.
In such circumstances, the respondents are not justified in relying on
the said decision to contend that composition should have the effect
of 'acquittal' and we have no hesitation to hold that while considering
the question, it cannot have precedential value in view of the
decision in Biswabahan Das' case (supra). That apart, in
Sivapalan's case, the learned Single Judge held that once an offence
is compounded, the composition has the same effect in a criminal
trial as it would have in the case of a compromise in a civil suit. The
learned Single Judge was considering the scope of composition under
Section 86(5) of the Motor Vehicles Act, 1988. Further, it was held
therein thus:-
"The effect of composition is that it precludes the
authority who initially agreed for it from initiating
any fresh proceedings against the offender as
composition operates as a complete bar to any
further proceedings as if the offender had been
acquitted."
This position laid in Sivapalan's case cannot be blindly followed in
the case of deciding the effect of composition of offence under
Section 67A of the Abkari Act. The compounding of offences
mentioned in Section 320(1) or (2), Cr.P.C punishable under the
Indian Penal Code got the effect of an acquittal so as to bar the trial
of the offence in view of specific provision under Section 320(8)
Cr.P.C which provides the effect of composition as acquittal of the
accused. In such circumstances also, composition does not mean
that no offence was committed at all and in fact, it would bar the trial
of the accused concerned and he would be set at liberty as if he had
been acquitted. Irrespective of the stage at which a court discharges
an accused, the same signifies the disinclination on the part of the
court to proceed against the accused further.
17. The contention of the respondents herein is that in the
cases on hand, cases are pending before the Magistrate Court and
therefore, the Magistrate could consider the question of discharge
under Section 227 Cr.P.C. and it is after referring to Section 227 that
they canvassed the position that once discharge is ordered pursuant
to composition, it would amount to acquittal. 'Discharge' is
contemplated under different sections of Cr.P.C, such as under
Sections 227, 239, 245, 249 and 398. Under Chapter XVI of Cr.P.C,
there is no provision which empowers the Magistrate to discharge the
accused. The power of discharge under section 227 falls within
Chapter XVIII, dealing with 'trial before a Court of Session' and
therefore, the accused concerned can be discharged only by a trial
court as the court of the Judicial Magistrate is not the trial court in
respect of offences exclusively triable by a Court of Session (see the
decision in Sanjay Gandhi v. Union of India (AIR 1978 SC 514).
Going by the decision in Prahlad Singh v. State of Rajasthan &
Ors. [1990 Cr.L.J 1688 (Raj)], to which we respectfully agree, the
question whether a case is triable or not, for the purpose of exercise
of power under section 227 Cr.P.C vests with Sessions Judge
concerned. Therefore, the Sessions Judge concerned alone could
exercise the power of discharge under the said section. The power
under section 239 is available to a Magistrate in a matter of trial of
warrant cases instituted on a police report. The said section enjoins
upon the Magistrate to record his reasons for holding the charge
against the accused to be groundless and to discharge him. In
respect of cases instituted otherwise than on police report triable by
Magistrates, the power to discharge is available under section 245
Cr.P.C. The basis for discharging an accused under Section 245(1)
Cr.P.C is that even if the allegation against is unrebutted, it would not
warrant his conviction. Section 245 (2) enables the Magistrate to
discharge an accused at any previous stage, if, for reasons to be
recorded by such Magistrate and for its exercise, the Magistrate has
to find the charge to be groundless. Section 246 Cr.P.C under
Chapter XIX deals with the procedures to be followed, when the
accused is not discharged in a warrant case instituted on a police
report. Going by Section 248 (1), the question of recording acquittal
would arise only when charge has been framed and the Magistrate
finds the accused not guilty. In short, the question of handing down
an order of acquittal or judgment of acquittal would arise only on
conclusion of trial and upon finding the accused not guilty. On a
scanning of the aforesaid provisions in Cr.P.C relating discharge, it is
evident that the word 'discharge' employed thereunder cannot be
understood to be a synonym to the word 'acquittal'. They are
different and distinct having different consequences. In this context,
it is to be noted that even under section 320 Cr.P.C, what is stated is
that the composition of an offence under the said section shall have
the effect of acquittal of the accused.
18. As noticed hereibefore, the Hon'ble Apex Court in
Biswabahan Das' case held that to have the effect of composition
as acquittal, it should have been expressly provided in the relevant
statute. In the Abkari Act, it is not expressly provided that the
composition of offences mentioned in sub section (1) of Section 67A
under the said provision would have the effect of acquittal. As
noticed hereinbefore, the contention of the respondents is that the
words 'the accused person, if in custody, shall be discharged' used in
Sub section (3) of Section 67A of the Abkari Act should be construed
as the accused concerned shall be treated to have been acquitted
pursuant to the composition of the offence. We have already taken
note of the various provisions under the Cr.P.C dealing with
'discharge'. The decision referred to as also the provisions referred
hereinbefore would reveal that the meaning 'acquittal' cannot be
imported to the expression 'discharge'. 'Acquittal' is the state of
being found innocent of a charge of an offence by a court of
competent jurisdiction after the conclusion of the trial and that is why
under Section 320(8) Cr.P.C it is stated that the composition would
have the effect of acquittal. While considering this question, the
decision of the Hon'ble Apex Court in Ram Chandra's case (supra)
would also assume relevance. The Apex Court was considering the
impact of non-compliance with Section 50(3) of the Narcotic Drugs
and Psychotropic Substances Act, 1985. It reads thus:-
"50(1).......
(2)..........
(3) The gazetted officer or the Magistrate
before whom any such person is brought
shall, if he sees no reasonable ground for
search, forthwith discharge the person but
otherwise shall direct that search be made."
(underline supplied)
The Apex Court held that the expression 'discharge' used in sub
section (3) of section 50 is used in the sense that the detention is
terminated. Charles John Smith in 'A dictionary of Synonymous
Words in the English Language' explained the functional and doctrinal
difference between the words 'discharge' and 'acquittal' as
hereunder:-
"The discharge is a judgment upon an
accused person, because, the law is not
exactly provided for the offence. The
acquittal recognises his innocence. In the
former case, the law is powerless to punish;
in the latter, powerful to absolve."
19. In the decision in Sohanlal v. State of Rajasthan (AIR
1990 SC 2158), the Apex Court held the meaning of discharge
thus:-
"Refusing to proceed further, after issue of process is
discharge."
20. While considering the meaning of the words 'shall be
discharged' used in Section 67A(3) in the context of effect of
composition of offence, the words preceding them viz., 'if in custody'
assumes much relevance. If the word 'discharged' is given the
meaning 'acquitted' then, it might suggest that upon composition the
accused would be entitled to be acquitted only if he is in custody.
Such a construction of Section 67A(3) cannot be comprehended as
undoubtedly, upon composition of an offence given in the Table under
Section 67A(1) of Abkari Act, the accused concerned is entitled to be
discharged and that benefit cannot be confined to accused in custody
and in other words, accused enlarged on bail must also obtain such
entitlement. Therefore, those words 'if in custody' cannot be believed
to be used for the purpose of specifying that upon composition of
Abkari offence an 'accused in custody' alone is entitled to be
acquitted. Taking into account the meaning ascribable to the word
'discharged' in the context of composition of criminal cases bearing in
mind the aforesaid provisions and decisions and above all and taking
note of the fact that Section 67A(3) deals only with the case of an
accused in custody pursuant to the registration of an abkari case and
upon composition of an abkari offence mentioned in Section 67A(1)
with which he was charged and not with respect to an accused, not in
custody, during the pendency of the case, we are of the considered
view that Section 67A(3) speaks only of an accused in custody and
provides that he should be discharged viz., released upon
composition of the offence. In this context, we also note that the
Malayalam version of Act 3 of 2010, which got authenticity and
authority in view of Chapter XIV of the Rules of Procedure and
Conduct of Business in the Kerala Legislative Assembly, framed in
terms of Article 208(1) of the Constitution of India, would sanction
and support our view. Malayalam version of Ordinance No.6 of 2010
and the Malayalam version of Act 3 of 2010 would reveal the meaning
of the word 'discharged' used in Section 67A(3). They were produced
by the appellants along with the argument notes. In the Malayalam
version of Ordinance No.6 of 2010, 67A(3) is given as:-
(1)-)o ഉപവകപ പക ര ഈ ആവശതല കയ
അധക രപപടതയടള ഉല ഗസന, അതത സ ഗതലപ പ ,
അങപനയള തകലയ , വ ലയ അപ&ങൽ ഇവ രണ കടലയ
നൽകനതല.ൽ, കറ ലര പണ പ1യപപടടള ആപ4, അയ ൾ
കസഡയ പണങൽ, ല8 1പലകണത , പടപ:ടത വസ
വടപക ടലകണത ആആൾലക വസവലന എതര യ യ പത ര
തടർനളനടപടകള സABകരകവ ൻ പ ട& തത8 ണ.
As per the Malayalam version of Act 3 of 2010, 67A(3) reads thus:-
(1)-)o ഉപവകപ പക ര ഈ ആവശതല കയ
അധക രപപടതയടള ഉല ഗസന, അതത സ ഗതലപ പ ,
അങപനയള തകലയ , വ ലയ അപ&ങൽ ഇവ രണ കടലയ
നൽകനതല.ൽ, കറ ലര പണ പ1യപപടടള ആപ4, അയ ൾ
കസഡയ പണങൽ, ല8 1പലകണത ണ.
The English translation of the word 'ല8 1പലകണത ണ' can never be
'acquitted' as the Malayalam meaning of 'acquitted' is 'കറവമകന ക'.
Therefore, the meaning can be taken only as 'to be released'. As
noted earlier, in the decision in Ram Chandra's case (supra), the
Apex Court held that the expression 'discharge' used in sub-section
(3) of Section 50 of NDPS Act, 1985 is used in the sense that the
detention is terminated. In the circumstances, the meaning of the
word 'discharged' used in Section 67A(3) of the Abkari Act cannot be
given the meaning as 'acquitted'. In short, the Writ Court ought not
have held that upon composition the petitioners would stand absolved
of all liabilities in respect of the offences alleged against them in
terms of Section 57(aa) of the Act. True that upon such composition,
the court would decline to proceed further with the criminal
proceedings and at any rate, it will not preclude from putting the civil
liability on the person concerned, in accordance with law. Acquittal
recognizes innocence of the person concerned whereas 'discharge'
pursuant to composition will not recognize innocence and it only
marks lack of necessity to proceed with further.
21. Under section 67A (3) of the Abkari Act, evidently,
'discharge' pursuant to composition is possible only on payment of
such sum of money or such value or both as prescribed. The
compounding fee for composition of the offence of 'mixing starch with
liquor' falling under section 57(aa) of the Abkari Act is prescribed as
rupees twenty five thousand. Fee is the charge or emolument or
compensation for particular acts or services; reward of compensation
for services rendered or to be rendered. It also got another meaning
viz., a levy by an authority in return for certain functions performed
by it. Whatever that be, the fact is that for compounding the
offences under sub section (1) of Section 67A(1) in respect of any
offence mentioned thereunder, the compounding fee prescribed
thereunder is to be paid. It is only thereafter that the person, if in
custody, can be discharged in the sense that he can be released from
custody. When the accused concerned has to pay the compounding
fee, the consequent discharge cannot be said to be an acquittal as an
'acquittal' is a state of being innocent of an offence after the
conclusion of trial, especially in view of the fact that there is nothing
in the Abkari Act which would suggest that discharge consequent to
composition of the offence by the court is acquittal or that it would
have the effect of acquittal. If a person is found innocent of an
offence, where is the question of making him pay the prescribed
compounding fee, which is actually equivalent to the minimum fine
awardable for the offence under Section 57(aa) of the Abkari Act?
Taking into account all the aforesaid circumstances, it can only be
said that the meaning 'acquittal' cannot be given to the word
'discharge' employed in section 67A(3) of the Abkari Act. In such
circumstances, we are of the view that the learned Single Judge was
correct in holding that upon composition, the petitioners
therein/respondents would stand absolved of all liabilities in respect
of any penal provision in terms of the Abkari Act or the rules made
thereunder, but at the same time, we hold that the latter part of the
direction of the learned Single Judge that in case the compounding
applications preferred by the petitioners are allowed, the issue of
cancellation of licences shall be taken up and decided taking note of
the fact that the petitioners stand absolved of all liabilities in respect
of the offences alleged against them in terms of Section 57(aa) of the
Act is not the correct exposition of law. We may hasten to add that
we shall not be understood to have held that the direction to take up
and decide the requirement or otherwise of cancellation of licences is
bad in law and we will consider its correctness a little later. Our
finding of incorrect exposition of law is confined only to that part of
the direction to treat that the petitioners/the respondents herein
stood absolved of all liabilities in respect of the offences alleged
against them in terms of Section 57(aa) of the Act in case the
compounding applications are allowed.
22. We have already taken note of the the fact that application
of the rule of beneficial construction on ex post facto law by virtue of
Article 20(1) of the Constitution would apply if a subsequent law
mollifies the rigour of law in a previous law and provides for a lesser
punishment than one prescribed for the same offence. The immunity
extends only against punishment by courts for a criminal offence and
therefore, the beneficial construction by virtue of ex post facto law, in
terms of Article 20(1) applies only in criminal proceedings that too,
only when the ex post facto law mollifies the rigour of a criminal law,
as held earlier. In otherwords, the prohibition by virtue of Article
20(1) applies only in proceedings which partake the character of
criminal proceedings and it will not have any application in respect of
civil liability. In such circumstances, the question is what exactly is
the meaning of civil liability? No such term is coined and defined
under the Abkari Act. However, it does not mean that the penal
provisions for commission of Abkari offences or violation of conditions
of licence would not be having any civil consequences or civil liability.
In Blacks Law Dictionary, Eighth Edition, the term 'civil liability' is
given the meaning as 1. 'liability' imposed under the civil, as opposed
to the criminal law. 2. the state of being legally obligated for civil
damages. In P.M.A Metropolitan v. Moran Mar Marthoma (AIR
1995 SC 2001), the Apex Court held that the word 'civil nature' is
wider than the 'civil proceeding' and that the same would, therefore,
be available in every case where the dispute has the characteristic of
affection of one's rights which are not only civil but of civil nature. In
the decision in Hatisingh Mfg.Co.Ltd v. Union of India & others
reported in AIR 1960 SC 923, the Apex Court held that the
prohibition under Article 20(1) would not apply to civil liability. In
that case, an Act was passed in 1957 whereby liability was imposed
on the employers for closing their undertaking, to pay compensation
since November 28, 1956. The liability could be enforced by coercive
process leading to imprisonment in case of failure to discharge it.
The Apex Court held that the liability imposed by the law was a civil
liability which was not an offence and so Article 20(1) could not be
applied to the liability for the period concerned viz., for the period
from November 28, 1956 to June 1957.
23. In view of the aforesaid position obtained in regard to civil
liability, the question to be looked into is whether commission of
abkari offence of 'mixing starch with liquor' casts any civil liability. To
consider the same, certain provisions of law have to be looked into.
Firstly, we will refer to Section 26 of the Abkari Act. It deals with the
power of the Commissioner to recall licences and it empowers the
Commissioner to cancel or suspend any licence or permit granted
under the Act under situations contemplated under sub section (b)
thereof, as well. The relevant portion of the said section reads thus:-
"26.Power to recall licenses etc.--The Commissioner
may cancel or suspend any license or permit granted
under this Act--
(a) xxxxxxxxxxxxxxxxxxxxx
(b)in the event of any breach by the holder of such
license or permit, or by his servant, or by any one acting
with his express or implied permission on his behalf, of
any of the terms or conditions of such license or permit"
24. The power to recall the licence is conferred on the
Commissioner of Excise in the event of any breach by the holder of
such licence as well. Going by Rule 9(2) of the Disposal Rules, toddy
offered for sale shall be natural and conforming to such specifications
and complying to such restrictions as may be notified under clause
(n) of Rule 2. Specifications and restrictions to be complied with,
notified under Rule 2(n), inter alia, mandating that toddy shall be
free from starch by the Government as per G.O.(P).No.25/2007/TD
dated 14.2.2007 and in pursuance thereof mixing starch with toddy
was to attract the offence under Section 57(a) of the Abkari Act
punishable with imprisonment for a term which may extend to five
years or with fine which may extend fifty thousand rupees or with
both. The extenuatory amendment was made as per Ordinance
No.38 of 2017 dated 21.12.2017, which was later incorporated into
the principal Act as per Act 25 of 2018. The fact is that the alleged
commission of offence of mixing of starch with toddy, falling under
Section 57 (a), was prior to 21.12.2017 when it was a serious
offence. The extenuatory amendment made to Section 57(a) made
the offence of mixing starch with liquor a separate offence under
Section 57(aa) of the Act a less serious offence punishable with
imprisonment for a term which may extend to six months or with fine
which shall not be less than twenty five thousand rupees. Whatever
be the degree of punishment prescribed under post and pre-
amendment to Section 57(a), the fact is that the act of mixing starch
with liquor, here toddy, continues to be an offence and hence, its
commission would amount to breach of conditions of licence. In
otherwords, in terms of Rule 9(2), when there is violation of the
specifications and restrictions notified by the Government under Rule
2(n) of the Disposal Rules, the action, rather, the commission of
offence of mixing starch with toddy should be regarded as violation of
conditions of licence and when there occur breach of conditions of
licence, it would fall within the purview of Section 26(b) of the Abkari
Act. In such circumstances, especially in view of the fact that the
rule of beneficial construction based on ex post facto law would apply
only in respect of criminal proceedings in view of Article 20(1) of the
Constitution and it would have no impact on civil consequences or
civil liability, according to us, despite the composition of offence
under Section 67A the Commissioner of Excise would and should
retain the power available under Section 26 of the Abkari Act. But at
the same time, we are of the considered view that the learned Single
Judge was correct in directing reconsideration of the issue of
cancellation of licence subject to the outcome of application, if any,
for composition of the offence for the simple reason that going by
Section 26 all cases falling under 26(b) do not call for cancellation of
licence. Obviously, the question of necessity to cancel the licence
may differ from case to case, depending upon the nature of breach of
the terms of the licence. This position is settled by this Court in
Banerji Memorial Club, Thrissur v. Deputy Commissioner,
Excise (2009(3) KLT 950). In fact, the said position is evident
from Section 26 itself wherein while repositing the Commissioner the
power to cancel or suspend any licence or permit the word 'may' was
used by the Legislature in the matter of its exercise and thereby
virtually granted discretion to the Commissioner to cancel or not to
cancel, to suspend or not to suspend any licence or permit granted
under the Abkari Act taking note of the nature and gravity of the
offence which may differ from case to case. In the cases on hand, it
is evident that the Commissioner did not consider the question
whether, despite the subsequent developments extenuating the
rigour of the law regarding penal provisions, cancellation of licence is
required or not. There cannot be an automatic cancellation and the
requirement for cancellation would depend upon the consideration of
all aspects by the Commissioner of Excise in accordance with law.
However, the fact is that in the cases on hand, after the cancellation
of licences issued in favour of the appellants concerned, re-auction of
shops was conducted and presently, the shops concerned are being
run by the successful bidders in the resale. Still, we are of the view
that in case the respondents-writ petitioners submit representations
for compounding the offence, the authority competent shall consider
such applications in accordance with law and subject to the outcome,
consider the issue whether cancellation of the licence was called for
in the matter. We think it absolutely unnecessary for us to consider
the question what benefit a composition would fetch to the person
seeking composition of an offence mentioned in the Table under
Section 67A of the Abkari Act other than getting released from
custody, in view of our findings on the question of civil liability.
25. Now, we will consider Rule 5(1) of the Disposal Rules and
Rule 5 to the extent it is relevant for the disposal of the case reads
thus:-
''Rule 5(1)(a): While giving privilege,
preference shall be given to those licensees
who had conducted toddy shops during the
year 2013-2014, provided no Abkari case is
registered against him other than under section
56 of the Abkari Act. The licensees who have
conducted the shops during the year 2013-
2014 and whose licenses cancelled due to
registration of Abkari cases and subsequently
exonerated by the Court and those licensees
who could not complete the year 2009-10 on
account of the closure of shops shall also be
given preference.
Provided that shops which functioned till
2006-07 and which are sought to be relocated
within 50 metres radius of the previous site, for
carrying out repair to the building etc. shall be
deemed as functional during 2013-14.''
26. Going by the Rule 5(1) of the Disposal Rules, registration
of an abkari case other than under Section 56 of the Abkari Act might
result in deprival of privilege. In the said circumstances, in view of
the decision of the Apex Court in Khoday Distilleries Ltd. v. State
of Karnataka reported in (1995) 1 SCC 574 holding that trade in
liquor is not a fundamental right but only a permissible privilege, the
question of privilege if raised by the respondents/writ petitioners has
to be considered by the appellants appropriately and in accordance
with law.
27. The learned senior counsel appearing for the respondents in
W.A.Nos.2451/2018 and 2453/2018 submitted that in case this Court
holds that discharge pursuant to composition of the abkari offence
would not amount to acquittal, the respondents may be given the
liberty to withdraw from composition of offence allowed at their
instance. We have already taken note of the fact that the
respondents in the said appeals moved for composition of the offence
and in fact, got it compounded on payment of Rs.25,000/- each. In
the said circumstances, in this jurisdiction, the respondents therein
cannot be given liberty as sought for as the abkari offence for mixing
starch with liquor was already compounded at their instance.
However, like the respondents in the other appeals, they may also
move for reconsideration of the issue of cancellation of licence.
In the result, the appeals are allowed in part subject to the
declaration of law on the impact of composition of offence under the
Abkari Act and the findings and observations on the question of civil
liability even after composition of an abkari offence given in the table
under Section 67A of the Abkari Act. We make it clear that in the
said circumstances, if applications for compounding are preferred by
the party respondents, the issue of cancellation of licences shall be
taken up and decided in accordance with law, but bearing in mind
that the beneficial construction of an ex post facto law is applicable
only in criminal proceedings and not in proceedings for deciding civil
liability and further that all cases falling under Section 26(b) of the
Abkari Act do not call for cancellation of licence and it has to be
decided depending upon the nature of breach of the terms of the
licence.
Sd/-
C.T.RAVIKUMAR
Judge
Sd/-
N.NAGARESH
Judge
spc/
