No blanket waiver of Highway Liquor Ban in Municipal areas: Madras HC [Read Order]

The Madras High Court has clarified that while the Supreme Court-imposed highway liquor ban may not apply to municipal areas, applications to set up liquor shops within municipal limits must be assessed on a case-to-case basis in line with the Supreme Court’s directions..On an appraisal of the Supreme Court rulings on the subject, the High Court found that there is no blanket waiver of the highway liquor ban in municipal areas..Consequently, the High Court has set aside a September notification (‘notification’) issued by the State Prohibition and Excise Department, which had directed District Collectors to permit Foreign Liquor licensed shops within the limits of municipal corporations, municipalities and town panchayats..The Bench of Chief Justice Indira Banerjee and Justice Abdul Quddhose passed an order to this effect on Saturday while allowing a PIL filed by Advocate K Balu against the notification. Pursuant to this notification, around 1700 liquor shops were said to have opened in Tamil Nadu..After the petition was brought before the Court last September, an interim stay was imposed by the Court in November on the opening of the liquor shops pending the disposal of the case..The initial question that emerged during the proceedings was whether the highway liquor ban was applicable to municipal areas through which national/state highways passed..Balu had contended that the ban was expressly made applicable to municipal areas as well. However, the State placed reliance on the Supreme Court’s judgment in Arrive Safe Society of Chandigarh v Union Territory of Chandigarh to counter that the ban only applied to the sale of liquor along and in the proximity of highways properly understood, which provide connectivity between cities, towns, and villages..This order had further stated,.“The order does not prohibit licensed establishments within municipal areas. This clarification shall govern other municipal areas as well.”.However, in addition to this, the High Court took note of a clarification order passed by the Supreme Court in February this year. By this order, the Supreme Court had left it to the state government to determine whether an area covered by a local self-governing body is proximate to a municipal agglomeration or is sufficiently developed so as to warrant the application of the principle laid down in the Arrive Safe Society case..Further, to decide on the same, the Supreme Court noted that,.“…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 Madras High Court has taken the view that, by this order, the Supreme Court did not waive the liquor prohibition imposed by its judgment on highways passing by a municipal area..“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….…The Supreme Court, by its order dated 23.2.2018, 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.”.While emphasising on the mandate to make the decision on a case to case basis, it also appears that the High Court has also taken the view that the ban would not apply to licensed clubs and hotels which are not easily and/or ordinarily accessible to drivers of motor vehicles. The order states,.“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.”.Ultimately, the blanket permission enabled by the September notification was set aside on the ground that the State could only allow the opening of liquor shops in municipal areas on a case to case basis..“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 … 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 11.7.2017 in Arrive Safe Society of Chandigarh (supra), on a case to case basis..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.”.Read Order below: