Liquor Licensing Authority Cannot Cancel Licence On Mere Suspicions & Presumptions: Allahabad HC

The bench of Justice Saumitra Dayal Singh and Justice Donadi Ramesh observed, “ While suspicion may arise and may continue to exist in the minds of the Licensing Authority from the facts of an individual case, at the same time, suspicions and presumptions may never translate to findings, on their own. Unless cogent material and evidence exist, such suspicion may never result in penal or harsh consequences such as cancellation of another license.”

Senior Advocate V.K. Singh appeared for the Appellant and Additional Chief Standing Counsel Nimai Das appeared for the Respondent.

Brief Facts-

The petitioner Sandeep Singh’s licence for the counter-liquor shop at Majhenpurwa was cancelled under Section 34(2) of the United Provinces Excise Act, 1910 by the Collector/ Licensing Authority. Undisputedly, no specific allegation of violation was made against the petitioner with respect to the running/operation of the licence of the liquor shop. Earlier, the allegation had emerged under Section 34(1)(b) of the Act with respect to another license issued to the petitioner for the shop at Gehrukheda that led to the cancellation of the petitioner's license for the said shop.

The Court stated that it was not open to the Licensing Authority in its consequential order to repeat the mistake and cancel the petitioner's liquor licence for the shop without offering any reason how the cancellation of the petitioner at Gehrukheda demanded cancellation of the other license as well.

The Court noted that the petitioner was found in violation at the Gehrukheda shop, where eight pouches without QR codes were recovered, along with liquor bottles with tampered seals and other items like Alum and Urea. Notably, there were no sample tests conducted, and there was no allegation of the petitioner selling spurious or adulterated liquor at the Gehrukheda shop.

The Court stated that the impugned order was a reiteration or repetition of the earlier stand taken by the State. Therefore, as per the Court, it had to be acknowledged that there exists no material with the Licensing Authority to pass any order cancelling any other license of the petitioner, except for the Model Shop at Gehrukheda.

Finally, the Court quashed the order of the Licensing Authority and allowed the petition.

Cause Title: Sandeep Singh v. State of U.P. (Neutral Citation: 2024:AHC:57708-DB)