Case Note & Summary
The case pertains to the allotment of a foreign liquor shop license at Pithoragarh, Uttarakhand. Initially, the license was allotted to Sh. Balkar Singh for the financial year 2020-2021. However, due to the COVID-19 pandemic, the shop remained closed, and Balkar Singh sought cancellation of the allotment. The authorities cancelled his license and initiated recovery of the shortfall from him. Subsequently, a resettlement process was conducted, and the appellant, Suresh Chandra, emerged as the highest bidder with an offer of Rs. 3,46,78,112 for the remaining period. The first respondent, Joga Singh Bisht, who had been an unsuccessful bidder in the original allotment but did not participate in the resettlement, filed a writ petition in the High Court challenging the allotment to the appellant on the ground that it caused a loss of revenue of Rs. 5 crores. The Single Judge dismissed the writ petition for lack of locus standi. However, the Division Bench granted an interim stay on the license, observing that the first respondent had offered a higher amount and that the loss of revenue was a matter of public interest. The Supreme Court set aside the High Court's orders, holding that the first respondent had no locus standi as he did not participate in the resettlement process. The Court noted that the government had already initiated recovery proceedings against the original allottee for the shortfall, ensuring no actual loss to the revenue. The Court further observed that the first respondent's offer of a higher amount was misleading and should not have been entertained. The Supreme Court dismissed the writ petition as frivolous and imposed costs of Rs. 1,00,000 on the first respondent, payable to the appellant.
Headnote
A) Locus Standi - Non-Participant in Resettlement - A person who did not participate in the resettlement process for a liquor shop license has no locus standi to challenge the allotment on the ground of loss of revenue, especially when there is no allegation of malafides, favoritism, or nepotism. (Paras 4, 7) B) Public Interest - Loss of Revenue - Allegation of loss of revenue cannot be a ground for interference when the government has initiated recovery proceedings against the original allottee for the shortfall, ensuring no actual loss to the exchequer. (Para 7) C) Interim Relief - Stay of License - The High Court erred in staying the operation of a validly granted license pending appeal, as the appellant had complied with all conditions and deposited the amount, and the respondent's offer of a higher amount was not made in the resettlement process. (Paras 7, 8) D) Frivolous Litigation - Costs - A writ petition filed by a non-participant without any malafides allegation, based on a misconception of loss of revenue, is frivolous and liable to be dismissed with costs of Rs. 1,00,000 payable to the appellant. (Para 8)
Issue of Consideration
Whether a non-participant in the resettlement process has locus standi to challenge the allotment of a liquor shop license on the ground of loss of revenue, and whether the High Court was justified in granting interim stay despite no loss to revenue due to recovery proceedings against the original allottee.
Final Decision
The Supreme Court allowed the appeals, set aside the High Court orders dated 21.08.2020 and 08.09.2020, dismissed the writ petition as frivolous with costs of Rs. 1,00,000 payable to the appellant within four weeks, and directed that the appellant be permitted to continue running the liquor shop subject to compliance with the terms of resettlement.
Law Points
- Locus standi
- Public interest litigation
- Loss of revenue
- Interim relief
- Recovery of shortfall from original allottee
- Frivolous litigation
- Costs
