The High Court of Karnataka has upheld the rules that allows the government-owned or controlled companies to operate retail liquor shops sans limitation fixed on the number of liquor shops based on population as per the provisions of the Karnataka Excise Act, 1965, and the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968.
The court said non-application of limitation of number of shops that can be established cannot be applied to government-owned companies like MSIL as the citizens have no fundamental right to do trade or business in intoxicating liquor and citizens have the right to carry on trade or business only subject to the limitation fixed by the State.
Justice Hemant Chandangoudar passed the order while dismissing a batch of petitions filed by private licenced liquor shop owners questioning the Rule 3(11-C) of the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968 that allowed MSIL to establish retail liquor shops in a taluk sans limitation fixed based on population.
Citing apex court’s judgment, which had held that State can make a monopoly either in itself or the agency created by it, for the manufacture, possession, sale, and distribution of liquor as a beverage, the High Court said granting retail licences to the government-owned company cannot be said to be discriminatory when the government, in law, has monopoly in liquor business.
The petitioners had also questioned the 2016 notification which had permitted setting up of four liquor outlet of MSIL within the limits of each Assembly constituency. However, the court said the notification was issued in terms of the Rule 3(11-C) could not be said to be illegal since no right was created in favour of any citizen.
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