BENGALURU: The High Court of Karnataka has allowed the state government to grant lapsed and forfeited excise licences, which are non-renewal, by e-auction in accordance with the prescribed reservation. A division bench of Chief Justice Vibhu Bakhru and Justice CM Poonacha passed the order on April 15 allowing the appeal filed by the state government questioning the ad interim order dated November 25, 2025, passed by a single judge on the petition filed by Guruswamy and several others.
The division bench said it does not appear that single judge had examined the rival contentions. The impugned order is based mainly on an observation that, prima facie, the rules travel beyond the rule-making, which requires examination. Legislation, including subordinate legislation, is presumed to be valid.
Thus, unless a very strong case of invalidity of the legislation is made out, its operations cannot be stayed, the Bench noted. Before the single judge, the petitioners, who are the excise licensees, have challenged the amendments introduced to Rule 5, 5-A and 12 of the Karnataka Excise (Sale of Indian and Foreign Liquor) Rules, 1968, through the second amendment in 2025.
The single judge stayed the operation, implementation and enforcement of the amended Rules 5 and 5-A. Though it was an interim order, it has been extended. The division bench said that we are unable to readily accept that the impugned Rules are ex facie invalid and that the petitioners have made out a case warranting a stay of the impugned Rules.