Karnataka High Court strikes down liquor licence renewal
BENGALURU: The Karnataka High Court kept in abeyance the renewal of a liquor licence approved by the Commissioner of Excise to one of the partners of a liquor shop, by observing that the state cannot try to protect its own interest of revenue when two partners in a business are involved in litigation. The Commissioner had passed an order clearing the renewal of the licence on the ground that the state exchequer would suffer if the licence was not renewed.
“Commissioner of Excise has in fact passed an order approving the renewal of the licence on the ground that the state exchequer would suffer which cannot be a ground for renewal of the licence of a private party. The state cannot seek to try and protect its own interest of revenue when two partners are involved in litigation. The said observation made by the Excise Commissioner is completely untenable”, said Justice Suraj Govindaraj.
Answering a question on whether if any of the partners continue the business of the firm once a suit for dissolution of the partnership is pending, the court said the plaintiff in a suit for dissolution of a firm cannot seek renewal of a licence and continuance of the business.
Allowing the petition filed by Nagalinga, a resident of the city, the court said that no person shall be permitted to make use of the licence in question during a pending suit between the two partners in Mandya.