Bombay High Court

TANAJI DEVRAO LAKADEversusTHE STATE OF MAHARASHTRA THROUGH ITS PRINCIPAL SECRETARY AND OTHERS

Disposal: DISPOSED OFF

Holding

The cancellation orders were quashed and the matter remanded to the Collector to decide afresh, considering the compoundability of the breaches under the Maharashtra Prohibition Act.

Summary

Tanaji Devrao Lakade challenged the cancellation of his FL‑III liquor licence by the Osmanabad District Collector, which was affirmed by the State Excise Commissioner and the State Excise Minister. The cancellation was based on three alleged breaches during a surprise inspection, but the petitioner argued that under Section 104 of the Maharashtra Prohibition Act and a 2001 circular, such breaches are compoundable and should attract only a penalty, not licence cancellation. The State argued that a pending criminal case under various IPC and Maharashtra statutes justified the cancellation. The Court held that the Collector’s order was based solely on the three breaches and did not consider the compoundability provision, and that the authorities could not introduce the pending criminal case as a new ground. Consequently, the Court quashed the cancellation orders and remanded the matter to the Collector to reconsider, applying the compoundability rules and providing a fresh notice if other breaches are found.

Issues considered

Whether the cancellation of the FL‑III licence was valid despite the breaches being compoundable under Section 104 of the Maharashtra Prohibition Act, 1949.
Whether the authorities could rely on a pending criminal case, not mentioned in the original order, as a ground for licence cancellation.

Legislation cited

Indian Penal Code, 1860 — s. 188, 268, 294, 34, 569
Maharashtra Police Act, 1951 — s. 313, 33(w)
Maharashtra Prohibition Act, 1949 — s. 104, 65(e)
Mumbai Foreign Liquor Rules, 1953 — s. 49, 53, 58, 9

Subjects

licence cancellation
compoundable offence
Maharashtra Prohibition Act
excise law
writ petition
administrative law
procedural fairness

Judgment

2026:BHC-AUG:3027

1 WP / 13988 / 2023

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD

1038 WRIT PETITION NO. 13988 OF 2023

TANAJI DEVRAO LAKADE
VERSUS
THE STATE OF MAHARASHTRA THROUGH
ITS PRINCIPAL SECRETARY AND OTHERS

...
Advocate for petitioner : Mr. V.S. Undre
AGP for the respondent – State : Mr. D.R.Korde
...

CORAM : SIDDHESHWAR S. THOMBRE, J.

DATE : 17 JANUARY 2026

PER COURT :

Heard learned counsel for the respective parties.

2. By way of present petition, the petitioner assails the order dated
31.01.2022 passed by the District Collector, Osmanabad, whereby the FL-III
licence of the petitioner came to be cancelled. The said order was confirmed
by order dated 24.05.2022 passed by the Commissioner of State Excise,
Mumbai and the order dated 26.09.2023 passed by learned Minister, State
Excise, Mantralaya, Mumbai.

3. Mr. Undre, learned counsel for the petitioner submits that a
surprise visit was made at the hotel owned by the petitioner wherein following
three breaches were found :-
अ.क्र. मिळू न आलेल्या विसंगती उल्लंघन केलेला नियम
01 विहित नमुन्यातील रजिस्टर एफ एल आर - ३ (A) अनुज्ञप्ती
निरीक्षणावेळी सादर केली नाही. मुंबई विदेश मद्य नियम 1953 मधील
नियम 49, 53, 58 व शर्ट क्रमांक 9
02 नोकरनामे सादर केले नाही. चे उल्लंघन केले आहे.

03 अनुज्ञप्तीच्या मंजूर जागेमध्ये बदल केले

Therefore, on the ground of these breaches, FL-III licence was cancelled.
2 WP / 13988 / 2023

4. A show cause notice dated 22.12.2021 was given to the
petitioner to which he had replied stating that the said notice was not legal.
He further submits that as per section 104 of Maharashtra Prohibition Act,
1949, all these breaches are compoundable in nature and in view of circular
dated 27.07.2001 such breaches could be compounded by imposing penalty
instead of cancellation of the licence. As these grounds were not considered
by the Collector, appellate authority and the revisional authority, he prays for
setting the order of cancellation of the licence.

5. Per contra, learned AGP supports the order passed by the
District Collector, appellate authority and revisional authority by pointing out
that a crime no. 411 of 2021 punishable under section 188, 268, 569, 294, 34
of IPC read with section 33(w), 313 of the Maharashtra Police Act, 1951 read
with section 65(e) of Maharashtra Prohibition Act, 1949 was registered
against the petitioner and same is pending and, therefore, the learned AGP
submits that the licence was properly cancelled by the authorities.

6. Having heard learned counsel for the respective parties and
having gone through the order dated 31.01.2022, it reveals that the order
was passed only on basis of three breaches but in view of section 104 of the
Maharashtra Prohibition Act, 1949 and Circular dated 27.07.2001, all three
breaches are compoundable in nature, whereby penalty should have been
imposed on the petitioner instead of cancelling his licence. As far as
registration of the criminal offence is concerned, same was nowhere
mentioned in the order of cancellation of licence by the Collector and,
therefore, the authorities cannot supplant the reasons subsequently.

7. The Hon’ble Apex Court in the matter of Mohinder Singh Gill
and Another Vs. The Chief Election Commissioner AIR 1978 SC 851 has
held in paragraph no. 8 as under :-

“8. The second equally relevant matter is that when a statutory
functionary makes an order based on certain grounds, its validity
must be judged by the reasons so mentioned and cannot be
supplemented by fresh reasons in the shape of affidavit or otherwise.
3 WP / 13988 / 2023

Otherwise, an order bad in the beginning may, by the time it comes to
court on account of a challenge, get validated by additional grounds
later brought out. We may here draw attention to the observations of
Bose J. in Gordhandas Bhanji "Public orders, publicly made, in
exercise of a statutory authority cannot be construed in the light of
explanations subsequently given by the officer making the order of
what he meant, or of what was in mind, or what he intended to do.
Public orders made by public authorities are meant to have public
effect and are intended to effect the actings and conduct of those to
whom they are addressed and must be construed objectively with
reference to the language used in the order itself."

8. In view thereof, I am inclined to allow the writ petition partly, by
remitting the matter to the Collector to decide the same afresh.

9. Hence, I proceed to pass the following order :

ORDER

I] Writ petition is partly allowed.

II] The order dated 31.01.2022 passed by the District Collector,
Osmanabad, order dated 24.05.2022 passed by the Commissioner of State
Excise, Mumbai and the order dated 26.09.2023 passed by learned Minister,
State Excise, Mantralaya, Mumbai are quashed and set aside.

III] The matter is remanded to the Collector, Osmanabad to decide
it afresh after considering whether the breaches which are mentioned in its
order, are compoundable or not in view of section 104 of the Maharashtra
Prohibition Act and the Circular dated 27.07.2001.

IV] If there are other breaches, then the Collector shall give notice
to the petitioner in respect of the same and after considering the reply, if any,
submitted by the petitioner, the necessary order be passed.

V] The learned Collector to complete the entire exercise within a
period of four (4) months from today.

[ SIDDHESHWAR S. THOMBRE ]
JUDGE
arp/

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