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Non-Reportable IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL     APPEAL     NO.7221     OF     2012   [Arising out of SLP (Civil) No. 1832 of 2010]

V.K. Sreedharan & Ors. .... Appellants

Versus

State of Kerala & Others       .... Respondents

O     R     D     E     R      

K.S.     Radhakrishnan,     J.   

1. Leave granted.

2. The Government of Kerala in exercise of the powers conferred  

under Sections 18A and 29 of the Abkari Act 1 of 1077 amended  

the Kerala Abkari Shops (Disposal in auction) Rules, 1974 and  

issued notification G.O. (M.S.) No.31/74/TD dated 28th February  

1974, published vide the Gazette Notification No.G.O.

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(P)No.88/2000/TD dated 2nd June, 2000, incorporating Rule 6 after  

sub-rule (5) of the following sub rule, which reads as follows:

“25A. Reduction of interest in certain  cases –  

(i) Notwithstanding anything contained in  this rule or any other rules made under  the Abkari Act 1 of 1077 or in any  judgment, decree or order of any court,  the person who are in arrears to pay  rentals, taxes, duties or other amounts  under this rule as on 31st Day of March  1997 shall be entitled to a reduction of  Seventy five per cent of the amount of  interest accrued on such rentals, taxes,  duties or other amounts as the case may  be,

Provided that the entire arrears of rentals,  taxes, duties or other amounts with the  reduced interest shall be paid on or before the  31st day of August, 2000;

Provided further that the maximum interest  payable after allowing the reduction mentioned  above shall be limited to one hundred per cent  of the principal amount of rentals, taxes,  duties or other amounts outstanding as  arrears.”

3. Claiming the benefit of the above-mentioned provision, the  

appellants approached the learned Single Judge of the High Court  

of Kerala.  It was pointed out that though the above-mentioned

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notification was published in the Gazette on 3.6.2000, the effect of  

Section 25A would be from 31.7.1997.  It was also submitted before  

the learned Single Judge that the appellants, even though remitted  

the entire amount on 4.4.1998 i.e. after the cutoff date mentioned  

in Section 25A, the state of affairs prevalent as on 31.3.1997 would  

govern the rights of parties for refund of the amounts.  

Consequently, it was contended that the appellants are entitled to  

get refund of the amount.  The learned Single Judge allowed the  

writ petition and passed the following order:

“By Ext. P8, the Kerala Abkari Shops (Disposal  in Auction) Rules, 1974 were amended  inserting section 25A whereby those persons  who had arrears to pay rentals, taxes, duties  or other amounts under those rules as on  31.3.1997 were entitled to a reduction of 75%  of the amount of interest accrued on such  rentals, taxes, duties or other amounts as the  case may be.  Though Ext. P8 is issued only on  2.6.2000 and published in the gazette on  3.6.2000, the effect of section 25A is on the  basis of the state of affairs as on 31.3.1997.  Admittedly, the petitioner made the remittance  only on 4.4.1998, that is, after the cutoff date  in terms of section 25A.  He is, therefore,  entitled to the benefit of section 25A in relation  to the arrear that was outstanding as on  31.3.1997.  It is so declared.  The impugned  orders shall stand modified accordingly and

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the Excise Commissioner is directed to have  the outstanding worked out on the basis of the  declaration contained in this judgment and  have a demand issued to the petitioner for any  outstanding balance, within an outer limit of  three months from the date of receipt of a copy  of this judgment.”

4. Aggrieved by the same the State filed Writ Appeal No.1005 of  

2008 before the Division Bench and the Division Bench allowed the  

appeal and set aside the order of the learned Single Judge against  

which this appeal has been preferred.

5. Learned counsel appearing for the appellants submitted that  

the appellants are entitled to the benefit of remission provided in  

the notification dated 2.6.2000 by which Section 25A was inserted.  

It was stated that newly introduced provision providing for  

remission specifically referred to the arrears benefit of 31.3.1997.  

Admittedly, it was pointed out that the appellants were in default  

on 31.3.1997 and the arrears were paid on 15.12.1997 and  

17.11.1998.  It was also submitted that the learned Single Judge  

rightly directed the refund of the amount in view of Section 25A.  

Shri M.T. George, learned counsel appearing for the State

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submitted that the appellants are not entitled to get the benefit of  

Section 25A since they were not on default as on 31.6.2000.   

6. We notice that sub-rule in the Abkari Shops (Disposal in  

Auction) Rules, 1974 was intended to be applied to those who were  

in arrears as on 31.3.1997 and continues as such in arrears till the  

publication of the notification on 3.6.2000.  Persons who fall in that  

category were entitled to get an option to avail of the benefit of the  

above-mentioned provision by clearing the entire arrears on or  

before 31.8.2000.  The provision is not intended to confer any  

option to those who have already cleared the arrears before coming  

into force of the provisions which were given effect only from  

3.6.2000.  Sub-rule 25A(i) has not extended the benefit of that rule  

to those persons who had already cleared their arrears between  

31.3.1997 and 3.6.2000.  Facts will indicate that the appellant had  

cleared the arrear amount on 17.11.1998 and clause (ii) and (iii) of  

the sub-rule would make it clear that the rule is meant only to  

benefit those persons who remained as defaulters as on 3.6.2000.  

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7. We, therefore, find no error in the view expressed by the  

Division Bench.  Therefore, this appeal is dismissed, with no order  

as to costs.    

……………………………….J. (K.S. Radhakrishnan)

..………………………………J. (Dipak Misra)

New Delhi, October 4, 2012