KSR Alankar Hotels and Resorts Pvt. Ltd. Vs State of Kerala (Kerala High Court)
The Kerala High Court considered a batch of writ petitions concerning the fine under Section 67(2) of the Abkari Act, 1077 and fees under Rule 19 of the Foreign Liquor Rules, 1953 for regularisation of reconstitution of the Board of Directors of private limited companies holding FL 11 licences without obtaining prior permission of the Commissioner.
KSR Alankar Hotels and Resorts Pvt. Ltd. had reconstituted its Board of Directors on 31.08.2017 by inducting Mrs. Shereena Roshy, wife of the Managing Director, and recording the resignation of Mr. K.R. Suraj, brother of the Managing Director, without prior permission. The company operated three hotels with FL 11 licences. KSR Alankar Elite Inns and Hotels Pvt. Ltd. had similarly inducted Mrs. Thulasi Sooraj as a Director without obtaining prior permission.
The impugned orders imposed Rs.3,00,000 as fine under Section 67(2) and demanded fees of Rs.20,00,000 for each inducted Director and Rs.2,00,000 for each Director who retired under the Second Proviso to Rule 19(iv). In one matter, a further Rs.2,00,000 fee was demanded for change of name of the licence.
The petitioners contended that they were liable only to the Rs.3,00,000 fine under Section 67(2) and Rs.1,00,000 fee under Rule 19(iii). They also raised contentions concerning the applicability of the Second Proviso to Rule 19(iv), the number of fines payable, the change-of-name fee and liability for a hotel that did not have a licence on the date of reconstitution.
