Crown Beverage Ltd. and another Vs.

Board of Investment and Others, 2004, 33 CLC (HCD)

Tuesday, 15 March 2011 13:36
Supreme Court High Court Division (Special Original Jurisdiction) Present: SAN Mominur Rahman J Abdus Salam Mamun J Crown Beverage Ltd. and another..........................Petitioners Vs. Board of Investment and Others........................Respondents Judgment April 6, 2004. Cases Referred toChairman, Board of Intermediate and Secondary Education, Jessore and others vs. Md. Amir Hossain and another, 56 DLR (AD) 24, M A Hai vs. Trading Corporation of Bangladesh, 32 DLR (AD) 46, Acqua Foods Limited and another vs. Controller of Imports and Exports and others, 49 DLR 498, Travancore Rayons Ltd. Vs. The Union of India and Others, AIR 1971 SC 862, Md. Hazrat Ali vs. Chairman, Bangladesh Chemical Industries Corporation and Another, 1981 BLD 86, and Abdur Saboor Khan vs. University & Controller of Examination, Karachi University, 18 DLR (SC) 422, Chairman of National Board of Revenue vs. Beximco Infusions Ltd., 51 (AD) 36, Bangladesh Telecom Ltd. vs. Bangladesh Telegraph and Telephone Board and another, 48 DLR (AD) 20, Fazlur Rahman and others vs. Bangladesh, 53 DLR 237, Islam vs. Bangladesh, 11 BIT 65. Lawyers Involved: Rafique-ul Huq, Senior Advocate with Ahsanul Karim, Faheemul Huq, and M Sakhawat Hossain, AdvocatesFor the Petitioners.

A J Mohammad Ali, Additional Attorney General with Adilur Rahman Khan, Deputy Attorney General, Naima Haider, Assistant Attorney-General and Zaman Akter, Assistant AttorneyGeneralFor Respondent. Md. Ashik Al-Jalil with Arafat Amin, Advocates For Respondent No. 5. Md. Salahuddin, AdvocateFor Respondent No. 6. Writ Petition No. 1119 of 2004. Judgment Abdus Salam Mamun J.- This Rule Nisi was issued upon the respondents as to why the cancellation order communicated by the Memo No. / /-// dated 43-2004, evidenced by Annexure A to the Writ Petition shall not be declared to be without authority and of no legal effect. 2. The case of the petitioners, in short, is that, (a) the petitioner No. 1 is a private limited company carrying on business, inter alia, of manufacturing and marketing of beverage products and established a most modern factory in Gazipur and that the products of the petitioner-company are absolutely non-alcoholic in nature. The petitioner-company was registered with the Board of Investment, the respondent No. 1, for manufacturing "malt beverage, evidenced by Annexure "B" to the Writ petition, and started production of its two products namely, "Crown" and "Hunter". The Crown and Hunter are non-alcoholic drinks as per definition of alcohol in the Narcotics Control Act, 1990. The petitioner applied to the Director (CM), Bangladesh Standard and Testing Institute (BSTI), Dhaka, the respondent No. 5, for issuing a CM licence in its favour for marketing its non-alcoholic malt beverage product named "Crown Energy Drink" on 4-22004, as evidenced by Annexure C to the Writ Petition, and also applied to the Director General, Environment Directorate, Dhaka for a No Objection Certificate" on 27-1-2003 and the Environment Directorate issued a "No Objection Certificate" on 27-1-2003 and vide Memo No. Environment/Dha/3/5176/374 dated 3-2-2003, evidenced by Annexure D to the Writ Petition. The company is registered with the VAT Commissionerate, Gazipur Division, Gazipur, as evidenced by Annexure D (1), to the Writ Petition, and was also registered with the Import and Export Directorate, Dhaka, as evidenced by Annexure-"D(3)", to the Writ Petition; (b) On 9-12-2003 the respondent No. 5 by its letter bearing Memo No.

/-

/// informed the petitioners that they have no standard (BDS) for "non-alcoholic malt beverage" till date and, as such, expressed their inability to grant a licence for the product named 'Crown Energy Drink' of the petitioner, evidenced by Annexure E to the Writ Petition, and also informing the petitioner that a licence can be granted on the heading of "Non-Carbonated, Non-alcoholic ready to drink" Beverage under standard (BDS-1727:2000), if the petitioner's product is "Non-Carbonated" and so applies for appropriate level and licence;
(c) Thereafter, the petitioner received a letter from the respondent No. 1 on 1-3-2004 stating that the registration certificate being No. L-22030208152-H, dated 26-8-2002 was issued in favour of the petitioner company for production of Malt Beverage and the

condition-precedent for marketing of the product was that the petitioner must obtain a licence from the Bangladesh Standard and Testing Institute (BSTI) before marketing its products under condition No. 3 of the registration certificate, but it appears that the Company has marketed its products namely, "Crown" and 'Hunter", without prior obtaining the required licence from the BSTI and accordingly, asked the Writ petitioners to produce the BSTI licence as required under condition No. 3 within 3(three) days, i.e., 4-3-2004, failing which the aforesaid registration would be cancelled, evidenced by Annexure "I" to the Writ petition. (d) The petitioners on receipt of the said letter, vide Annexure "I", gave a reply to the respondent No. 1 by its letter dated 4-3-2004 stating that under the existing Industrial Policy Rule No. 5 under Chapter 5.2 (a) registration with the Board of Investment was not necessary for their Industrial concern named the "Crown Beverage Ltd." but inspired by the supporting role of the Board, the Company was registered with the Investment Board and that the Company has applied to the BSTI for a licence of its product namely, "Crown Energy Drinks" and "Hunter Malt Beverage" in accordance with the condition No. 3 of the registration certificate and in response thereto the BSTI by its Memo No. /-

"non-alcoholic malt beverage" has been fixed in Bangladesh till date and hence granting of a licence was not possible on its part. The petitioners in the said reply, further stated that the condition No. 3 of the registration certificate issued in favour of "Crown Beverage Limited" was not applicable on their products and, as such, it cannot be said that the Company has violated any of the conditions. A copy of said reply dated 4-3-2004 has been annexed as Annexure "J1 to the Writ petition; (e) Thereafter the respondent No. 1 by the impugned letter No. //-// dated 4-3-2004 (Annexure A) has cancelled the registration of the petitioner Company issued by it in favour of "Crown Beverage Limited" on the ground of violation of its condition No. 3 holding the petitioner responsible for marketing its products despite the BSTI's inability to grant a licence. Being aggrieved by the said order, the petitioners have preferred this Writ Petition and obtained the instant Rule; (f) In their affidavit-in-reply the petitioners have stated that since the products of the petitioners are containing less than 5% alcohol, the products are thus non-alcoholic products within the meaning of Narcotics Control Act, 1990. 3. The respondent Nos. 1 and 2 jointly and the respondent Nos. 5 and 6 separately have entered appearance by filing powers. The respondent Nos. 1 and 2 have jointly and the respondent No. 6 has separately affidavits-in-opposition. 4. In its affidavit-in-opposition, respondent No. 6, the Inqilab Enterprise and Publication Limited, has stated that apart from their reporting in their newspaper The Daily Inqilab, they have no direct interest in the products of the writ petitioner, and that their reporting was relating to harmful effects of the products named 'Crown' and 'Hunter on the public health, especially child health, which contain alcohol, and the reporting was general in nature, which was also reported by other newspapers too and in making such reporting they did neither twist nor embellish the facts, rather, the experts' findings have supported their contentions that the products are alcoholic products' and the statements and declaration made by the Crown Beverage Ltd., the petitioners that their product named "Crown" and "Hunter" were "Non-alcoholic Beverage" was not true. This respondent has also stated that the writ petitioners have instituted the Money Suit No. 11 of 2004, now pending in the 5th

/// dated 9-12-2003 has informed that no standard for

Court of Joint Judge, Dhaka, claiming damages and, as such, the matter is sub-judice. However, they made the correct reportings. 5. In their affidavits-in-opposition the respondent Nos. 1 and 2 have stated that(a) the Writ Petition is not maintainable for there has been a violation of the terms and conditions of the registration/approval and if there be any grievances of the petitioners for cancellation of the registration the remedy lies in a suit for damages and not under Article 102 of the Constitution. These respondents have further stated that the products of the petitioner are 'alcoholic products' and the respondent No. 1 has cancelled the registration under section 15 of the Investment Board Act, 1989 for failing to comply with its condition namely, violation of the condition No. 3 embodied in the registration letter itself by the writ petitioners. Their further statements are that since the BSTI did not grant a licence for the products of the petitioners, which they were bound to obtain before marketing of those products, the petitioners were thus not entitled to market their afore-mentioned products. But the petitioners have directly marketed the products without making any communication with or reference to the BOI and, as such, the registration was liable to be cancelled and the respondent No.1 has cancelled it in accordance with law, for, the condition No. 3 of the registration letter was a condition-precedent for the petitioners i.e. to obtain necessary permission from the BSTI before marketing of their products, which they utterly failed to comply with; (b) the writ petitioners have marketed their products, which are directly related to public health, in contravention of the said condition No. 3. The respondent No. 1, BOI, had the right to know or inquire into whether the products were marketed without obtaining prior permission or licence from the BSTI as per condition of the registration and also have the right to take appropriate measures, including cancellation of the registration. The Board of Investment had exercised the power conferred upon it under section 15 of the Investment Board Act, 1989. (c) Prior to the cancellation of the registration, the petitioners were asked, vide BOI letter No. //-// dated 1-3-2004 to submit the permission letter/licence obtained from the BSTI in compliance with the condition No. 3 of the registration letter within 3 (three) days and by the same letter it was also informed to the petitioners that the registration would be cancelled if they failed to produce the licence obtained from BSTI. Since the petitioners could not produce the BSTIs lincence in accordance with the requirements of the said letter and admitted in their reply that the BSTI did not grant a licence to them, the respondent No. 1 has exercised the statutory power by cancelling the registration. 6. Though the respondent No. 5, the Bangladesh Standard and Testing Institute (BSTI), did not file any affidavit-in-opposition but Mr. Ashik Al-Jalil, the learned Advocate, has appeared on behalf of this respondent submitting that the BSTI has got a list of articles for which standard (BDS) have been fixed and the BSTI is under responsibility to see whether commodities, having those standards and obtained licence from it, are properly maintaining the same, and for determining standard of an article, the Government used to send the particulars of the article for fixing its standard and since there is no article in the country called "non-alcoholic malt beverage" so, they also did not fix any standard for such an item from before and, as such, they had to turn down the application of the petitioners for licence for their "non-alcoholic malt beverage" product called "Crown". The said item, i.e. non-alcoholic malt beverage was not included in the said list and that the BSTI has acted in accordance with law namely, the BSTI Ordinance, 1985, in refusing the application for a

licence for the product named 'Crown' under the circumstances. Mr. Ashik-AI Jalil further submits that the BSTI informed the petitioners that it could apply for a licence if their said product was 'non-carbolic', for which it has a fixed standard. 7. Mr. Salahuddin, the learned Advocate appearing for the respondent No. 6, has reiterated the statements made by this respondent in its affidavit-in-opposition with a further statement that the respondent No. 6 has neither any like-business nor rivalry with the petitioners and the respondent No. 6 has made correct reportings on 'Crown' and 'Hunter. 8. Mr. Rafique-ul Huq, the learned Advocate appearing for the petitioners, has argued at the outset that under the Narcotics Control Act,1990 the products of the petitioners are not 'alcoholic products' within the meaning of section 2(Kha) of the Act and that the issue for determination in this writ petition is not whether the petitioner manufactured "alcoholic or non-alcoholic item" but whether the cancellation of registration of the project of the petitioner-company is in accordance with law or not. 9. Mr. Huq submits that when, admittedly, the BSTI was not in a position to grant a licence as mentioned in Clause 3 of BOI registration certificate, Clause 3 becomes redundant and has no force of law. He further submitted that in cancelling the registration, the respondent No. 1 has not complied with the principle of natural justice so far it relates to giving a personal hearing to the petitioners and thus the impugned order of cancellation of the registration is arbitrary, void and also mala fide made on the basis of paper reportings. 10. According to Mr. Huq, the notice that was issued by the BOI, asking the petitioner to produce the permission/licence obtained from the BSTI within three (3) days was not a show cause notice in the strict sense of law and as such, the petitioners have been deprived of opportunity of being heard and also no personal hearing was given to them before cancellation of the registration. Under the principle of natural justice, personal hearing ought to have been given to the petitioners before cancellation of the registration. 11. Mr. Huq further submits that under section 15 of the Investment Board Act, 1989, no registration/approval can be cancelled except in the manner prescribed by the rules and since BOI has not yet framed any rules, it had no authority to cancel the registration/approval and that the impugned action is violative of Articles 31 and 40 of the Constitution and also hits the doctrine of legitimate expectation. 12. In support of his contention on the point of principle of natural justice, the learned Advocate has cited a good number of decisions, such as, in the case of (1) Chairman, Board of Intermediate and Secondary Education, Jessore and others vs. Md. Amir Hossain and another, reported in 56 DLR (AD) 24, (2) M A Hai vs. Trading Corporation of Bangladesh, reported in 32 DLR (AD) 46, (3) Acqua Foods Limited and another vs. Controller of Imports and Exports and others , reported in 49 DLR 498, (4) Travancore Rayons Ltd. Vs. The Union of India and Others , reported in AIR 1971 SC 862, (5) Md. Hazrat Ali vs. Chairman, Bangladesh Chemical Industries Corporation and Another, reported in 1981 BLD 86, and (6) Abdur Saboor Khan vs. University & Controller of Examination, Karachi University , reported in 18 DLR (SC) 422. 13. Mr. AJ Mohamad Ali, the learned Additional Attorney-General, appearing for the respondent Nos. 1 and 2, submits, on the other hand, that by not obtaining a licence from the BSTI and by marketing the products without a licence from the BSTI the petitioners have deliberately violated the condition No. 3 of the BOI's registration and, as such, the BOI

was competent to cancel the registration of the petitioner No. 1 under the law. According to him, the notice issued on 1-3-2004 asking the petitioners for production of licence required to be obtained from the BSTI in connection with the products named Crown" and Hunter" and notifying them also that in case of failure, the registration would be cancelled was the show cause notice, affording sufficient opportunities to the writ petitioners of hearing and also to present their case before the BOI for consideration. The learned Attorney-General further submitted that, the namely, "Crown" and 'Hunter', are alcoholic beverage" which the petitioners produced and marketed but falsely declaring those to be "non-alcoholic beverage. He has referred to the expert report submitted by the Institute of Food, Science and Technology, Bangladesh Council of Scientific and Industrial Research (BCSIR) vide Annexure 1 to the Affidavits-in-Opposition of the respondent Nos. 1 and 2, which shows 4.81% alcohol was found in "Hunter" and 0.68% alcohol was found in "Crown" in the laboratory test and argued that by marketing 'alcoholic beverage' the petitioners with their mala fide intention and fraudulent device described them as absolutely non-alcoholic' and, according to the learned Additional Attorney-General, those drinks are injurious for public health, especially for the young generation. Referring to the Harmonised Commodity Description and Coding System, Annexure 2 to the said affidavits-in-opposition, the learned Additional Attorney-General has argued that a non-alcoholic beverage' means beverage of an alcoholic strength by volume not exceeding 0.5%. alcohol and the petitioners have tried to deceive the people by describing their product to be 'non-alcoholic' beverage although those contained admittedly more than 0.5% alcohol. Relying also upon the Annexure 3 to the affidavit-in-opposition he submits that there are many well known brands of Beer which contain less than 1% alcohol and that, in fact, the products marketed by the petitioners are "Beer", which is not permitted for marketing under the law. 14. Perused the writ petition, supplementary affidavits and the affidavits-in-opposition, affidavits-in-reply together with annexures annexed therewith of the respective parties, and considered the submissions of the learned Advocates of the respective parties. 15. From a perusal of the Investment Board Act, 1989 it appears that sub-section (4) of section 11 provides as follows: "(4) If, after considering the application, the Board is satisfied that the project should be approved, it shall, subject to such conditions and limitations as it deems fit to impose, approve the same and shall issue a letter of approval to the applicant and shall specify in such letter the time limit for the implementation of the project and also the time-limit for commencement of production thereat." ( Underlining is ours) Sub-section (9) of section 11 of the Act further provides that: "(9) Where an industrial project faces any difficulty in the completion of the project within the time-limit specified in the letter of approval or if, after such completion, it faces any difficulty in commencing, within such time-limit, production thereat, the entrepreneur of the project may apply to the Board for removing such difficulty, and upon such application, the Board shall endeavour to extend to the entrepreneur necessary assistance." ( Underlining is ours) From the above provisions of law it appears that the petitioner-company was registered with the Board of Investment in accordance with the Investment Board Act, 1989 (Act No. XVII of 1989) undertaking to comply with the conditions that shall be imposed by the BOI in the registration/ approval in accordance with sub-section (4) of section 11 and in case of any difficulties faced by the registered company after completion of the project and commencing

production thereat, the petitioner-company was under obligation to approach the BOI to remove such difficulties for the purpose of production and marketing in accordance with sub-section (9) of section 11 of the Act, 1989. 16. It also appears from the preamble of the BSTI Ordinance, 1985 (Ordinance No. XXXVII of 1985) that the Ordinance was promulgated "to provide for the establishment of an Institute for standardisation, testing, metrology, quality, control, grading and marketing of goods" and under section 2(q) of the Ordinance, 1985 the BSTI in issuing a licence must satisfy specification of an article which means nature, quality, strength, purity, composition, quantity, dimensions, weight, grade, durability, origin, Age, material, mode of manufacture or other characteristics to distinguish it from any other article or process and the BSTI is responsible to maintain it after the commodity is marketed. Under the Ordinance 'Licence' means a Licence granted under section 20 thereof to use standard mark in relation to any article or process which conforms to the Bangladesh Standard and 'Standard Mark means the Bangladesh Standards and Testing Institution Certification Mark specified by the Institution to present a particular Bangladesh Standard. 17. Sections 19(1) and 20 of the Ordinance, 1985 provides as follows: "19. Prohibition of improper use of Standard Mark.- (1) Except under a licence granted under section 20, no person shall use in relation to any article or process or in the title of any patent, or in any trade mark or design, the Standard Mark or any colourable imitation thereof." "20. (1) Any person who intends to use, in relation to any article or process or in the title of any patent, or in any trade mark or design, the standard mark shall apply to the Institution, in such form as may be prescribed, for grant of a licence for such use. (2) The Institution may grant a licence if, after such enquiry as it deems necessary, it is satisfied that (a) the article or process in respect of which the Standard Mark is to be used conforms to the related Bangladesh Standard; and or (b) there is arrangement for routine inspection and testing to ensure that the article or process concerned conforms to the related Bangladesh Standard. (3) A licence shall be granted in such form and on payment of such fee as may be prescribed, and may be subject to such conditions as may be specified therein by the Institution. (4) A licence granted under this section shall remain valid for a period of three years: Provided that the Institution may revoke the licence at any time, if it is satisfied that the licensee has violated any condition specified in the licence: Provided further that no licence shall be revoked unless the licensee is given a reasonable opportunity of being heard.

18. Sections 21-23 of this Ordinance, 1985 contain prohibitions and under section 24 thereof the Government may prohibit sale and distribution of any article which does not conform to the Bangladesh Standard. Section 28 provides for appeal which is as follows: "28. Appeals.- (1) Any person aggrieved by an order passed under clause (1) of section 5 may prefer an appeal to the Government within three months from the date of receipt of the decision or within such further time as may be allowed by the Government on payment of such fee as the Government may, by notification in the official Gazette, determine. (2) The Government may call for relevant papers from the Institution and may, after such inquiry in the matter as it considers necessary, pass such order as it thinks fit and any such order passed by the Government shall be final. 19. It is apparent from the facts of the writ petition that the writ petitioner-company directly to the market with its two products, namely, Crown and Hunter after the BSTI has informed them that they had no standard for non-alcoholic malt beverage' and could not grant a licence for the article and if, however, the article is 'non-carbolic' it could grant a licence, if applied for, and according to the supplementary affidavit filed by the petitioners, these two products went to the market on 10-12-2003 and 11-1-2004 respectively without informing the BOI under sub-section (9) of section 11 of the Investment Board Act, 1989 or preferring an appeal to the Government under section 28 of the BSTI Ordinance, 1985. 20. To our query, Mr. Rafique-ul Huq submitted that inability to grant a licence expressed by the BSTI was not tantamount to rejection of the application made by the petitioners for a licence and consequently, the petitioner-Company was not bound to follow the provisions of appeal as has been laid down under section 28 of the BSTI Ordinance, 1985, and further the products were not within the list that has been prepared and approved by the BSTI. 21. To our further query, the learned Advocate for the petitioners submits that sub-section (9) of section 11 of the Investment Board Act, 1989 was not applicable in the instant case and the petitioners were not obliged to inform the BOI of the difficulties it faced with its products in respect of marketing. In this respect the learned Advocate has cited the case of Chairman of National Board of Revenue vs. Beximco Infusions Ltd., reported in 51 (AD) 36 where the imported machineries of the respondent were damaged by cyclone and tidal bore on 29 April, 1991 while awaiting clearance at the Chittagong Port, imported under SRO dated 25-7-1990 enjoying 90% customs duties and tax rebate, and for substitution of damaged machinery again imported some capital machineries and applied for the said rebate facilities but the authority did not agree on the ground that the Company could not bring the required certificate from the BOI. Both the High Court Division and the Appellate Division of this Court found that the Board of Investment which is the proper authority has certified that the disputed machineries were imported for replacement of the damaged components and parts without which the original plant could not be made functional. Thus the Court found that the National Board of Revenue was not justified in demanding 100% duties and taxes. Facts and circumstances of the reported case has no nexus with the facts and circumstances of the instant case. Rather, we find that in the reported case, the Company approached the Board of Investment for assistance when it faced difficulties with the Board of Revenue and since the Company was registered with the BOI, the BOI came forward to render assistance to the Company and the Company ultimately won over the legal battle mainly on the basis of assistance rendered by the BOI by way of issuing certificate thereof.

22. Mr. Huq argued that without a licence from the BSTI the Company was competent to market its products since the BSTI had no standard of those products and in marketing the products the company has committed no illegality, for BOI's registration includes both manufacture and marketing. 23. In view of the decision given in the case of Bangladesh Telecom Ltd. vs. Bangladesh Telegraph and Telephone Board and another, reported in 48 DLR (AD) 20 we are unable to accept the contention of Mr. Huq. In that case, it was held that apart from registration with the BOI the company also required a licence for marketing of its product from other competent authority. 24. Mr. Huq lastly, argued that the Industrial concern has solved employment problem of 500 employees and workers involving huge capital investment within the meaning of Board of Investment Act, 1989 and if closed down, it will add sufferings to the families of those people. They will be out of their jobs and have no means for living. 25. Before considering this last branch of arguments, advanced by Mr Rafique-ul Huq on behalf of the petitioners, we feel it necessary to point out some important aspects of this case. In its application made in a prescribed Form to the BOI vide Anriexure B to the Writ Petition, the Writ Petitioner No. 2 had stated that the name of the Industrial Project will be the "Crown Beverage Ltd." and the nature of the Industry will be " Food and Beverage" and the Company will produce "Malt Beverage (330ml. can)" from rice, salt from domestic sources and Malt, Hops and other chemicals by import employing 260 employees/workers and 10 people for management and the marketing of the product will be 100%, domestic marketing. By Annexure B(l) the respondent No. I registered the Company as "Malt Beverage" with 100% domestic marketing. Now, what is Malt? According to Oxford's Advanced Learners Dictionary 'Malt' is special kind of fermented Barley used for manufacturing Beer and Whiskey. Dictionary meaning of the term is as follows: "Malt-grain, usually Barley, that has been soaked in water for a period of time and then dried, used for making beer, whiskey, etc." The principal ingredient for Beer and whiskey is alcohol and malt is the principal source of alcohol. In the book named "Modi's Textbook of Medical Jurisprudence and Toxicology, 20th, Edition at Page 651, the author NJ Modi has defined alcohol under the Chapter of "Cerebral Poisons internal Poisons" as follows: "Pure ethyl alcohol (C2H5OH) is a transparent, colourless, mobile and volatile liquid, having characteristics of spirituous odour and burning taste used, amongst others, in alcoholic drinks.", and percentage of absolute alcohol in various alcoholic beverages are: Beer: 2 to 6 per cent, Ginger Beer: about 1 to 3 per cent." 26. The petitioners in this writ petition have categorically stated and repeatedly asserted that both the products called Crown and "Hunter" are absolutely 'non-alcoholic beverage. In its application made to the BSTI, respondent No. 5, the petitioners applied for a CM Licence for its "non-alcoholic malt beverage' named 'Crown Energy Drink. The respondents Nos. 1 and 2, on the other hand, both in their affidavits-in-opposition and hearing, made a definite statement that the products are 'alcoholic products' and will spoil the school/college going children/adolescent because of its indiscriminate marketing and availability. Were both the parties not aware of a malt-product at the beginning? Why the petitioner did not apply for a CM Licence to the BSTI for its product called 'Hunter which according to the expert, contains 4.81% alcohol?

In their reply to the BOI the petitioners stated that they applied to the BSTI for both for Licence both for 'Crown' and "Hunter which form the application itself appears to be not correct. Let us now see the consequence of a beverage containing 4.81% alcohol from the medical point of view and again from the book 'Medical Jurisprudence and Toxicology, "Acute poisoning may result from consumption of an alcoholic beverage in small doses at short intervals or in an excessively large dose at a time, sometimes even by inhalation of alcoholic vapours." "This is fatal according to the habit and age of the patient, and the nature and strength of the liquor taken. Death occurs usually from a large quantity taken in a short space of time. About 150 to 250 ml of absolute alcohol are considered fatal for an adult. About 60 ml. of absolute alcohol, are probably fatal to a child under 12. "Consumption of one fluid ounce of Whiskey gives a maximum concentration of alcohol of 0.024% alcohol in the urine while the consumption of a pint of beer will give a concentration of 0.037%. Persons with a concentration of 0.2 % alcohol in the blood show symptoms of moderate intoxication, those with from 0.2 to 0.4% are dizzy, delirious, stuporous and quite drunk and those with more than 0.5 % are dead drunk or deeply comatose. When the amount of alcohol approaches 0.6 to 0.7 % or more in the blood, death usually ensures from asphyxia." In 1900 an epidemic broke out in Lancashire of beer containing 1 to 2 % contaminated alcohol causing mass deaths" (ibid) 27. According to the petitioners, they are neither responsible to the BSTI as the BSTI could not grant a MC Licence for the product as not being an enlisted one nor to the BOI for, under the Industrial Policy they were not required to go to the BOI for registration but have gone out of courtesy. So, who were supposed to see the purity, components, ingredients etc. of these two products namely, Hunter containing 4.81% alcohol and Crown containing 0.68%, alcohol sold to the school going children and the young generation and there is none, according to them, to look after it? Annexure 3 to the affidavits-in-opposition submitted by the respondent Nos. 1 and 2 6 shows that the Narcotics Control Directorate has made a laboratory test of 15 numbers of beer namely, Holsten, Faxe, Buckler, Shark containing 0.67%, 0.49% and 0.19 per cent alcohol respectively and the "Hunter" ranked the top containing 4.82% and Crown ranked third containing 0".58% (according to BSCIR 0.68%). 28. Referring to section 2(Kha) of the Narcotics Control Act, 1990 Mr. Huq argued that the two products are not alcoholic within the definition of the Act for, it is not spirit or liquor of any kind, wine, beer or liquid containing more than 5% alcohol. Under section 2(Ja Ja) of the Act, 1990 "Beer" means any drink made in Brewery containing not less than 5% and not more than 8.5% alcohol. Under section 10 of the Act establishment of brewery and production of alcohol without obtaining a licence from the Directorate is prohibited, under Schedule Kha 3. Alcohol means all kinds of liquor, rectified spirit or any medicine or liquid made in combination of rectified spirit, beer or any liquid containing more than 5% alcohol.

29. We are of the view that the argument in this respect is fallacious though the petitioners made a shift from absolutely non-alcoholic Beverage' to '5% to 8.5% alcohol' within the meaning of Narcotics Control Act. The very term 'narcotic' means "(substance) inducing drowsiness, sleep, stupor, or insensibility; (fig) sporific; of narcosis (drug, e.g. stimulant or hallucinogen) affecting the mind."The Narcotics Control Act deals with narcotics and not with Food and Beverage" under which the petitioner No. 1 was registered. The Pure Food Ordinance, 1959 deals, to some extent, with this matter under which the petitioners are not permitted to product and market their "Crown" and "Hunter" containing this level of alcohol, as Food and Beverage. The definition of 'food' given in the Ordinance, 1959 is applicable to the products of the petitioners. NJ Modi has stated in 'Chapter XXIX' that some Whiskey (Spiritin Frumenti), such as, Ale, contains about 5 to 7% alcohol and Porter, about 5-7% alcohol (ibid). 30. The arguments of the learned Advocate for the petitioners in respect of observance of Principle of Natural Justice also does not sound reasonable. The principle audi alteram partem no person be condemned unheard" nowhere means that the hearing must be and solely personal hearing and written hearing will not suffice. In fact, written hearing (by way of issuing show cause notice and reply thereto from the delinquent) is the best way for observance of the principle of Natural Justice, save and except some exceptional circumstances. 31. When the Law is articulate, absence of subordinate law will not prevent the law from its application; Rule cannot supersede the statute, 'enactment shall control the rule ( Fazlur Rahman and others vs Bangladesh, 53 DLR 237 (if there be any). The condition No. 3 of the registration/approval was neither redundant nor lost its force. Since the petitioners were treated in accordance with the expressed provisions of law there is no question of infringement of Article 31 of the Constitution and application of Article 40 is "subject to any restrictions imposed by law". And 'wishful hopes without lawful root is not legitimate expectation' (Hafizul Islam vs Bangladesh, 11 BIT 65). 32. In Travancore Rayons vs Union of India 1971 AIR SC 862 the Company first preferred an appeal against the impugned Order and then a revision to the Government. The Government rejected the revision without hearing the petitioner and under that circumstances the Supreme Court held that 'It is true that the rules do not require that personal hearing shall be given, but in appropriate cases where complex and difficult question requiring familiarity with technical problems are raised personal hearing is given, it would conduce to better administration and more satisfactory disposal of grievances of citizens'. 33. But, in the instant case, the petitioners even did not prefer an appeal under section 28 of the BSTI Ordinance to the Government nor did they inform the matter to the BOI. No complex, difficult and technical questions were raised in the instant case. 34. In MA Hai's Case (Supra), the enquiry was held and the witnesses were examined by the enquiry committee in the absence of the delinquent employee and the question of awarding graver punishment than that of one recommended by the enquiry committee came up for consideration. 35. The facts and circumstances of the case of Acqua Food Limited together with other cited cases are distinguishable from those of the instant case and not applicable under the peculiar facts and circumstances of the present case.

36. Section 28 of the BSTI Ordinance, 1985 was fully applicable in the case of the petitioners and so also sub-section (9) of section 11 of the Investment Board Act, 1989. 37. Section 15 of the Investment Board Act, 1989 is as follows: "15. Cancellation of approval.- In an industrial project approved under section 11 contravenes any of the provisions of this Act or of any rules made thereunder or violates any of the conditions relating to the approval, the Board may, in the manner prescribed by rules, cancel the approval of the project." The condition No. 3 was a condition imposed relating to approval. 38. The last point to be considered in this Writ Petition is, the welfare of the workers; their means of living and it is the only point which sounds reasonable. Under the registration/ approval, Annexure B(l) to the Writ Petition, admittedly 260 people are working in the industrial establishment and making their living and they will lose their employment and means of living if the industry is closed down. 39. The BSTI said that they are ready to grant a licence, vide Annexure E to the writ petition, if the article is "Non-carbonated under its "BDS No. 1727:2000 Non-Carbonated, Non-alcoholic ready to drink Beverage" heading, if the company so apply in the prescribed manner. Now, it is for the writ petitioners to decide. The petitioners have stated in their Writ Petition and asserted repeatedly that their products are "absolutely non-alcoholic", they might have a chance to prove their worth. 40. Had the petitioners applied to the BOI in accordance with sub-section (9) of section 11 of the Investment Board Act, 1989 the Board was duty-bound to come forward for assistance of the Company in respect of difficulties relating to its manufacture and marketing. The respondent No. 1 is also not absolved from responsibilities, especially in respect of registration of a malt beverage manufacturing company, in view of the meaning of the term "Malt. They may now take corrective measures by rendering effective assistance to the Company and the petitioners may also take turn to reasons. 41. Though the Writ petitioners failed on all scores in this Writ petition but succeeded on the welfare score which is the basic norm of "social justice' as enshrined in the preamble and under Article 8 of our Constitution. 42. Without rendering effective assistance and making offer to the company for manufacturing alternative 'non-alcoholic products, cancellation of the registration of the Company was not proper. Further, the issuance of show cause letter dated 1-3-2004 allowing (3) days' time and issuance of cancellation letter on the same day (4-3-04) it received the reply dated 4-3-04 leads us to believe that the decision has been taken in haste and the writ petitioners were not fairly dealt with and there was lack of application of mind inasmuch as, the registration has been cancelled for illegal marketing of the products , namely "Crown" and " Hunter", as has been submitted by the learned Additional AttorneyGeneral. 43. In the result, the Rule is made absolute on the terms that the industrial concern will manufacture such drink, for internal consumption, permissible under the law of the country, but not "Crown" and " Hunter" or any alcoholic beverage, with due clearance from the authority concerned, if they so wish, and the Board of Investment will render necessary

assistance to the industry concerned for manufacturing and marketing of such products. The production and marketing of the petitioners products " Hunter" and "Crown" are declared to be unlawful for marketing and sale within the country and the writ petitioners are directed to withdraw and ensure withdrawal of entire stock of those two drinks from the market of the country within 30 days and stop and ensure stoppage of sale of those two drinks within the country with immediate effect. There will be no order as to costs. Ed. This Case is also Reported in: 9 BLC (2004) 601.