The Supreme Court, on April 1, 2025, set aside an interim order issued by the Punjab and Haryana High Court that had stalled the implementation of liquor vend allotments under the Chandigarh Excise Policy 2025-2026. The ruling was delivered by a bench comprising Justice Dipankar Datta and Justice Manmohan, who found that the High Court's decision lacked recorded reasoning.
The Supreme Court emphasized that the High Court had failed to provide reasons for granting interim relief. The judgment stated:
"If indeed the High Court had found a prima facie case for granting interim relief and also considered balance of convenience, irreparable loss, and injury, we would have expected it to record at least some reason(s), howsoever brief, showing application of mind to the contentions urged. Unfortunately, the High Court has recorded no such satisfaction."
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Due to this lack of reasoning, the Supreme Court set aside the High Court's order, thereby allowing the Chandigarh administration to proceed with the liquor vend allotments.
The Punjab and Haryana High Court had issued an interim order on March 26, 2025, directing a status quo on liquor vends until April 3, 2025. As a result, the implementation of the allotments was put on hold, freezing 97 liquor vends allocated through an e-auction starting April 1, 2025.
The Union Territory of Chandigarh and the allottees challenged this decision before the Supreme Court, leading to the present ruling.
Following the Supreme Court’s ruling, all parties were instructed to appear before the High Court on April 3, 2025. The Supreme Court clarified that at the final hearing stage, the allottees could not claim any equity in their favor, and the High Court would have to decide the matter purely on its merits.
Furthermore, the Supreme Court stated:
"If the High Court cannot dispose of the petitions by the end of April 2025, it may consider interim relief. However, any such relief must be supported by cogent reasons."
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Background of the Case
The legal dispute arose from three pleas filed by liquor companies challenging the liquor vend allotments. The petitioners alleged that the bidding process was manipulated, leading to unfair allotments. They claimed that 87 out of 97 vends were awarded to bidders allegedly linked to a single family, violating Clause 14 of the Excise Policy, which prohibits issuing more than ten licenses to a single entity or its associated parties.
Vault Liquor Private Limited, one of the petitioners, argued that cartelization had occurred, with 12 cartel members allegedly refraining from cross-bidding, causing financial losses to the state.
In response to these concerns, the High Court had initially allowed amendments to the petitions, enabling the petitioners to challenge the constitutionality of the Chandigarh Excise Policy 2025-2026. It had also granted an ad-interim stay on allotments until April 3, 2025.
The legal battle saw prominent advocates representing both sides:
- For the Chandigarh Administration: Solicitor General Tushar Mehta
- For the Allottees: Senior Advocates Dr. Abhishek Manu Singhvi and Aryaman Sundaram, along with Advocate-on-Record Pranav Krishna
- For the Petitioners: Senior Advocates Mukul Rohatgi, PS Patwalia, and Puneet Bali
Case no. – SLP (C) Nos. 8919-8921/2025
Case Title – Union Territory of Chandigarh & Ors. Etc. v. M/S. Kler Wines & Ors. Etc.
