HP High Court Quashes Brewery Licence Cancellation; Says Inspection Team Was Not Constituted As Per Excise Act

The Himachal Pradesh High Court dismissed a cancellation order, holding that the inspection team which conducted the inspection of the brewery was not in accordance with the framework under the Excise Act.

Justice Jyotsna Rewal Dua remarked that: “The team constituted by the respondents for inspecting petitioner's premises did not have Executive Magistrate of First Class. Apparently, this team did not even have Police Officer of the rank specified in the Excise Act & the Notification. The inspection report… does not give names of specific Police Officers or their ranks… It has to be held that constitution of the team that inspected the premises was not in consonance with the Act & the applicable Notification.” 

Background:

The petitioner, a licensed manufacturer of Indian Made Foreign Liquor and country liquor, operated under multiple licenses granted under the Himachal Pradesh Excise Act, 2011. On 4 May 2025 a surprise inspection was conducted which allegedly revealed several violations, including unauthorized bottling, use of unapproved brands, illegal storage of materials, and operation beyond permitted hours. 

According to the inspection, an FIR was registered after which departmental proceedings were initiated. An inquiry and recommended cancellation of the petitioner's primary licenses. Acting on this recommendation, the Commissioner cancelled the licenses on 4 July 2025.

The Court noted that the the inspection was not as per the statutory notification which required inclusion of specific Executive Magistrate and Police Officer of prescribed rank.

The Court remarked that even though the inspection team was not constituted in accordance with law, such a defect would not automatically invalidate the entire proceedings in this case. It noted that an FIR had already been registered based on the inspection, and importantly, the petitioner failed to show how the absence of the required Executive Officer and Police Official caused any actual prejudice to it.

Further the Court stated that the Commissioner's decision was found to be influenced by the Collector's recommendations and not independently reasoned. Thus, High Court quashed the cancellation order.

Case Name: M/s Tiloksons Brewery & Distillery, Kala Amb District Sirmour, H.P. V/s State of H.P. & Ors.

Case No.: CWP No.16382 of 2025

Date of Decision: 02.04.2026 

For the petitioners: Sh. Sunil Mohan Goel, Senior Advocate with

Mr. Paras Dhaulta, Advocate.

For the Respondents: Mr. Y.P.S. Dhaulta & Mr. L.N. Sharma, Additional Advocates General and Ms. Seema Sharma, Deputy Advocate General for the respondents/State.

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