Apex Court reiterates limits of High Court jurisdiction in second appeals; emphasises that even erroneous factual findings cannot be interfered with absent substantial question of law
The Supreme Court has reiterated that High Courts cannot interfere with findings of fact in second appeals unless a substantial question of law arises. Even erroneous factual findings are not enough to justify interference.
In State of Uttar Pradesh v. Mayoor Ahuja (order dated April 6, 2026), the Court partly allowed the State’s appeals.
Mayoor Ahuja held a CL-2 licence for wholesale liquor trade in Badaun and Sambhal for the 2020–21 excise year.
On March 4, 2021, officials inspected the premises. A show cause notice followed on March 5, 2021. It alleged:
- No signboard
- Shortage of 1980 packets
- No CCTV cameras
- Lack of fire safety equipment
Ahuja denied the allegations.
On March 27, 2021, the Excise Commissioner cancelled the licence and forfeited the security deposit. The order also relied on additional allegations such as illegal transport and forged barcodes.
Ahuja’s revision failed on February 23, 2024.
The Allahabad High Court later set aside the cancellation on April 23, 2025.
The Supreme Court agreed with the High Court on key points:
- The violations were minor and compoundable
- The cancellation relied on grounds not mentioned in the show cause notice
- This violated principles of natural justice
However, the Court found a major flaw in the High Court’s ruling. It completely blocked any future action by the State.
The Bench, comprising Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe, held that this approach was incorrect.
The Court stressed that regulatory accountability in liquor trade is essential. The State must retain the power to act under the law.
The High Court’s order effectively gave the respondent immunity from future proceedings. The Supreme Court rejected this.
