Arguments in [http://courtnic.nic.in/supremecourt/temp/ac%20415715p.txt The Kerala Bar Hotels Association vs State of Kerala] began with a lot of excitement on both sides last week (14 August) before the bench of justices Viramajit Sen and Shiva Kirti Singh.

The excitement was partly due to the fact that the star hotels in Kerala, other than the five star hotels, that are aggrieved by the Kerala High Court’s order of March 31, (Xavier Residency vs State of Kerala, delivered by Justices K.T. Sankaran and Babu Mathew P. Joseph), justifying the State Government’s abkari policy, are now before the Supreme Court with their last attempt to challenge the liquor policy of the State Government.

According to them, the liquor policy discriminates against them, while favouring the five-star hotels with bar licences.

Part of the excitement is also due to the fact that the Attorney-General Mukul Rohatgi is appearing for a private party, Hotel Sky Pearl, a four star hotel, after assuming office as the AG.

Although the rules permit the law officers of the Central Government to appear for private parties after obtaining permission from the Government, internal office memoranda issued by the Union Law Ministry from time to time, have discouraged the law officers from making requests for permission to appear for private parties.

[http://thewire.in/2015/07/22/questions-raised-over-propriety-of-attorney-general-representing-private-party-6873/ The controversy] has had its echo this time with advocate Kaleeswaram Raj appearing for United Democratic Front (UDF) MLA, TN Pratapan, making a strong plea against the AG’s accepting the brief from a private party.

The bench, however, dismissed the objections, saying it is for the Central Government, which appointed the AG, to take a view on the matter.

Today, C.A.Sundaram, senior advocate appearing for the lead petitioner, the Kerala Bar Hotels Association, began his arguments saying that the protection of Article 47 of the Constitution is not available to the State Government’s discriminatory policy, because if the objective is prohibition, the State Government ought to regulate its own liquor sales. Instead, the state government regulates the liquor sales of everyone else, but not its own.  He said that stopping fresh bar licences is different from withdrawing the existing ones.   The Government’s policy to stop fresh bar licences may be valid, but not withdrawal of the existing ones, he said.

“Don’t stop me on the pretext that you want to stop liquor in the state. You yourself are doing the opposite," he argued.

He drew a distinction between Articles 14 and 19 of the Constitution.  Under Article 14, you have to establish the nexus between classification and the object of classification, rather than the object of restriction on the right, whereas under Article 19, the nexus has to be established between restriction on the right, and the object sought to be achieved by that restriction, he said. He contended that the state Government’s policy is not a reasonable restriction under Article 19(6).

Saying that even a law student knows that under Article 14, there has to be intelligible differentia and rational nexus, he said he could find no intelligible differentia between five star and four star hotels.

He further argued that discrimination is per se hostile.  State can’t claim that it did not intend discrimination; its effect has to be seen, he contended.

He also attacked the State Government’s stated goal of protection of tourism behind its policy of granting only five star hotels bar licences. “You are protecting the rich tourists”, he said.

When the Bench asked whether it can sever the State Government’s policy from its exemption to five-star hotels, and approve the policy, while striking down the exemption, Sundaram said reading down can’t arise if state is in business; it can’t be that only one category is stopped, he suggested.

Arguments will continue this week.