Case Background
The case arose from the seizure of a container truck bearing Registration No. MH-04JU-0423 on 26.12.2022. From this vehicle, 477 litres of Indian made foreign liquor were recovered in the State of Bihar, where prohibition is in force under the Bihar Prohibition and Excise Act, 2016.
On the same day, Patepur P.S. Case No. 346 of 2022 was registered under Sections 30(a), 32(2), 41(1) of the Bihar Prohibition & Excise Act, 2016. The case was registered against the owner of the vehicle and other apprehended accused persons. The driver and cleaner were caught at the spot.
On 27.12.2022, the Station House Officer, Patepur Police Station, sent a proposal for confiscation of the seized vehicle to the competent authority by Memo No. 1347/22. On that basis, Excise Confiscation Case No. 04 of 2023 was initiated before the Additional Sub Divisional Officer, Mahua (respondent no. 5).
On 20.02.2023, in that confiscation case, the vehicle was ordered to be confiscated and the Sub Divisional Officer, Mahua was requested to initiate the process of auction. The petitioner, who is the registered owner of the truck and a resident of Maharashtra, says he was never issued notice nor heard before passing this harsh order.
Later, on 29.09.2023, the confiscated vehicle was auctioned and sold to one Sandeep Kumar for Rs. 2.2 lakh by order of the Sub Divisional Officer, Mahua, Vaishali. By that time, the petitioner claims he had come to know of the seizure and had submitted Form IV on 28.09.2023 to the District Magistrate seeking release of the vehicle. Despite this, the truck was sold the very next day.
Aggrieved by the confiscation order dated 20.02.2023 and the subsequent auction, the petitioner filed Civil Writ Jurisdiction Case No. 18561 of 2023 before the Patna High Court. He sought quashing of the confiscation order, release of his truck if not yet auctioned, or compensation with interest if already sold, alleging clear violation of principles of natural justice.
What the Court Examined and Decided
The Patna High Court, speaking through Hon’ble Mr. Justice S. B. Pd. Singh (for the Bench also comprising Hon’ble the Acting Chief Justice), carefully examined both the factual circumstances and the statutory scheme under the Bihar Prohibition and Excise Act, 2016 and the Bihar Prohibition and Excise Rules, 2021.
The petitioner’s main case was that he is the bona fide owner of the truck, which he had given on rent to a transport company and to one individual (respondent no. 7). The vehicle had a national permit and he was residing in Mumbai. He asserted that he had no role in carrying liquor, and that the entire confiscation and auction process had taken place behind his back without notice or opportunity of hearing.
He pointed out that the authorities did not bother to verify his name and address from the District Transport Officer, Vaishali. Instead, they went through a mere formality by issuing a notice through a local newspaper in Bihar, even though the registered owner lived outside the State. He argued that this was a sham notice and a clear violation of the principles of natural justice.
The petitioner also relied on insurance documents to show the value of the vehicle. According to him, at the time of seizure on 26.12.2022, the insurance value of the truck was Rs. 21,00,000/-. On the date of auction on 29.09.2023, the insured value was still Rs. 9,47,893/-. Yet, the vehicle was sold for only Rs. 2.2 lakh, which he described as a throwaway price, causing serious financial loss and affecting his livelihood.
On the other side, the State authorities argued that the vehicle was confiscated and auctioned as part of a collective exercise under Letter No. 633 dated 25.01.2023, issued by the then Additional Secretary, Prohibition, Excise and Registration Department to the District Magistrates. It was submitted that the petitioner himself was negligent and did not promptly file an application in Form IV under Rule 12A of the Bihar Prohibition & Excise Rules, 2021 to seek release of his vehicle on payment of penalty.
Before dealing with these arguments, the Court set out the relevant statutory provisions. It referred to Section 47 of the Act, which punishes any person in control of a conveyance who knowingly allows it to be used for an excise offence, treating such person as if he himself committed the offence.
The Court then discussed Section 57B, inserted in 2022, which allows release of any seized vehicle used in an excise offence on payment of a penalty decided by the Collector. The provision applies to pending confiscation proceedings and clarifies that such release is at the discretion of the Collector and does not affect the criminal trial.
Most crucially, the Court focused on Section 58, which lays down the procedure for confiscation by the District Collector or authorised officer. The officer who seizes the vehicle must promptly report to the District Collector. The Collector may order confiscation if satisfied that an offence has been committed, but under Section 58(3) he must first give a reasonable opportunity of hearing to the person concerned.
The Court also referred to Section 61, which states that after a confiscation order under Section 58 becomes final, the property vests in the State Government. Sections 92 and 93, regarding departmental appeals and revisions, were set out to show the overall legal framework, and Section 95 empowering the State to frame rules was also cited.
On the rules side, the Court discussed Rule 12A of the Bihar Prohibition and Excise Rules, 2021, inserted in 2022, which allows release of seized vehicles on payment of penalty upon an application in Form IV by the owner. The Rule also says that where the owner is unknown or does not come forward within 15 days, the Collector can proceed to confiscate and auction the vehicle.
Importantly, Rule 12A(2) requires the authority, while fixing penalty, to consider the quantity of intoxicant recovered, the involvement of the vehicle owner, and the insured value of the vehicle, with clear limits on minimum and maximum penalty.
After setting out this legal framework, the Court drew key conclusions. It held that two basic conditions must be met before a vehicle can be seized or confiscated under the Act:
First, the vehicle must have actually been used to carry or transport liquor or intoxicant. Second, there must be consent or connivance of the vehicle owner, or at least some involvement, direct or indirect, in the offence.
The Court stressed that mere use of the vehicle is not enough. The owner’s role is critical. The Court noted that in cases where the owner is directly involved, he is made an accused. Even where involvement is indirect, he can be arraigned under Section 47. Therefore, unless the owner is an accused, it is difficult to say he was involved in the prohibited use.
The Court also observed that the State Government itself had earlier recognised these principles. It referred to Government Letter No. 13/HC-06-55/2020-670 dated 07.02.2020 issued by the Additional Chief Secretary, Home Department cum Prohibition, Excise and Registration Department. That letter, following directions of the High Court, clearly stated that vehicles from which no liquor was recovered should not be confiscated, and where only the driver was drunk but no liquor was found, only the driver should be prosecuted.
Turning back to the present facts, the Court accepted that 477 litres of illicit liquor were recovered and that the driver and cleaner were caught. The petitioner, as registered owner, was also made an accused in the FIR, though he was not present at the spot. However, the Court specifically recorded that there was no allegation of direct or indirect involvement of the petitioner in the commission of the offence, beyond his status as owner.
The Court was highly critical of the manner in which notice was handled. It found that the authorities had not properly verified the name and address of the owner from the District Transport Officer. Instead, they relied on local newspaper publication in Bihar, even though the owner was living in Mumbai and the vehicle had a national permit.
The Court characterised this as a flimsy exercise and a mere formality, contrary to the requirement of giving a real, effective opportunity of hearing as mandated by Section 58(3) and the principles of natural justice. On this basis, the Court held that the confiscation proceedings and auction were conducted casually and without due process.
The Court went further and examined the valuation at the time of auction. It noted that when the truck was sold on 29.09.2023 for Rs. 2.2 lakh, the insured value was Rs. 9,47,893/-, and at the time of seizure, the insured value was Rs. 21 lakh. This large gap led the Court, by an earlier order dated 19.03.2025, to hold that the officials had erred in determining valuation for auction. The Court had then directed the Principal Secretary, Department of Registration and Excise, to lodge a criminal case against such officials, and had also ordered the State to deposit Rs. 21 lakh in the Registry of the Court.
The State challenged this order before the Supreme Court in Special Leave to Appeal (C) No. 12926/2025, but the Supreme Court rejected the SLP on 07.05.2025. Thereafter, in compliance with the High Court’s order, the State deposited a Demand Draft of Rs. 21,00,000/- in favour of the Registrar General, Patna High Court on 12.05.2025.
Finally, after considering all these facts, the Patna High Court concluded that the two prerequisites for seizure and confiscation—use of the vehicle for carrying liquor and consent or connivance of the owner—were not satisfied in this case. Consequently, the vehicle was not liable to be seized or confiscated under the Act.
The Court held that the impugned confiscation order was arbitrary, violative of Article 14 of the Constitution, and infringed the petitioner’s constitutional right to property under Article 300A, which forbids deprivation of property without authority of law. The Act did not authorise such confiscation in these circumstances, so the seizure and confiscation were without legal authority and had to be quashed.
Since the vehicle had already been sold, the Court directed that the Demand Draft of Rs. 21,00,000/- deposited by the State be released in favour of the petitioner. At the same time, recognising that 477 litres of liquor were actually recovered from the truck, the Court directed the petitioner to deposit the maximum penal amount of Rs. 5,00,000/- with the concerned authority and to submit the receipt before the Registrar General to secure release of the Rs. 21 lakh. Alternatively, the Court allowed adjustment so that the Government would retain Rs. 5 lakh and the remaining Rs. 16 lakh would go to the petitioner.
With these directions, the writ petition was disposed of.
Why This Judgment Matters
This judgment of the Patna High Court is important for vehicle owners, transporters and drivers whose vehicles are seized in prohibition cases in Bihar.
First, it reinforces that the State cannot simply confiscate and auction a vehicle without giving proper notice and a real opportunity of hearing to the owner. Publishing a notice in a local newspaper, without even checking the registered owner’s address, is not enough.
Second, the Court makes it clear that using a vehicle for carrying liquor is not, by itself, sufficient to justify confiscation. The authorities must show that the owner either knew about it, allowed it, or was somehow involved. Otherwise, a person can lose a vehicle and livelihood for someone else’s wrongdoing, which the law does not permit.
Third, the Court has taken a strong stand against undervaluing vehicles in auctions. Selling a truck with an insured value of several lakhs at a fraction of that amount has been condemned. The Court not only quashed the confiscation, but also directed criminal action against officials and ordered full compensation to the owner.
Fourth, the case shows how Section 57B and Rule 12A, which allow release of vehicles on payment of penalty, must be applied fairly and with regard to involvement of the owner and the insured value. The Court balanced this by directing the owner to pay the maximum penalty, acknowledging that liquor was actually seized from his truck.
This decision therefore sends a clear message that even under strict prohibition laws, the State must act within the four corners of law and respect constitutional protections of equality and property.
Legal Issues and Answers
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Issue: Can a vehicle be confiscated and auctioned under the Bihar Prohibition and Excise Act, 2016 without proper notice and without proving the owner’s involvement in carrying liquor?
Answer: No. The Patna High Court held that both use of the vehicle for transporting liquor and consent or connivance of the owner are necessary. Without proof of the owner’s involvement and without giving him a reasonable opportunity of hearing, confiscation and auction are illegal and violate Articles 14 and 300A. -
Issue: What is the consequence when authorities undervalue a seized vehicle and sell it at a throwaway price in auction?
Answer: The Court found the auction illegal where valuation was grossly erroneous. It directed the State to pay the full insured value to the owner, ordered possible criminal proceedings against erring officials, and allowed the State to retain only a statutory penalty amount in light of the liquor recovery. -
Issue: How do Section 57B of the Act and Rule 12A of the Rules operate in pending confiscation proceedings?
Answer: They allow the Collector to release seized vehicles on payment of penalty in pending cases. However, while fixing penalty and deciding release, the authority must consider the owner’s involvement and insured value, and must still respect the mandatory requirement of notice and hearing prescribed under Section 58.
Cases Cited by the Court
- The judgment refers to various earlier decisions of the Patna High Court in writ jurisdiction and to directions leading to Government Letter No. 13/HC-06-55/2020-670 dated 07.02.2020. However, no specific case names or citations are mentioned in the text provided.
Case Details
Case Number: Civil Writ Jurisdiction Case No. 18561 of 2023
Case Title: Sharad Navnath Gange v. The State of Bihar & Ors.
Citation: 2025 (2) PLJR 431
Coram: Hon’ble the Acting Chief Justice and Hon’ble Mr. Justice S. B. Pd. Singh
Date of Judgment: 01.09.2025
Advocates:
- For the petitioner: Mr. Deo Prakash Singh
- For the respondents (State of Bihar and others): Mr. Madhaw Pd. Yadaw (GP23)
Nature of the Case: Writ petition under Article 226 of the Constitution of India challenging an excise confiscation order and consequential auction of a vehicle seized under the Bihar Prohibition and Excise Act, 2016.
Link to Judgment: Click here to read the full judgment of the Patna High Court
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