Order of Appellate Division reversed and that of Special Term reinstated, with costs in this court and in the Appellate Division. The license held by the Vanger Restaurant, owned and operated by petitioner’s principal shareholder, has now been surrendered. In light of the earlier offer of the Vanger Restaurant to surrender its license, the refusal of the State Liquor Authority to approve petitioner’s application must be deemed arbitrary, capricious and unreasonable.

Concur: Chief Judge Fold and Judges Van Voorhis, Burke, Scileppi, Bergan, Keating and Breitel.