JUDGMENT

B. P. Jeevan Reddy, J. - Leave granted.

2. The dispute pertains to the grant of FL-16 licence in respect of the area Kachchi Sarai, Dal Mandi, Sector-II, Varanasi. Only one licence is sanctioned for the said area.

Prior to 1961, the licence stood in the name of Mohd. Abdul Hamid, brother of Mohd. Khalil-fifth respondent herein. In that year, the name of fifth respondent was also added. Abdul Hamid died in March 1979. Accordingly, the licence for the excise year 1979-80 was renewed in the name of fifth respondent alone. On May 24, 1980, the licence in favour of fifth respondent was cancelled and a temporary licence was issued to One R.S. Tiwari. Fifth respondent complained against the same and took several proceedings in that behalf. Ultimately, he filed a writ petition in the Allahabad High Court (Writ Petition (C) No. 15434 of 1981) which was allowed on August 29, 1986. Pursuant to the said order, the licence in favour of the fifth respondent was renewed and continued to be renewed till and including the excise year 1991-92.

3. For the excise year 1992-93, the fifth respondent applied for renewal in the usual course. Thereon, a query was raised by the District Excise Officer as to the circumstances in which licence was granted to the fifth respondent in 1984 and later. The fifth respondent furnished his explanation to the said query but no orders were passed in the matter. While So, Sri Surender Tripathi filed an application dated June 4, 1993 reqesting for grant of a temporary FL-16 licence in the name of his wife, Shanti Devi. On the said application, a report was submitted by the office that while the fifth respondent had not applied for renewal of licence for the year 1993-94, he is yet running the business on the basis of a temporary licence. [This fact is taken from the order of the District Magistrate dated May 20, 1994.] On this report, the District Excise Officer, Varanasi, cancelled the licence in favour of the fifth respondent with the result that the licence in respect of the said shop was deemed to be vacant. A notification was issued on October 16, 1993 calling for applications for the grant of a regular licence in respect of the said shop. Eleven persons including the appellant herein, Sri Gorakhnath applied. The licence was granted to Gorakhnath-against which the fifth respondent again took proceedings before the excise authorities. On May 20, 1994, the District Magistrate, Varanasi accepted the fifth respondent s case and directed the renewal of Fl-16 licence, for the year 1994-95, in his favour under an elaborate order. In this order, the District Magistrate set out the history relating to the grant and the subsequent litigation concerning the said licence and found that the cancellation of fifth respondent s licence by the District Excise Officer by his order dated July 3, 1993 was incompetent in law and not warranted on facts. The appellant preferred an appeal against the order of the District Magistrate which was dismissed by the Additional Excise Commissioner. A revision filed before the Government was also dismissed, whereupon he approached the Allahabad High Court by way of a Writ Petition (C) No. 707 of 1995.

4. Writ Petition (C) No. 707 of 1995 has been dismissed by the High Court under the order impugned herein. The reasoning of the High Court is: once it is rightly held that the order of cancellation [of the fifth respondent s licence] dated July 3, 1993 is competent and erroneous, it must follow that there was no vacancy in the licence and hence, calling for applications for grant of licence and the consequential grant of licence in favour of the appellant is incompetent in law. The High Court rejected the appellant s plea that cancellation of his licence without hearing him is illegal being violative of the principles of natural justice. It opined that the licence granted to the appellant, even if described as permanent, has to be treated as an interim or temporary arrangement subject to the