SUPREME COURT OF INDIA
Dipak Misra, Prafulla C. Pant, JJ.
State of West Bengal and Others – Appellants
Versus
R.K.B.K. Ltd. & Anr. – Respondents
CIVIL APPEAL NO. 2825 OF 2015 [Arising out of SLP(C) No. 30338 OF 2014]
Decided On : 04-09-2015
(1987) 1 SCC 424 – Relied upon
(b) West Bengal Kerosene Oil Control Order, 1968 – Paragraphs 9 and 10 – Order becomes effective only when communicated – Limitation of 30 days – Starts from the date of communication of order – Second show cause issued by SCFS is appealable before Director who alone has jurisdiction – Director’s order can be challenged in appeal before the State Government. (Para 30)
(2007) 7 SCC 309; (1992) Supp. (1) SCC 471; AIR 1954 SC 194; AIR 1961 SC 1500; (1999) 7 SCC 510; (2005) 4 SCC 480 – Relied upon
2005 (4) CHN 264 – Distinguished
Facts of the case:
First respondent was granted the licence for carrying on the business of superior kerosene oil as an agent by the Joint Director of Consumer Goods, West Bengal
The monthly allocation of public distribution system of superior kerosene oil to the said respondent was fixed by the Director of Consumer Goods, West Bengal at 1,82,000 litres per month.
On 10.8.2012 a physical inspection was carried out and it was reported to the SCFS that 71,494 litres of superior kerosene oil had been delivered in excess by the dealer.
The Director of Consumer Goods held that SCFS has the authority to ask for explanation regarding distribution of superior kerosene oil in his jurisdiction; and that the Director of Consumer Goods being the Licensing Authority, can exercise the power to issue show cause notice and after giving the delinquent agent a fair opportunity of being heard, pass appropriate orders. The Director of Consumer Goods imposed a penalty of Rs.26,08,816.00 and further directed reduction of monthly allocation of superior kerosene oil of the agent by 12,000 litres for a period of one year.
The order passed by the Director was assailed by the agent in writ petition. The Single Judge directed that if the agent prefers an appeal by 6.9.2013, the appellate authority shall dispose of the same by 31.12.2013. The Single Judge further directed that the agent shall maintain with utmost care an inventory of stocks and accounts for periodical submission to the authorities and the penalty amount should be deposited by 6.9.2013 and the said penalty amount shall be kept in a separate interest bearing account.
The Division Bench allowed the appeal and set aside the judgment of the Single Judge.
Finding of the Court:
The matter was rightly referred to the Director for action, if required, in terms of paragraph 9 of the Control Order.
JUDGMENT :
Dipak Misra, J.
In this appeal, by special leave, the legal substantiality and acceptability of the judgment and order dated 29.08.2014 passed by the Division Bench of the High Court of Calcutta in AST No. 177/2013 whereby it has overturned the decision of the learned Single Judge requiring the respondent-writ petitioner to knock at the doors of the alternative forum by way of appeal, on the foundation that the authority that had passed the adverse order against the first respondent had no jurisdiction, and assuming he had the jurisdiction, it stood extinguished by expiration of the time limit stipulated in certain paragraphs of the West Bengal Kerosene Oil Control Order, 1968 (for brevity, ‘the Control Order’), is called in question.
2. The facts which need to be exposited for adjudication of this appeal are that the first respondent was granted the licence for carrying on the business of superior kerosene oil as an agent by the Joint Director of Consumer Goods, West Bengal in accordance with the paragraph 5(1) of the Control Order. The monthly allocation of public distribution system of superior kerosene oil to the said respondent was fixed by the Director of Consumer Goods, West Bengal at 1,82,000 litres per month. On 10.8.2012 a physical inspection was carried out by the Area Inspector attached to the office of the Sub Divisional Controller, Food and Supplies, Burdwan (for short, “SCFS”) at the depot of the respondent. The concerned Inspector submitted the report to the SCFS stating that 71,494 litres of superior kerosene oil had been delivered in excess by the dealer. On 8.4.2013, the SCFS issued a notice seeking explanation about the discrepancy pointed out by the Area Inspector. On receipt of the said show cause notice, the first respondent submitted his explanation on 16.4.2013. The SCFS afforded an opportunity of personal hearing to the dealer on 3.5.2013 and the same was availed of. After conducting the enquiry, the SCFS forwarded the entire record to the District Controller, Food and Supplies Department, Burdwan, who in turn sent the entire case records to the Director of Consumer Goods for appropriate decision. After scrutiny of the records, the Director of Consumer Goods issued a show cause notice to the dealer on 26.6.2013. The first respondent replied to the same on 28.6.2013 through his counsel stating, inter alia, that under the Control Order, after the licence is issued to an agent by the Office of the Director, the District Magistrate having jurisdiction or any officer authorised by him, is alone empowered to look into the functioning of the said agency and to give directions to him and/or initiate action against the concerned agent. Additionally, it was also put forth that the second show cause notice on the self-same allegations was untenable in law and accordingly prayer was made to withdraw and/or rescind the notice and take steps for disposal of the matter in terms of the provisions of the Control Order.
3. As the factual matrix would further undrape, the Director of Consumer Goods, vide order dated 22.7.2013 narrated the facts in detail and came to hold that SCFS has the authority to ask for explanation regarding distribution of superior kerosene oil in his jurisdiction; and that the Director of Consumer Goods being the Licensing Authority, can exercise the power to issue show cause notice and after giving the delinquent agent a fair opportunity of being heard, pass appropriate orders. The said order also would reflect that the counsel for the first respondent had appeared before the Director on 17.7.2013. The concerned Director analysed the factual matrix and in exercise of power conferred on him under paragraph 9(ii) of the Control Order imposed a penalty of Rs.26,08,816.00 and further directed reduction of monthly allocation of superior kerosene oil of the agent by 12,000 litres for a period of one year.
4. The order passed by the Director was assailed by the agent in W.P.No. 25204 (W) of
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