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2016 Supreme(Cal) 872
IN THE HIGH COURT AT CALCUTTA
Samapti Chatterjee, J.
M/s. G.S.N. Murty and Another - Appellant
Vs.
The State of West Bengal & Others - Respondents
W.P. 12871 (W) of 2015
Decided On : 27-04-2016
For the Petitioners: Mr. K.K. Bandyopadhyay, Mr. Debasish Saha Roy, Mr. Timir Baran Saha
For the Respondents: Mr. L.K. Gupta, Mr. Amitesh Banerjee, Mr. Tarak Karan
An authority's decision to cancel a license must be based on a valid inspection report and the authority must provide the licensee with the foundation materials requested in order to ensure that the principles of natural justice are upheld.
Headnote:
Kerosene Oil Licence Cancellation - Violation of Natural Justice Principles - Lack of Inspection and Failure to Provide Foundation Materials.
Fact of the Case:
The petitioner, a kerosene oil agent, challenged the cancellation of his license and imposition of fines by the Director of Consumer Goods, Food & Supply Department. The cancellation was based on an inspection report that was conducted pursuant to an order that was later withdrawn by the authority.
Finding of the Court:
The court found that the inspection report relied upon by the authority was not valid as it was conducted pursuant to an order that was subsequently withdrawn. The court also found that the authority failed to provide the petitioner with the foundation materials requested, despite the petitioner's repeated requests.
Issues: 1. Whether the cancellation of the petitioner's license was based on a valid inspection report. 2. Whether the authority violated the principles of natural justice by failing to provide the petitioner with the foundation materials requested.
Ratio Decidendi: The court held that the cancellation of the petitioner's license was illegal as it was based on an invalid inspection report and the authority's failure to provide the petitioner with the foundation materials requested violated the principles of natural justice.
Final Decision: The court quashed the impugned orders and directed the authority to hold a fresh inspection and issue a fresh show cause notice in accordance with the law.
Samapti Chatterjee, J.
1. Assailing the impugned orders dated 02.02.2015, 15.05.2015 & 08.06.2015 passed by the Director of Consumer Goods, Food & Supply Department whereby the petitioner’s super kerosene oil licence was cancelled and also imposing fine as provided in Schedule ‘E’ of Paragraph-9 of the said Control Order along with penalty.
FACT OF THE CASE
2. The brief case of the petitioner is as follows :
The petitioner’s firm has been carrying on business of kerosene oil as agent since 1974. Curiously on 22nd August, 2014 the respondent no.2 the Director of Consumer Goods directed the oil companies to reduce allocation of 196 K.L of the petitioner’s firm. Since that order was passed without giving any opportunity of hearing to the petitioner, the petitioner moved before this Hon’ble Court challenging the said order of reduction of allocation of the petitioner’s firm by filing a writ petition under Article 226 of the Constitution of India being W.P No. 24592 (W) of 2014. Immediately thereafter, the respondent no.2 cancelled the said order dated 22.08.2014 and issued a subsequent order on 25th August, 2014.
The petitioner then challenging the subsequent order dated 25.08.2014 filed another writ petition before this Hon’ble High Court being W.P. No. 24665 (W) of 2014. The said order dated 25.08.2014 was also withdrawn by the respondent no.2 and respondent no.2 again on 28.08.2014 issued another order of inspection. The said order for inspection dated 28.08.2014 is quoted below :-
“It has been decided to hold an inspection in respect of utilization of S.K. Oil by M/s G.S.N. Murty of Kharagpore Sub-Division for the period from April, 2010 to March, 2014. An Inspecting team has been formed order……….of Shri Sankar Narayan Bankura, Dy. Director of D.D.P & S as per Order of Commission of Food……named 9I) Ardhendu Gayen, (ii) Prasanta Sarkar, (iii) Tamal Chakraborty will be members of Inspector……They will undertake the Inspections to find out (1) The status of lifting of K. Oil M/s G.S.N. Murty, Kharagpur Sub Division from Hindustan Petroleum Corporation Ltd. Both an account of his licence and on……tagged allocation of M/s Jain Traders which was tagged allocation of M/s Jain Traders which was tagged with him on and from 03.06.2013; (2) Maintenance of Sale and Stock Register of M/s G.S.N. Murty during the period; (3) Status of actual figure of K. Oil supplied by M/s G.S.N Murty to all dealers tagged with him during period; (4) Status of actual figure of K. Oil received by these Dealers as mentioned in the Sale and Stock Registers of these Dealers during the period; (5) Status of supply of Kerosene Oil these Dealers to either Ration Card holders or to other dealers during the period; (6) Status of Sale of K. Oil second set of dealers who were supplied K. Oil by the Dealers who received K. Oil from M/s G.S.N. Murty during the ……..;(7) Status of actual figure of K. Oil which was lifted by M/S. G.S.N. Murty from H.P.C.L but not supplied to the dealers tagged with him during the period; (8) Status of K. Oil actually received by tagged dealers of M/s G.S.N. Murty on the basis of Sale and Stock Registers during the period to either Ration Card Holders or Dealers tagged dealers during the period; (9) Actual figure of Sale of K. Oil by these Dealers; (10) Actual figure of K. Oil supplied by tagged dealers of G.S.N. Murty to Dealers tagged with them on the basis of Sale and Stock Register of the Dealers.
The Inspecting Team will complete the inspection with a period of one month from the gate of the …….Inspection in which they will need to visit the outlets of M/s. G.S.N. Murty and of ……at the Sale and Stock Registers and other related Books of Accounts. This has approval of the commission.”
Since the respondent no.2 is not authorised under Paragraph 15 of the Control Order to form Inspecting Team and conduct inspection at the agent premises who carries on business as an agent in District, therefore the authority concerned had withdrawn the sa
