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IN THE HIGH COURT OF JHARKHAND AT RANCHI
SUJIT NARAYAN PRASAD, J.
Md. Iqbal Hussain Khan, Son of Late Jakir Hussain Khan - Petitioner
Versus
The State of Jharkhand and Ors. - Respondents
W.P.(C) No. 1284 of 2009
Decided On : 21-06-2024
[JURISDICTION] - [CANCELLATION OF LICENSE] - [Bihar Trade Articles (Licenses Unification) Order, 1984; Bihar Re-organization Act, 2000; Section 85] - [The court discussed the jurisdiction of the state authority under Clause 11 of the Bihar Trade Articles (Licenses Unification) Order, 1984, which mandates that no license can be canceled without providing the licensee a reasonable opportunity to present their case. The court emphasized the importance of natural justice and the requirement for adequate notice and opportunity to defend against allegations before any adverse action is taken. The interpretation of Section 85 of the Bihar Re-organization Act, 2000, was also highlighted, confirming the applicability of pre-existing laws in the successor state of Jharkhand.]
Fact of the Case:
The petitioner, who had been operating a public distribution shop since 1986 under a license granted by the state, faced cancellation of his license based on an inspection that found his shop closed on a day he was at the FCI Godown to lift food grains. The petitioner contended that the cancellation was unjust as he had provided a valid explanation and had not been given the inspection report or adequate opportunity to defend himself against the allegations.
Finding of the Court:
The court found that the cancellation of the license was not in compliance with the principles of natural justice, as the petitioner was not provided with the inspection report or a proper opportunity to respond to the allegations against him. The court emphasized that the cancellation was based on multiple complaints that were not disclosed to the petitioner, thus violating the requirement for a reasonable opportunity to be heard.
Issues: Whether the cancellation of the public distribution license was justified given the lack of adherence to the principles of natural justice and the failure to provide the petitioner with the inspection report and adequate opportunity to defend against the allegations.
Ratio Decidendi: The court held that the cancellation of the license violated Clause 11(2) of the Bihar Trade Articles (Licenses Unification) Order, 1984, which requires that a licensee must be given a reasonable opportunity to state their case before cancellation. The court reiterated that natural justice must be observed in administrative actions that affect an individual's rights, particularly when such actions lead to civil consequences.
Final Decision: The court quashed the orders of cancellation of the license and allowed the writ petition, reinstating the petitioner’s right to operate the public distribution shop.
ORDER :
SUJIT NARAYAN PRASAD, J.
Pleading
1. The issue involved in this writ petition is for cancellation of the license pertaining to the Public Distribution System.
2. In addition to the issue on merit, the issue of jurisdiction has also been raised and taking note of the aforesaid submission, the Court has passed an order directing the State to establish the jurisdiction in taking action in cancellation of the license granted under the provision of Bihar Trade Articles (Licenses Unification) Order, 1984.
3. The learned State Counsel has submitted by making reference of the Clause 11 of the Bihar Trade Articles (Licenses Unification) Order, 1984 which confers the jurisdiction to the State authority to deal with such licensee in whose favour, the license has been granted and if it will be found that the terms and conditions of the license are being flouted, then the said power is to be exercised and accordingly in the instant case , the power as stipulated in Clause 11 of the Bihar Trade Articles (Licenses Unification) Order, 1984, has been exercised.
4. The State Counsel has further submitted by making reference of Section 85 of the Bihar Re-organization Act, 2000, wherein, it has been provided that the law which will prevalent having been enacted by the erstwhile State of Bihar prior to 15.11.2000, will have its applicability in the successor State of Jharkhand on or after 15.11.2000.
5. The learned State Counsel has relied upon the judgments passed by the Hon’ble Apex Court in the case of Commissioner of Commercial Taxes, Ranchi & Anr. Vrs. Swarn Rekha Cokes & Coals (P) Ltd. & Ors., reported in (2004) 6 SCC 689 in order to strengthen his argument that the law which was prevalent on or before 15.11.2000 will be applicable, so long, it is not being altered.
6. Learned counsel for the petitioner has submitted by going through the provision of Section 85 of the Bihar Re-organization Act, 2000 having been interpreted by the Hon’ble Apex Court in the case of Commissioner of Commercial Taxes, Ranchi & Anr. (supra) that he is not raising the issue of jurisdiction, rather, he will address the issue on merit by pointing out the illegality and impropriety in passing the order of cancellation of license.
Prayer
7. The order dated 12.11.2008 passed by Deputy Commissioner, Dumka in RMA No. 53 of 2008-09 has been challenged by which the order passed by the Sub-Divisional Officer, Dumka dated 22.07.2008 passed in office being order No. 122/2008 has been affirmed whereby and whereunder the PDS license being License No. 38/1986 for the village/panchayat Sukhjora, Block Raneshwar, District Dumka has been cancelled.
Facts
8. The brief facts of the case, as per the pleading, made in the instant petition reads as under:
9. It is the case of the writ petitioner that he was granted public distribution shop license by the Respondent No. 3 in year 1986 under Bihar Trade Articles (Licenses Unification) Order, 1984 bearing License No. 38/1986.
10. The writ petitioner had been running his said shop without any complain to the satisfaction of all cardholder/consumer since 1986.
11. Thereafter, the respondent No. 2 has issued direction/instruction to every licensee, Raneshwar circle, to lift food grains from the FCI Godown at Raghunathpur, only on Friday.
12. Further, the Respondents no. 3 has inspected the public distribution shop of the petitioner on 06.06.2008 (Friday) and on that time the shop of the petitioner was closed because the petitioner had gone to FCI Godown Raghunathpur for lifting food grains on 06.06.2008 (Friday) which is only day (Friday) to lift food grains from the above said godown.
13. Further, the Respondent No. 3 issued explanation notice to the petitioner vide order No. 108/2008 stating therein that the shop of the petitioner was found to be closed and the petitioner was found absent on inspection dated 06.06.2008 (Friday).
14. It is the further case of the writ petitioner that he has submitted his explanation on 07.07.2008 in res
The cancellation of a licence based on an order that was not in existence at the time of cancellation is null and void. Violation of principles of natural justice in the cancellation process requires....
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