IN THE HIGH COURT OF JUDICATURE AT MADRAS
RMT. TEEKAA RAMAN, J.
C. Rajendran – Appellant
Versus
State Rep. By, The Principal Secretary, Health Department, Chennai & Others – Respondents
Writ Petition No. 3596 of 2023
Decided On : 17-04-2023
Trading License - Cancellation - Chennai City Municipal Corporation Act IV of 1919, Section 379(A) - Summary: The court discussed the cancellation of the trading license under Section 379(A) of the Chennai City Municipal Corporation Act IV of 1919. The key legal provisions of natural justice and the requirement of a show cause notice before cancellation were highlighted, influencing the court's decision to set aside the impugned order.
Fact of the Case:
The petitioner's trading license for selling construction materials was cancelled based on allegations of air pollution and public nuisance. The petitioner contested the cancellation, citing valid registration and tax compliance.
Finding of the Court:
The court found that the cancellation of the trading license was done without following the principles of natural justice, as no show cause notice was issued to the petitioner. The court set aside the impugned order.
Issues: The main issue was the validity of the cancellation of the trading license without a show cause notice and compliance with natural justice principles.
Ratio Decidendi: The court held that the cancellation of a trading license without issuance of a show cause notice is bad in law, emphasizing the requirement of natural justice.
Final Decision: The court set aside the order of the 3rd respondent dated 18.10.2022, allowing the writ petition and imposing no costs.
JUDGMENT
(Prayer: This Writ Petition is filed under Article 226 of the Constitution of India, praying for issuance of a Writ of Certiorarified Mandamus, directing the respondents to call for the records of the 3rd respondent in Maa.4.va.thu.Na.Ka.No.AAR.3/1726/2022 dated 18.10.2022 and quash the same and direct the respondents 1 to 3 to re-issue the cancelled licenses of the petitioner.)
1. Challenging the cancellation of Trading License, this writ petition has been filed.
2. Mrs.P.T.Ramadevi, the learned Standing Counsel for the respondents 2 and 3/Greater Chennai Corporation, has filed a counter affidavit and the same has been adopted by the 1st respondent.
3. The learned Standing Counsel for the Corporation would submit that based upon the complaint given by the 4th respondent that the petitioner herein is running a Cement storage and selling Shop in the said premises, without due license and without clearance from the Pollution Control Board as required for both air and noise pollution, the official respondents have issued necessary notice under Section 379(A) of the Chennai City Municipal Corporation Act, 1919.
4. It is also stated by the learned counsel for the 2nd respondent that the petitioner has given a representation stating that he is vacating the said Cement shop and wanted to reside a domestic life there and after issuing notice to him, he has filed the above writ petition.
5. Heard the learned counsel on either side and perused the materials available on record.
6. In the affidavit filed in support of the writ petition, the petitioner has averred as that he is doing business of selling bricks, sand, cement and blue metals in the name and style of “Ananda Agencies” for the past 20 years. He has registered the agency and obtained valid registration certificate at the Commercial Taxes Department. He is having license for the trade of selling of cement and Hardware till March 2023. He is a Professional Tax payer of Chennai Corporation and that he is having No Objection Letter of all other residents except the 4th respondent herein. Further, the petitioner has averred that he is just a trader and not a manufacturer.
7. The other allegations in the writ petition are that the 4th respondent is envious of petitioner''s employment and has frequently made quarrel and also resulted in filing a complaint before the H3 Police Station, Tondiarpet and the 4th respondent filed WP No.14160 of 2022 for a Writ of Mandamus, directing the official respondents 1 to 3 to take appropriate action to cancel the Trading license and the said writ petition appears to have been allowed and the official respondents, have been directed to pass orders on the representation of the 4th respondent, within a period of four weeks.
8. An enquiry was called on 30.08.2022 and petitioner attended the same and the 3rd respondent closed the sale of the shop on 09.10.2022 and hence the writ petition.
9. The official respondents 2 and 3 filed counter alleging that the 4th respondent herein filed a writ petition in WP No.14160 of 2022 praying for a Writ of Mandamus directing the respondent Corporation to take appropriate action to cancel the Trade license issued to the petitioner namely M/s. Ananda Agencies that is violating rules and specified guidelines and for sealing and closure of its shops that is storing and selling the building construction materials causing Air Pollution, Health Hazard and public nuisance based on his representation (4th respondent herein) dated 13.09.2021.
10. As stated supra, in the said writ petition, this Court by an order dated 08.06.2022 has directed the official respondents to dispose of the representation in accordance with law.
11. Based on the above order passed by this Court on 08.06.2022, a letter dated 27.08.2022 was addressed to the petitioner and the 4th respondent and they were called for a personal hearing before the Zonal Officer, Zone-IV on 30.08.2022 and instructed them to produce the relevant records.
12. The 4th respondent
AI
The cancellation of a license requires adherence to due process, including proper notifications and opportunities for the licensee to respond.
Trade licence rejection invalid without verified pollution evidence; must rely on official inspections, not complaints.
Cancellation of Trade Licences without due process and proper notice constitutes a violation of the principles of natural justice.
The cancellation of a trade license must adhere to due process, allowing alternative documentation; arbitrary grounds violate the right to trade.
Cancellation of a trade licence without prior notice or opportunity to be heard violates principles of natural justice as mandated by Section 378(3) of the GMC Act, 1971.
The main legal point established in the judgment is the requirement to adhere to the principles of natural justice, provide reasoned orders, and comply with the procedural requirements outlined in th....
An industry cannot operate without a valid statutory license; however, access may be granted for necessary removal of goods.
Natural justice requires a show cause notice before cancelling a licence even when violations are found during enquiry.
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