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2003 DIGILAW 1603 (AP)

Gummadisetti v. Joint Collector, Khammam

2003-12-30

B.SUDERSHAN REDDY, K.C.BHANU

body2003
B. SUDERSHAN REDDY, J. ( 1 ) THE unsuccessful petitioner in W. P. No. 23710 of 2003 is the appellant in this appeal preferred against the order made in the said writ petition wherein a learned single Judge of this Court upheld the order passed by the Joint Collector, Khammam, the respondent herein dated 1-11-2003 keeping the licence of the appellant herein under suspension pending enquiry. ( 2 ) THE appellant is a wholesale kerosene dealer of the Hindustan Petroleum corporation Limited (HPCL ). When tanker bearing No. AP 31t 5549 was transporting for public distribution system 12 Kilo Litres (KLs) of blue dyed kerosene oil belonging to the appellant herein drawn from Kondapalli terminal of the HPCL, the Regional vigilance and Enforcement Officer intercepted the tanker. The lorry and the kerosene were seized and the matter was reported to the Joint Collector, Khammam. We do not propose to refer to the allegations in detail levelled against the appellant herein and his defence so as to avoid unnecessary prejudice to either of the parties since enquiry is to be held against the appellant pursuant to the show cause notice stated to have already been issued by the Joint collector. ( 3 ) THE Joint Collector, Khammam having received the auto-max message dated 11 -10-2003 in which it is inter alia alleged that the dealer deliberately diverted PDS sk oil to M/s. Dowpati Chinnaiah and sons, hpc Dealer. Narsaraopet through the oil tanker bearing No. AP 31t 5549, without valid documents with a mala fide intention to direct (sic. divert) the PDS Kerosene oil into black market, passed the impugned order on 1-11-2003, the operative portion of which reads a follows:"the material evidence available has been examined and this is a prima facie case of the intention of diverting PDS kerosene oil into black market to gain illegal profits on the part of M/s Suguna agencies, HPCL Kerosene Dealer and his men and it is clear violation of provisions of clauses 26 and 28 of andhra Pradesh Petroleum Products (Landrs) Order, 1980 and hence the licence No. 1/1997 held by M/s Suguna agencies, HPCL Kerosene Dealer, manuguru is suspended with immediate effect under Clause 29 (2) of the above order pending enquiry. M/s Ananda Rao enterprises, K. Oil Wholesale dealer, bhadrachalam is kept in charge for purchase and sale of Kerosene Oil intended to M/s. Suguna Agencies, hpcl Kerosene Dealer, Manuguru. M/s Ananda Rao enterprises, K. Oil Wholesale dealer, bhadrachalam is kept in charge for purchase and sale of Kerosene Oil intended to M/s. Suguna Agencies, hpcl Kerosene Dealer, Manuguru. The Mandal Revenue Officer, Manuguru is directed to take steps for taking possession of the ground stocks and handing over to the in charge Dealer under cover of Panchanama and report compliance. " ( 4 ) IT was contended before the leaded single Judge that the appellant is not involved in diversion of kerosene oil meant for public distribution system as alleged and therefore, exercise of power under sub- clause (2) of Clause 29 of the Andhra pradesh Petroleum Products (Licensing and regulation of Supplies) Order, 1980 (for short the Control Order ) is unwarranted. It was also contended that the impugned order passed by the Joint Collector is without any notice and hence the same is invalid. ( 5 ) THE learned Judge having noticed the contentions held that the impugned order passed by the Joint Collector is traceable to the power under sub-clause (2) of clause 28 of the Control Order which empowers the licensing authority to pass an order of interim suspension pending action under sub-clause (1) of Clause 28 of the Control Order for cancellation or suspension, as the case may be. The learned Judge also found that a mere mention of wrong provision in an order does not vitiate the order itself, ( 6 ) IN this writ appeal, the learned counsel for the appellant, Sri. A. Rajasekhar reddy strenuously contended that even if the order passed by the Joint Collector is traceable to sub-clause (2) of Clause 28 of the Control Order, the same could not have been passed without initiating any action as against the appellant herein under sub- clause (1) of Clause 28 of the Control Order. The contention is that sub-clause (2) of clause 28 confers jurisdiction upon the licensing authority to pass an order of interim suspension of the licence or registration certificate provided action had already been initiated and pending against the licensee under sub-clause (1) of Clause 28 of the control Order. it was submitted that admittedly as on 1-11-2003, no action has been initiated against the appellant herein under sub-clause (1) of Clause 28 and therefore, the impugned order of suspension is ultra vires. it was submitted that admittedly as on 1-11-2003, no action has been initiated against the appellant herein under sub-clause (1) of Clause 28 and therefore, the impugned order of suspension is ultra vires. ( 7 ) A plain reading of sub-clause (2) of clause 28 does not support the contention put fourth by the learned counsel for the appellant. Sub-clause (1) of Clause 28 authorises the licensing authority to cancel or suspend for such period as may be specified the licence, registration certificate/ supply card on the ground that the licensee has contravened, attempted or abetted the contravention of any of the licence conditions issued under the Control Order. Sub-clause (2) of Clause 28 enables the licensing authority for reasons to be recorded in writing to order an interim suspension of the licence pending the action as under sub-clause (1) of Clause 28. A plain reading of sub-clauses (1) and (2) of clause 28 makes it abundantly clear that the licensing authority may for the reasons recorded in writing place the authorization or the registration certificate under suspension pending enquiry under sub-clause (1) of clause 28. it means that simultaneous action can be contemplated under sub- clause (1) of Clause 28 as well as an order of suspension of the licence in exercise of the power under sub-clause (2) of Clause 28 of the Control Order. It is true as contended by the learned counsel for the appellant that unless an action is contemplated or envisaged under sub- clause (1) of Clause 28, the licence or registration certificate, as the case may be cannot be kept under suspension. An enquiry must be contemplated against the licensee and then alone, an order of suspension could be made in exercise of power under sub-clause (2) of Clause 28. But we find it difficult to accept the submission made by the learned counsel for the appellant that first action must be initiated under sub-clause (1) of Clause 28 by putting the licensee on notice and only thereafter, an order of suspension could be made in exercise of the power under sub- clause (2) of Clause 28. What is required is contemplation of action against the licensee under sub-clause (1) of Clause 28. An appropriate decision can be taken by the licensing authority simultaneously to take action under sub-clause (1) of Clause 28 as well as the action under sub-clause (2) of clause 28. What is required is contemplation of action against the licensee under sub-clause (1) of Clause 28. An appropriate decision can be taken by the licensing authority simultaneously to take action under sub-clause (1) of Clause 28 as well as the action under sub-clause (2) of clause 28. ( 8 ) HOWEVER, Sri Rajasekhar Reddy, learned counsel for the appellant relied upon the decision of this Court in A. Srirama murthy v. Joint Collector, Visakhapatnam and others in support of his submission that for invocation of power under Clause 28 (2) of the Control Order, action is required to be initiated before the order of suspension is made. The Division Bench observed that "there is a power of suspension under the main provision contained under clause 28 (1) of the Order, but the proviso controls the said provision warranting compliance of principles of natural justice of affording opportunity before invoking either the power of cancellation or suspension. Apart from the above power, there is a power for ordering interim suspension of the licence, under sub-clause (2) of Clause 28 of the Order. But, this is hedged with a condition of initiation of action and unless action has been initiated and pending, the power of ordering interim suspension under sub-clause (2) of Clause 28 of the Order cannot be invoked. " ( 9 ) THE observations made by the Division bench have to be construed and understood in the proper perspective. The observations made by the Division Bench do not support the contention put forth by the learned counsel for the appellant that unless a show cause notice has been issued prior to passing of the order under sub-clause (1) of clause 28, no action could be initiated or order be passed under sub-clause (2) of clause 28 of the Control Order. All that the division Bench observed is that the law requires initiation of action and the same should be pending as on the date of passing of the interim suspension under sub- clause (2) of Clause 28 of the Control Order. It means that an action can be initiated both under sub-clause (1) of Clause 28 as well as under sub-clause (2) of Clause 28 simultaneously. It means that an action can be initiated both under sub-clause (1) of Clause 28 as well as under sub-clause (2) of Clause 28 simultaneously. ( 10 ) THE very expression used in the impugned order that "pending enquiry interim suspension of the licence has been made" itself suggests that action has been conceived and initiated against the appellant herein under sub-clause (1) of Clause 28. The same is followed by a show cause notice to which the appellant had already submitted its explanation. Mere fact that a show cause notice has been prepared and sent subsequent to the order of suspension would not make the order of suspension a void one. ( 11 ) IN Commissioner of C. C. , Hyd. and others v. Radha Automobiles, Hyd. , another division Bench of this Court observed that "a bare look at sub-clause (2) of Clause 28 would show that this sub-clause can be resorted to only pending action as contemplated in sub-clause (1 ). Again no action till to day, has been initiated against the respondent under sub-clause (1) of clause 28. Therefore, Clause 28 could also not be resorted to. " ( 12 ) EVEN the said judgment upon which reliance has been placed by the learned counsel for the appellant does not support the contention urged by him. In our considered opinion, it would be enough if action has been initiated as contemplated in sub-clause (1) of Clause 28 which enables the licensing authority to pass appropriate order of suspension in exercise of the power under sub-clause (2) of Clause 28. Both can simultaneously be made. ( 13 ) THE decision in W. A. No. 614 of 2001 dated 19-6-2001 is of no help to resolve the question raised by the learned counsel for the appellant in this appeal. In the said order, the Division Bench observed that there cannot be any doubt whatsoever that suspension of licence has civil consequences, and therefore, authority before passing any such order suspending the licence should comply with the mandatory requirements contained in clause 28 of the Control Order. ( 14 ) FOR all the aforesaid reasons, we do not find any legal infirmity in the order passed by the leaned single Judge requiring our interference. ( 14 ) FOR all the aforesaid reasons, we do not find any legal infirmity in the order passed by the leaned single Judge requiring our interference. ( 15 ) WE make it clear that it shall always be open to the licensing authority to initiate action simultaneously both under sub- clause (1) as well as under sub-clause (2) of clause 28 of the Control Order. However, we may hasten to add that unless an action is contemplated or conceived against the licensee under sub-clause (1) of Clause 28, no order could be made under sub- clause (2) of Clause 28 of the Control Order. ( 16 ) WE do not find any merit in the writ appeal and the same shall accordingly stand dismissed. ( 17 ) IN the view the have taken, the decision rendered by the learned single judge in W. P. Nos. 10512, 10517 and 11946 of 1997 dated 9-1-2003 is overruled. ( 18 ) IT is needless to observe that the enquiry initiated against the appellant under sub-clause (1) of Clause 28 shall go no strictly in accordance with law uninfluenced by any of the observations made in this order as well as the observations made by the learned single judge. The licensing authority is required to provide an adequate opportunity to the appellant herein and if necessary permit him to lead evidence in support of his case, both documentary as well as oral. The objections preferred and the evidence made available by the appellant shall be taken into consideration before an appropriate decision is taken by the licensing authority under sub- clause (1) of Clause 28 of the Control Order. The proceedings in this regard shall be completed within a period of four weeks from the date of receipt of a copy of the order.