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2008 DIGILAW 550 (CAL)

Dipak Choudhury v. STATE OF WEST BENGAL

2008-05-16

DIPANKAR DATTA

body2008
Judgment :- (1.) SUBJECT matter of these writ petitions being related, the same were heard together and would be governed by this common judgment. Popular Drug House Private Limited, a company incorporated under the companies Act, 1956 (hereafter the Company), its Managing Director and two other directors are the four petitioners in that order in W. P. No. 5137 (W) of 2008. (2.) THE private respondents in that writ petition (respondents 4 to 25) are the employees of the Company who according to these petitioners are unauthorisedly and illegally running the medicine shop of the Company. (3.) THE petitioners case is that the business of the said Company which commenced in the fifties was prospering till 2002 when the staff and employees of the company started creating disturbances in smooth running of the medicine shop. The private respondents in the petition are guilty of misbehaviour, insubordination, indiscipline, irregularity and serious misdemeanor like siphoning of funds, etc. Illegal demands were raised by the Union of the employees which ultimately failed. It was, thereafter, discovered that the private respondents had been selling medicines to customers without issuing cash memo. There was unauthorized purchase of medicines by the private respondents which were not properly accounted for in the books of account of the company. The cashier stopped handing over cash to the Company. A bank account was opened in the United Bank of India, Shyambazar Branch in the name of the Company by the private respondents. (4.) ACCORDING to these petitioners, the employees have no right to run the medicine shop in terms of provisions contained either in Companies Act or the laws relating to Drugs and Cosmetics after expiry of the drug license on 31. 12. 07. They claim that although the private respondents are not entitled to sell medicines but have been continuing to do so in utter violation of law. Pursuant to an order of Court dated 12. 12. 07, the Director of Drugs Control by an order dated 5. 2. 08 has rejected the prayer for renewal of drug license as made by the private respondents. Thereafter, the other writ petition has been instituted wherein the employee petitioners have not disclosed that an appeal has been preferred by them before the State (respondent 1). According to these petitioners, the order dated 5. 2. 2. 08 has rejected the prayer for renewal of drug license as made by the private respondents. Thereafter, the other writ petition has been instituted wherein the employee petitioners have not disclosed that an appeal has been preferred by them before the State (respondent 1). According to these petitioners, the order dated 5. 2. 08 has been correctly passed by the Director of Drugs Control and since the employee petitioners have been continuing to sell medicines despite rejection of their prayer, appropriate action ought to be initiated against them. Writ of mandamus has been prayed for on the State respondents by these petitioners to forthwith ensure that there is no sale of drugs by the private respondents from the shop room in question and also to initiate criminal proceedings against them in terms of provisions contained in the Drugs and cosmetics Act, 1940 (hereafter the Act) and to confiscate drug and cosmetics lying thereat. A writ in the nature of prohibition has also been prayed for to restrain the State (respondent no. 1) from hearing any appeal or any representation against the order dated 5. 2. 08 passed by the Director of Drugs control or for renewing the drug license issued in the name of the Company. (5.) W. P. No. 4708 (W) of 2008 has been preferred by the employees of the Company, inter alia, the private respondents in W. P. No. 5137 (W) of 2008 (hereafter the employee petitioners). Subject matter of challenge in this writ petition is an order dated 5. 2. 08 passed by the Directorate of Drugs Control, West Bengal (respondent no. 2). By the said order, the Director rejected the prayer submitted by the employee petitioners for renewal of drug license issued in favour of the company pursuant to consideration effected in terms of order dated 12. 12. 07 passed by a learned Judge of this Court on their earlier writ petition. (6.) FACTS leading to filing of this writ petition, as pleaded, may now be taken note of. Differences arose between the directors and the employees of the Company as well as between directors and directors thereof. A suit was filed in the year 1995 before this Court being Suit No. 6 of 1995 by one of the directors, Prabir chowdhury against the Company. On an interim application filed in connection with such suit, an order was passed on 20. 9. A suit was filed in the year 1995 before this Court being Suit No. 6 of 1995 by one of the directors, Prabir chowdhury against the Company. On an interim application filed in connection with such suit, an order was passed on 20. 9. 02 by a learned Judge of this Court directing the parties to maintain status quo. In order to ascertain who was in possession or occupation of the premises in question, a learned Advocate of the court was appointed as Special Officer. While hearing another application in connection with the said suit (being G. A. No. 1523 of 2005) wherein it was admitted by the plaintiff/applicant that the business of Popular Drug House (Pvt) Ltd. is being run by the employees through Union viz. Popular Drug House (Pvt.) Ltd. Employees Working Committee since September, 2003 as the respondent Nos. 2,3 and 4 alongwith their daughter left, another learned Judge of this Court passed an order on 19. 5. 05 to the following effect: let there be no change in the management of the business carried on at 128/1, Bidhan Sarani, Calcutta-700 004 under the name and style of Popular Drug House Pvt. Ltd Interim order shall continue till 15th June, 2005. By an order dated 13. 6. 05, the date 15th June, 2005 in the order dated 19. 5. 05 was directed to be read as 15th July, 2005. By a further order dated 15. 7. 05, the said interim order was initially extended for a period of six weeks and by a subsequent order dated 23. 8. 05, it was extended till further orders. The said interim order, it is claimed, is still subsisting. It is the further claim of the employee petitioners that the Managing Director of the Company and other directors thereof being the private respondents (respondents 3 to 5) left the Company voluntarily creating huge financial burden. Provident Fund dues were not paid by them; contribution towards Employees state Insurance were not paid. Loans obtained by the Company from the United bank of India (hereafter the said Bank) had not been repaid which led to filing of a suit before the Debts Recovery Tribunal by the said Bank for recovery of a sum of Rs. 11,29,000/ -. Provident Fund dues were not paid by them; contribution towards Employees state Insurance were not paid. Loans obtained by the Company from the United bank of India (hereafter the said Bank) had not been repaid which led to filing of a suit before the Debts Recovery Tribunal by the said Bank for recovery of a sum of Rs. 11,29,000/ -. It is the specific case of the employee petitioners that on approach made by Popular Drug House Employees Working Committee (hereafter the Working Committee) to deposit Provident Fund dues, the Provident Fund commissioner by a letter dated 8. 12. 03 permitted them to deposit dues towards provident Fund through the Working Committee, on behalf of the Company under the same code number allotted to it. It is also the claim of the petitioners that they intervened before the Debts Recovery Tribunal and prayed for leave to liquidate the said banks dues. The suit filed before the Debts Recovery Tribunal has since been disposed of on compromise between the said bank and the working Committee on 8. 10. 07. According to the terms of compromise, the working Committee was directed to liquidate the said banks compromised dues by payment of thirty equal monthly installments of Rs. 16,000/-each. Till date of filing of the writ petition by the employee petitioners, out of the settled loan amount of Rs. 7 lakh, they had already paid Rs. 6. 79 lakh to the said bank. It is the further case of the petitioners that contributions towards Employees State insurance have duly been cleared and no amount is due and payable to any of the statutory authorities. (7.) IT is also their specific case that since the time they have been running the medicine shop in question, they have obtained renewal of trade license since 7. 9. 03 and have also been paying the electricity and telephone bills. Dues of distributors from whom the Managing Director had obtained medicines on credit and had not paid for the same, have duly been paid by the employee petitioners. They have also been paying the rent of the premises in question from October, 2003 by account payee cheques issued in favour of the landlord. In fine, all possible steps necessary for revival of the Company have been taken by them. They have also been paying the rent of the premises in question from October, 2003 by account payee cheques issued in favour of the landlord. In fine, all possible steps necessary for revival of the Company have been taken by them. It is also on record that the private respondents in W. P. 4708 (W) of 2008 had moved a writ petition in April, 2005 for ousting the employee petitioners from the shop room in question. That writ petition was disposed of on 20. 4. 05 by a learned Judge of this Court by directing the police to remove the employees (employee petitioners) and to hand over possession of the medicine shop of the company in favour of the Managing Director and its directors being respondents 3 to 5. On appeal, by an order dated 22. 6. 05 the order impugned had been stayed by the Division Bench. The appeal is stated to be pending with the interim order. The employee petitioners have therefore been running the medicine shop over the last few years. Since the drug license issued in favour of the Company was due to expire on 31. 12. 2007, it is claimed that they made necessary application and submitted it in the office of the Directorate of Drugs Control along with the necessary fees. However, since no action was taken on the application despite reminders sent by them, they had the occasion to approach this Court by filing a writ petition being W. P. No. 26043 (W) of 2007. During the pendency of the petition, by a letter dated 10. 12. 07, the Assistant director-Prosecution and Legal Cell of the Directorate of Drugs Control had conveyed to the Secretary of the Working Committee, on the issue of drug license, that the Directorate would consider renewal thereof after obtaining application in statutory form (Form 19) with requisite fees as per Rule 59 of the Drugs and cosmetics Rules, 1945 (hereafter the Rules) read with Rules 64 and 65a thereof. Soon thereafter, that writ petition came to be disposed of on 12. 12. Soon thereafter, that writ petition came to be disposed of on 12. 12. 07 with a direction upon the Director, Drugs Control to consider and dispose of the application for renewal of drug license in accordance with the said Rules after giving opportunity of hearing to the representatives of the employee petitioners and the private respondents [respondents 3 to 5 in W. P. 4708 (W) of 2008] and to pass a reasoned order within five weeks from date of communication thereof. It was further recorded therein that if it was found that no application has been filed by the employee petitioners, the Director would be at liberty to proceed in accordance with law. (8.) IT is the specific case of the employee petitioners that after receipt of letter dated 10. 12. 07 referred to above, the petitioners 2 and 3 had been to the office of the respondent no. 2 on 10. 12. 07 and on production of such letter dated 10. 12. 07 had requested for supply of statutory form and duly endorsed T. R. Challan No. 7 for the purpose of depositing requisite fees with the Reserve Bank of India. However, the respondent no. 2 did not hand over the statutory form and the T. R. Challan for filing of application to seek renewal of drug license. It is asserted in the petition that the officers attached to the office of the respondent no. 2 conveyed to them that workers have no right to submit statutory form for renewal of drug license as a result whereof the statutory form could not be submitted on 12. 12. 07. (9.) IT is, however, pleaded that on 28. 11. 07 the petitioners 1 and 2 being the president and Secretary of the Working Committee had submitted Form 19 as well as additional information for renewal of drug license along with T. R. Challan no. 7 and account payee cheque payable to the Reserve Bank of India amounting to Rs. 3,000/-for payment to respondent no. 2 through Bengal Chemists and druggists Association. However, despite receiving the form and the application and even after putting necessary stamp and signature, the office of the respondent no. 2 struck off the same and, ultimately, returned those documents to the petitioners 1 and 2. Copies of such returned documents have been annexed to the petition and marked as Annexure P-22. However, despite receiving the form and the application and even after putting necessary stamp and signature, the office of the respondent no. 2 struck off the same and, ultimately, returned those documents to the petitioners 1 and 2. Copies of such returned documents have been annexed to the petition and marked as Annexure P-22. (10.) IT is in the background of the aforesaid facts and circumstances that the Director considered the prayer of the employee petitioners. It would be worthwhile to extract operative portion of the order passed by the Director, which is as follows : on perusal of the petition and after hearing submissions of the representative of the petitioner and the respondent nos. 5 to 7 I find that the undersigned has no other alternative but to dispose of the prayer of the petition in accordance with The Drugs and Cosmetics Rules, 1945. (11.) RULE 65 A of The Drugs and Cosmetics Rules, 1945 the application for the grant of a licence or any person granted a licence under this part shall on demand furnish to the Licensing authority before the grant of the licence or during the period of the licence in force as the case may be documentary evidence in respect of the ownership or occupation on rental or other basis of the premises specified in the application for licence or in the licence granted constitution of the firm or any other relevant matter which may be required for the purpose of verifying the correctness of the statements made by the applicant or the licensee while applying for or after obtaining the licence as the case may be. As per the provisions of Rules 65-a of The Drugs and Cosmetics Rules, 1945 a licensee can submit application with necessary and proper documents, the correctness of which are to be verified before grant or renewal of drugs licenses. Moreover, no application in statutory from has been submitted by the petitioner. Under the circumstances and after due consideration I have decided that the prayer submitted by the petitioner is not a fit case for renewal of drugs license of M/s. The Popular Drug House Private Limited and hence the prayer is rejected and thus disposed of. This mater is being considered in pursuance of the directions of His Lordship honble Mr. Justice Soumitra Pal dt. 12-12-2007. This mater is being considered in pursuance of the directions of His Lordship honble Mr. Justice Soumitra Pal dt. 12-12-2007. Let a copy of this order be made available to the parties concerned. (12.) MR. Hirak Kumar Mitra, learned Senior Counsel appearing for the petitioners in w. P. No. 5137 (W) of 2008 submitted that the employees have no right whatsoever to run the medicine shop. According to him right to sell medicines or to carry on business can never be with the employees. There being no abandonment of business by the Directors, he urged that employees should not be blessed with any right to have renewal of any license and to carry on business. Repository of power, according to him, is the Company or its Board of Directors or its share holders and there is no fourth seat of power even if the employers can be termed to be bad employers. Having usurped a power which they do not possess, he submitted that the employee petitioners have not even a tenuous connection in relation to making of application for license and hence no right to claim that they are entitled to renewal of license as of right. He concluded by submitting that the climate is such that right of ownership would stand obliterated if orders as prayed for by the Company and its Directors are not passed and in such case the court would recognize trespassers as having the right to carry on business bypassing the shareholders. He also referred to provisions contained in Sections 256 to 260 of the Companies Act as well as Sections 290-293 and relied on the decision of this Court reported in Cal. LT. 1998 (1) H. C. 61 : Ambari Tea company Limited vs. Manjushree Saha to buttress his submission. (13.) MR. Tiwari, learned Counsel appearing for the employee petitioners and the private respondents in W. P. 5137 (W) of 2008 contended that undoubtedly the medicine shop is being run by them through the Working Committee since september, 2003 and that various statutory and other dues have been shouldered by them. According to him, the employee petitioners have been striving and toiling to keep the business in running condition which ultimately has provided succour to them. According to him, the employee petitioners have been striving and toiling to keep the business in running condition which ultimately has provided succour to them. The Directors of the Company, he contended, have acted to the detriment and prejudice of the Company itself and, but for the employee petitioners, the Company would have been wound up long ago. He relied on the orders of this Court in connection with Suit No. 6 of 1995 to contend that the employee petitioners having been accepted by this Court to be in management of the Company, the orders of this Court have to be respected. (14.) ACCORDING to him, the order passed by the Director did not at all take into consideration the fact that application though tendered in statutory form with requisite fees had been returned and therefore to reject the prayer on the ground that no application had been filed clearly demonstrates non-consideration of relevant materials by him. Also, he submitted that the Director did not at the time of hearing enquire from the employee petitioners as to whether they were in possession of relevant documents in support of lawful occupation of the premises in question and thus had acted illegally in rejecting their claim. Referring to the appeal stated to have been filed by the employee petitioners, as contended by the other set of petitioners, he submitted that no appeal as is contemplated in view of the provisions of the Act or the rules framed there under against the order of rejection has been filed, but what they did file is a representation to the State Government. According to him, factum thereof cannot in any way affect the merits of the writ petition having regard to the stand of the state respondents that the employee petitioners do not have any right to pray for renewal of drug license, which has the effect of foreclosing the issue. He relied on the decisions of the Apex Court reported in AIR 1983 SC 75 : national Textile Workers Union vs. P. R. Ramakrishnan and AIR 1989 SC 9 : navnit R. Kamani vs. R. R. Kamani in support of his submission that the Apex court has recognised the right of employees to run business. He relied on the decisions of the Apex Court reported in AIR 1983 SC 75 : national Textile Workers Union vs. P. R. Ramakrishnan and AIR 1989 SC 9 : navnit R. Kamani vs. R. R. Kamani in support of his submission that the Apex court has recognised the right of employees to run business. The decision in (1998) 5 SCC 343 : State of Haryana vs. Brij Lal Mittal was referred to for the proposition that a Director of a company engaged in the business of drugs and cosmetics under the Act in view of Section 34 thereof does not become vicariously liable for offence committed by the company if he was not in charge of the same. He also cited some other decisions in support of the point that an alternative remedy is not an absolute bar for maintaining a writ petition. (15.) MR. Das, learned Counsel appearing for the State respondents in both the writ petitions submitted that the order of the Director dated 5. 2. 08 rejecting the prayer of the employee petitioners does not suffer from any legal infirmity and in fact, supported the stand of the Company and its Directors. He contended that having regard to the scheme of the Act and the Rules a license can be issued either in the name of any person or firm or in the name of any Company and once license is issued in the name of a company, renewal thereof must be sought for either by the Board of Directors or those in management thereof. In particular, he referred to a specimen copy of the statutory form at page 211 of the petition of the employee petitioners to contend that the application should have been signed either by the Proprietor or by the Partner or by the Manager but in the present case had been signed by the Secretary of the Working Committee and, therefore, the application for renewal was not maintainable in law. He further contended that Drug Control authorities were justified in returning the application which was received as well as in not receiving any application from the employee petitioners since the workers had no right to apply for renewal. He further contended that Drug Control authorities were justified in returning the application which was received as well as in not receiving any application from the employee petitioners since the workers had no right to apply for renewal. Replying to a query of Court regarding any particular statutory provision which empowered the Director or his subordinates not to furnish the requisite form or if furnished to refuse acceptance of an application for renewal of license in prescribed form and with requisite fees when tendered, he submitted that the director has inherent power to decide whether to receive an application for renewal or not and therefore was justified in not accepting the form from the employee petitioners. (16.) BY relying on the affidavits-in-opposition filed by the State respondents, he submitted that in terms of the statutory rules a license validly issued shall be deemed to be in operation till six months from date of expiry even if no application for renewal has been made and, therefore, the State respondents have not been able to take any action against the employee petitioners since the license is valid till 30. 6. 08. There being no valid application from the end of the company expressing its intention of having the license renewed, he concluded by submitting that the order of the Director is unexceptionable. Mr. Bandopadhyay, learned Counsel appearing for the private respondents in (17.) W. P. 4708 (W) of 2008 adopted the submissions of Mr. Mitra. According to him, it is the person who has originally been granted the license who is entitled to renewal thereof. The Company being the licensee, question of renewal of license does not arise if the Company does not seek such renewal. If license is not renewed, it would be the share holders whose rights would be affected and not the employees rights. If the establishment is closed, the employees would be entitled to compensation under the Industrial Disputes Act but they cannot have any right to claim renewal of license. By referring to Rules 61, 63 and 64 of the rules, he contended that it is the Company which is entitled to renewal on an application made by a person duly authorised by it. The employees cannot represent the management and, therefore, there has been no illegality on the part of the Director to refuse the prayer of the employee petitioners. The employees cannot represent the management and, therefore, there has been no illegality on the part of the Director to refuse the prayer of the employee petitioners. He further submitted that any interim order passed in a suit cannot give rise to any right on the employees to obtain renewal, for, status of an employee cannot be enhanced by the Court of Law. No legal right of the employee petitioners having been infringed by the impugned action of the State Respondents, he submitted that the writ petition itself is not maintainable and thus liable to be dismissed. This Court has heard learned Counsel for the petitioners and the State respondents and respective learned Senior Counsel for the Company and its directors. The issues that fall for determination are : 1) Whether the writ petition of the employee petitioners ought to be decided on merits having regard to the fact that the order dated 5. 2. 08 passed by the director is apealable and that a representation has been addressed to the state against such order? 2) Whether having regard to the facts on record, the employee petitioners are entitled to have the drug license in the name of the Company renewed? 3) Whether the process of decision making leading to the order dated 5. 2. 08 passed by the Director suffers from any of the vices for attracting judicial review? 4) To what relief, if any, are the respective petitioners entitled on facts and in the circumstances? (18.) THE impugned order dated 5. 2. 08 is no doubt appealable. It is also true that the employee petitioners have represented before the Government airing their grievance against the same. However, having regard to the stand taken on behalf of the respondent authorities before this Court which also includes the State (i. e. the appellate authority) to the effect that the employee petitioners have no right to apply for renewal of drug license, it would be futile and an idle formality to relegate the employee petitioners to the appellate forum. Since the mind of the state respondents has already been disclosed before this Court, the possibility of a fair and just decision would stand aborted. The writ petition of the employee petitioners on facts and in the circumstances, therefore, deserves to be decided on merits. Issue No. 1 is accordingly answered in favour of the employee petitioners. Since the mind of the state respondents has already been disclosed before this Court, the possibility of a fair and just decision would stand aborted. The writ petition of the employee petitioners on facts and in the circumstances, therefore, deserves to be decided on merits. Issue No. 1 is accordingly answered in favour of the employee petitioners. (19.) NONE can dispute the contentions raised by Mr. Mitra and Mr. Bandopadhyay that employees of a company cannot seek renewal of license regulated by statutory provisions and the issue of renewal of license issued in favour of a company can only be considered if a proper application has been made by such company acting through its authorised officer or those in management thereof. In an ordinary case, this Court would have no hesitation but to accept their contention and to hold that the employees of a Company have no right to maintain an application for renewal of license issued in its name. (20.) BUT this is an exceptional case which warrants a different treatment. That the employee petitioners have been blessed with an order passed by a coordinate bench of this Court directing that management of the Company shall remain in their hands until further orders are passed clinches the issue in their favour. No administrative authority exercising quasi judicial functions can seek to ignore this order. Till such time the said order subsists, it has to be respected and the employee petitioners have to be treated as persons authorised to continue to manage the affairs of the Company and, thus, entitled to seek renewal of license. (21.) IT would be worthwhile at this stage to extract certain passages from the decision in National Textile Workers Union (supra), which runs as follows: 6. It is not only the shareholders who have supplied capital who are interested in the enterprise which is being run by a company but the workers who supply labour are also equally, if not, more interested because what is produced by the capital. In fact, the owners of capital bear only limited financial risk and otherwise contributes a major share of the product. While the former invest only a part of their moneys, the latter invest their sweat and toil, in fact their life itself. The workers therefore have a special place in a socialist pattern of society. In fact, the owners of capital bear only limited financial risk and otherwise contributes a major share of the product. While the former invest only a part of their moneys, the latter invest their sweat and toil, in fact their life itself. The workers therefore have a special place in a socialist pattern of society. They are not mere vendors of toil, they are not a marketable commodity to be purchased by the owners of capital. They are producers of wealth as much as capital-nay, very much more. They supply labour without which capital would be impotent and they are, at the least, equal partners with capital in the enterprise. Our constitution has shown profound concern for the workers and given them a pride of place in the new socio-economic order envisaged in the Preamble and the Directive Principles of State Policy. The preamble contains the profound declaration pregnant with meaning and hope for millions of peasants and workers that India shall be a socialist democratic republic where social and economic justice will in form all institutions of national life and there will be equality of status and opportunity for all and every endeavour shall be made to promote fraternity ensuring the dignity of the individual. 14. Unlike the shareholders, to most of whom the shares they hold represent mere investments and to some of whom, the means to control the affairs of the company, to the workers, the life of the company is their own and its welfare is theirs. They are so intimately tied up that their interest in the survival and the well-being of the company is much more than the interest of any shareholder be he an investor, a corporate commander or a corporate manipulator. 14a. Our Constitution has accepted the workers entitlement to control and it is one of the Directive Principles of State Policy that the State shall take steps, by suitable legislation or in any other way, to secure the participation of workers in the management of undertakings, establishments or other organisations engaged in any industry. It is in this context of changing norms and waxing values that one has to judge the workers demand to be heard. (underlying by this Court for emphasis) (22.) HAVING regard to the above and keeping in mind the peculiar features of this case, the right claimed by the employee petitioners is enforceable by a Writ. It is in this context of changing norms and waxing values that one has to judge the workers demand to be heard. (underlying by this Court for emphasis) (22.) HAVING regard to the above and keeping in mind the peculiar features of this case, the right claimed by the employee petitioners is enforceable by a Writ. In this context, there are certain other aspects which are noteworthy. The employee petitioners have cleared the statutory dues and have even generated funds to liquidate the dues of the said bank. They have been toiling since 2003 to ensure that the medicine shop does not close down. One has to perform to survive. By dint of performance which has not been faulted at any point of time by the statutory authorities, they have succeeded in keeping the Company alive. But for their efforts, it would have been curtains for the Company. As has been held in National Textile Workers Union (supra) the Companies Act do not provide for all situations. Similarly, the Act or Rules framed thereunder also do not provide for all situations. The statutory form does not specify who shall apply. The entries in the specimen form that either the Proprietor/partner/manager has to apply, do not form part of the statutory form. It has been inserted by the State. The employee petitioners, so long they are under the protective umbrella of this courts order dated 19. 5. 05 read with orders dated 15. 7. 05 and 23. 8. 05, deserve equitable protection having regard to the constitutional goal enshrined in the directive Principles and, accordingly, they are entitled to claim renewal of drug license. (23.) SUBMISSION of Mr. Bandopadhyay that interim order passed by he Suit Court cannot confer any right on the employee petitioners has not impressed this court. Since the Suit Court has not disturbed the existing arrangement of the shop being managed by the employee petitioners, they are entitled to reap the benefits of the said orders. By those orders passed in connection with the suit, status of the employee petitioners is not at all enhanced. They would continue to manage the shop till such time it subsists, without being owners thereof. The writ Courts act as guardians of citizens rights and it would be unjust and unfair, on facts and in the circumstances, not to interfere. By those orders passed in connection with the suit, status of the employee petitioners is not at all enhanced. They would continue to manage the shop till such time it subsists, without being owners thereof. The writ Courts act as guardians of citizens rights and it would be unjust and unfair, on facts and in the circumstances, not to interfere. (24.) THE issue raised by the Directors of the Company in their earlier writ petition that the employee petitioners have forcibly taken over possession of the medicine shop is yet to be finally decided. Incidentally, the order passed by a learned judge in their favour has since been stayed and, therefore, the question as to whether the employee petitioners have forced their entry in the medicine shop and have dispossessed the Directors of the Company is sub-judice. This is an additional factor which weighs in the mind of the Court to hold in favour of the employee petitioners. (25.) THIS issue is also answered in favour of the employee petitioners. The order of the Director impugned by the employee petitioners was preceded by two significant incidents. Application for drug license submitted through the association of Druggists and Chemists was accepted on putting seal and signature which later on was scored of and the application returned. Again, it is undisputed that the attempt of the employee petitioners to obtain the statutory form (Form 19) and T. R. Challan No. 7 was refused by the office of the Drugs controller, even on the face of the letter dated 10. 12. 07, on the ground that the employee petitioners had no right in law to apply for renewal. The Director obviously considered the issue of renewal with a mindset that the employee petitioners had no right. (26.) THE approach appears to be entirely wrong. The Act and the Rules framed there under do not empower the Director to form an opinion, at the stage of furnishing the statutory form together with T. R. Challan, as to whether the prospective applicant has the right to apply for renewal or not. Such opinion could have been formed, if at all, only after the application is made in proper form together with requisite fees and comes up for consideration. Argument of mr. Das that the Director has the inherent power to decide whether statutory form shall be supplied or not is fallacious. Such opinion could have been formed, if at all, only after the application is made in proper form together with requisite fees and comes up for consideration. Argument of mr. Das that the Director has the inherent power to decide whether statutory form shall be supplied or not is fallacious. The Director is the statutory licensing authority. In discharge of duties of a licensing authority, he is empowered only to exercise powers that are conferred on him by the Act and the Rules framed there under. He enjoys no inherent power. It is settled law that when a power is exercised for a purpose or with an intention beyond the scope of or not justified by the instrument creating the power, in legal parlance it would be a fraud on power. Exercise of power by the Director in this particular case stands vitiated by reason of fraud on power. (27.) THAT apart, a bare perusal of the order passed by the Director manifests utter lack of correlation with the statutory provision extracted therein and the finding which he intended to arrive at based on application of such provision. Mere setting out of a statutory provision and recording of ipse dixit that prayer made cannot be granted can hardly be countenanced. (28.) THE Act and the Rules framed there under do not lay down the grounds based whereon a prayer for renewal of license can be rejected. Discretion to be exercised at the time of considering the issue of renewal of license is not unbridled or unfettered but must be judicious. Unless the licensee has been found to be accused of any conduct which would clearly bar passing of an order for renewal, such prayer ordinarily should not be refused. (29.) HAVING regard to the provisions of the Act renewal of license appears to be the rule, non-renewal is an exception. The employee petitioners having conducted themselves in such manner after September, 2003 which has not given rise to any complaint of any nature, except the complaint of the Directors who have since been displaced by them, there is no reason as to why they shall not be entitled to a fair, just and impartial consideration of the application for renewal particularly having regard to the orders passed by the Suit Court referred to above. (30.) IN exercising powers of judicial review, testing of the impugned orders/actions on applying the principle of wednesbury unreasonableness has given way to the doctrine of proportionality [see (2004) 2 SCC 130 : Terai Oat Estates (P) Ltd. vs. U. T. Chandigarh] and [ (2006) 11 SCC 67 : Indian Airlines Ltd. vs. Prabha D. Kanan. ] Scope of judicial review in its expanded form includes scrutiny as to whether there has been misdirection in law, posing of a wrong question or irrelevant question and failure to consider relevant question. An interpretation of the law which strikes a balance between enforcement of the law and protection of valuable human right (read : right to life of the employee petitioners) must be resorted to. By applying the said principle, this Court is unable to record its satisfaction that the Director did not misdirect himself or that he did not consider irrelevant question or that he has struck a balance between competing claims. The object of the Company would be achieved not by rejecting the claim of the employee petitioners for renewal of the drug license but by allowing the prayer for renewal subject to further order being passed by the Suit Court in the pending suit. (31.) THE impugned order of the Director accordingly cannot stand and is thus set aside. The issue is answered accordingly. (32.) HAVING regard to the discussions on the above issues, the conclusion is inevitable and this Court holds that the employee petitioners are entitled to relief to be indicated hereafter while the petitioners in W. P. 5137 (W) of 2008 are not entitled to any relief. It stands dismissed. (33.) THE petition of the employee petitioners is allowed with the further following directions : The Director shall furnish to the employee petitioners appropriate statutory form together with T. R. Challan, if an approach is made by them, within three days of such approach to enable them submit application along with requisite fees afresh. Since the employee petitioners had attempted to submit application for renewal before expiry of drug licence, they shall not be liable to bear additional fees which one has to pay while applying for renewal of licence after its expiry but within six months thereof. Since the employee petitioners had attempted to submit application for renewal before expiry of drug licence, they shall not be liable to bear additional fees which one has to pay while applying for renewal of licence after its expiry but within six months thereof. If application for renewal of drug license together with requisite fees are submitted by the employee petitioners with the Directorate within two weeks of receipt of application, the Director shall proceed to reconsider their prayer for renewal of license and dispose of the same in the light of the observations made above as early as possible but positively within three weeks from date of receipt of application and fees from the employee petitioners. Till 30. 6. 08 or till such time a decision is given by the Director on the application for renewal, if made by the petitioners, whichever is later, status quo with regard to running of the medicine shop shall continue. The writ petitions stand disposed of without order for costs.