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2021 DIGILAW 239 (JHR)

Dilip Prasad Jaiswal v. State of Jharkhand

2021-02-24

RAJESH SHANKAR

body2021
JUDGMENT : The present writ petition has been filed for quashing the order dated 16.05.2016 (Annexure-10 to the writ petition) passed by the respondent No.2 in Misc. Appeal No. 27 of 2014 as well the order as contained in memo No. 485 dated 27.08.2013 (Annexure-8 to the writ petition) passed by the respondent No.3 by which the license granted to the petitioner under Bihar Trade Articles (License Unification) Order, 2001 [hereinafter referred to as ‘the Order, 2001’] has been cancelled. 2. The factual background of the case, as stated in the writ petition, is that the petitioner was granted a license being license No. 18 of 1989 under the Bihar Trade Articles (License Unification) Order, 1984 [hereinafter referred to as ‘the Order, 1984’] in the year 1989 for running a fair price shop to sell and distribute various commodities such as kerosene oil, food grains, sugar, cooking oil and cloth at the price fixed by the government. After creation of the State of Jharkhand, all retail shopkeepers were required to apply for grant of fresh license under the Order, 1984 with respect to running fair price shop. The petitioner applied for the same and after due enquiry, he was granted a fresh license having license No. 2 of 2008 dated 14.06.2008. In the month of November, 2012, the villagers of Village-Jageshwar came to know that a recommendation was made to bifurcate some of the BPL card holders related to PDS shop of Village-Jageshwar and to shift them to another PDS shop of Panchayat/Village-Kunda which was about 4 to 6 Kilometers away from the said village. The residents of the said village protested against the said decision by filing representation before the respondent No.4 on 21.11.2012 requesting him that they should be given kerosene oil, food grains and other commodities from the PDS shop of Village-Jageshwar instead of PDS shop of Village-Kunda. However, no heed was paid on the said request of the villagers and the respondent No.3 vide order as contained in Memo No. 565 dated 26.11.2012, issued direction to shift the place of the PDS shop of Khusboo Mahila Swayam Sahayata Samuh, Kunda having license No. 36/2012 to Village-Jageshwar for distributing kerosene oil, food grains and other commodities. However, no heed was paid on the said request of the villagers and the respondent No.3 vide order as contained in Memo No. 565 dated 26.11.2012, issued direction to shift the place of the PDS shop of Khusboo Mahila Swayam Sahayata Samuh, Kunda having license No. 36/2012 to Village-Jageshwar for distributing kerosene oil, food grains and other commodities. After shifting the place of the said PDS shop, some of the BPL card holders concerned with the petitioner’s PDS shop of Village-Jageshwar, were transferred to the said newly shifted PDS shop. Thereafter, the petitioner received a copy of the order as contained in memo No. 566 dated 27.11.2012 issued by the respondent No.3 suspending license No. 2 of 2008 standing in the name of the petitioner on certain allegations and he was also served with a show cause notice. The petitioner filed his reply to the said show cause notice on 17.12.2012 before the respondent No.3 denying the allegations levelled against him and stating inter alia that he had submitted Demand Draft No. 971817 dated 15.10.2012 of Rs.2,251/- for lifting rice for the month of November, 2012, but the same was not supplied to him. However, after lapse of about ten months, the license of the petitioner was cancelled by the respondent No.3 vide impugned order as contained in memo No. 485 dated 27.08.2013. Thereafter, the petitioner preferred a writ petition being W.P.(C) No. 6265 of 2013 before this Court against the order dated 27.08.2013 which was disposed of as withdrawn vide order dated 05.05.2014 giving liberty to the petitioner to prefer an appeal before the appropriate forum. The petitioner accordingly preferred an appeal before the respondent No.2 being Misc. Appeal No. 27 of 2014 which was dismissed by the said respondent vide impugned order 16.05.2016. Hence, the present writ petition. 3. Learned counsel for the petitioner submits that the impugned order as contained in memo No. 485 dated 27.08.2013 has been passed in violation of the principles of natural justice as a copy of letter No. 07 dated 09.01.2013 issued by the respondent No.4 has never been communicated to the petitioner whereas, the same has been heavily relied upon by the respondent No.3 while passing the impugned order cancelling the P.D.S license of the petitioner. The petitioner has denied the allegation that the letter as contained in memo No. 329 dated 05.07.2013 was issued to him, but he refused to receive the same. The petitioner had been running the fair price shop since 1989 and as such there was no reason for non-lifting of the food grains and kerosene oil, as directed by the respondent No.4 on telephone. Moreover, the petitioner had deposited the demand draft dated 15.10.2012 for lifting rice for the month of November, 2012, but the same was not supplied to him by the respondents. It is further submitted that the allegations levelled against the petitioner in the impugned orders that he did not use to open the shop on time and used to misbehave with the consumers as well as that he did not receive the notice, are totally false. The petitioner was running the fair price shop since 1989 without any complaint from any consumer or villager or officer. It is also submitted that the petitioner has not violated the terms and conditions of the Order, 2001 and as such his P.D.S license could not have been cancelled. 4. Per-contra, learned counsel for the respondents submits that the order as contained in Memo No. 566 dated 27.11.2012 has been passed by the respondent No.3 in accordance with law as the petitioner was residing at Mandu Block, but he got the license of PDS shop from Gomia Block. It is further submitted that after due enquiry, the respondents found that the petitioner was residing permanently at Mandu Block whereas his PDS shop was situated at Village-Jageshwar, P.S-Mahuwatand, District-Bokaro in a rented premises. The allegation made by the petitioner that the letter relied upon by the respondent No.3 was not served to him, is false as the same was well within his knowledge, but he refused to receive the same. The petitioner had got the license of the PDS shop issued by the respondent authority after suppressing the fact, as he was neither residing within the local limits of Gomia Block nor he had any residence within the said territory and he did not use to open the PDS shop on time as well as used to misbehave with the consumers. Moreover, he did not receive the notice sent by the respondents knowingly. Moreover, he did not receive the notice sent by the respondents knowingly. The petitioner has made false statement in the writ petition that his fair price shop had been running since 1989 and there had been no complaint against him either from the consumers or villagers or officers. The respondent authorities have passed the impugned orders cancelling the petitioner’s P.D.S license after observing all the requirements provided under the law. The petitioner has violated the terms and conditions of the P.D.S license issued to him under the Order, 2001 and as such after due enquiry, the same has been cancelled. The impugned order dated 27.08.2013 has been passed after following the principles of natural justice. 5. Heard learned counsel for the parties and perused the relevant materials available on record. The thrust of the argument of learned counsel for the petitioner is that the impugned order dated 27.08.2013 has been passed by the respondent No.3 in violation of the principles of natural justice as the documents which have been relied upon by him while passing the said order, were not served to the petitioner. 6. To appreciate the said contention of the learned counsel for the petitioner, I have perused the record of the case. It appears that the order as contained in Memo No. 566 dated 27.11.2012 suspending the P.D.S license of the petitioner was passed by the respondent No.3 on the allegation that he did not lift the rice sent by the transporter and also did not send the bank draft for lifting food grains and kerosene oil. The petitioner was asked to file reply to the said allegation, which he filed on 17.12.2012 stating inter alia that since the villagers were annoyed with the decision of the authority whereby the allotment of the petitioner’s PDS shop was curtailed and transferred to Khusboo Mahila Swayam Sahayata Samuh, Kunda, he could not lift the rice due to pressure and agitation of the villagers. He further claimed that on 26th November, 2012, he went to lift kerosene oil and food grains from the wholeseller, but he denied to accept the cheque. Thereafter, the respondent No.3 called for a report from the respondent No.4, who in turn, submitted the report vide letter dated 09.01.2013 with a recommendation to take strict action against the petitioner also alleging that he had obtained the P.D.S license by submitting a forged document. Thereafter, the respondent No.3 called for a report from the respondent No.4, who in turn, submitted the report vide letter dated 09.01.2013 with a recommendation to take strict action against the petitioner also alleging that he had obtained the P.D.S license by submitting a forged document. Thereafter, a notice vide memo No. 329 dated 05.07.2013 was issued by the respondent No.3 to the petitioner asking him to file response to the allegation of obtaining the license of fair price shop by submitting a false residential certificate. Finally, the respondent No.3 passed the impugned order dated 27.08.2013 cancelling the P.D.S license of the petitioner. 7. It however appears that the reply of the petitioner has not been taken into consideration by the respondent No.3 while passing the impugned order dated 27.08.2013, rather the respondent No.3 has given much stress on the allegation that the petitioner had obtained the license by producing a forged residential certificate. The respondent No.2 has also dismissed the petitioner’s appeal observing that he failed to produce any evidence to discard the allegation of obtaining license by submitting a false residential certificate. 8. The petitioner claims that a copy of memo No. 329 dated 05.07.2013 was not served to him to explain the said allegations. The respondents have denied the said claim of the petitioner and have stated in the counter affidavit that the petitioner refused to receive the said letter. Even if for the sake of argument, the said statement of the respondents is accepted, it was the bounden duty of the respondents to opt for substituted mode of service of notice so as to comply the principles of natural justice. 9. It further appears that the respondent No.3 has relied upon letter No. 40 dated 28.02.2013 sent by the respondent No.4 wherein it was alleged that the petitioner did not use to open the shop regularly and his behavior with the beneficiaries was not good. However, the said letter was neither served to the petitioner nor any averment has been made in the counter affidavit so as to suggest that the respondents had attempted to serve the said letter to the petitioner. 10. In the case of Kesar Enterprises Ltd. Vs. State of U.P. & Ors. reported in (2011) 13 SCC 733 , the Hon’ble Supreme Court has held as under:- “26. 10. In the case of Kesar Enterprises Ltd. Vs. State of U.P. & Ors. reported in (2011) 13 SCC 733 , the Hon’ble Supreme Court has held as under:- “26. In Swadeshi Cotton Mills v. Union of India [ (1981) 1 SCC 664 ] R.S. Sarkaria, J., speaking for the majority in a three-Judge Bench, lucidly explained the meaning and scope of the concept of “natural justice”. Referring to a catena of decisions, His Lordship observed thus: (SCC p. 666) “Rules of natural justice are not embodied rules. Being means to an end and not an end in themselves, it is not possible to make an exhaustive catalogue of such rules. But there are two fundamental maxims of natural justice viz. (i) audi alteram partem, and (ii) nemo judex in re sua. The audi alteram partem rule has many facets, two of them being (a) notice of the case to be met; and (b) opportunity to explain. This rule cannot be sacrificed at the altar of administrative convenience or celerity. The general principle—as distinguished from an absolute rule of uniform application—seems to be that where a statute does not, in terms, exclude this rule of prior hearing but contemplates a post-decisional hearing amounting to a full review of the original order on merits, then such a statute would be construed as excluding the audi alteram partem rule at the pre-decisional stage. Conversely if the statute conferring the power is silent with regard to the giving of a pre-decisional hearing to the person affected and the administrative decision taken by the authority involves civil consequences of a grave nature, and no full review or appeal on merits against that decision is provided, courts will be extremely reluctant to construe such a statute as excluding the duty of affording even a minimal hearing, shorn of all its formal trappings and dilatory features at the pre-decisional stage, unless, viewed pragmatically, it would paralyse the administrative process or frustrate the need for utmost promptitude. In short, this rule of fair play must not be jettisoned save in very exceptional circumstances where compulsive necessity so demands. The court must make every effort to salvage this cardinal rule to the maximum extent possible, with situational modifications. In short, this rule of fair play must not be jettisoned save in very exceptional circumstances where compulsive necessity so demands. The court must make every effort to salvage this cardinal rule to the maximum extent possible, with situational modifications. But, the core of it must, however, remain, namely, that the person affected must have reasonable opportunity of being heard and the hearing must be a genuine hearing and not an empty public relations exercise.” (emphasis added) 27. In Canara Bank v. V.K. Awasthy [ (2005) 6 SCC 321 ] the concept, scope, history of development and significance of principles of natural justice have been discussed in extenso, with reference to earlier cases on the subject. Inter alia, observing that the principles of natural justice are those rules which have been laid down by the courts as being the minimum protection of the rights of the individual against the arbitrary procedure that may be adopted by a judicial, quasi-judicial and administrative authority while making an order affecting those rights, the Court said: (SCC p. 331, para 14) “14. Concept of natural justice has undergone a great deal of change in recent years. Rules of natural justice are not rules embodied always expressly in a statute or in rules framed thereunder. They may be implied from the nature of the duty to be performed under a statute. What particular rule of natural justice should be implied and what its context should be in a given case must depend to a great extent on the fact and circumstances of that case, the framework of the statute under which the enquiry is held.” 29. A Bench of three Judges, speaking through one of us (D.K. Jain, J.), explaining the concept of “natural justice” and the principles governing its application, summed up the legal position as under: (Sahara India case [ (2008) 14 SCC 151 ], SCC p. 163, paras 19-20) “19. Thus, it is trite that unless a statutory provision either specifically or by necessary implication excludes the application of principles of natural justice, because in that event the court would not ignore the legislative mandate, the requirement of giving reasonable opportunity of being heard before an order is made, is generally read into the provisions of a statute, particularly when the order has adverse civil consequences for the party affected. The principle will hold good irrespective of whether the power conferred on a statutory body or tribunal is administrative or quasi-judicial. 20. We may, however, hasten to add that no general rule of universal application can be laid down as to the applicability of the principle audi alteram partem, in addition to the language of the provision. Undoubtedly, there can be exceptions to the said doctrine. Therefore, we refrain from giving an exhaustive catalogue of the cases where the said principle should be applied. The question whether the principle has to be applied or not is to be considered bearing in mind the express language and the basic scheme of the provision conferring the power; the nature of the power conferred and the purpose for which the power is conferred and the final effect of the exercise of that power. It is only upon a consideration of all these matters that the question of application of the said principle can be properly determined.” 31. Undoubtedly, action under the said Rule is a quasi-judicial function which involves due application of mind to the facts as well as to the requirements of law. Therefore, it is plain that before raising any demand and initiating any step to recover from the executant of the bond any amount by way of penalty, there has to be an adjudication as regards the breach of condition(s) of the bond or the failure to produce the discharge certificate within the time mentioned in the bond on the basis of the explanation as also the material which may be adduced by the person concerned denying the liability to pay such penalty. Moreover, the penalty amount has also to be quantified before proceedings for recovery of the amount so determined are taken.” 11. In the case of Dharampal Satyapal Ltd. Vs. CCE reported in (2015) 8 SCC 519 , the Hon’ble Supreme Court has held as under:- “35. From the aforesaid discussion, it becomes clear that the opportunity to provide hearing before making any decision was considered to be a basic requirement in the court proceeding. Later on, this principle was applied to other quasi-judicial authorities and other tribunals and ultimately it is now clearly laid down that even in the administrative actions, where the decision of the authority may result in civil consequences, a hearing before taking a decision is necessary. Later on, this principle was applied to other quasi-judicial authorities and other tribunals and ultimately it is now clearly laid down that even in the administrative actions, where the decision of the authority may result in civil consequences, a hearing before taking a decision is necessary. It was, thus, observed in A.K. Kraipak case [ (1969) 2 SCC 262 ] that if the purpose of rules of natural justice is to prevent miscarriage of justice, one fails to see how these rules should not be made available to administrative inquiries. In Maneka Gandhi v. Union of India [ (1978) 1 SCC 248 ] also the application of principle of natural justice was extended to the administrative action of the State and its authorities. It is, thus, clear that before taking an action, service of notice and giving of hearing to the noticee is required. In Maharashtra State Financial Corpn. v. Suvarna Board Mills [ (1994) 5 SCC 566 ], this aspect was explained in the following manner: (SCC p. 568, para 3) “3. It has been contended before us by the learned counsel for the appellant that principles of natural justice were satisfied before taking action under Section 29, assuming that it was necessary to do so. Let it be seen whether it was so. It is well settled that natural justice cannot be placed in a straitjacket; its rules are not embodied and they do vary from case to case and from one fact-situation to another. All that has to be seen is that no adverse civil consequences are allowed to ensue before one is put on notice that the consequence would follow if he would not take care of the lapse, because of which the action as made known is contemplated. No particular form of notice is the demand of law. All will depend on facts and circumstances of the case.” 12. Thus, it is well established that the principles of natural justice are quite flexible principles which cannot be applied in any straitjacket formula. It all depends upon the kind of function performed and to the extent a person is likely to be affected. The State authorities, while exercising the powers vested in them, have to observe the principles of natural justice. It all depends upon the kind of function performed and to the extent a person is likely to be affected. The State authorities, while exercising the powers vested in them, have to observe the principles of natural justice. Irrespective of fact whether that statute provides for issuance of notice or not, it is incumbent upon the quasi-judicial authority to issue a notice to the persons concerned disclosing the circumstances under which proceedings are sought to be initiated against them, failing which the conclusion would be drawn that the principles of natural justice have been violated. This is imperative especially, if action is going to have adverse civil consequences for the affected person. An order passed by a State authority, particularly when by reasons of which a citizen is to be visited with civil consequences must meet the test of principles of natural justice. 13. In the present case, the respondent Nos. 2 and 3 have passed the impugned orders dated 16.05.2016 & 27.08.2013 respectively in a quite mechanical way. They have totally ignored the reply submitted by the petitioner, who had elaborately refuted the allegations levelled against him, rather they have passed the impugned orders on totally different allegations for which no notice was served to the petitioner. 14. In view of the discussions made hereinabove, I am of the considered view that the impugned order dated 27.08.2013 has been passed by the respondent No.3 in violation of the principles of natural justice and the respondent No.2, functioning as an appellate authority, while dismissing the petitioner’s appeal vide order dated 16.05.2016, has also failed to consider the said issue and as such both the impugned orders dated 16.05.2016 & 27.08.2013 passed by the respondent Nos. 2 and 3 respectively cannot be sustained in law and the same are hereby quashed and set aside. However, the concerned respondent shall be at liberty to issue a fresh show cause notice to the petitioner on the allegation of furnishing a false residential certificate for obtaining the license of fair price shop and thereafter shall pass a fresh order in accordance with law after providing due opportunity of hearing to the petitioner. 15. The present writ petition is, accordingly, disposed of.