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2025 DIGILAW 1194 (GAU)

By The Way v. State of Assam

2025-07-28

DEVASHIS BARUAH

body2025
JUDGMENT : DEVASHIS BARUAH, J. 1. Heard Mr. S. J. Sharma, the learned counsel appearing on behalf of the petitioners and Mr. S. Bora, the learned Standing counsel appearing on behalf of the respondent Nos. 1, 2 and 3. 2. The petitioners herein are aggrieved by the action on the part of the respondent authorities in forcefully realising an amount of Rs.1,50,000/- on the ground that the petitioners were running a business with an invalid trade license and serving hookah without trade license. 3. The materials on record show that the petitioners prior to the starting the business sought for a No Objection from the Commissioner, Guwahati Municipal Corporation to run the trade of hookah bar. The Commissioner, GMC issued a No Objection Certificate on 11.04.2019 in favour of the petitioners. One of the stipulations contained in the said No Objection Certificate is that the petitioners have to obtain a trade license. 4. The materials on record further show that on 20.05.2022, the petitioner No.1 hereinafter referred to as the petitioner firm was issued a trade license for running a restaurant having above 30 seats for the year up to 31.03.2023. It is further seen that the license fee was Rs.8,650/-. Subsequent thereto, for the year 2023-2024, the petitioner firm was issued another trade license on 18.04.2023 for running a restaurant having 30 seats. It is however pertinent to mention that the license fee mentioned in the said trade license was Rs.2,750/-. 5. At this stage, it is apposite to take note of certain developments after the petitioner firm obtained the No Objection Certificate dated 11.04.2019. The Commissioner, GMC had issued a notice dated 18.12.2020 to all concerned. In terms with the said notice, it was notified that all trades in respect to hookah bar operating within the city of Guwahati should be closed. Further to that, it was mentioned that there shall be no further renewal or issuance of trade license for hookah bar would be entertained by the Guwahati Municipal Corporation. This notification dated 18.12.2020 was put to challenge before this Court in WP(C) No.75/2021 and this Court taking into account the provisions of the Cigarettes and Other Tobacco Products, (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003 (hereinafter referred to as the ‘Act of 2003) as well as the Rules framed therein under passed a judgment and order on 18.02.2021. The notification dated 18.12.2020 though not interfered with as per the said judgment and order but appropriate directions were issued as to how a hookah bar can continue in the city of Guwahati. Paragraph Nos. 14 and 15 of the said judgment and order dated 18.02.2021 being relevant are reproduced herein under: “ 14 . After taking note of the submissions advanced by learned counsel for both the parties, this Court is of the opinion that it would not necessary for this Court to go into the question of legality and validity of the impugned notice in the present proceeding and therefore, the said issue is kept open for decision in an appropriate proceeding. As agreed to by learned counsel for the parties, I dispose of this writ petition by granting leave to the petitioners to submit proper applications with undertaking laying down the following points :- (1) That they would not use the expression “Hookah Bar” in any form while operating their restaurants. (2) Hookah or any other tobacco products would not be advertised in any form. (3) The petitioners would strictly comply with the provisions of the Act of 2003 and the Rules framed thereunder, while operating their restaurants. 15 . If such undertaking is furnished within three days from today, the respondent No.2 shall pass appropriate orders allowing the petitioners to operate their restaurants by adhering to the provisions of the Act of 2003 and the Rules framed thereunder.” 6. It is alleged in the writ petition that on 30.06.2023, some of the officials of the respondent corporation visited the petitioners’ firm and directed payment of a fine of Rs.1,50,000/- verbally. The petitioners were compelled to deposit the said amount under coercion. Being aggrieved by the high-handedness on the part of the respondent authorities, the petitioners have approached this Court by filing the present writ petition. 7. The record reveals that this Court vide an order dated 23.08.2023 while issuing notice directed that no coercive action shall be taken against the petitioners pursuant to the demand raised on 30.06.2023 subject to the condition that the petitioners operate the restaurant by complying with all rules and regulations. The record further reveals that the respondent authorities have filed an affidavit-in-opposition wherein various pleas were taken as regards the maintainability of the writ petition. The record further reveals that the respondent authorities have filed an affidavit-in-opposition wherein various pleas were taken as regards the maintainability of the writ petition. It is the specific case of the respondents in their affidavit-in-opposition that the petitioners were running the business without a valid trade license and documents and paying insufficient license fees which led to the imposition of fine in terms with Section 404(1) of the Guwahati Municipal Corporation (Amendment) Act, 2021. It was further mentioned that the trade license which the petitioners were required to pay was Rs.8,650/- however during that relevant point of time, the petitioners paid only Rs.2,750/-. 8. This Court has duly heard the learned counsels appearing on behalf of the parties and perused the materials on records. 9. From the averments made in the writ petition, it is noticed that the officials of the respondent corporation have visited the petitioners’ establishment on 30.06.2023. On that very date, the respondents without issuance of any notice or even an order had verbally imposed penalty in terms with Section 404(1) of the GUWAHATI MUNICIPAL CORPORATION ACT , 1971 as amended by the Guwahati Municipal Corporation (Amendment) Act, 2021 (for short ‘the Amending Act’). This aspect is apparent from the receipt issued by the Respondent Corporation. 10. At this stage, it is pertinent to take note of Section 404(1) of the GUWAHATI MUNICIPAL CORPORATION ACT , 1971 as was substituted vide the Amending Act of 2021 and the same is reproduced herein under: “ 404.(1) Whoever,- (a) contravenes any provision of any of the sections, sub-sections or clauses mentioned in this Act or any bye-laws framed or of any regulation or order made thereunder. (b) fails to comply with any requisition lawfully made upon him under any of the said sections, sub-section or clauses, shall be punishable, for each such offence, disobedience, with fine, if not provided specifically under the said sections, sub-sections, clauses, which may extend up to Rupees Five thousand per day.” 11. A perusal of the above quoted provision would show that the action which is contemplated under Section 404(1) is in the form of penalty/fine and there is also a discretion conferred upon the respondent authorities as to how much fine should be imposed per day inasmuch as the term used is “which may extend up to Rupees Five thousand per day”. In the opinion of this Court, the said imposition of Rs.1,50,000/- upon the petitioners by the respondent authorities that too without issuance of notice and followed by an order is completely contrary to Section 404(1) of the Act of 1971 as amended by the Amending Act of 2021 and further is also in violation to the principles of natural justice. It is the opinion of this Court that when a statutory authority imposes a fine or penalty, the imposition of fine or penalty should be preceded by a notice giving the person who would be effected a reasonable opportunity to explain and thereupon an order is required to be passed. Further to that, when a discretion is conferred upon a statutory authority to impose fine with the stipulation that it may extend up to Rs.5,000/- per day, it is incumbent upon the statutory authority to state the reasons why the highest of the fine is imposed. In the instant case, not to speak of notice, there is not even an order passed but the petitioners were compelled to pay the amount of Rs.1,50,000/-. The imposition so made of Rs.1,50,000/- therefore requires interference as the same violates Article 14, 19(1)(g) as well as Article 21 of the Constitution. 12. Accordingly, this Court disposes of the instant writ petition with the following observations and directions: (i) The imposition of the fine of Rs.1,50,000/- upon the petitioners by the respondent authorities which is not preceded by a notice and followed by an order is interfered with. (ii) This Court directs the respondent authorities more particularly the Commissioner, GMC to refund the amount of Rs.1,50,000/- to the petitioner within a period of 1 (one) month from the date a certified copy of this order is served upon the respondent No.3 i.e. the Commissioner, GMC. (iii) The interference made hereinabove shall not preclude the GMC Authorities to take action after refunding the amount of Rs.1,50,000/- as directed above to the petitioners, by following the mandate of law and taking into account the observations made herein above.