EKASILA FILLING STATION HANUMAKONDA Vs. COLLECTOR WARANGA

JUDGEMENT

(1.) The petitioner is a licensee under the Andhra Pradesh Petroleum Products (Licensing and Regulation of Supplies) Order, 1980, for short, "the Order", to supply and distribute petroleum products. He has been running the business for about seven years. On January 16, 1984, the Vigilance Authorities took samples of the products and thereafter, for the contravention of the order, laid prosecution under Section 7 of the Essential Commodities Act, 1955. A partner of 'he oetitioner was convicted and sentenced against which Crl. Appeal No. 828/84 was filed and by order in Crl. M P. No. 3167/84 dated December 10, 1984, this Court suspended the operation of the sentence. On a letter written by the Vigilance Inspector, the respondent passed the impugned order dated December 15, 1984, cancelling the licence of the petitioner. Assailing the legality thereof, the above writ petition is filed. Pursuant to the interim directions ordered by this Court, the supplies of petroleum products were Restored.

(2.) Sub-clauses {)) and (2) of Clause 23 of the order provides thus : 29. (1) Notwithstanding anything contained in C/ause 23 where a licence or holder of a registration certificate or supply card has been convicted by a Court of law in respect of any of the provisions of the Essential Commodities Act, 1955 (Central Act 10 of 1955) the licensing authority may by order, in writing cancel his licence or certificate or supply card issued under this order. (2) Pending action as in sub-clause (1) above, the licensing authority may, for the reasons to be recorded in writing, order an interim suspension of the licence, registration certificate or supply card for the duration of the proceedings in the Court : Provided that where such conviction is set aside in appeal or revision, the licensing authority shall on application by the person whose licence or registration certificate or supply card has been cancelled, re-issue the licence or registration certificate or supply card to such person.

(3.) The contention of the learned Government Pleader is that ones there has been a conviction by a competent Court, the pow r under sub Clause (1) of Clause 29 can be invoked. The trial Court convicted the petitioner and on appeal in Crl. Appeal No. 828/84, by order dated December 10, 1984, the sentence alone was suspended and the conviction has not been suspended. Therefore, the exercise of the powers cannot besaid to be illegal. I am unabla to agree. Uncer Clause 28, it is open to the competent authority to initiate action for contravention of the provisions of the Order and to pass an order thereon to cancel the licence or registration certificate or supply card after following the procedure prescribed therefor and after affording fair and reasonable opportunity to the licensee. The exercise of the power under Clause 29 (1) is a residue power only on conviction by a competent court for the contravention of the provisions of the order. When action under Clause 29 (1) is resorted to, no doubt, on a conjoint reading of sub-clause (1)of Clause 29 and the proviso thereof, the licensing authority has been clothed with a power to cancel the licence or certificate or the supply card. Pending consideration thereof, the power to make an interim suspension may be exercised But a licensee having been provided with a right to carry on business, if ultimately he it succeeds in the appeal or revision, in the interregnum he will be unlawfully deprived of his right to carry on his trade as assured in Anicle 19(1) (g) of the Constitution Of course, the licensee has no right to contravene the law and yet claim the right. But the exercise of the power must be sparingly invoked and be circumspect, depending on the serious nature ot the contravention and its impact on the general consumer public in the distribution or supply of essential commodities. Right of appeal or revision against a conviction is a valuable and substantive right. But when the appeal is pending, any action under Clause 29 would imoede the exercise of the right to carry on his right to trade, assured under Article 19 (1) (g) of the Constitution Exercise of power under Clause 29 (1) does not appear to be intended as a guillotine to inflict lethal blow annihilating the fundamental right to business even for a specified period. Suspension of business creates he teous in the continuity of activity, disruption of business and an assault on "goodwill ' and incidentally on personal reputation. Therefore when action under Clause 29 (1) is initiated the minimnm procedure of opportunity of representation and hearing is to be accorded. Otherwise it would incur the wrath of arbitrary exercise of power offending Article 14 and an unfair procedure violating Article 21 of the Constitution the procedure must be fair, just and reasonable. Clause 29 is in supplementation to Clause 23 without going through the entire gamut of the procedure prescribed in Clause 28 once over. But it is not bereft of the minima! procedure of opportunity of representation and hearing because the convicted lincensee may have justifiable reasons as mitigating circumstances to pursuade the licensing authority to desist from cancelling the licence or registration certificate or authorisation or supply card pending disposal of the appeal. Even a proved offender has been assured under Section 235 (2) of the Code of Criminal Procedure, a right to plead extenuating circumstances to award lesser sentence. On the same parity of reasoning, the convicted licensee can not be put in a worse position. The impugned action visits with civil consequences and so the principles of natural justice is to be read in Clause 29 (1) of the order, since there is no such express exclusion therein. I am, therefore, of the view that on an harmoneous construction, the exercise of the power initiated under Sub-clause (1) of Clause 29 is to be resorted to normally after the conviction by a Criminal Court has become final. Pending consideration tnereof, an action to cancel the licence is to be sparingly taken and an interim order suspending the licence or authorisation or the supply card or the registration certificate may be made. In this case, straight away the licence was cancelled. Therefore, I hold that cancellation of the licence without affording an opportunity, on the facts and circumstances, is illegal and arbitrary and cannot be sustained. The order is accordingly quashed This decision does not preclude the respondents to take action, after the Criminal proceedings are terminated, according to law, if the facts so warrant. The writ petition is accordingly allowed with costs. Advocate's fee Rs. 150/-.