CURE Vs. STATE OF ORISSA

JUDGEMENT

(1.) The petitioner firm, M/s. The Cure, secured Drug Licences Nos. CU 2255 WC and CU 2256 WC dated 27-9-1978 and carried on its business as a Druggist and Chemist in a rented premises at Mission Road, Cuttack belonging to the Urdu Library. The date of expiry of the aforesaid Drug Licences was 31-12-1979. The firm had begun its business as a partnership firm with three partners, but after voluntary retirement of two partners, one after the other in 1979 and 1980 respectively, the sole proprietor is carrying on that business in the name and style of the old licensee. His case is that the firm had applied for renewal of the drug licence, first on 31-3-1979, while the partnership firm comprised of three partners. The firm again applied for renewal of the licence on 31-8-1979, following the retirement of one of the partners from the partnership firm. After the firm became a proprietary concern, it made another application for renewal of the drug licence on 7-9-1980. The firm continues to carry on its business in the same premises being located in one out of the six shop rooms which have been rented out to different persons for different business purposes by the said Library. The shop room of the firm had been approved as a fit place for running of the drug shop and accordingly the licence had been issued to the firm in 1978. It is stated that the relationship between the firm and its landlord, the library, became strained as the President of the library issued a notice to the firm on 24-9-1979, asking for delivery of vacant possession by 31-10-1979 on which date the tenancy was to expire. It is alleged that the President of the library harassed the petitioner-firm with threats of disconnection of electricity on account of which the petitioner-firm instituted Title Suit No. 170 of 1979 in the Civil Court wherein the petitioner-firm prayed for permanent injunction against the landlord. It is stated that an order of injunction was issued by the Civil Court. The President of the library soon instituted a proceeding under Section 7 of the Orissa House Rent Control Act asking for eviction of the petitioner-firm from the shop room and the said case, which has been registered as H. R. C. Case No. 69 of 1979, is pending disposal. In December, 1979, the Drugs Inspector (opposite party No. 4) inspected the premises of the firm and thereafter a notice was issued on 17-3-1980 asking the petitioner-firm to show cause why action should not be taken against it for violation of, the Drugs and Cosmetics Rules, 1945 (hereafter referred as the Rules) as per details given in the said notice -- vide annexure 1. The petitioner-firm did not give a reply to the aforesaid notice as, according to the Proprietor, Sk. Zaburul Islam, he was ill. On enquiry from the office of the licensing authority Sk. Islam learnt that the matter had been dropped. On 25-7-1980, the petitioner firm received another notice asking it to show cause why its licence should not be suspended or cancelled on account of violation of the provisions of the Rules as per details given in the notice -- vide annexure 2. The petitioner-firm submitted its show cause on 6-8-1980 -- vide annexure 3. On 22-7-1980, Sk. Islam met the Assistant Drugs Controller (opposite party No. 3) and the latter asked him to obtain a letter of consent from the landlord regarding the fact that tenancy was subsisting. The petitioner-firm informed the licensing authority that in view of the pending eviction proceedings and the civil suit between the firm and its landlord, it was not possible for it to obtain the consent of the landlord for continuance of its tenancy and further pointing out that the firm was continuing in the shop room as a tenant -- vide Annexure 4 dated 5-8-1980. It is alleged that on 5-9-1980, opposite party No. 3 visited the shop room of the firm and thereafter the petitioner received another notice dated 19-9-1980 asking it to show cause why its drug licence should not be suspended or cancelled on account of violation of the provisions of the Rules as per details given in the notice -- vide annexure 5. The petitioner-firm submitted its show cause --vide Annexure 6. It is stated that on 24-9-1980, the petitioner-firm received the suspension order dated 19-9-1980 from opposite party No. 2 -- vide Annexure 7. The licence of the petitioner-firm was suspended for a period of seven days with effect from the date following the date of receipt of the order. Another suspension order was passed by opposite party No. 2 on 14-10-80 suspending the licence of the petitioner firm for a period of ten days with effect from the date following the date of receipt of the order. It is alleged that this order had not been duly delivered to the petitioner-firm which discovered its existence only on 9-11-1986. Finally the petitioner-firm received the order dated 1-111980 wherein opposite party No. 2 as the licensing authority refused to grant renewal of licence in favour of the petitioner-firm on the ground that the firm was not a fit person to whom such a licence could be issued -- vide annexure 9. The petitioner-firm thereafter filed an appeal before the Government under Rule 66 (2) of the Rules, and the said appeal has been rejected by Government order dated 29-12-l980 -- vide Annexure 12. It is alleged in the writ petition that the licensing authority (opposite party No. 2) was biased against the petitioner and had joined hands with its landlord who was interested in evicting the petitioner-firm from the premises and that its application for renewal of drug licence has been rejected on extraneous considerations. In support of this allegation, the petitioner-firm relies on Annexures 10 and 11 Annexure 10 is a copy of the letter D/- 3-11" 1979 from the licensing authority to the President of the library wherein the licensing authority has stated that the renewal application of the petitioner-firm beyond 31-12-1979 would not be considered unless the firm produced a satisfactory consent letter from its landlord regarding occupation of the premises where the shop was functioning. Annexure 11 is a copy of the letter dated 3-12-1980, wherein the licensing authority informed the said President that the application for renewal filed by the petitioner-firm had been rejected and that against the said order of rejection, the petitioner-firm had preferred an appeal before the State Government, According to the petitioner, its application for renewal of the licence was rejected on account of bias, prejudice and in gross violation of the principles of natural justice. The order passed against the petitioner-firm is also challenged on the ground that it was based on misconception of law and facts. The petitioner-firm has prayed that the orders as per Annexures 7, 8, 9 and 10 should be quashed and the licence of the petitioner-firm should be directed to be renewed.

(2.) In his counter, the opposite party No. 2 Deputy Drugs Controller-the Licensing Authority, has denied the allegations made by the petitioner. According to the return, the licensing authority had rightly refused renewal in view of the past performance of the petitioner-firm ran account of which its licence had been suspended on three occasions and on account of failure of the petitioner-firm to produce the documents regarding its tenancy in respect of the premises. The allegations of mala fide are denied. It is stated that the President of the library had filed an application before opposite party No. 2 that the premises in which the medicine shop was situated was no longer held by the petitioner-firm as a tenant and that the petitioner-firm was in unauthorised occupation of the said premises. It is also stated that the letter from the President had no connection with the order ultimately passed by the licensing authority. The inspection of the shop permises by the Drugs Inspector has been justified in the return as having been done in accordance with the requirements of the statute and its rules. It is denied that the licensing authority (opposite party No. 2) or the Assistant Drugs Controller (opposite party No. 3) had given an assurance to the petitioner-firm at any time that the matter of show cause had been dropped. Opposite party No. 2 has accordingly prayed for dismissal of the writ petition.

(3.) Opposite party No. 1 in its counter has stated that the appeal filed by the petitioner-firm had been duly processed and placed before the Minister and that the appeal would be heard properly after due notice to the parties. It may be noted that the counters of the opposite parties had been filed in O. J. C. No. 1951 of 1980, while the appeal before the Government was pending and after disposal of O.J.C. No. 1951 of 1980, as not pressed the said counters have been accepted as counters of opposite parties in the present petition as requested. As already noted the appeal before the Government has been rejected by order dated 28-12-1980 -- vide Annexure 12.