22 of 1960
Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights
HJ Umrigar and B P Maheshwari for the petitioner
AC Mitra B Das and P K Bose for the respondents Nos 1 and 2
P K Mukherjee for respondent No 3 1960 December 9
The Judgment of Kapur Gajendragadkar and Wanchoo JJ was delivered by Wanchoo J and that of Sinha CJ and Subba Rao J was delivered by Subba Rao J WANCHOO J
This petition under article 32 of the Constitution challenges the constitutionality of section 39 of the Calcutta Police Act No IV of 1866 hereinafter called the Act
The facts necessary for our purpose are these
On August 11 1954 the petitioner entered into an agreement with one Haripada Bhowmick who is respondent No 3 with respect to an eating house named Kalpatoru Cafeteria  situate in No 2 Chowranghee Road Calcutta
The petitioner was appointed a contractor by this agreement and was given the exclusive use and occupation of the said eating house upon certain terms and conditions
A licence has to be taken out with respect to an eating house under section 39 of the Act
It appears that originally the licence was in the name of Bhowmick and one of the conditions of the licence was that the eating house should not be sublet 139 without permission of the Commissioner of Police hereinafter referred to as the Commissioner
On the date of the agreement Bhowmick held a licence for the eating house which was to expire on March 31 1955
It is said that under the agreement the licence was to remain in the name of Bhowmick while the petitioner was to carry on the business as a contractor
The petitioner carried on the business from after the date of the agreement and no application for a fresh licence was made by him before March 31 1955 when the licence in the name of Bhowmick was to expire
It was only on August 8 1955 that an application for licence was made by the petitioner on behalf and in the name of Bhowmick though the business was continued to be run by him all the time after March 31 1955
It appears that the application made in the name of Bhowmick was rejected on December 27 1956 but in the meantime Bhowmick was prosecuted on September 10 1955 for running the eating house without a licence and was fined on December 12 1955
Thereafter a notice was issued to Bhowmick on September 7 1956 to show cause why his application for licence should not be refused inasmuch as he had not applied in time and violated the condition of the licence by sub letting the eating house to the petitioner
Thereafter the petitioner applied on September 21 1956 for the issue of a licence in his own name
It may be mentioned that in the meantime there had been disputes between Bhowmick and the petitioner and a suit had been filed by Bhowmick against the petitioner in October 1956 in that connection
It may also be mentioned that though the petitioner applied for the first time on September 21 1956 for licence he had already been prosecuted in October 1955 for keeping an eating house without a licence and convicted in November 1955
The application made by the petitioner on September 21 1956 was eventually rejected on March 30 1958 though in the meantime the petitioner was all along continuing the business of the eating house without having obtained a licence
After the rejection of his application the petitioner applied to the High 140 Court under article 226 of the Constitution challenging the constitutionality of section 39 and also challenging the order of the Commissioner rejecting his licence on various grounds
This application was dismissed on August 7 1958
Thereupon the petitioner went up in appeal to a Division Bench of the High Court which was disposed of on March 4 1959
The Division Bench held section 39 to be constitutional
It further held that as extraneous matters had been taken into account in rejecting the application of the petitioner for a licence the rejection was not in accordance with law
However as the period of one year for which a licence is valid under section 39 had expired in September 1957 and the judgment was being delivered in March 1959 the appeal was dismissed on the ground that application could not be considered in 1959
Thereupon the petitioner made another application to the Commissioner on March 30 1959 for the period from April 1 1959 to March 31 1960
During all this time the petitioner was carrying on his business as a keeper of the eating house without a licence
This application was found defective and another application was made on May 14 1959
In the meantime the petitioner again applied to the High Court on or about May 8 1959 under article 226 of the Constitution in order to compel the Commissioner to issue him a licence or in the alternative to compel him not to prosecute him for keeping an eating house without a licence and for such other orders as the High Court might deem fit to pass
It may be mentioned that day to day prosecution of the petitioner had begun from February 1956 under section 40 of the Act for continuing to keep an eating house without a licence
This writ application filed in the High Court was withdrawn by the petitioner on May 13 1959 as his application to the Commissioner of March 30 was defective
On May 30 1959 the Commissioner rejected the application of the petitioner for a licence on the ground that his antecedents and his present conduct showed that he would not keep good behavior and further that he would not be able to prevent drunkenness or disorder among the persons frequenting or using the eating 141 house  The petitioner s complaint is that he was not heard before the order rejecting his application was passed
Then on June 15 1959 the petitioner again applied under article 226 of the Constitution to the High Court against the rejection of his application on May 30
On February 11 1960 the High Court allowed the petitioner to withdraw the application with liberty to move such application as he may be advised before this Court in case such liberty was necessary
Thereafter the petitioner moved this Court by his present application on February 15 1960
His main contention before us is that section 39 of the Act confers naked and uncanalised powers on the Commissioner to grant or refuse a licence and that no criteria have been laid down anywhere in the Act to guide the discretion of the Commissioner
Further no opportunity is provided to an applicant for a licence to be heard either orally or in writing before passing orders on an application for licence in consequence the Commissioner has been given completely arbitrary powers either to grant or to refuse a licence and this amounts to an unreasonable restriction on the fundamental right of the petitioner to carry on the trade of eating house keeper
Besides this attack on the constitutionality of section 39 the petitioner also contends that the order is mala fide and should be struck down on this ground
There are some other grounds in the petition but they have not been pressed before us and it will not be necessary to consider them
The first question therefore that falls for consideration is whether section 39 of the Act is a reasonable restriction within the meaning of article 196 on the fundamental right to practise any profession or to carry on any occupation trade or business contained in article 19 1g
39 is in these terms The Commissioner of Police may at his discretion from time to time grant licences to the keepers of such houses or places of public resort and entertainment as aforesaid for which no licence as is specified in the Bengal Excise Act 1909 is required upon such conditions to be inserted in every such 142 licence as he with the sanction of the said State Government from time to time shall order for securing the good behaviour of the keepers of the said houses or places of public resort or entertainment and the prevention of drunkenness and disorder among the persons frequenting or using the same and the said licences may be granted by the said Commissioner for any time not exceeding one year
 Learned counsel for the petitioner contends that the language of section 39 shows that an absolute discretion untrammelled by any considerations is conferred on the Commissioner by this section and there is nothing either in the section or anywhere in the Act to guide the discretion of the Commissioner in the matter of granting such licences
Therefore according to learned counsel the power conferred on the Commissioner is arbitrary and unguided and such power is necessarily to be struck down on the ground that it cannot be a reasonable restriction on the fundamental right to carry on trade
There is no doubt that if the section empowers the Commissioner to grant or refuse a licence without any criteria to guide him it would be an unreasonable restriction on the right to carry on trade
We have therefore to see whether there is any guidance either in the section or in the Act to regulate the exercise of discretion of the Commissioner in the matter of granting such licences
In this connection it must be remembered that the Act was passed in 1866 when there were no fundamental rights and we cannot expect that meticulousness of language which should be found in statutes passed after January 26 1950
It may also be mentioned that the Act replaced two earlier Acts namely Act XIII of 1856 and XLVIII of 1860
The Act of 1860 also contained provisions for licences for eating houses in sections II and 12 thereof though the language of those sections was somewhat different
11 laid down that in the towns of Calcutta Madras and Bombay no eating house shall be kept without licence and provided for a penalty for the same
12 then laid down that the Commissioner shall from time to time grant licences to 143 keepers of such houses upon conditions for securing the good behaviour of the keepers of the said houses and for the prevention of drunkenness and disorder among the persons frequenting or using the same
The language of section 39 however is different inasmuch as it provides that the Commissioner may at his discretion from time to time grant licences
The Act of 1860 was interpreted by the Bombay High Court in Rustom J Irani vs H Kennedy 1 as giving no discretion to the Commissioner to refuse a licence if the person applying for the licence was willing to fulfil the conditions imposed thereunder
In the case of Calcutta however section 39 made a change in the language contained in the earlier Act giving discretion to the Commissioner in the matter of grant of licences
The question therefore is whether the word discretion introduced by section 39 means an absolute and unguided discretion and would therefore now become an unreasonable restriction on the fundamental right of a citizen to carry on the trade of keeping an eating house
There is no doubt as we have already indicated that the section does not say as many of the provisions of laws passed after January 26 1950 do that the Commissioner would grant licence on certain specified considerations
The contention on behalf of the petitioner is that the first part of section 39 confers an absolute discretion on the Commissioner to grant or to refuse a licence just as he pleases and that the second part of the section merely provides for certain conditions to be imposed in case the Commissioner pleases to grant a licence
We are however of opinion that when we are judging a law passed in 1866 to decide whether it satisfies the test of constitutionality based on article 191g and article 196 we should take the section as a whole and see whether on a fair reading of the section it can be said that there is no guidance for the Commissioner in the matter of granting or refusing licences and his power is arbitrary
If such guidance can be found on a fair reading of the section there would be no reason for striking it down simply because it has not been worded in a manner which 1 Bom
144 would show immediately that considerations arising from the provisions of article 191g and article 196 were in mind naturally those considerations could not be in the mind of the legislature in 1866
We have therefore to see whether an Act passed before the Constitution came into force can be reasonably and fairly read as containing guidance in the matter of licensing as in this case
If it can be fairly and reasonably read to contain guidance it should not be struck down
If on the other hand on a fair and reasonable construction of the section as a whole we come to the conclusion that there is no guidance in it and the discretion vested in the Commissioner is absolute and arbitrary it will have be struck down
What then does the section provide It certainly gives powers to the Commissioner to grant licences at his discretion
Those words however by themselves do not necessarily mean that the Commissioner has the power to act arbitrarily and grant licences where he pleases and refuse where he does not please to do so
The section provides further that the licence has to be granted upon certain conditions and those conditions have to satisfy two objects namely i securing of the good behaviour of the keepers of the said houses or places of public resort and entertainment and ii the prevention of drunkenness and disorder among the persons frequenting or using the same
Of course it is implicit in the section that a licence will only be granted to a person who is the keeper of an eating house
We cannot read the section as laying down that the discretion is absolute and that the im
posing of conditions for the aforesaid two objects only arises after that absolute discretion has been exercised in favour of the grant of licences
We see no unfairness or unreasonableness in reading the section to mean that the Commissioner shall satisfy himself i that the person applying for a licence is the keeper of an eating house meaning thereby that he has a place where he can carry on the business or trade and that he actually and effectively has control and possession of that place ii that the keeper is a person of good behaviour so that the eating house may not become 145 a resort of criminals and persons of ill repute and iii that the keeper is in a position to prevent drunkenness and disorder among those who come to the eating house
This section appears in the Police Act the purpose of which is to maintain law and order and that is why we find that the two objects to be secured when granting licences are the good behaviour of the keeper himself and the prevention of drunkenness and disorder among those who frequent the eating house
It seems therefore to us that section 39 clearly provides that the Commissioner will use his discretion in deciding whether the person applying for a licence is in actual and effective control and possession of the place where the eating house is to be kept and is thus the keeper thereof
He will also satisfy himself that the keeper is a person of good behaviour and further that he is able to prevent drunkenness and disorder in the eating house
If he is satisfied on these three matters it seems to us that the section contemplates that the discretion will be exercised in favour of the grant of a licence
We cannot accept that even though the Commissioner may be satisfied that the person applying for a licence has actual and effective control of the place where he is going to keep the eating house is a person of good behaviour and can prevent drunkenness and disorder among the clientele he will still go on to refuse the licence
The discretion that is given to him is to satisfy himself on these three points and if he is satisfied about them he has to grant the licence
On the other hand if he is not satisfied on any one or more of these points he will exercise the discretion by refusing the licence
As for the conditions which will be inserted in the licence they are only for the purpose of carrying on the two objects specified in the section
They will naturally be more detailed in order to carry out the two objects aforesaid
But these two objects in our opinion along with the obvious implication in the section that the person applying must have actual and effective control of the place where he is going to keep the eating house are the criteria which will govern the exercise 146 of discretion by the Commissioner in the matter of granting or refusing a licence
We cannot agree with the learned counsel for the petitioner that the two parts of section 39 should be read separately as if one has no effect on the other
Reading them together it is in our opinion fair and reasonable to come to the conclusion that the discretion of the Commissioner in this matter is guided by the two objects mentioned in the section and by the necessary implication contained in it that the person applying must be in actual and effective control and possession of the place where he is going to keep the eating house
The argument therefore that section 39 confers an arbitrary and uncanalised power Without any criteria for guiding the discretion of the licensing authority must fail and the section cannot be held to be an unreasonable restriction on the right to carry on trade on this ground
Then it is urged that even if there is guidance in the section it provides for no hearing either oral or written of the person applying for a licence
Further it provides for no grounds to be given for refusing a licence
Therefore though there may be some guiding principle in the matter of granting licences the absence of a provision for hearing and for giving reasons for refusal would also make the provision unconstitutional as an unreasonable restriction on a fundamental right
Reference in this connection was made to State of Madras vs V G Row 1 where it was observed that In considering the reasonableness of laws imposing restrictions on fundamental right both the substantive and procedural aspects of the impugned law should be examined from the point of view of reasonableness and the test of reasonableness wherever prescribed should be applied to each individual statute impugned and no abstract standard or general pattern of reasonableness can be laid down as applicable to all cases
 There is no doubt that procedural provisions of a statute also enter into the verdict as to its reasonableness but at the same time there can be no abstract or 147 general principles which would govern the matter and each statute has to be examined in its own setting
It is undoubtedly correct that no provision has been made for giving a hearing to a person applying for a licence and the Commissioner has not to give reasons when refusing the licence but it cannot be laid down as a general proposition that where in the case of licensing statute no provision is made for hearing and there is no provision for giving reasons for refusal the statute must be struck down as necessarily an unreasonable restriction on a fundamental right
No case has been cited before us which lays down such a general proposition
We have therefore to examine the section in its setting to decide whether the absence of a provision for hearing and for requiring the Commissioner to give reasons for refusal would make this section unconstitutional
The section appears in the Police Act which deals generally with matters of law and order and the two objects specified in the section are also for the same purpose
The discretion is vested in a high police officer who one would expect would use it reasonably
There is no provision for appeal and there is no lis as between the person applying for a licence and the Commissioner the exercise of the discretion depends upon the subjective satisfaction of the Commissioner as to whether the person applying for a licence satisfies the three conditions mentioned above
It is true that the order when made one way or the other affects the fundamental right of carrying on trade but in the circumstances it cannot but be an administrative order see Nagendra Nath Bora vs The Commissioner of Hills Division and Appeals Assam 1 and though the Commissioner is expected to act reasonably there is no duty cast on him to act judicially
In Nakkuda Ali vs M F De section Jayaratne 2 the Privy Council pointed out that it was Quite possible to act reasonably without necessarily actinG judicially and that it was a long step in the argument to say that because a man is expected to act reasonably he cannot do so without a course of conduct analogous to the judicial process
The compulsion of hearing before 1  1253
2 148 passing the order implied in the maxim audi alteram partem  applies only to judicial or quasi judicial proceedings see Express Newspapers P Ltd vs The Union of India 1
Therefore the fact that no hearing is required to be given by the Commissioner before he decides to grant or refuse a licence would not make the provisions as to licensing in the circumstances of this case unreasonable restrictions on the fundamental right of carrying on a trade
For the same reasons it cannot be said that because the reasons for refusal are not communicated to the person applying that would make the licensing provision unconstitutional
The person applying knows that under the law there are three conditions already set out above which the Commissioner has to consider in granting or refusing the licence
If he thinks that he fulfills the three conditions and the Commissioner has acted unreasonably in rejecting his application he is not without a remedy he can apply to the High Court under article 226 and compel the Commissioner to disclose the reasons for refusal before the Court and if those reasons are extraneous or are not germane to the three matters arising under section 39 the High Court will compel the Commissioner to act within the scope of section 39
We are therefore of opinion that in the circumstances of this case and in the setting in which section 39 appears the mere absence of a provision for a hearing or a provision for communicating the reasons for refusal to the person applying does not make section 39 unconstitutional as an unreasonable restriction on a fundamental right
The attack therefore on the constitutionality of section 39 must fail
Then we turn to the question of mala fides
It is not the case of the petitioner that the Commissioner has any personal animus against him or that he is favouring Bhowmick
What he says in ground 41 of his petition in this connection is that the reasons given by the Commissioner in his order dated May 30 1959 for refusing the licence are not correct and that the Commissioner is annoyed with him because he went to the High Court by means of a writ application
1 106
149 These in our opinion are no grounds for holding that the order of the Commissioner passed in this case on May 30 1959 is malafide
The petition therefore fails and is hereby dismissed with costs
SUBBA RAO J We regret our inability to agree with Wanchoo J Our learned brother in his judgment has stated the facts fully and it is not necessary to restate them here
The petitioner applied to the Commissioner of Police Calcutta for a licence to enable him to carry on the business of an eating house known as Kalpatoru Cafeteria
The Commissioner by his order dated May 30 1959 rejected the application made by the petitioner for a licence on two grounds namely that he was not satisfied that from the antecedents and resent conduct of the petitioner it would be reasonable to think that the petitioner would keep good behaviour and would be able to prevent drunkenness or disorder among the persons frequenting the eating house
The application was rejected under section 39 of the Calcutta Police Act No IV of 1866 hereinafter called the Act
The short question raised is whether section 39 of the Act is constitutionally valid
Section 39 of the Act reads The COMMISSIONER of Police may at his
discretion from time to time grant licenses to the keepers of such houses or places of public resort and entertainment as aforesaid for which no license as is specified in the Bengal Excise Act 1909 is required upon such conditions to be inserted in every such license as he with the sanction of the said State Government from time to time shall order for securing the good behaviour of the keepers of the said houses or places of public resort or entertainment and the prevention of drunkenness and disorder among the persons frequenting or using the same and the said licenses may be granted by the said Commissioner for any time not exceeding one year
 Learned counsel for the petitioner contends that 150 the petitioner has under article 191g of the Constitution a fundamental right to carry on the business of an eating house and that the provisions of section 39 of the Act impose unreasonable restrictions on the exercise of his right and therefore the said section is void
Before scrutinising the provisions of that section it would be convenient at the outset to notice the relevant aspects of the law vis a vis the concept of reasonable restrictions on a fundamental right
The concept of reasonableness has been clearly defined by Patanjali Sastri C J in State af Madras vs V G Row 1 thus It is important in this context to bear in mind that the test of reasonableness wherever prescribed should be applied to each individual statute impugned and no abstract standard or general pattern of reasonablenes s can be laid down as applicable to all cases
The nature of the right alleged to have been infringed the underlying purpose of the restrictions imposed the extent and urgency of the evil sought Co be remedied thereby the disproportion of the imposition the prevailing conditions at the time should all enter into the judicial verdict
There the constitutional validity of section 152b of the Indian Criminal Law Amendment Act 1908 was impugned on the ground that it fell outside the scope of authorized restrictions in article 194 of the Constitution
The issue of a notification by the State Government declaring an association unlawful was made to depend upon its subjective satisfaction of certain objective factors
The Act also provided for an enquiry before an Advisory Board and the subsequent review of the order by the Government on the basis of the said enquiry
It was pressed upon this Court to hold that the said restriction passed the test laid down in article 194 of the Constitution
In rejecting the con tention Patanjali Sastri C J observed thus The formula of subjective satisfaction of the Government or of its officers with an Advisory 11952 SCR 597 607 608
151 Board thrown in to review the materials on which the Government seeks to override a basic freedom guaranteed to the citizen may be viewed as reasonable only in very exceptional circumstances and within the narrowest limits and cannot receive judicial approval as a general pattern of reasonable restrictions on fundamental rights
 The learned Chief Justice adverting to the procedural aspect of the restriction criticised the absence of a provision in the impugned Act for personal service on the association and thus depriving its members of the opportunity to make their representations
Compared with section 39 of the Act the impugned provisions of the Criminal Law Amendment Act impose more stringent control on the exercise of the discretionary power by the Government
Yet the Court struck down the provisions
The attempt made to distinguish that decision on the ground that it related to the fundamental right of freedom of speech cannot be justified as the freedom to do business is also one of the important fundamental rights under the Constitution The case of Thakur Raghubir Singh vs Court of Wards Ajmer 1 was concerned with the question of the reasonableness of the provisions of section 112 of the Ajmer Tenancy and Land Records Act XLII of 1950 which provided that if a landlord habitually infringes the rights of a tenant under this Act he shall notwithstanding anything in section 7 of the Ajmer Government Wards Regulation 1888 1 of 1888 be deemed to be a landlord who is disqualified to manage his own property  within the meaning of section 6 of the said Regulation and his property shall be liable to be taken under the superintendence of the Court of Wards
 The determination of the question whether a landlord habitually infringed the rights of a tenant was left to the Court of Wards
This Court held that section was void as being unreasonable restriction on the right in property as the restriction made the enjoyment of that right to depend upon the mere discretion of the 11953 SCR 1049 1055
152 executive
Mahajan J as he then was observed as under When a law deprives a person of his possession of his property for an indefinite period of time merely on the subjective determination of an executive officer such a law can on no construction of the word reasonable be described as coming within that expression because it completely negatives the fundamental right by making its enjoyment depend on the mere pleasure and discretion of the executive the citizen affected having no right to have recourse for establishing the contrary in a civil court
 Though section 112 of the Ajmer Tenancy and Land Records Act laid down an objective test namelya landlord habitually infringing the rights of tenants under that Act and therefore may be said to have laid down some policy for the exercise of the discretion by the Court of Wards the section was struck down as the discretion was uncanalised and no effective procedure was prescribed to remedy the grievance of an aggrieved party
It cannot be said that the Commissioner of Police has a higher status than the Court of Wards or that the taking over of the management of an estate affects a larger right than preventing a person from doing his business
The decision in Messrs Dwarka Prasad Laxmi Narain vs The State of Uttar Pradesh 1 dealt with cl
43 of the Uttar Pradesh Coal Control Order 1953 whereunder the licensing authority was given absolute power to grant or refuse to grant renew or refuse to renew suspend revoke cancel or modify any licence under the said Order and the only thing he had to do was to record reasons for the action he took
Under the clause the State Coal Controller could delegate power to any other officer
This Court held that the said Order was void as it imposed unreasonable restrictions on the freedom of trade and business guaranteed under article 191g of the Constitution and not coming within the protection afforded 11954 SCR 803 811
153 by cl
6 of the Article
Mukherjea J as he then was observed to the following effect The power of granting or withholding licences or of fixing the prices of the goods would necessarily have to be vested in certain public officers or bodies and they would certainly have to be left with some amount of discretion in these matters
So far no exception can be taken but the mischief arises when the power conferred on such officers is an arbitrary power unregulated by any rule or principle and it is left entirely to the discretion of particular persons to do anything they like without any check or control by any higher authority
 We shall now notice some of the decisions cited at the Bar on behalf of the Commissioner in support of the validity of the impugned provisions
In Babul Chandra vs Chief Justice and Judges High Court of Patna 1 it was held that the proviso to s ub section
1 of section 9 of the Indian Bar Councils Act was not void as being an unreasonable restriction upon the freedom to practise a profession or to carry on an occupation trade or calling
The proviso to section 91 states expressly that the rules shall not limit or in any way affect the power of the High Court to refuse admission to any person at its discretion
Under section 8 of the Indian Bar Councils Act no person is entitled as of right to practise in any High Court unless his name is entered in the roll of the Advocates of that Court maintained under the Act
Under section 9 of that Act the Bar Council can frame rules with the sanction of the High Court to regulate the admission of persons as Advocates
The proviso saves the overriding power of the High Court to refuse admission in its discretion
It was contendedthat an unfettered and uncontrolled discretion wasgiven to the High Court and that was unreasonable
This Court pointed out that there could not be a better authority than the High Court in that State to which the discretion could be entrusted
This decision turned upon three considerations namely 1 no person was entitled as of right to practise 2 the discretion to refuse was vested in the 1AIR 20 154 highest judicial body in the State and 3 it was implicit in the power of discretion that the High Court would give notice before rejecting an application
On that basis this Court held that the restrictions imposed by the proviso to section 91 were reasonable
Nor does the decision in Harishankar Bagla vs The State of Madhya Pradesh 1 lay down any different principle
There this Court was concerned with cl 3 of the Cotton Textile Control of Movement Order 1948 promulgated by the Central Government under section 3 of the Essential Supplies Temporary Powers Act 1946 which required a citizen to take a permit from the Textile Commissioner to enable him to transport cotton textiles purchased by him
It was contended in that case that the requirement of a permit was an unreasonable restriction on the citizen s right under sub cls
f and g of article 191 of the Constitution
This Court rejected the contention and affirmed the validity of the law
Mahajan C J speaking for this Court gave four reasons in support of his conclusion and they were 1 the Legislature passed the Essential Supplies Temporary Powers Act during a period of emergency when it was necessary to impose control on the production supply and distribution of commodities essential to the life of the community 2 cl
3 of the Control Order did not deprive a citizen of the right to dispose of or transport cotton textiles purchased by him but only required him to take a permit from the Textile Commissioner to enable him to transport them 3 if transport of essential commodities by rail or other means of conveyance was left uncontrolled it might well have seriously hampered the supply of these commodities to the public and 4 the policy underlying the Order was clearly enunciated by the provisions therein and that policy governed the exercise of the discretion by the Textile Commissioner
On these considerations this Court maintained the validity of that Order
The said decision has no analogy to the provisions of section 39 of the Act in question
The decision in Union of India vs Bhana Mal Gulzarimal Ltd 2 related to the question of validity of 1 2   641
155 cl
11B of the Iron and Steel Control of Production and Distribution Order 1941
This Court held having regard to the provisions of that Order and those of the Essential Supplies Temporary Powers Act 1946 that the Legislature had clearly enunciated its legislative policy and that cl
11B of the Order laid down the object which was intended to be achieved
Gajendragadkar J delivering the judgment of the Court observed thus Therefore reading cl
11B by itself we do not see how it would be possible to hold that the said clause is violative of article 19
In fact if sections 3 and 4 are valid and cl
11B does nothing more than prescribe conditions for the exercise of the delegate s authority which are consistent with section 3 it is only the actual price structure fixed by the Controller which in a given case can be successfully challenged as violative of article 19 The learned Judge considered the price structure fixed by the notification and observed that the respondents therein did not seriously challenge the validity of the notification in respect of price structure and that apart it was not proved that the notification adversely affected a large class of dealers taken as a whole
The judgment therefore does not help the respondents
Nor is the decision of this Court in Mineral Development Ltd vs State of Bihar 1 of any help to the respondents
There the constitutional validity of section 251 of the Bihar Mica Act 10 of 1948 was impugned as violating the petitioners  fundamental right under article 191f and g of the Constitution
Under section 251c of that Act discretion was given to cancel a licence to the State Government but cl
c was hedged in by two important restrictions namely i the failure to comply with the provisions of that Act or the rules made thereunder should be a repeated failure and not a mere sporadic one ie the defaulter must be a recalcitrant one ii before canceling the licence the State Government should afford reasonable opportunity to the licensee to show cause why his license 1  619
156 should not be cancelled
This Court in upholding the validity of the said section observed thus The power given to the State Government is only to achieve the object of the Act ie to enforce the said provisions which have been enacted in the a interest of the public and that power as we have indicated is exercisable on the basis of objective tests and in accordance with the principles of natural justice
We cannot therefore hold that section 251c of the Act imposes an unreasonable restriction on the petitioner s fundamental rights under article 191f and g of the Constitution
 This decision far from helping the respondents is to some extent against their contention
The result of the discussion may briefly be summarized in the form of the following propositions A fundamental right to do business can be controlled by the State only by making a law imposing in the interest of the general public reasonable restrictions on the exercise of the said right restrictions on the exercise of a fundamental right shall not be arbitrary or excessive or beyond what is required in the interest of the general public the reasonableness of a restriction shall be tested both from substantive and proce dural aspects an uncontrolled and uncanalised power conferred on an officer is an unreasonable restriction on such right though a legislative policy may have been clearly expressed in a statute it must also pro
vide a suitable machinery for implementing that policy in accordance with the principles of natural justice whether a restriction is reasonable or not is a justiciable concept and it is for the Court to come to one conclusion or the other having regard to the considerations laid down by Patanjali Sastri CJ in State of Madras vs V G Row 1and similar others in taking an overall picture of the relevant circumstances the Court may legitimately take into consideration the fact that the discretion is entrusted to a State Government or a highly placed officer but that in it self is of minor importance for the simple reason that the fundamental right itself is guaranteed against the 11952 SCR 597
157 action of the State which is defined to include not only the Union or the State Governments but also Parliament Legislatures and all local or other authorities within the territory of India the distinction between an administrative authority and a judicial authority is not of much relevance in the context of a reasonable restriction except perhaps a Court may more readily be inclined to uphold a restriction if a matter is entrusted to an impartial judicial authority than to an executive authority
Bearing the aforesaid principles in mind let us look at the impugned provisions of the Act
The section has been extracted supra
The first part of the section confers a free and unqualified discretion on the Commissioner to grant a licence
A discretionary power to issue a licence necessarily implies a power to refuse to issue a licence
The word may is an enabling one and in its ordinary sense means Permissible
When coupled with the words at his discretion it emphasises the clear intention of the legis lature to confer on the Commissioner an unrestrained freedom to act according to his own judgment and conscience
If the section stops there it is common case that the power of the Commissioner isuncontrolled and uncanalised
The second part of the section deals with the nature of the conditions to be inserted in the licence
The conditions to be imposed are for securing the good behaviour of keepers of public resort and for the prevention of drunkenness and disorder among the persons frequenting or using such places
No doubt the said conditions must have the sanction of the State Government
This part therefore ensures the peaceful and orderly conduct of business
The section is clear and unambiguous in terms and it is not disputed that the plain terms of the section will not enable the conditions of a licence to be projected into the matter of the exercise of the discretion
But what is contended is that the conditions laid down a precise policy for guiding the discretion of the Commissioner to give or not to give a licence
There are many objections to this approach 158 to the problem
Firstly it is to rewrite the section
If the legislature intended to guide the discretion by laying down objective criteria it would have stated so in express terms it would not have left the matter to the absolute discretion of the Commissioner
Secondly if the two conditions only of the licence control the exercise of the discretion the Commissioner cannot travel beyond the said two conditions
As a result the amplitude of the discretion is drastically cut down
The Commissioner would be able to refuse a licence only if he was satisfied that the applicant could not be relied upon to comply with the said conditions if he was so satisfied he could not refuse a licence in spite of the fact that there were many other good and relevant reasons for doing so
Thirdly if the conditions are not exhaustive but only illustrative the section would continue to suffer from the same vice as it would still be open to the Commissioner to refuse a licence for any other reason
Fourthly discretion based upon an anticipatory breach of conditions will be as arbitrary as in the case of absolute discretion particularly in the case of new applicants as more often than not it will have to be exercised on the basis of surmises gossip or information which may be false or at any rate untested
Lastly by this unwarranted search for an undisclosed policy in the crevices of the statute this Court will not only be finding an excuse to resuscitate an invalid law but also be encouraging the making of laws by appropriate authorities in derogation of fundamental rights
The provisions of sections 47 and 483 of the IV of 1939 bring out in bold relief the distinction between the exercise of a discretion to issue a licence and the imposition of conditions in a licence
Section 47 enjoins on the Regional Transport Authority in considering an application for a stage carriage permit to have regard to the matters enunciated in that section
Section 483 enables the Regional Transport Authority to attach to the permit the conditions detailed in that sub section
While the former section regulates the exercise 159 of the discretion of the Regional Transport Authority issuing a permit the latter describes the nature of the conditions to be inserted in the permit
These provisions no doubt cannot be invoked to construe the provisions of section 39 of the Act but we are referring to them only to show the legislative practice in such matters and to emphasize the fact that the scope of the discretion to issue a licence and that of the power to impose conditions in a licence are different
Therefore on a true construction of the plain words of the statute we cannot hold that any policy reasonably capable of controlling the discretion of the Commissioner has been laid down
Even if the two conditions can be read into the first part of section 39 the arbitrariness is writ large in the manner of exercising the so called guided discretion
In this context it is not necessary to come to a definite conclusion on the question whether the discretion is judicial or executive for whatever be the nature of the discretion it must be tested from the standpoint of reasonableness of the restrictions imposed on a person s right to do business
A citizen of India for the purpose of eking out his livelihood seeking to do an extensive business of an eating house applies to the Commissioner for a licence for without that licence he cannot do business and if he does he will be liable to prosecution
The Commissioner can reject the application on two grounds namely 1 from his antecedents and present conduct it would be unreasonable to think that the petitioner would keep good behaviour and 2 the Commissioner is not satisfied that the petitioner would be able to prevent drunkenness and disorder among the persons frequenting or using the eating house
Admittedly this order is made without giving any opportunity to an applicant to prove that he would satisfy both the tests laid down by section 39 of the Act
The Commissioner is not legally bound to give any reasons for his refusal to give a licence
Even if reasons are given there is no machinery for getting such an order revoked or vacated
The section does not impose a duty on the Commissioner to give reasonable opportunity to an 160 applicant to clear his character or to disprove any un warranted allegations made against him or to prove that he would satisfy both the tests laid down by section 39 of the Act
Nor does the section provide for an appeal against the order of the Commissioner to an appropriate authority
The suggestion that the authority is a high officer in the police department and that he can be relied upon to exercise his discretion properly does not appeal to us for two reasons namely 1 as we have already pointed out the Constitution gives a guarantee for the fundamental right against the State and other authorities and 2 the status of an officer is not an absolute guarantee that the power will never be abused
Fundamental rights cannot be made to depend solely upon such presumed fairness and integrity of officers of State though it may be a minor element in considering the question of the reasonableness of a restriction
Therefore it is clear to our mind that the exercise of the power also suffers from a statutory defect as it is not channelled through an appropriate machinery
We have therefore no hesitation to hold that section 39 of the Act infringes the fundamental right of the petitioner under article 191g of the Constitution both from substantive and procedural aspects
The next question is whether a mandamus will issue against the Commissioner
The Commissioner admittedly has launched criminal proceedings against the petitioner under the provisions of the Act for not taking out a licence under section 39 of the Act
As we have held that section 39 of the Act is constitutionally void a writ of mandamus will issue against the Commissioner of Police Calcutta directing him not to take any further proceedings against the petitioner for not taking out a licence under the provisions of the Act
BY COURT
In accordance with the opinion of the majority this Petition is dismissed with costs


Summary:
By section 39 of the Calcutta Police Act 1866 The Commissioner of Police may at his discretion from time to time grant licenses to the keepers of such houses or places of public resort and entertainment as aforesaid for which no licence as is specified in the Bengal Excise Act 1909 is required upon such conditions 1 1934 LR 61 IA 398
136 to be inserted in every such license as he with the sanction of the said State Government from time to time shall order for securing the good behaviour of the keepers of the said houses or places of public resort or entertainment and the prevention of drunkenness and disorder among the persons frequenting or using the same and the said licenses may be granted by the said Commissioner for any time not exceeding one year
The petitioner whose application for a license in respect of an eating house was refused by the Commissioner of Police Calcutta under the section challenged its constitutional validity on the ground that it conferred arbitrary and unguided powers on the Commissioner to grant or refuse a license without hearing the applicant and was therefore an unreasonable restriction on his fundamental right to carry on his trade guaranteed by article 191g of the Constitution
Held per Kapur Gajendragadkar and Wanchoo JJ that in order to decide whether a provision in a pre Constitution statute like the one in question satisfies
the test of constitutionality laid down by article 19ig read with article 196 of the Constitution the impugned section has to be read as a whole in a fair and reasonable manner and it should not be declared void simply because the considerations relevant to those Articles are not immediately apparent from its language
It is not correct to say that the discretion conferred on the Commissioner by the first part of the section is absolute and that the question of imposing the two conditions mentioned by the second part can arise only after the grant of the license
The two parts read together can lead only to the conclusion that the discretion vested in the Commissioner is guided by the two conditions mentioned in the section namely the securing of good behaviour and the prevention of drunkenness and disorder and a third by necessary impli cation that the applicant must have actual and effective control and possession of the place where he keeps the eating house
Section 39 of the Calcutta Police Act 1866 therefore con fers no arbitrary or uncanalised discretion on the Commissioner unguided by any criteria and does not constitute an unreasonable restriction on the fundamental right to carry on trade under article 19ig of the Constitution
Rustom jamshed Irani vs Harley Kennedy Bom
386 inapplicable
Although there can be no doubt that procedural provisions of a statute also enter into the verdict as to its reasonableness it cannot be laid down as a general proposition that if a licensing statute omits to provide for a hearing or for the giving of reasons for refusal such omission must necessarily constitute an unreasonable restriction on a fundamental right
The Commissioner in passing an order under the section acts administratively and although he must act reasonably there is no duty cast on him 137 to act judicially
Regard being had to the setting in which the impugned section appears in the Act and the circumstances of this case it could not be said that section 39 of the Act was such a restriction
State of Madras vs V G Row   Nagendra Nath Bora vs The Commissioner of Hills Division and Appeals Assam   Nakkuda Ali vs M F De section jayaratne and Express Newspapers P Ltd vs The Union of India  relied on
If an applicant thinks that he has fulfilled the three con ditions and the Commissioner has unreasonably rejected his application he has his remedy under article 226 of the Constitution
Per Subba Rao J It is well settled that restrictions on fundamental rights must not be arbitrary or excessive or beyond what is required in the interest of the general public
Such restrictions have to be tested both from the substantive and the procedural aspects
An uncontrolled or uncanalised power constitutes an unreasonable restriction
Even though the statute may clearly express the legislative policy that cannot be enough unless it provides a suitable machinery for implementation of that policy in accordance with the principles of natural justice
Restrictions are justifiable and in deciding whether a restriction is reasonable or not the Court cannot attach much importance to the fact that the impugned statute vests discretion in the State Government or a high officer
Nor can the distinction between an administrative authority and a judicial one have much relevance except that the Court may be more inclined to uphold the discretion if vested in an impartial judicial authority rather than in an administrative one
State of Madras vs V G Row   Thakur Raghubir Singh vs Court of Wards Ajmer  and Ms Dwarka Prasad Laxmi Narain vs The State of Uttar Pradesh   relied on
Babulal Chandra vs Chief justice and judges High Court of Patna AIR 1954 SC 524 Harishankar Bagla vs The State Of Madhya Pradesh  Union of India vs Bhana Mal Gulzarimal Ltd  and Mineral Development Ltd State of Bihar considered
Thus viewed the plain words of the impugned section cannot be said to lay down any policy reasonably capable of controlling the discretion vested in the Commissioner
The word may  coupled with the words at his discretion  in the first part of the section clearly emphasises the intention of the Legislature to confer absolute power on the Commissioner
The second part deals with the nature of the conditions to be inserted in the license
But the scope of the discretion to issue 18 138 the license and the power to impose conditions in a license are two different matters
Even if the two conditions mentioned in the second part could be read into the first the discretion conferred by the section would still be arbitrary since the section neither requires that the Commissioner should give reasonable opportunity to the applicant to prove that he satisfies both the tests prescribed by it nor that he should give reasons for refusing the license and no appeal is provided for
Consequently  from the substantive as much as the proce dural aspect section 39 of the Act infringes the fundamental right of the petitioner guaranteed by article 19ig of the Constitution