171 of 1958
Petition under Article 32 of the Constitution of India for enforcement of fundamental rights
Purshottam Tricumdas Porus A Mehta section N Andley J B Dadachanji Rameshwar Nath and P L Vohra for the petitioners
C K Daphtary Solicitor General of India N section Bindra B H Dhebar and T M Sen for the respondents
December 9
The judgment of Sinha CJ Gajendragadkar Das Gupta and Shah JJ was delivered by Das Gupta J Subba Rao J delivered a separate judgment
DAS GUPTA J
The first petitioner is a Company registered under the Indian Companies Act having its registered office in Bombay and is engaged in the business of dyes chemicals plastics and various other goods
The second petitioner is the Chairman and a Director of the first petitioner Company
In this petition for enforcement of fundamental rights under the Constitution they pray for the issue of a writ of certiorari or other appropriate writ direction or order quashing an order made by the first respondent the Chief Controller of Imports and Exports Government of India New Delhi by which he cancelled five import licences which had been granted to the first petitioner by the Joint Chief Controller of Imports and Exports Bombay
There is also a prayer for an order on the second respondent the Collector of Customs Bombay directing him to assess the goods of the petitioner Company which have been landed in Bombay having been imported on the strength of these licences and allow the petitioner company to clear them
Of these five licences two were dated July 24 1958 two dated August 16 1958 and the fifth 411 dated September 4 1958
The total value of the imports authorised by these five licences was Rs 2575000
The petitioners contend that these five licences were granted to the petitioner Company on five applications sent by them by registered post to the Chief Controller of Imports and Exports Government of India New Delhi three sent on June 17 1958 one on June 26 1958 and the last on July 22 1958
It is further stated that in respect of each of these applications a letter was received by the Company from the office of the Chief Controller of Imports and Exports Government of India New Delhi intimating that their application had been forwarded to the Joint Chief Controller of Imports and Exports Bombay with the necessary comments and asking the Company to contact this officer the Joint Chief Controller of Imports and Exports Bombay direct in the matter
The petitioner Company wrote in each case to the Chief Controller of Imports and Exports New Delhi acknowledging receipt of these letters and at the same time to the Joint Chief Controller of Imports and Exports Bombay requesting that the licences should be issued to them at an early date
After the licences were received by the Company from the office of the Joint Chief Controller of Imports and Exports Bombay the Company placed orders for the goods covered by these licences and some of the goods actually arrived at Bombay
Before however any of these goods could be cleared the Company received a notice dated September 24 1958 stating that whereas there was reason to believe that these five licences had been obtained fraudulently the Government in the exercise of the powers specified in para
9 of the Imports Control Order 1955 proposed to cancel the said licences unless sufficient cause against that was furnished to the Chief Controller of Imports and Exports New Delhi within 10 days of the date of the issue of the said notice 
On September 26 the petitioner Company s solicitors sent a telegram to the Chief Controller of Imports and Exports New Delhi requesting him to give particulars of the alleged fraud and to give them an appointment for inspection of papers 412 and documents relied upon by him
On September 27 Company wrote a letter to the same officer in which they gave a written explanation pointing out various facts and stating that they were victims of foul play by some person interested in causing damage to them and involving their reputation and in order to bring them in bad books with the authorities
In the concluding portion of this letter the Company stated  We also reserve our right to add to amend or alter the explanations contained in this letter hereafter and to submit such further explanations as may become necessary after taking inspection of all the papers and after getting the particulars of the alleged fraud
We shall thank you to give us also an opportunity of a personal hearing in the matter
 This written explanation was handed over to the first respondent by the Company s representatives at an interview with him on September 30
At that interview also it is said the representatives of the Company pointed out to Mr Bilgrami that in the absence of any particulars of the alleged fraud and without inspection of the papers relied upon by him it was not possible for the petitioners to give a complete explanation and that they reserved their right to give further explanation on getting the said particulars and inspection of the said papers
The Company s representatives had another interview with Mr Sundaram Director Administra tion in the Chief Controller s Office on October 14 1958
At this interview the petitioners again requested Mr Sundaram to give them particulars and that they might be permitted to inspect the papers
No particulars were however furnished and no inspection was allowed but on that very date when they had this interview with Mr Sundaram the first respondent made the order of cancellation
The ten grounds set out in Cls
A to L of para
15 of the petition as the basis for the relief resolve on analysis into four only
These are 1 Clause 9a of the Import Control Order under which the order of cancellation has been made is itself unconstitutional being violative of the petitioners  413 rights under article 191f  g and article 31 of the Constitution  2 The Order of cancellation has been made without compliance with the mandatory requirement of cl 10 of the Imports Control Order to give the licensee a reasonable opportunity of being heard  3 The first respondent Mr Bilgrami bad no authority in law to make any order under cl 9 of the Import Control Order 4 The petitioners have been denied equal protection of laws under article 14 of the Constitution inasmuch as other persons similarly situated have been given a proper opportunity and a personal hearing before taking any action against them while the petitioners have been denied a proper opportunity to show cause for the cancellation of licences and personal hearing in the matter
Of these four grounds the third ground viz that Mr Bilgrami had no authority in law to make an order under cl 9 of the Imports Control Order was made in apparent ignorance of the fact that the Chief Controller of Imports and Exports became competent to make an order thereunder in consequence of an amendment made in the Order in 1958
As the clause originally stood the relevant words were  The Central Government or any other officer authorised in this behalf may cancel any licence granted under this order 
By the amendment made on February 27 1958the words or the Chief Controller of Imports and Exports  were inserted after the words the Central Government  in this clause
The position on the relevant dates in September and October 1958 therefore was that the Chief Controller of Imports and Exports New Delhi had authority to cancel any licence granted under the Imports Control Order without being specially authorised in that behalf
It was apparently in view of this position which was pointed out by Mr Bilgrami in his affidavit in opposi tion that the  learned Counsel for the petitioners did not press this ground at all
Nor did he press the fourth ground viz that the petitioners  right under 53 414 article 14 of the Constitution has been infringed
It is obvious that if the order has been made without the petitioners having been given a reasonable opportunity of being heard that itself would entitle them to the relief prayed for
The question whether or not other persons were given a fair opportunity of being heard is entirely irrelevant
In opposition to this application Mr Bilgrami the first respondent contends inter alia that the provision for cancellation of a licence under cl 9 of the Order does not contravene any of the fundamental rights granted under article 191f and g and Art 31 of the Constitution and that the petitioners were given adequate and reasonable opportunity of being heard before the order of cancellation was made
Mr Bilgrami has stated in the affidavit that while it is true that four applications for licence three dated June 17 arid one dated June 26 1958 were received in his office the fact is that all these four applications were rejected and that it is now found that while these four rejected applications were lying in his office four similar applic ations bearing the same dates and containing the same particulars and a fifth application bearing the date July 22 1958 somehow made their appearance in the office of the Joint Chief Controller of Imports and Exports Bombay along with five separate letters one in respect of each application containing recommendations for issue of licences purporting to have been issued from the office of the Chief Controller of Imports and Exports New Delhi under the signature of one Shri M L Gupta Deputy Chief Controller of Imports and Exports
The respondent contends that the purported signatures of Shri M L Gupta on these letters were not genuine
Mr Bilgrami also contends that though these letters purported to state that the issue of licences was authorised by him he did not in fact give any authority and that when the petitioners  representatives interviewed him on September 30 1958 they were told of the  general nature of the fraud  and that he further told them that the issue of the licences had not been authorised by him as they purported to be and that they had been obtained 415 fraudulently
The respondents further contend that when again on October 14 1958 the petitioners had an interview with Mr Sundaram the Director of Administration in the office of the Chief Controller of Imports and Exports Mr Sundaram told them expressly that the recommendations against which the disputed licences were granted to the petitioners were not genuine
The first contention on behalf of the petitioners is that cl 9a of the Imports Control Order is itself invalid as it violates a licensee s rights under article 191f and g and article 31 of the Constitution
Clause 9a is in these words  Cancellation of Licence The Central Government or the Chief Controller of Imports and Exports or any other officer authorised in this behalf may cancel any licence granted under this order or otherwise render it ineffective  a If the licence has been granted  through inadvertence or mistake or has been obtained by fraud or misrepresentation  
As in the present case there is no question of the licences having been granted through inadvertence or mistake it is not necessary for us to consider whether the provision for cancellation of licences on the ground that they have been granted through mistake or inadvertence is invalid
The question in the present case is whether the provision for cancellation of licences on the ground that they have been obtained by fraud or misrepresentation is  a reasonable restriction in the interests of the general public  on the exercise of the petitioners  right under article 191f and It has to be noticed first that here is no case of unbridled authority to cancel a licence nor is there any scope for arbitrary action
If a provision for giving a reasonable opportunity of being heard bad not been made in the Order itself it would have been necessary to consider whether this had still to be given because rules of natural justice required it
No discussion about the requirements of the rule of natural justice is however called for here as cl
10 of the Order provides that no action shall be taken under clauses 7 8 or 9 416 unless the LicenseeImporter has been given a reasonable opportunity of being heard
It is proper to state that the learned Counsel for the petitioners does not attack the validity of the provisions on the ground that it gives unbridled authority to cancel a licence or that the requirements of natural justice have not been sufficiently fulfilled by clause 10
His argument is that though it may not be unreasonable that a licence should be cancelled if the licensee himself has practised fraud in obtaining it cancellation is wholly unreasonable if it is made merely on the ground that it has been obtained by fraud without it being further shown that the licensee himself has been a party to the fraud
It appears to us that in most cases if not in all cases where a licence is obtained by fraud or misrepresentation it would be reasonable to think that the person in whose favour the licence has been obtained cannot but be a party to the fraud or misrepresentation
The petitioners  Counsel submitted that it is possible to imagine a case where an enemy of the person in whose favour the licence is granted procures such grant by means of fraud with the deliberate motive of accusing this person later on of fraud and thereby subjecting him on the one hand to criminal prosecution and on the other hand damaging his reputation and ruining his business
It is unnecessary for us to decide in the present case whether this may ever happen
Clearly however the fact that fraud by which the grant of the licences has been induced by an enemy is wholly immaterial on the present question
The entire scheme of control and regulation of imports by licences is on the basis that the licence is granted oil a correct statement of relevant facts
That basis disappears if grant of the licence is induced by fraud or misrepresentation
Whether the licensee himself or some others party is responsible for the fraud or misrepresentation the fact remains that in such cases the basis of the grant of licence has disappeared
It will be absolutely unreasonable that such a licence should be allowed to continue
We are therefore of opinion that the provision that licence may be cancelled if it is found after giving a 417 reasonable opportunity to the licensee to be heard to have been obtained by fraud or misrepresentation is a reasonable restriction in the interests of the general public on the exercise of the fundamental right of a citizen guaranteed under article 191f and g of the Constitution
The cancellation being under a valid law there can be no question of any right under article 31 of the Constitution having been infringed
This brings us to the main contention pressed on behalf of the petitioners viz that the licensee has not been given a reasonable opportunity of being heard before the order of cancellation was made
There can be no doubt that if a reasonable opportunity to be heard as against the proposed order of cancellation has not been given the order would be an unjustified interference with the petitioners  right
It is necessary therefore to examine the material on the record to see whether the petitioners have succeeded in showing that no reasonable opportunity has been given
The requirement that a reasonable opportunity of being heard must be given has two elements
The first is that an opportunity to be heard must be given the second is that this opportunity must be reasonable
Both these matters are justiciable and it is for the Court to decide whether an opportunity has been given and whether that opportunity has been reasonable
In the present case a notice to show cause against the proposed order was given it was stated in the notice that the ground on which the cancellation was proposed was that the licences had been obtained fraudulently and later on a personal hearing was given
It must therefore be held that the requirement that an opportunity to be heard must be given was satisfied
What the petitioners  Counsel strenuously contends however is that though an opportunity was given that opportunity was not reasonable
In making this argument he had laid special stress on the fact that particulars of the fraud alleged were not given and an opportunity to inspect the papers though repeatedly asked for was not given
It is now necessary to consider all the circumstances in order to arrive at a conclusion whether the omission to give particulars of fraud and 418 inspection of papers deprived the petitioners of a reasonable opportunity to be heard
There can be no invariable standard for  reasonableness in such matters except that the Court s conscience must be satisfied that the person against whom an action is proposed has bad a fair chance of convincing the authority who proposes to take action against him that the grounds on which the action is proposed are either non existent or even if they exist they do not justify the proposed action
The decision of this question will necessarily depend upon the peculiar facts and circumstances of each case including the nature of the action proposed the grounds on which the action is proposed the material on which the allegations are based the attitude of the party against whom the action is proposed in showing cause against such proposed action the nature of the plea raised by him in reply the requests for further opportunity that may be made his admissions by conduct or otherwise of some or all the allegations and all other matters which help the mind in coming to a fair conclusion on the question
The action proposed in the present case viz the cancellation of the five licences was proposed on a tentative conclusion by Mr Bilgrami on the basis of the material in his possession that the five licences bad been obtained fraudulently
The main grounds on which this tentative conclusion appears to have been based were that four applications three dated June 17 and one dated June 26 1958 similar in all particulars to the four which are now found in the office of the Joint Controller of Imports and Exports Bombay had been actually received but had been rejected and were lying in the Chief Controller s Office that four similar applications bearing the same dates and same particulars which were lying in the Bombay Office and also a fifth application dated July 22 were accompanied by five forwarding letters purporting to have been signed by Mr M L Gupta recommending the prayer for licence and containing a statement that the first respondent had authorised such issue of licences on those applications but these signatures purporting to have been of Mr M L Gupta were not really his 419 signatures  that while the forwarding letters purported to state that the issue of these licences prayed for had been authorised by Mr Bilgrami as the Chief Controller of Imports and Exports New Delhi he himself knew that such issue had not been authorised by him
We find that in the very notice that was given to the petitioners  company to show cause against the proposed action of cancellation it was stated that these licences appeared to have been obtained by fraud
On the question of particulars of fraud it has been stated by the first respondent in his affidavit that at that stage no particulars of the fraud could be given by him as they were unknown to him but that be did inform the petitioners  representatives Mr Parikh a director of the Company the second petitioner Mr Rangwala who is the Chairman of the Company and the Company s solicitor Mr Hussaini Doctor of the  general nature of the fraud 
In para 23 of his affidavit Mr Bilgrami has made the following statement  I say that the Director of the petitioners  Company Shri B K Parekh and Shri Rangwala and their attorney s partners Mr Huseni Doctor saw me on the 30th September 1958
I told them that the issue of the licences had not been authorised by me as they purported to be and that they had been obtained fraudulently though at that stage I was unable to say how exactly and by whom the fraud was committed
As also the investigation by the Police was already in progress it was not possible to give minute particulars of the fraud
When the petitioners were told as above the petitioners  chairman started raising contentions suggesting that the fraud might have been committed by reason of the Gujarati Maharashtrian and anti Muslim feeling amongst the employees of his firm
 The affidavit in reply was sworn by Mr Rangwala himself
We find therein repeated denials of Mr Bilgrami s assertion that the Company s representatives were told of the  general nature of the fraud 
It was worth noting however that as regards the categorical statement made in para
23 as to what 420 Mr Bilgrami told Mr Rangwala and others and what they told him there is no clear denial
Dealing with para
23 of Mr Bilgrimi s affidavit in para
of his own affidavit in reply Mr Rangwala after saying that the first respondents statement does not say anything as to how exactly and by whom the fraud was committed but simply added that the first respondent did not say anything beyond the fact that the licences had been obtained by fraud
It is significant that no specific denial was made of Mr Bilgrami s assertion that to Mr Rangwala Mr Parekh and Mr Huseini Doctor he had himself stated that the  issue of the licences had not been authorised by him as they purported to be 
No less important is the fact that Mr Rangwala does riot deny the assertion made by Mr Bilgrami that he Mr Rangwala in the course of that interview on September 30 suggested that the fraud might have been committed by reason of certain feelings amongst the employees of his firm
It is reasonable therefore to believe that besides stating that the licences had been obtained fraudulently Mr
Bilgrami definitely informed the Company s representatives on September 30 1958 that though issue of the licences had been purported to be authorised by him with apparent reference to the forwarding letters recommending the issue of the licences this had not actually been authorised and further that on receipt of this information the Company s representatives instead of saying that no fraud had been practised and that Mr Bilgrami was making a mistake in thinking that he had not authorised the issue of the licences and that perhaps his memory had failed him took refuge behind the plea that it was not the Company but some enemy of the Company who had perpetrated the fraud
The petitioners  representatives had also an interview with Mr Sundaram on October 14 1958
While we have not got any statement of Mr Sundaram himself as to what happened in that interview we find apart from Mr Bilgrami s affidavit in para
24 that Mr Sundaram also informed the petitioners  representatives at that interview that the recommendations 421 against which the disputed licences were granted to the petitioners were not genuine which assertion was repeated in slightly different words in para
29 the fact that the first respondent s letter dated December 18 1958 a copy of which Mr Rangwala annexed to his affidavit in reply concluded with the following words  It may be stated that the fact that the following letters referred to above were not genuine were mentioned to the representatives of your firm when they interviewed Shri D R Sundaram Director Administration on October 14 1958
 Though annexing a copy of this letter to his affidavit in reply Mr Rangwala did not state that this statement in the concluding portion of the letter was not true
This justifies the conclusion that Mr Bilgrami s assertion that Mr Sundaram told the Company s representatives that the forwarding letters containing the recommendations on the basis of which the licences had been issued were not genuine is true
Mr Bilgrami s statement in para
29 of his affidavit is that when Mr Sundaram informed the Company s representatives of this they had no explanation to give
Dealing with para
29 of this affidavit in para
23 of his own affidavit Mr
Rangwala did not state that Mr Sundaram did not tell them that the licences issued were on the basis of documents which were not genuine or that on being so told they had no explanation to offer
On a consideration of the entire background in which the notice for cancellation was issued what was stated by the petitioners in their letter dated September 27 and what we find to have taken place at the interviews on the 30th September and the 14th October specially the fact that the Company s reprepresentatives appeared to have been more concerned to show that the Company was not a party to the fraud than to show that there was no fraud practised at all we are of opinion that the omission to give further particulars or inspection of papers did not deprive the petitioners of a fair chance of convincing Mr Bilgrami that the grounds on which cancellation of the licences was proposed did not exist or even if they existed 54 422 they did not justify cancellation of the licences
We are therefore of opinion that the opportunity that was given to the petitioners in the present case amounted to a reasonable opportunity of being heard against the action proposed
The petitioners are therefore not entitled to any relief
The petition is accordingly dismissed with costs
SUBBA RAO J I have had the advantage of perusing the judgment of my learned brother Das Gupta J
I regret my inability to agree with his conclusion
The facts are fully stated in the judgment of my learned brother and I shall therefore briefly restate only the material facts
The first petitioner Ms Fedco Private Limited hereinafter called the Company is a Company registered under the Indian Companies Act having its registered office in Bombay
It is engaged in the business of dyes chemicals plastics and various other goods
The second petitioner is the Chairman and a Director of the first petitioner Company
The Company sent five applications by registered post to the Chief Controller of Imports and Exports New Delhi hereinafter called the Chief Controller
Three of the applications were dated June 17 1958 one was dated June 26 1958 and the last was dated July 22 1958
In the said applications the Company prayed for the issue of import licences to enable them to place orders and import different types of goods from West In regard to each of these applications received a letter purporting to be from the Chief Controller intimating them that their applications had be en forwarded to the Joint Chief Controller of Imports and Exports Bombay hereinafter called the Joint Controller with the necessary comments
The Company acknowledged the receipt of these letters Thereafter five licences were received from the Office of the Joint Controller Bombay and two of them were dated July 24 1958 another two were dated August 16 1958 and the fifth was dated September 4 1958
On the basis of the said licences orders were 423 placed with a foreign company in West Germany and goods of considerable value actually arrived in the Bombay port
By letter dated September 23 1958 the Joint Controller asked the Company to return the said five licences granted to them without entering into any commitments
After some correspondence between the Company and the Chief Controller the former received a notice dated September 24 1958 from the latter to the effect that the Government had reason to believe that the said licences were obtained fraudulently and therefore they proposed to cancel the said licences unless sufficient cause was shown against such action being taken within ten days of the issue of the said notice
On October 16 1958 the Company received an undated order from the Chief Controller purporting to cancel the said five licences
The Com
pany and their manager filed the present petition under Act
32 of the Constitution praying for a writ of certiorari or other appropriate writ quashing the order of the Chief Controller cancelling the said five licences and directing the Collector of Customs Bombay to assess the goods of the Company which had been imported into India and allow them to clear the same
Mr Purshottam Trikamdas learned Counsel for the petitioners in support of his contentions raised before us two points viz 1 cls
9 and 10 of the Imports Control Order 1955 hereinafter called the Order where under the licences were cancelled infringe the fundamental rights of a citizen under article 191f and g of the Constitution inasmuch as the said provisions constitute an arbitrary and unreasonable restriction on the said rights and 2 the Chief Controller has not complied with the provisions of cl 10 of the Order as he failed to give the Company reasonable opportunity of being heard before the licences granted to them were cancelled and therefore the act of the Chief Controller in cancelling the licences infringes the rights of the Company under article 191f and g of the Constitution
The first point need not be considered as I am clearly of the view that no  reasonable opportunity  within the meaning of cl 10 of the Order was given to the 424 petitioners by the Chief Controller
The material parts of cls
9 and 10 of the Order read clause 9
Cancellation of Licences
The Central Government or any other Officer authorised in this behalf may cancel any licence granted under this Order or otherwise render it ineffective a if the licence has been granted through inadvertence or mistake or has been obtained by fraud or misrepresentation
Clause 10
 Applicant or Licensee to be heard
No action shall be taken under Clauses 7 8 or 9 unless the licenseeImporter has been given a reasonable opportunity of being heard
 It is not disputed that the Central Government delegated its powers to act under these clauses to the Chief Controller
The first question is what is the scope of the enquiry under cl 10 of the Order  Is it purely an administrative act or is it a quasi judicial act  The criteria to ascertain whether a particular act is a quasijudicial act or an administrative one have been laid down with clarity by Lord Justice Atkin in Rex vs Electricity Commissioners Ex Parte London Electricity Joint Committee Co1 elaborated by Lord Justice Scrutton Rex vs London County Council Ex Parte Entertainments Protection Association Ltd 2 and authoritatively restated by this Court in Province of Bombay vs Khusaldas section Advani 3
They laid down the following conditions a the body of Dersons must have legal authority b the authority should be given to determine questions affecting the rights of subjects and c they should have a duty to act judicially
All the three conditions are satisfied in this case
Under the said clauses authority is conferred on the Central Government or any other officer authorized in this behalf to cancel any licence granted under the Order and the cancellation of a licence certainly affects the rights of subjects
A clear duty to act judicially is imposed by cl 10 on the said authority
He has to give to the affected party  reasonable opportunity of of being heard 
It is therefore clear that under 1 2 3  425 cls
9 and 10 of the Order the Chief Controller performs a quasi judicial act and is therefore bound to follow the principles of natural justice in cancelling a licence
Clause 10 clearly and without any ambiguity describes the principles of natural justice by using the three well known words and phrase viz  reasonable opportunity  and  of being heard They imply that when the charge is one of fraud the affected party is entitled to know the particulars of fraud alleged to inspect the documents on the basis of which fraud is imputed to him and to a personal hearing to explain his case and to absolve himself of the charge made against him
Without these elementary safeguards provided by the authority the opportunity to be heard given to the licensee becomes an empty formality
With this background I shall scrutinize the relevant facts to ascertain whether any such reasonable opportunity was given to the petitioners in this case
The question falls to be decided only on the affidavits filed by the parties
I shall assume for the purpose of this petition that the affidavit filed by the Chief Controller represents what all had taken place between him and the representatives of the Company
The notice dated September 24 1958 issued to the petitioners laconically states that the licences granted by the Joint Controller to the Company were fraudulently obtained and therefore it was notified that the Government of India in exercise of the powers specified in paragraph 9 of the Order proposed to cancel the said licences unless sufficient cause against the proposed action was furnished to the Chief Controller within ten days of the date of the issue of the notice
On receipt of the said notice the petitioner Company sent a telegram through their Solicitors requesting the Chief Controller not to publish the said notification
On September 26 1958 the Company s Solicitors sent another telegram to the Chief Controller requesting him to give them the particulars of the alleged fraud and to give them an appointment for inspection of papers and documents relied upon by the Chief Controller
On September 27 1958 the Company sent a letter to 426 the Chief Controller pointing out the relevant facts and stating that the petitioner Company had accepted the licences honestly and had at no time any reason to doubt the bona fides of the grant of the licences to them that they suspected they were victims of foulplay by some persons interested in causing damage to them and to their reputation that Mr B K Parekh a Director of the petitioner Company and the Company s Solicitor Mr Hooseini Doctor met the Chief Controller on September 30 1958 and handed over the explanation to him and also personally told him that in the absence of any particulars of the alleged fraud and without inspection of the papers relied upon by the Chief Controller it was not possible for the petitioner Company to give a complete explanation and that the petitioners reserved their right to give further explanation on getting the said particulars and inspection of the said papers
They also requested the Chief Controller to give the Company a personal hearing to meet the charges after giving the necessary particulars and the inspection of papers asked for
The Chief Controller told them that the issue of the licences had not been authorized by him as they purported to be and that they had been obtained fraudulently though at that stage he was not able to say how exactly and by whom the fraud was committed
He also did not give them the particulars of fraud
The Director of the Company suggested that the fraud might have been committed by reason of the Gujarati Maharashtrian and anti Muslim feeling amongst the employees of the Company
On behalf of the petitioner Company the Chief Controller was told that it was not possible for the Company to give a complete explanation and that they reserved their right to give further explanation
The petitioners were not allowed inspection of the papers
By their letter dated October 3 1958 the Company recorded what took place at the said interview and sent it to the Chief Controller
The petitioners again wrote another letter to the  Chief Controller reminding him that they had not received any particulars of the alleged fraud
This letter was personally handed over to Mr Sundaram 497 the Director of Administration in the Office of the Chief Controller on October 14 1958
At that interview Mr Sundaram told the petitioners that the recommendations against which the disputed licences were granted were not genuine
On October 16 1958 the Chief Controller cancelled the said five licences issued to the petitioner Company
On the aforesaid facts which we have assumed for the purpose of this petition can it be said that the Chief Controller gave the petitioners a reasonable opportunity of being heard  to enable them to establish that no fraud had been committed in getting the said licences  The learned Solicitor General appearing for the respondents contended that the Company admitted the fraud that their only defence was that the fraud might have been committed by reason of the Gujarati Maharashtrian and anti Muslim feeling amongst the employees of the Company and that therefore the fact that the Chief Controller told the petitioners that the issue of the licences had not been authorized by him and the fact that Mr Sundaram told the petitioners on October 14 1958 that the recommendations against which the disputed licences were granted to the petitioners were not genuine were in the circumstances sufficient disclosure of the particulars of fraud and that therefore reasonable opportunity within the meaning of cl 10 of the order had been given to the petitioners
I find it very difficult to accept this argument
The argument assumes that the petitioner Company accepted the version given by the Chief Controller or by Mr Sundaram
For the purpose of this petition it must be assumed that the petitioners were innocent
The notice was given to them to show cause why the licences given to them should not be cancelled on the ground of fraud
By letters and in person they requested the Chief Controller to give them the particulars of the fraud and to allow them to inspect the relevant documents so that they might give a further explanation to show cause against the cancellation of the licences
The affidavit filed by the Chief Controller only discloses that he in his conversations with the Solicitor and the Director of 428 the Company mentioned to them that he did not issue the licences
In the affidavit he admits that they asked for particulars and for the inspection of the documents but he says that the petitioners were told sufficiently what was against them and their demand for the inspection of the papers was mischievous
But what he told them about the particulars of the alleged fraud is in his own words  I told them that the issue of the licences had not been authorised by me as they purported to be and that they had been obtained fraudulently though at that stage I was unable to say how exactly and by whom the fraud was committed  The conversation with Mr Sundaram on October 14 1958 does not carry the matter further
He has not been authorized by the Central Government to make an enquiry and the fact that he told the petitioners that the recommendations against which the disputed licences were granted were not genuine even if true does not carry the matter any further
The fact therefore remains that notwithstanding specific request by the petitioners no particulars were furnished to them no facilities for inspection of the relevant documents given and no date was fixed for the enquiry in regard to the alleged fraud
The learned Solicitor General asked what was that that the petitioners could have gained if the particulars were given and if they were allowed to inspect the relevant documents This is a lopsided way of looking at things
The question should have been what reasonable opportunity to be heard was given to the petitioners to establish their innocence  That apart without apportioning any blame either on the petitioners or on the respondents many possibilities can be visualized viz i the petitioners were guilty of fraud they knew that their applications were rejected by the Chief Controller they got similar applications surreptitiously introduced in the Bombay Office with forged recommendations under the signature of the Deputy Chief Controller New Delhi Mr M L Gupta and obtained the licences by practising fraud on the Joint Chief Controller Bombay ii a third party 429 presumably a rival businessman or members of the staff of the Company evolved a complicated scheme of fraud to cause damage to the Company and their reputation
the Company s enemies came to know that the applications of the Company were rejected then forged fresh applications got them surreptitiously introduced in the Bombay Office and got the licences issued in favour of the petitioners this is a rather far fetched theory iii after the applications were rejected fresh applications were filed in the New Delhi Office got forwarded to the Joint Chief Controller Bombay with the directions issued by the Deputy Chief Controller New Delhi iv the original applications filed by the Com pany were ordered and not rejected by the Chief Controller or his Deputy and they were sent in due course along with the recommendations duly signed by the Deputy Chief Controller to the Joint Controller Bombay and that the licences were issued in the usual course the Office of the Chief Controller New Delhi after realizing that licences were issued contrary to rules or orders that licences should not be issued in respect of goods to be imported from soft currency areas set up a false case of the original applications being rejected and the fresh applications substituted in the Bombay Office
The aforesaid are some of the possibilities and there may be many others
When notice was issued to the petitioners on the ground of fraud they were certainly entitled to the particulars thereof
The Chief Controller could have given the following particulars i the petitioners  applications were rejected on a particular date ii the orders of rejection were communicated to them on a particular date iii that he did not issue any letters to the petitioners as regards the forwarding of their applications or the recommendations to the Joint Chief Controller Bombay iv after the rejection of their applications the Office of the Chief Controller did not receive any letters from the petitioners v that the applications on which the licences were issued were not the same applications sent to the Delhi Office vi that the signature of Mr 55 430 M L Gupta was forged and vii that there is nothing in the Bombay Office to show that they received any applications from the Delhi Office
If these particulars were given to the petitioners they might have by inspecting the documents proved that there was no fraud that there was no order rejecting the applications that the despatch book showed that the applications were forwarded to the Bombay Office and that the original applications were not in that Office that the despatch book and the receipt book showed the correspondence that passed between the Chief Controller and the petitioners and that the signature of Mr Gupta on the recommendations was genuine
It is not as if the petitioners admitted that they committed the fraud
When they were confronted with the notice unless the particulars were given to them and the documents shown to them it was not possible for them to know whether a fraud was committed at all and if committed how was it committed
Only for the purpose of explaining that no fraud was committed by them they asked for the particulars for inspection of the relevant documents and for a personal hearing all these were denied to them
In the circumstances I find it not possible to hold that the petitioners were given reasonable opportunity of being heard within the meaning of cl 10 of the Order
The stakes are high and the order of cancellation was made arbitrarily and in utter disregard of the principles of natural justice
I should not be understood to have expressed any opinion on the merits of the case
It may be or it may not be that the petitioners were guilty of fraud but they should have been given a reasonable opportunity of being heard before they were condemned as having committed the fraud and their licences were cancelled
1 therefore direct the issue of a writ of certiorari quashing the order of the Chief Controller cancelling the licences granted to the petitioners
ORDER OF COURT In accordance with the opinion of the majority the Petition is dismissed with costs


Summary:
The Secretary of the Government of Bihar in the Revenue Department issued a notice to the petitioner company who were the lessees of mining lease charging it with violation of sections 10 12 and 14 Of the Bihar Mica Act 1947 and calling upon it to show cause why action should not be taken to cancel its licence which was being issued from year to year for mining Mica
The company asked for particulars of the alleged violation of the provisions of the Act from the Government which was furnished
The company sent a written representation to the Government denying the allegations
After two years of the said representation the Government issued a notification cancelling the 78 610 petitioner company s licence under the provisions of section 251c Of the Act
The company moved the Supreme Court under article 32 Of the Constitution for the issue of a writ of certiorari to quash the said order of the Government of Bihar cancelling the licence and for the issue of writ of mandamus directing them to forbear from giving effect to the said order of cancellation on ground inter alia that the Government acted illegally and with mala fides and infringed the fundamental rights of the petitioner under article 191 sub cls
f and g of the Constitution and that the provision of section 251c of the Bihar Mica Act 1947 operate as an unreasonable restriction on the said right and even if the said section did not infringe its fundamental rights the order of the Government in cancelling the lease without affording it a reasonable opportunity to show cause within the meaning of the second proviso to that section infringed its fundamental rights
Held that the provisions of section 251c of the Bihar Mica Act does not impose an unreasonable restriction on the fundamental rights under article 191f  g of the Constitution
The restrictions which a State is authorised to impose under cls
5  6 of article 19 of the Constitution in the interest of the general public over the fundamental rights of a citizen under sub cls
f  g of clause 1 of article 19 must be reasonable and must not depend upon the mere uncontrolled discretion of the executive
It is the duty of this Court to decide having regard to the concept and principle of reasonableness which is correctly laid down in The State of Madras vs V G Row whether a particular Statute satisfied the objective test of  reasonableness
 The statutory conditions of the Bihar Mica Act subject to which the licence is given are obviously reasonable and necessary for regulating the mining industry The power to cancel the licence which is conferred on the Government under section 25 Of the said Act is only to achieve the object of the Act ie to enforce provisions which have been enacted in the interest of the public and that power is exercisable on the basis of objective tests and in accordance with the principles of natural justice
The general proposition that whenever discretionary power is conferred on a State Government or the Union Government by law the said law must necessarily operate as a reasonable restriction on a fundamental right negatives the concept of fundamental rights for the simple reason that fundamental rights are guaranteed against State action
Therefore the conferment of such a power on the State Government and not upon a subordinate officer is only one of the considerations that may enter into the judicial verdict on reasonableness of a particular law and the reasonableness of that law falls to be decided only on the cumulative effect of the circumstances under which such power is conferred
611 The concept of  reasonable opportunity  is an elastic one and is not susceptible of easy and precise definition
What is reasonable opportunity under one set of circumstances need not be reasonable under different circumstances
It is the duty of the Court to ascertain in each case having regard to the overall picture before it to come to a conclusion whether reasonable opportunity is given to a person to  show cause
 Tribunals or authorities who are entrusted with quasi judicial functions are as much bound by the relevant principles governing the  doctrine of bias  as any other judicial tribunal
In the instant case the Revenue Minister had personal bias within the meaning of the decisions and he should not have taken part in either initiating the enquiry or in cancelling the licence
Neither the necessary conditions to enable the Government to take action under section 251c Of the Act has been established nor the State Government has afforded reasonable opportunity to the petitioner within the meaning of the second proviso to section 251 Of the Act
State of Madras vs V G Row   followed
Thakur Raghubir Singh vs Court of Wards Ajmer   held inapplicable