IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE FIFTH DAY OF MARCH TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION No : 21664 of 2006 Between: M/s. Naik Gas Agencies, IOC Dealer, Adilabad, Rep by its Manager, Sri Ramesh Deshpande, S/o. Gajanan Rao Deshpande, Aged about 49 years, R/o. Adilabad. ..... PETITIONER AND 1 The Joint Collector, (Civil Supplies) Adilabad. 2 The District Supply Officer, Adilabad. .....RESPONDENT(S) Counsel for the Petitioner: MR.T.V.RAMANA RAO Counsel for the Respondents: AGP FOR CIVIL SUPPLIES The Court made the following: THE HON'BLE MR JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION No : 21664 of 2006 ORDER: This writ petition is filed for a writ of Certiorari to quash proceedings dated 21.09.2006 of respondent No.1 whereby the petitioner was directed to deposit an amount of Rs.5,12,188/- towards the alleged excess cost of the accessories pertaining to gas connections. The petitioner is a LPG gas licencee having about 24,900 consumers in and around Adilabad District with about 10 outlets. On a complaint made by one Sama Santhosh Reddy, the District Supply Officer, Adilabad, respondent No.2, held a preliminary enquiry and submitted report dated 13.04.2006 to respondent No.1. Based on the said report, show cause notice dated 11.05.2006 was issued to the petitioner calling for his explanation. The petitioner submitted his explanation on 25.12.2006 and having considered the same, respondent No.1 passed the impugned order directing the petitioner to deposit an amount of Rs.5,12,188/- towards the excess amount collected from the consumers over and above permitted by the India Oil Corporation. Assailing the said order, the petitioner filed this writ petition. Sri T.V. Ramana Rao, learned counsel for the petitioner submitted that the order passed by respondent No.1 suffers from serious illegalities, inasmuch as, the order is purported to have been passed for violation of certain clauses of LPG (Regulation of Supply and Distribution) Order, 1993 (for short, ‘the 1993 Order’), which was repelled by the Liquefied Petroleum Gas (Regulation of Supply and Distribution) Order, 2000 (for short, ‘the 2000 Order’). The learned counsel further submitted that the order is bereft of detailed reasons and was based on material collected behind the back of the petitioner. His further contention is that direction to the petitioner to deposit the abovementioned amount allegedly collected in excess of the permitted charges is outside the scope of clause 28(1) of the A.P. Petroleum Produces (L&R) Order, 1980 (for short, ‘the 1980 Order’) and a fortiori beyond the powers of respondent No.1. Opposing the contention of the learned counsel for the petitioner learned Assistant Government Pleader for Civil Supplies submitted that though the 1993 Order was mentioned in the impugned order, as averred in para 9 of the counter-affidavit, the 2000 Order is made applicable. He further submitted that the petitioner was afforded an opportunity of hearing and the impugned order contains reasons to the extent they are necessary and that though clause 28(1) of the 1980 Order specifically does not confer any power on respondent No.1 to direct the petitioner to deposit the excess amount collected by it, being the licencing authority respondent No.1 has the incidental power to pass such an order. I have carefully considered the submissions of the learned counsel for the parties and perused the record. Let me first dispose of the first contention of the learned counsel for the petitioner. It is true that 1993 Order was repelled by the 2000 Order, but it is not the case of the petitioner that the charges if proved against him do not constitute irregularities under the 2000 Order. Therefore, irrespective of whether the 1993 Order was repelled or not, if the charges are proved, the petitioner is liable for the penalties prescribed under the 1980 Order. It is legally well settled that mere mentioning of a wrong provision does not ipso facto invalidate an order, if it is otherwise valid. (see Municipal Corporation of the City of Ahmedabad v. Ben Hiraben Manilal, State of Karnataka v. Krishnaji Srinivas Kulkarni, Lok Nath and Company, The Mall Shimla v. Commissioner of Wealth Tax, Patiala and Vikarm Singh Junior High School v. District Magistrate (Finance and Revenue) This contention is therefore rejected. With regard to the contention that the impugned order does not contain detailed reasons, in the said order respondent No.1 mentioned that the District Supply Officer inspected the premises of the petitioner on 11.04.2006 along with his Enforcement Staff, Adilabad, and conducted open enquiry by recording the statements of the consumers and upon such enquiry, he detected the following irregularities: “1. The dealer M/s. Naik Gas Agencies, IOC dealer, Adilabad sold the Hose Pipe and Consumer pass book for Rs.220/-. As verified the MRP and invoice i.e., purchase price is Rs.170/- and 5/- respectively. With this it is clear that the Gas dealer collected an amount of Rs.50/- in addition to the MRP from the consumers. The dealer sold 4978 pipes and collected an excess amount of Rs.2,48,900/- (4978 x 50) from LPG consumers. 2. The dealer M/s. Naik Gas Agencies, IOC dealer, Adilabad has collected Rs.307/- instead of Rs.304-15 paisa from the consumers towards the cost of the full gas calendar i.e., the dealer has collected Rs.2.85 paisa from the consumers at godown point and thus for the LPG cylinders supplied as per sales register for the year 2005 is 92,382, they collected an excess amount of Rs.2,63,289/- (92382 x 2.85). 3. Some of the consumers who were present at the time of enquiry reported that the gas distribution boys M/s. Naik Gas Agencies, IOC dealer, Adilabad have collected Rs.20/- to 30/- extra per cylinder kept at the unauthorized storage points of M/s. Naik Gas Agencies, IOC dealer held by private person.” Respondent No.1 in his order mentioned that in the explanation filed by the petitioner, he denied sale of Hose pipe and consumer pass books on higher price and that he collected the excess amount or his distribution boys collected the excess amount from the consumers for supply of cylinders. Having taken note of the said explanation, respondent No.1 mentioned that after going through the explanation and information available on record, it is observed that the gas dealer has not filed any documentary evidence in support of his claim. He further found that the enquiry officer while conducting the enquiry recorded the statements from the consumers, who are available at M/s. Naik Gas Agency, verified the records of the agency and thus came to the conclusion and reported the findings to him and that the explanation of the petitioner was not found convincing. On this premise, respondent No.1 arrived at the conclusion that the petitioner violated condition Nos.6 and 8 of the licence issued under the provisions of clause 4(2) of the 1980 Order and clauses 7 and 8 (c) of the 1993 Order. He then directed the petitioner to deposit the amount of Rs.5,12,188/- allegedly collected by him from its consumers in excess of the permitted charges. A careful perusal of the order shows that respondent No.1 failed to give the details of the customers of the petitioner, whose statements were said to have been recorded by the enquiry officer. He has not discussed in his order the nature of those statements. Further, respondent No.1 committed a serious error in throwing the burden on the petitioner to prove his claim that he has not collected the excess charges. It is not the case of the respondents that the excess charges collected by the petitioner were shown in their records. In the very nature of the allegation that the petitioner collected the charges in excess of charges permitted to be collected by him, the burden heavily lies upon the respondents to prove the said charge on the basis of the evidence collected during the enquiry and which was supplied to the petitioner. The only way to prove the charges against the petitioner is by recording the statements of the consumers in the presence of the petitioner and giving the petitioner a reasonable opportunity of rebutting those statements. In paragraph 5 of the affidavit filed in support of the writ petition, the petitioner has taken the specific plea that the enquiry by the District Supply Officer was conducted behind the petitioner’s back and that the petitioner was not put on notice either at the time of recording the alleged statements or when the records were verified. Though in paragraph 3 of the counter-affidavit, the said allegation was denied and it was stated that the District Supply Officer held enquiry in the petitioner’s godown in the presence of 34 LPG consumers, who came to receive the LPG cylinders, it is not stated that those statements were supplied to the petitioner and he was given an opportunity of rebutting the correctness or otherwise of those statements. The law is well settled that before any order, which is likely to result in adverse consequences to a person, is passed, the person, who is likely to be effected by such an order shall be given a reasonable opportunity of hearing. (State of Orissa vs Binapani Devi, Swadeshi Cotton Mills vs Union of India and Menaka Gandhi vs Union of India) Unless the petitioner was supplied with the alleged statements of the 34 consumers and given an opportunity of rebutting those statements, the respondents are not justified in relying upon those statements to penalize the petitioner. Therefore, I have no manner of doubt that the decision making process leading to the passing of order dated 21.09.2006 is vitiated by violation of principles of natural justice. The impugned order also suffers from the vice of lack of detailed reasons. Respondent No.1 has not given the details of the consumers whose statements were recorded and the contents of those statements. It is only in the counter-affidavit that a detailed explanation is given. As held by the Supreme Court in Commissioner of Police, Bombay v Gordhandas Bhanji and Mohinder Singh Gill and another v The Chief Election Commissioner, New Delhi and others a statutory authority cannot supplement the reasons in its affidavits that subsequently filed before the Court if they are not otherwise contained in its order. The impugned order is therefore liable to be set aside. As regards the last contention of the learned counsel for the petitioner that respondent No.1 has no power to direct deposit of the amount purported to have been collected by the petitioner in excess of the permitted charges, it is not in dispute that respondent No.1 exercised its powers and passed order under clause 28 (1) of the 1980 Order, which reads as under: “Contravention of Conditions of Licence/ Registration Certificate/Supply Card/Provisions of this Order:- (1) No holder of a licence or registration certificate or supply card issued under this order or his agent or servant or any other person acting on his behalf shall contravene, attempt or abet the contravention of any of the provisions of this order or any of the conditions of the licence/registration certificate or any directions issued there under if any such holder or his agent or the servant or any person acting on his behalf contravenes any of the said terms or conditions may be cancelled or suspended for such period as may be specified by an order in writing by the licensing authority. Provided that no order shall be made under this clause unless the licensee or the holder of registration certificate has been given a reasonable opportunity for representing his case in writing and also having heard in person against the proposed cancellation.” From the above re-produced order, it is clear that respondent No.1 is vested with the power to cancel or suspend the licence, registration certificate or the supply card of the holder of a licence or registration certificate or supply card for contravention of any of the terms and conditions of the same. Thus, the power to impose the penalties having been restricted to cancellation or suspension, the direction to the petitioner to deposit the abovementioned amount is wholly without jurisdiction. The plea of the learned Assistant Government Pleader that respondent No.1 has got incidental power to pass such an order is without any basis, because the order directing recovery of alleged excess charges is substantive in nature and unless the authority vested with the power to pass such an order, it is beyond his power to pass such an order of recovery. The respondents, at best, can seek recovery of the alleged excess charges from the petitioner by approaching a Court of competent jurisdiction. For the abovementioned reasons, the writ petition is allowed and the impugned order is set aside. The amount of 50% directed to be deposited by this Court on 18.09.2007 shall be returned to the petitioner if he has already deposited, within a period of four weeks from the date of receipt of a copy of this order. Respondent No.1 shall be free to initiate fresh enquiry and pass appropriate orders in the light of the observations made supra. As a sequel to disposal of the writ petition in the manner indicated above, WPMP.No.27469 of 2006 filed by the petitioner for interim relief is disposed of as infructuous. C.V. NAGARJUNA REDDY, J Date: 05.03.2008 ES