IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.6876 of 2008 Abhinandan Kumar Sinha son of Rajeshwar Prasad, resident of village Makhdampur, Block & P.S. Korha, District Katihar……Petitioner. Versus 1. The State of Bihar through the Commissioner cum Secretary, Food, Supply and Commerce Department, Old Secretariat, Patna. 2. The District Magistrate, Katihar 3. The District Supply Officer, Katihar 4. The Sub Divisional Officer, Katihar, District Katihar. 5. The Supply Inspector, Koda, District Katihar. ...…….Respondents. For the petitioner : M/s Ramesh Kumar Agrawal and Vikas Kumar Singh, Advocates. For the respondents : Mr. K.K. Jha, SC-18 ----------- 03/ 01.07.2010 Heard learned counsel for the petitioner and learned counsel for the State and its authorities. This writ petition is being considered and decided at this stage at the instance of learned counsel for both the parties. 2. This petition has been filed by the petitioner for quashing order dated 09.01.2008 (Annexure-8) by which the Sub- divisional Officer, Katihar cancelled petitioner’s Licence no.04 of 1999 for running Fair Price Shop on the ground that the District Level Selection Committee had not approved recommendations of the Sub-divisional Officer and the Supply Inspector for revocation of suspension of the petitioner’s licence. 3. It is not in dispute that the petitioner is a fair price shop dealer at village and grampanchayat Makhdampur, Block and P.S. Korha in the district of Katihar and a retail Licence no.04 of 1999 was issued by the authority concerned. On 28.06.2007 the Supply Inspector, Korha sent a letter to the Sub-divisional Officer, 2 Katihar alleging black marketing of rice by the petitioner and on the said recommendation the Sub-divisional Officer, Katihar suspended petitioner’s licence vide order dated 05.07.2007 (Annexure-2) and a show-cause notice was issued by the Sub- divisional Officer, Katihar to explain why his licence should not be cancelled due to black marketing of food grains. Although the petitioner filed his detailed show-cause on 09.10.2007 (Annexure- 3) stating that the seized rice did not belong to him and the same belonged to one agriculturist, namely, Kameshwar Prasad. Subsequently, the Supply Inspector in his letter to Sub-divisional Officer dated 05.11.2007 (Annexure-5) also supported the petitioner’s claim stating that he had not violated any condition of the licence. However, the Collector did not approve the proposal of revocation of suspension order of petitioner’s licence vide order dated 27.12.2007 (Annexurse-7) and subsequently vide order dated 09.01.2008 (Annexure-8) the Sub-divisional Officer cancelled petitioner’s licence. 4. The point raised by learned counsel for the petitioner is that a punishment of suspension of licence for the period of 90 days has been given and hence for the same offence another punishment for cancellation of licence cannot be legally given to the petitioner and that too without any notice by the authorities concerned with regard to cancellation of licence. 5. On the other hand, learned counsel for the respondents submits that this is a matter with regard to food grains 3 meant for B.P.L/Antyodaya Schemes and for that purpose the Supreme Court has laid down some direction in its order dated 02.05.2003 passed in Civil Original Jurisdiction Writ Petition (Civil) No.196 of 2001 for distribution of food grains and in compliance of the said directions the State Government has been passing such orders. He also relies upon Clause 11 of the Bihar Trade Articles (Licenses Unification) Order 1984 (hereinafter referred to as the Bihar Order 1984). 6. Neither any order of the Supreme Court has been produced nor even the counter affidavit filed by respondent nos.3 to 5 shows that by the said order Supreme Court has expressed any view that for an offence both punishments of suspension and cancellation can be granted by the authorities concerned. Hence the said submission made on behalf of the respondents cannot be relied upon. 7. Clause 11 of the aforesaid Bihar Order 1984 was with respect to suspension and cancellation of License and provided as follows:- (i) If any licensee or his agent or servant or any other person acting on his behalf contravenes any of the terms and conditions of the licence, then without prejudice to any other action that may be taken against him under the Essential Commodities Act, 1955 (Central Act 10 of 1955) his licence may be cancelled or suspended with regard to one or more trade articles by an order in writing of the Licensing Authority and an entry will be made in his licence relating to such suspension or cancellation. (ii) No order of cancellation shall be made under this clause unless the licensee has been given a reasonable opportunity stating his case against the 4 proposed cancellation but during the pendency or in contemplation of proceedings of cancellation of licence, the licence can be suspended for a period not exceeding 90 days without giving any opportunity to the licensee of stating his case. Such suspension shall be limited only to those trade articles regarding which contravention has been made by the licensee. 8. Under the aforesaid provision of the Bihar Order 1984 License of such a dealer could have been suspended for an interim period during the pendency of a proceeding against the Licensee, which might culminate in cancellation of his licence, but even that period of suspension was to be limited to ninety days only, whereafter the order of suspension of licence would not have any legal effect. This was also settled by a plethora of decisions of this court including the judgment in case of M/s Yugal Kishore Rastogi vs. The State of Bihar reported in 1988 PLJR 571. 9. However, in the year 2001 the Central Government thought it necessary and expedient to exercise its powers conferred by section 3 of the Essential Commodities Act 1955 (hereinafter referred to as the Act) and to bring the Public Distribution System (Control) Order 2001 (hereinafter referred to as the Central Order 2001) for maintaining supplies and securing availability and distribution of essential commodities under the Public Distribution System. Clause 7 thereof was with respect to licensing. The said Central order 2001 also contained an Annexe having several paragraphs explaining in detail various aspects thereof. 10. Subsequently in view of Clause 7 of the above mentioned Central Order 2001 read with section 3 of the Act, the 5 Bihar Government with prior concurrence of Government of India brought into existence Government of Bihar (Food, Supply & Commerce Department) Public System (Control) Order vide G.S. R. No.01 dated 20.02.2007 (hereinafter referred to as the Bihar Order 2007) with respect to issuance of licence, suspension/cancellation, terms and conditions and regulating the sale and distribution of essential commodities through Fair Price Shops. 11. Clause 7 of the aforesaid Bihar Order 2007 is with respect to suspension and cancellation of licence and provides as follows:- (i) In the light of Hon’ble Supreme Court order in Civil Writ Petition 196/2001, action will be taken against the licensee in following situation:- Licensees, who (a) do not keep their shops open throughout the month during the stipulated period, (b) fail to provide grain to BPL families strictly at BPL rates and no higher, (c) keep the cards BPL household with them, (d) make false entries in the BPL cards, (e) engage in black marketing or siphoning away grains to the open market and hand over such ration shops to such other person/organizations shall make themselves liable for cancellation of their license. The concerned authorities/functionaries would not show any laxity on the subject. (ii) If any licensee contravenes the provision, terms of the licence, duties responsibilities and order of State Government then the Licesing Authority shall suspend/cancel the licence by a written order. 6 (iii) If F.I.R. is lodged against FPS dealers for contravention of an order issued under Essential Commodities Act, 1955, their licence shall be suspended till the matter is pending before the Court of Law. (iv) It shall be necessary to ask show cause by the Licensing Authority to licensee before suspending licence. Licensee will be given a reasonable opportunity stating his case against the proposed cancellation. (v) Suspension of licence shall be for a maximum period of ninety days. In the mean time records relating to suspension of licence should be sent to the District Level Selection Committee within a fortnight from the date of suspension of licence. The Selection Committee after due enquiry shall recommend for revocation of suspension. The Licensing Authority shall act accordingly. (vi) Allocation to FPS dealers shall not be discontinued under any circumstance. In case of suspension or cancellation of licence allocation to a FPS dealer should be tagged to the nearest FPS dealer. (vii) After suspension of licence of the Licensee the consumers shall be tagged to the nearest FPS shops by the respective Block Supply Officer/In charge Block Supply Officer/Supply Inspector. (viii)In general circumstances the tagging of consumers shall not be changed. (ix) All Consumers of APL, BPL and Antyodaya living within the area earmarked for a FPS dealer should be tagged to such a FPS dealer. 12. The above noted Clause-7 of the Bihar Order 2007 clearly shows that unlike Clause-11 of the Bihar Order 1984, there is no provision of interim suspension without show-cause. In the said Bihar Order 2007 suspension is by way of punishment after show-cause whereas cancellation is another punishment after 7 show-cause. It is further clear from a reading of the said provision that suspension under the said Order is not by way of any interim measure until the final order of cancellation is passed, rather both the punishments are distinct and separate. 13. Thus, it was for the authorities to select either to suspend the licence of the petitioner or to cancel it at the very initial stage. Once the punishment of suspension had been chosen by the authority vide order dated 05.07.2007 (Annexure-2) which continued till 05.10.2007 when the period of 90 days ended, there was no question for any further punishment for the same offence, namely, cancellation. In addition to the aforesaid illegality, no notice was given by the authorities to the petitioner before passing the order of suspension of petitioner’s licence, as required under the aforesaid Clause. 14. In the said circumstances, the order of cancellation of petitioner’s licence is absolutely illegal, perverse and cannot be allowed to stand. Thus, the said order of the authority concerned dated 09.01.2008 (Annexure-8) is hereby quashed. Similarly, the order of the District Magistrate dated 27.12.2007 (Annexure-7) by which approval was not granted for revocation of suspension after completion of 90 days is also quashed. Accordingly, this writ petition is allowed. harish/ ( S. N. Hussain, J. )