Qamruddin vs D.M Lucknow & Ors
2017 Latest Caselaw 3148 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

A.F.R.
 
Court No. - 5
 
Case :- MISC. SINGLE No. - 16613 of 2016
 
Petitioner :- Qamruddin
 
Respondent :- D.M Lucknow & Ors
 
Counsel for Petitioner :- Shafiq Mirza,Humayun Mirza
 
Counsel for Respondent :- C.S.C
 
connected with
 
Case :- MISC. SINGLE No. - 16615 of 2016
 
Petitioner :- Mahmoodul Hasan
 
Respondent :- D.M Lucknow & Ors
 
Counsel for Petitioner :- Shafiq Mirza,Humayun Mirza
 
Counsel for Respondent :- C.S.C
 

 
Hon'ble Devendra Kumar Upadhyaya,J.

Since the subject matter of both these writ petitions and the issues involved therein are identical to each other, both are being disposed of by the following common judgment and order.

For convenience, the Writ Petition No.16613 (M/S) of 2016 shall be treated to be the leading petition, and in the narration, which follows, facts of the said case shall be mentioned.

Heard Shri Shafiq Mirza, learned counsel for petitioners in both the writ petitions and Shri Kuldeep Pati Tripathi, learned Additional Advocate General assisted by Shri Rajesh Verma, learned Standing Counsel representing the State respondents.

The petitioners in these writ petitions have challenged the validity of the decision of the District Magistrate/Licensing Authority cancelling the license to manufacture fire works and to process and sell the same from their shops. The petitioners have also challenged the appellate order passed by the appellate authority whereby, the appeal preferred against the order of cancellation of license have also been dismissed.

The petitioners are the manufacturers of fire works and they are also sellers of fire works from their shops. They were granted license in License Form No. LE-1 and LE-5 as described in Part 1 of Schedule IV appended with The Explosive Rules, 2008. The license granted to the petitioners was valid up to 31.3.2015. It appears that the place of manufacturing and the shop from where the petitioners of both these writ petitions have been operating are located in each others neighborhood.

On 15.3.2014, some incident was reported to have occurred in the vicinity of the petitioner's shop and the manufacturing unit, in which certain casualties had taken place. The matter appears to have been reported to the District Administration and on asking of the District Magistrate, who is the Licensing Authority, a joint report dated 18.3.2014 was submitted by the Sub Divisional Magistrate and Circle Officer, Mohanlalganj, Lucknow on the basis of which licenses of the petitioners were suspended on 29.3.2014. The suspension order dated 29.3.2014 is on record as Annexure 3 to the writ petition No.16613 (M/S) of 2016. In fact it is a composite order of suspension and a show cause notice requiring the petitioners to submit their explanation as to why the licenses may not be cancelled. The show cause notice dated 29.3.2014 makes a mention of the report submitted by the Joint Committee of the Sub Divisional Magistrate and Circle Officer, Mohanlalganj, Lucknow dated 18.3.2014. The said show cause notice also mentions the gist of the report submitted by the Joint Committee of the Officers. However, no other material finds mentioned in the show cause notice dated 29.3.2014. The petitioners submitted their reply to the show cause notice which are also on record stating therein that petitioners have been manufacturing and selling the fire works in accordance with the requirement of the Rules and as such there was no occasion for the Licensing Authority to cancel the same.

The licenses of the petitioners have been cancelled by means of a purported order dated 18.9.2015 which has been annexed as Annexure 1 along with an affidavit filed in support of an application dated 11.5.2017. The said decision of the District Magistrate dated 18.9.2015 is not in the form of any order passed by him rather it only accords approval to the report submitted by three Officers namely Senior Assistant (Arms), In-charge Officer (Arms), and Additional District Magistrate (West), Lucknow. In the report dated 16.9.2015, on which only approval has been accorded by the District Magistrate, a mention has been made of the report submitted by the Chief Fire Officer on 15.9.2015. Based on the said report of the Chief Fire Officer, three members Committee in its recommendation dated 16.9.2016 has stated that considering the report submitted by the Chief Fire Officer, it is not safe to permit the petitioners' license to be continued. It also makes a mention of the incident which had taken place in the month of March, 2014 in village Amethi, Thana Gosaiganj. District Lucknow.

Looking to the fact that purported decision taken by the District Magistrate canceling the license of the petitioners was not in the form of an order which is required to be passed by the District Magistrate/ Licensing Authority, the original record relating to the matter was summoned which has been perused by the Court. On perusal of the original record what transpires it that the District Magistrate has not passed any order rather he has only appended his signatures on the recommendation made by the three members Committee dated 16.9.2015 comprising of Senior Assistant (Arms), In-charge Officer, (Arms) and Additional District Magistrate, (West), Lucknow.

Shri Kuldeep Pati Tripathi, learned Additional Advocate General, has attempted to defend the action on the part of the District Magistrate by submitting that though the District Magistrate has not passed any separate order, however, he has approved the recommendation made by the three members Committee which has submitted its report on 16.9.2015 and as such the course adopted by the District Magistrate while taking decision in canceling the license of the petitioners meets the requirement of law and Rules as such no illegality can be attributed to the decision taken by the District Magistrate.

I am afraid that the submissions made by the Additional Advocate General in this matter cannot be sustained for more than one reasons.

The grant of licenses of various types and their revocation/cancellation are the matters which are governed by The Explosives Rules, 2008 framed by the Central Government in exercise of its powers vested in its under Section 5 of The Explosives Act, 1884. Rule 118 of The Explosives Rules, 2008 provides that a license granted under the said Rules shall stand cancelled in certain situations. The said Rule further provides that every license granted under the Rules is liable to be suspended and cancelled by an order of the Licensing Authority "in case, any provision of the Act or the Rules or any condition of the license is found to be contravened."

Rule 118 (III) also empowers the Central Government to revoke or cancel a license if the Central Government is satisfied that there are sufficient grounds to do so. The proviso appended with Sub Rule (1) (III) provides that before suspending or cancelling a license, the holder of the license shall be given an opportunity of being heard. Sub Rule 5 of Rule 118 carves certain exceptions to the proviso appended to Sub Rule 1 of Rule 118. According to Sub Rule 5 of Rule 118, opportunity of being heard may not be given to a license holder before the order of suspension or cancellation is passed. It further provides that where the license is suspended or cancelled by the Central Government, if it considers that in the public interest or in the interest of the security of the State, such opportunity should not be given, opportunity of hearing can be denied.

Rule 118 of The Explosive Rules 2008, is extracted hereinbelow;

"118. Suspension and revocation or cancellation of licence.--(1) Every licence granted under these rules shall--

(I) stand cancelled, if--

(a) the licensee has ceased to have any right for the lawful possession over the

licensed premises;

(b) the licensee is convicted and sentenced under any criminal offences or ordered to execute under Chapter VIII of the Code of Criminal Procedure, 1973( 2 of 1974), a bond for keeping peace for good behaviour.

(II) stand cancelled, if the no-objection certificate is cancelled by the authority issuing the same or District Magistrate or the State Government in accordance with rule 115.

(III) be liable to be suspended or cancelled by an order of the licensing authority for any contravention of the Act or these rules or of any condition contained in such licence, or by order of the Central Government , if it is satisfied that there are sufficient grounds for doing so:

Provided that before suspending or cancelling a licence under this rule, the holder of the licence shall be given an opportunity of being

heard.

(2) The suspension or cancellation shall take effect from the date specified therein.

(3) An order of suspension or revocation of a licence shall be deemed to have been served if sent by post to the address of the licensee entered in the licence.

(4) The suspension of a licence shall not debar theholder of the licence from applying for the renewal.

(5) Notwithstanding anything contained in sub-rule (1), an opportunity of being heard may not be given to the holder of the licence before his licence is suspended or cancelled in cases--

(i) where the licence is suspended by a licensing authority as an interim measure for violation of any of the provisions of the Act or these 200 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II--SEC. 3(i)] rules or of any conditions contained in such licence and in his opinion such violation is likely to cause imminent danger to the public:

Provided that where a licence is so suspended, the licensing authority shall give the holder of the licence an opportunity of being heard before the order of suspension is confirmed; or

(ii) where the licence is suspended or cancelled by the Central Government, if that Government considers that in the public interest or in the interest of the security of the State, such opportunity should not be given.

(6) A licensing authority or the Central Government suspending or cancelling a licence shall record its reason for so doing in writing."

The facts of the case as deduced not only from the record available on this writ petition but also from the perusal of the original record which has been produced by the learned Additional Advocate General, makes it clear that the instant case is not a case falling in the exception Clauses contained in Sub Rule 5 of Rule 118 for the reason that no such reason emanates in this matter which are mentioned in Sub Clause 5 of Rule 118. The case at hand clearly falls under Sub Clause III of Sub Rule 1 of Rule 118 where the Licensing Authority is empowered to cancel a license provided the License Holder is found to have contravened any of the provisions of the Act, Rule or conditions of license. In such a situation, in terms of the Proviso appended to Clause III of Rule 118, it is incumbent upon the Licensing Authority to give opportunity of hearing to the petitioners. In the instant case, though a show cause notice dated 29.3.2014 was issued by the Licensing Authority i.e. the District Magistrate, Lucknow, however, as to whether the said show cause notice fulfills the requirement of providing opportunity of hearing in terms of the Proviso or not, is an issue which needs consideration by the Court. The show cause notice only makes a mention of the Joint Committee report dated 18.3.2014, submitted by the Sub Divisional Magistrate and the Circle Officer, Mohanlalganj, Lucknow. It also mentions the gist of the report submitted by the said Joint Committee on 18.3.2014. However, the said show cause notice does not make any mention about the report submitted by the Chief Fire Officer which in fact appears to be the basis of the recommendation made by the three members Committee dated 16.9.2015. In fact at the time, when the show cause notice dated 29.3.2014 was issued to the petitioners, the report of the Chief Fire Officer was not on record for the reason that the Chief Fire Officer submitted his report only on 15.9.2015 i.e. after issuance of show cause notice.

The purported decision dated 18.09.2015 by the District Magistrate/Licensing Authority is based on the recommendation of the three members Committee dated 16.9.2015 which, while making the recommendation for cancellation of petitioners' license has relied upon the report submitted by the Chief Fire Officer on 15.9.2015. Thus, it is clear that the petitioners were never ever confronted with the material relied upon by the three members Committee in its report dated 16.9.2015 inasmuch as the petitioners were never provided any copy of the report submitted by the Chief Fire Officer on 15.9.2015. As already observed above, the show cause notice issued to the petitioners on 29..3.2014 did not contain either the report submitted by the Chief Fire Officer or the gist thereof.

If a statute specifically requires giving an opportunity of hearing, the form and manner in which such an opportunity is provided should not be reduced to a mere formality. In fact, in such a situation, the show cause notice ought to be accompanied by all the materials which is intended by the authority concerned to be relied upon for taking impending action against the person concerned. In the instant case, the purported decision by the District Magistrate dated 18.9.2015, is based on three members Committee report dated 16.9.2015 which has relied only on two documents i.e. (i) the report of the Chief Fire Officer dated 15.9.2015 and the incident which had occurred in the year 2014 in village Amethi, Mohanlalganj, District Lucknow. The material which forms the basis for recommendation made by the three members Committee dated 16.9.2015 was never provided to the petitioners. This fact is not denied by the learned counsel representing the State respondents as is apparent from the perusal of the original record which has been produced before this Court. Thus, the impugned decision taken by the District Magistrate is completely unsustainable for want of observance of the provisions contained in the Proviso appended to Section III of Rule 118 (1) of The Explosive Rules, 2008.

The impugned action on the part of the Licensing Authority suffers from glaring illegality for yet another reason. The provision for cancellation of license as contemplated in Rule 118 provides that a license granted to a license holder is liable to be cancelled by an order of Licensing Authority. The Rule making authority thus, while framing Rule 118 (1) mandated the Licensing Authority that license can be cancelled only by passing an order. "Passing of order" is an expression which does not need an elaborate discussion to be understood. An order by an authority can be said to have been passed only if he considers the matter placed before him on the basis of material available and after analyzing the same, the authority concerned applies its mind. In the instant case, there is no ''order' which can be said to have been passed by the District Magistrate. What has been relied upon by the learned counsel representing the State authorities is only a recommendation made by the three members Committee on 16.9.2015, which has been made to the District Magistrate and the District Magistrate appears to have only appended his signatures on the said report on 18.9.2015. An order required to be passed under some statutory Rule must reflect the reasons and it also must reflect the decision making process adopted by the authority concerned while arriving at a conclusion.

For the aforesaid reasons, I have no hesitation to hold that there does not exist any order of cancellation of license as contemplated by Sub Rule III of Rule 118 of The Explosives Rules 2008. The expression "by an order of Licensing Authority" has to be given full meaning keeping in view the fact that the cancellation of license in this case has resulted in extinction of means of livelihood of the petitioners, who are petty fire work makers. Any order cancelling the license, in my considered opinion, should be informed of reasons which in this case are absolutely missing. It is also noticeable that neither The Explosive Act nor the Explosive Rules nor any other law contemplates or mentions of any Committee for the purposes of passing an order by the Licensing Authority for cancellation of license. The procedure, thus adopted by the District Magistrate, while taking the decision cancelling the license of the petitioners, cannot be appreciated rather it is absolutely unlawful and opposed to the provisions contained in The Explosive Rules, 2008.

For the aforesaid reasons, it is strange to notice that even the appellate authority while passing the impugned orders dismissing the appeals preferred by the petitioners has completely failed to examine the aforesaid issues which are involved in the present case while passing the appellate order.

Thus, the impugned decision dated 18.9.2015 as communicated to the petitioners by means of the orders dated 26.9.2015 passed by the District Magistrate as contained in Anneuxre 1 to both these writ petitions are, hereby, quashed. The appellate orders under challenge in both these writ petitions which have been annexed as Annexure 2 to the petitions, are also quashed.

It has been informed at the Bar that the term of license held by the petitioners expired on 31.3.2015. Sri Kuldeep Pati Tripathi, learned Additional Advocate General has thus submitted that the petitioners can now apply only for new license and that in case any such application is made, the same shall be dealt and decision thereon shall be taken in accordance with law. He however, states that since the term of the licenses has already expired on 313.2015, as such the question of their renewal does not arise at all.

The aforesaid submission made by the learned Additional Advocate General cannot be appreciated in the facts and circumstances of the instant case. The licenses of the petitioners were suspended on 29.3.1994 i.e. at the time when the term of the license of the petitioners survived. License has been cancelled by the impugned decision on 18.9.2015 i.e. after the term of the license had already expired on 31.3.2015. The Court in this case has already found that the entire exercise undertaken by the Licensing Authority which culminated ultimately in the cancellation of petitioner's license was absolutely illegal being in contravention of the provisions of law as discussed above.

In such circumstances, while allowing the writ petitions in terms of the aforesaid, it is further directed that the petitioners shall make their application for renewal of their licenses in accordance with the requirement of law and the Rules within three weeks from today. In case any such application is moved by the petitioners seeking renewal of their license, the same shall be considered by the Licensing Authority in accordance with law and the Rules applicable therein. It will be open to the authorities concerned to call for the requisite reports from the authorities at the time of consideration of the application to be moved by the petitioners for renewal of their license. The aforesaid exercise shall be completed within a month from the date of receipt of certified copy of this order along with the application for renewal of licenses.

The writ petition is allowed in the aforesaid terms.

There shall be no order as to costs.

Order Date :- 10.8.2017

Pks