Bombay High Court

Hotel Palkhi International ... vs The State Of Maharashtra And ... on 22 April, 2016

Bench: S.P. Deshmukh

                                          1                    WP-231.16.doc




                                                                         
              IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
                         BENCH AT AURANGABAD




                                                 
                           WRIT PETITION NO. 231 OF 2016




                                                
     Hotel Palkhi International
     Akashwani Road, Sindhi Colony,
     Jalgaon, District Jalgaon
     Through its Proprietor
     Shri Suresh Hukumatrai Jadhavani




                                       
     Age: 49 years, Occ. Business,
     R/o. Plot No.1, Gayatri Nagar, Jalgaon
                             
     District Jalgaon                               ... PETITIONER
                            
              VERSUS


     1.       The State of Maharashtra
              Through the Secretary for
      


              Home Department
              Mantralaya, Mumbai
   



     2.       The Divisional Commissioner,
              Nashik Division, Nashik





     3.       The Collector, Jalgaon
              District Jalgaon                     ...RESPONDENTS


                                 .....
     Mr. V. D. Hon, Senior Advocate i/by Mr. A. V. Hon, Advocate





     for petitioner
     Mr. G. O. Wattamwar, Assistant Government Pleader for
     respondents
                                 .....




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                                       CORAM :      SUNIL P. DESHMUKH, J.

                                        DATE :      22nd APRIL, 2016




                                                          
     ORAL JUDGMENT :

1. Rule. Rule made returnable forthwith and heard finally

with consent of learned advocates for the parties.

2. Factual aspects relevant for consideration in the writ

petition can be referred to as, that the petitioner has been

engaged in business of hotelier and for said purpose has

raised huge amount of loan from financial institutions. The

hotel building had been recently constructed. Business in the

same had been started and had been running smoothly and

peacefully.

3. Around March-April 2015, he has received various

licences, inter alia, eating house, lodging house and

entertainment from the authorities under the Maharashtra

Police Act, 1951.

4. Show cause notices were issued in respect of three

licences referred to herein above, stating that in Ramanand

Nagar Police Station, Jalgaon, a crime bearing No. 71/2015

3 WP-231.16.doc

has been registered under Section 143, 147, 452, 385, 323,

500(2), 504 and 506 on 20th May, 2015 by mother of one

Soham Joshi against petitioner and to show cause, as to why

the licences issued to him be not cancelled.

5. Two guests Ganesh Dhamne and Soham Joshi arrived in

the hotel on 22nd March, 2015 and accordingly, their entry in

the requisite register had been taken. The particulars as had

been given by them, had also been entered in the register.

The guests, early in April-2015, left the hotel without

payment of hotel charges. As such, payment of bill for hotel

charges is due and payable to petitioner.

6. In the beginning of May-2015, it appears that, mother

of aforesaid said Soham Joshi, lodged a complaint with

Ramanand Nagar Police Station, Jalgaon, alleging that among

several persons allegedly demanding money, the petitioner -

hotelier was one, demanding the amount towards bill.

7. With reference to the show cause notices, petitioner had

submitted his reply on 6th May, 2015, specifically referring to

that the notices though refer to various provisions of Indian

Penal Code, however, those do not make reference to any

specific allegation against petitioner. It has been further

4 WP-231.16.doc

referred to that even according to the notices the complaint

appears to be under investigation. The show cause notices do

not level any particular charge, that petitioner committed

breach of terms and conditions of licences, for which those

licences are being considered for cancellation. It had been

submitted that the petitioner has not committed any

irregularity or illegality or for that matter any breach of terms

and conditions of licences. It was contended that notices had

been issued malafide. Subsequently, elaborate replies had

been submitted, pointing out that the hotel had started

running business inter-alia, about six months before. It was

further clarified that the room had been rented out for lodging

to one Mr. Dhamne and one Soham had accompanied him and

as such, his name was also referred to in the register. It was

explained that Mr. Dhamne had been acquainted with a friend

of petitioner Mr. Mohit Changre and therefore advance had not

been insisted upon, particulars were recorded with the

petitioner.

8. By orders dated 26th June, 2015, the petitioner's

licences were cancelled by the District Magistrate, Jalgaon,

referring to that offences have been registered against

5 WP-231.16.doc

petitioner under Crime No. 71/2015 with Ramanand Nagar

Police Station, Jalgaon that Soham Joshi had been allotted

room in the hotel without verifying his age and that people

were invited to hotel and they were allowed to smoke, play

cards and as such, that had been in breach of terms and

conditions.

9. Against aforesaid orders of cancellation of licences, the

petitioner had approached this Court, however, having regard

to alternate remedy available in appeal before the

Commissioner, petitioner was directed to exhaust the same.

Accordingly, an appeal was preferred. Petitioner's request in

said appeal for interim relief had been turned down.

10. Petitioner had been before this court by way of writ

petition No. 9571 of 2015 against refusal to grant interim

relief, and it was directed by this court to decide the appeal

pending before Divisional Commissioner, Nashik, at an early

date. Thereafter, the Divisional Commissioner, Nashik under

his order dated 30th November, 2015 has dismissed the appeal

and as such, petitioner impugns said decision in the present

writ petition.

6 WP-231.16.doc

11. Learned Senior Advocate Mr. Hon submits that all of a

sudden from no where and petitioner was taken by surprise

by show cause notices.

12. Learned counsel contends, it has been particularly made

clear that the petitioner in no way had participated in nor

permitted playing cards or smoking cigarette, in the room.

Petitioner has not approved of such activities. Such activities,

if were or if at all have taken place, those were not known to

the petitioner. Petitioner had not consented to or connived at

the same. Neither hotel nor him had consented any criminal

act or breach of any of the terms and conditions of the

licences. Petitioner further purports to dispute the authenticity

of the bill produced/procured by the police authorities.

13. Learned Senior Advocate Mr. Hon vehemently submits

that Divisional Commissioner has failed to apply his mind to

the facts and circumstances involved in the case. A cursory

reference has been made to that a minor had been allotted a

room for lodging and in the hotel and smoking, playing cards

etc. had taken place. However, for such consideration, as a

matter of fact, according to learned counsel, there is no

7 WP-231.16.doc

material with the authorities concerned to show that the hotel

had ever allowed the people to smoke or play cards.

Explanation about age of Soham has not been given its due.

14. Learned counsel further submits that the major reason

which appears to have weighed is that offences have been

registered against the petitioner. According to learned

counsel, such a consideration is absolutely misplaced in the

present facts and circumstances. Petitioner cannot even

remotely be connected to the alleged offences, for more

reasons than one for in the first place, it is not viable for him

to go after customers seeking recovery of the amounts and

secondly in the present case, the petitioner is being

deliberately dragged to avoid payment of hotel charges. To

get over the liability, allegations and accusations are being

hurled by the complainant making use of their liaison with the

authorities. He submits that simply registration of crime is not

sufficient for cancellation of licences. He refers to and relies

on a case of Dilip J. Bhatia Vs. The Commissioner of Police, Thane

and another", reported in 2001(1) Bom. C.R. 448. He submits that

cancellation of licences is ultra vires the powers and facts and

circumstances.

8 WP-231.16.doc

15. It has been submitted that when the licence holder

himself, if he has been convicted of any offence in any

manner, then only action for cancellation of licence can be

proceeded with, with reference to the breach of the conditions

as are sought to be alleged.

16. It is submitted that Rule 26 of the Keeping Places of

Public Entertainment Rules envisages that unless all the

aspects referred to therein are involved, the action cannot be

taken. According to learned senior advocate in the present

case none of the three aspects, as are required, are involved

in the case.

17. The submission has been advanced without acceding to

or conceding to assume that there is any breach of such

nature in the present case. He submits that, even if it is

assumed for sake of argument that there is a such type of

breach, for a singular breach, such a drastic action cannot be

taken. According to him, this sufficiently indicates that the

authorities have not been acting reasonably and/or rather are

capricious in approaching the matter.

18. Learned senior counsel submits that it is learnt that the

complainant's family is close to some police authorities and

9 WP-231.16.doc

the liaison has been put to misuse and taken disadvantage of

making allegations against petitioner.

19. Learned Assistant Government Pleader submits that,

there has been breach of terms and conditions of licence and

as such, action has been taken. It is being submitted that

from school leaving certificate of Soham Joshi, it appears that

he was minor when he was admitted in the hotel and the

hotel owner has noted his age as 18 years. Although Soham

Joshi was minor, his age has been scored in order to show

him as major. Learned Assistant Government Pleader, as such,

submits that there was sufficient material before the

authorities which led to cancellation of the licences of

petitioner. It cannot be said that the authorities have acted

outside their powers and authority.

20. While considering various aspects argued on behalf of

either side, it would be pertinent to note that the show cause

notices issued were almost identically worded, an extract from

one of those is reproduced herein below which reads as

under;

" vki.kkl ;k uksVhlh}kjs dGfo.;kr ;srs dh] iksyhl vf/k{kd] tGxkao ;kauh fnukad [email protected]@2015 ps i=kUo;s gkWVsy iky[kh baVjuW'kuy tGxkao ;k ukokus [kk|x`g ijokuk ns.;kr

10 WP-231.16.doc

vkysyk vlwu] vkiY;k gkWVsye/;s >kysY;k voS/k izdkjkckcr

jkeuan uxj iksyhl iksyhl LVs'kuyk Hkkx 5] xq +j +ua [email protected] Hkknafo dye 143] 147] 452] 358] 323] 500 ¼2½ ]

504] 506] izek.ks fnukad [email protected]@2015 jksth Lusgk feyhan tks'kh ;kaps fQ;kZnho:u xqUgk nk[ky dj.;kr vkyk vlwu

pkSd'kh varh gkWVsy iky[kh baVjuW'kuy tGxkao ;k ukokus ns.;kr vkysY;k [kk|x`g ijokuk jí gks.ksckcrpk izLrko lknj dsysyk vkgs-

R;kvuq'kaxkus ek>s dk;kZy;krhy nkyuke/;s fnukad

[email protected]@2015 jksth ldkGh 11-00 oktrk lquko.kh Bso.;kr vkysyh vkgs- lnj lquko.khP;k fno'kh vkiyk ys[kh [kqyklk

dkxnir=kalg le{k lknj djkok- lquko.khps fno'kh vkiyk ys[kh [kqyklk izkIr u >kY;kl vkiys dkgh ,d Eg.k.ks ukgh vls x`fgr /k:u gkWVsy iky[kh baVjuW'kuy tGxkao ;k ukokus

vki.kkl ns.;kr vkysyk [kk|x`g ijokuk dzekad [email protected] jí

dj.;kckcrph dkjokbZ dj.;kr ;sbZy ;kph uksan ?;koh -"

21. Perusal of the same would show that it is with reference

to the offences registered against petitioner and others, there

is no specific imputation about breach of terms and conditions

of licences.

22. During pendency of this petition, record had been

produced before this court and on verification of the same,

learned counsel appearing for the parties have to concede to

a position that the record nowhere reveals as to any show

11 WP-231.16.doc

cause notice with regard to breach of terms of licences was

ever being given to the petitioner, albeit learned Assistant

Government Pleader purports to rely upon copy of purported

bill as appearing in the record, which contains bill for smoking

giving according to him sufficient indication of that there is

breach of terms and conditions of licence. Petitioner has a due

licence for liquor vending, however, learned Assistant

Government Pleader submits that, from the same it cannot be

said that liquor has been sold to permit holders. These

submissions although being advanced, those do not relate to

reasons for which impugned orders have been purportedly

passed. There is no reference to aforesaid submissions of

learned Assistant Government Pleader that the petitioner had

committed error or rather illegality in selling liquor and for

that matter he had no licence in respect of the same. In the

absence of any basis for such submissions it is difficult to go

by these submissions.

23. Contention of learned Assistant Government Pleader

that the impugned action would relate to breach of Rule 26

(ii) of "the Keeping Places of Public Entertainment Rules". Rule

26 is reproduced hereinbelow for reference.

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" 26. The Licensing Authority shall have the power in his

discretion at any time to cancel a licence granted under these rules or to suspend it for such period as may specify

or refuse to renew it and to direct the keeper of any place of public entertainment to close such place, either permanently, or otherwise act with reference thereto if the

Licensing Authority is satisfied after such inquiry as he deems fit that;

(i) the licensee is not a suitable person for continuing

to hold the licence;

(ii) in order to prevent any obstruction, inconvenience,

annoyance, risk, danger or damage to the disturbance in such place; or

(iii) the licensee frequently violates the rules/conditions of the licence.

and every person keeping a place of public entertainment shall forthwith comply with such direction. "

24. An unreported judgment rendered by Hon'ble Single

Judge of this court at Nagpur Bench in the case of " Nandlal

Hiralal Gupta Vs. State of Maharashtra and another" in Writ Petition

No. 1547 of 2014 dated 13th July, 2015 has been cited. In

paragraph No.12 of said judgment, the court with reference to

Rule 26 of aforesaid rules has considered thus ;

13 WP-231.16.doc

...................................

....................................

" 12. The other aspect of the matter that requires consideration is the action of cancelling the licence in exercise of powers conferred by Rule 26 of the Rules.

Perusal of Rule 26 indicates that discretion has been granted to the Licensing Authority in the matter of exercising powers on being satisfied after enquiry that

there has been a violation of the conditions of the licence.

The discretion is either to cancel the licence or to suspend it for such period or to refuse to renew the licence. This

discretion has to be exercised after taking into account all the relevant facts and circumstances that have resulted in the breach of the conditions of the licence. Rule 26 of the

Rules does not contemplate cancellation of licence for any and every breach of the conditions of the licence. In fact, a

discretion has been conferred on the Licensing Authority by which the licence either could be suspended or there

could be a refusal to renew the same or then to cancel it. The discretion, therefore, has to be exercised by the Licensing Authority after due consideration of the facts of the case. Sub clause (iii) of Rule 26 refers to frequent

violation of the rules/conditions of the licence. This, therefore, indicates that a singular violation may not always lead to cancellation of the licence and the Licensing Authority in exercise of the discretion conferred could even suspend the same. In case of frequent violation of the conditions of the licence, the Licensing Authority

14 WP-231.16.doc

may in the facts of a particular case cancel the licence or

refuse to renew the same. Rule 26, therefore, expects the Licensing Authority to exercise discretion before it directs

cancellation or suspension or refuses to renew the licence. The order of the Licensing Authority, therefore, should reflect application of mind in that regard".

...................................




                                              
              Looking
                             
                             at    aforesaid    observations,        those      to     a

considerable extent hold and apply in the present case,

rendering the impugned order and action unsustainable.

25. Learned Assistant Government Pleader although is

trying to support the impugned action, the authorities do not

appear to have given any notice in respect of breach of terms

and conditions of licences to the petitioner and as such, such

contention would hardly be of any avail to defend the action

taken by respondents.

26. An aspect, that would be required to be looked into

which has been submitted and argued vehemently on behalf

of the petitioner by learned Senior Advocate Mr. Hon, that

cancellation of licence cannot be justified at all, merely on the

ground that criminal cases are pending against person

15 WP-231.16.doc

concerned. Judgment cited by him in the case of Dilip J. Bhatia

Vs. The Commissioner of Police, (supra) Thane and another", reported

in 2001(1) Bom. C.R. 448 - reads as under;

" (A) Bombay Police Act, 1951, Secs. 110, 117 & 162(2)

--- Cancellation of licence - Of eating house and lodge --- On ground that cases under Immoral Traffic are pending against them --- Held, pendency of cases is no ground for

cancellation of licence unless licensee or his agent is

convicted of such offences. W.P. 1041 of 1985 Date of Decision : 16-8-1985 (D.B.) followed. (Para 11) ".

27. It has been emphasised that the allegations in said case

were of sever nature than the ones involved in the present

case. It was the case involving moral turpitude and the court

has ruled as referred to in head note A.

28. There appears to be considerable force in the

submissions being advanced on behalf of the petitioner. The

action is being taken long after the alleged incident had

occurred based upon a complaint by Mrs. Joshi, criminal

prosecution of which is still on and petitioner has not been

convicted of any offence as yet. The show cause notices do

not allege any breach of terms and conditions in licence.

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