M/S.Bharat Stores vs Govt. Of N.C.T. Of Delhi & Ors
2014 Latest Caselaw 1522 Del

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*        IN THE HIGH COURT OF DELHI AT NEW DELHI
+        W.P.(C) 8229/2007
%                                               Judgment dated 21.03.2014


         M/S.BHARAT STORES                                  ..... Petitioner
                      Through :           Mr.Puneet Mittal, Advocate

                            versus

         GOVT. OF N.C.T. OF DELHI & ORS                   ..... Respondents

Through : Mr.S.D. Salwan and Ms.Latika Dutta, Advocate

CORAM:

HON'BLE MR. JUSTICE G.S.SISTANI

G.S.SISTANI, J (ORAL)

1. Present petition has been filed by petitioner under Articles 226/227 of the Constitution of India for issuance of a writ of certiorari or any other writ directing respondent no.1 to 3 to quash the show cause notice dated 27.8.2007 issued by respondent no.3, Assistant Commissioner (North).

2. Rule. With the consent of counsel for the parties, present writ petition is set down for final hearing and disposal.

3. The necessary facts for disposal of the present writ petition are that in the year authorization for running a Fair Price Shop was issued to Shri B.M. Bansal, by the Department of Food & Supplies, Govt. of NCT of Delhi. On 21.7.1992 the present petitioner became a partner to the firm i.e. M/s.Bharat Stores for running the Fair Price Shop (for short, 'FPS') No.7433 in Circle No.13. The licence granted by the department continued till 22.10.2007. A copy of the license dated 21.7.1992, granted

in favour of the petitioner, has been filed along with the writ petition.

4. On 3.9.1992 an inspection was carried out by the Food & Supplies Delhi Administration and upon inspection certain discrepancies were found in the stock. Thereafter in the month of October, 1992 a 'Suspension order cum show cause notice' was issued to the petitioner, wherein in addition to others, following variations were recorded as wheat 32,44,300 short, rice 02,73,300 excess and atta 03,20,000 short. Against the order of suspension-cum-show cause notice, the petitioner filed an appeal before the Commissioner Food and Supplies as provided for in the Delhi Specified Articles (Regulation of Distribution) Order, 1981, whereby the Commissioner was pleased to stay the suspension vide order dated 13.10.1992. On 26.2.1993 'Suspension order cum show cause notice' issued to the petitioner, was disposed off by the respondent no.3 [Asst. Commissioner (Food & Supplies) (North), 23-27, Shooping Complex, Gulabi Nagh, New Delhi, by issuing a warning to the petitioner and directed to maintain proper records in future and further forfeited the entire security amount of Rs.500/-. On 12.8.1998 cognizance was taken by Special Court of Delhi under Section 7 of the Essential Commodities Act under the same alleged misconduct. On 8.12.1998, petitioner and his father pleaded guilty before Special Judge, who was pleased to grant benefit of Section 4 of the Prohibition of Vendors Act and did not impose any sentence of fine or imprisonment on the petitioners, but costs of proceeding was imposed. Thereafter on 23.2.2006 the licence of the petitioner was renewed upto 26.2.2009 on the same terms and conditions. On 27.8.2007 a show cause notice was issued to the petitioners for cancellation of authorization in view of the order passed by the Special Judge in the year 1998. On 16.10.2007 petitioner filed reply to the show cause notice dated 27.8.2007. On 27.10.2007 the impugned cancellation

order was passed on the administrative side by respondent no.1, which has led to filing of the present writ petition.

5. It is the case of the petitioner that petitioner was running the FPS shop for the last 9 years after passing of the judgment dated 8.12.1998; and the impugned show cause notice was issued for cancellation of the licence by respondent no.1 solely on the basis of the judgment dated 8.12.1998.

6. Counsel for the petitioner submits that it is clear that the Show Cause Notice dated 27.8.2007 was issued by respondent on the basis of the directions / letter dated 4th July, 2007 passed by the higher authorities [Central Vigilance Committee].

7. Learned counsel for the petitioner submits that the petitioner cannot be punished for an offence committed by him fifteen years ago. Counsel further submits that during the period of fifteen years the license of the petitioner was renewed from time to time. Counsel also contends that the license of the petitioner cannot be cancelled after such a long gap without any cogent or plausible explanation with regard to delay on the part of the respondents. Counsel also contends that on account of the delay the respondent has condoned the act of the petitioner and the action of the respondent is stale.

8. Counsel contends that it is the case of the petitioner that after the Committee was formed by the Supreme Court of India, sweeping actions were taken without any application of mind and under the fear of strictures being passed and action being taken against the erring officials.

9. Mr.Salwan, learned counsel for the respondent, submits that once the petitioner had committed breach and he was convicted, the respondent was well within its right to take action as per Clause 7 of the 1981 Order dated 12.01.1981, i.e. Delhi Specified Articles (Regulations of Distribution) Order, 1981 which reads as follows:

"7. Cancellation of authorization upon Conviction.- Notwithstanding anything contained in this clause where an authorized wholesaler or a fair price shop holder has been convicted by a court of law in respect of contravention of any of the provisions of this Order or any other order made under Section 3 of the Essential Commodities Act, 1955 (10 of 1955), the Deputy Commissioner may, by order, in writing cancel his authorization forth with :

Provided that where such conviction is set aside in appeal or revision the Deputy Commissioner may on application by the person whose authorization has been cancelled re-issue the authorization to such person."

10. Counsel for the respondent submits that the delay is procedural, as in the period of 18 years, 24 Assistant Commissioners had been transferred in one zone, and in another zone 12 Assistant Commissioners were transferred in 10 years, and, thus, the delay cannot be attributed to the respondent.

11. Learned counsel for the respondent, while placing reliance on the report of Justice Wadhwa Committee, contends that the Supreme Court of India passed an order in WP(C) 196/2001 constituting Central Vigilance Committee to be headed by Mr.Justice D.P. Wadhwa, a retired Judge of the Supreme Court to be assisted by Dr.N.C. Saxena, Commissioner, earlier appointed by Court. The Committee was required to look into the maladies affecting the proper functioning of Public Distribution System (PDS) and to suggest remedial measures. In particular, the Committee was asked to focus on (a) The mode of appointment of the dealer; (b) the ideal commission or the rate payable to the dealers; (c) modalities as to how the Committees already in place, can function better; and (d) modes as to how there can be transparency in allotment of the food stock to be sold at the shops. The Supreme Court further directed that while dealing the question of mode of appointment, the Committee would also suggest as to a

transparent mode in the selection of the dealers. The Committee would also indicate as to how more effective action can be taken on the report of the Vigilance Committee already appointed. The direction was issued initially for the Government of Delhi to be followed on all India basis.

12. It is submitted by counsel for the petitioner that the scope of the directions of the Committee was not to look into the genuine cases and old matters where action had already been taken many years prior to the formation of the Wadhwa Committee. It is further submitted that the petitioner was once issued warning on 26.2.1993 by the respondent, forfeiting the entire security amount; and thereafter on 8.12.1998 the learned Special Judge imposed costs of proceedings for the same offence, thus, he should not be punished again for the same offence by issuing cancellation order dated 27.10.2007 by respondent no.1.

13. Learned counsel for the respondent submits that as per Clause 7 of Delhi Specified Articles (Regulations of Distribution) Order, 1981, it was mandatory upon the respondent to cancel the license of the petitioner after adjudication by a court of law. Counsel further submits that the action was optional as the word, which has been used is 'may' and the same cannot be read as 'shall'. Counsel also submits that there is no question of double jeopardy as the action for cancellation of the license has been taken pursuant to Clause 7 of Delhi Specified Articles (Regulations of Distribution) Order, 1981, which would come into play after the order of conviction has been passed.

14. I have heard learned counsel for the parties and considered their rival submissions. In this case, admittedly, Authorisation No.7433 in Circle No.13 was granted in favour of the petitioner for running a shop. On 3.9.1992 an inspection of the shop of the petitioner was carried out. Subsequently on 7.10.1992 a 'Suspension order sum show cause notice'

was issued to the petitioner, wherein in addition to others, following variations were recorded as wheat 32,44,300 short, rice 02,73,300 excess and atta 03,20,000 short. On 26.2.1993 'Suspension order sum show cause notice' was finalized with giving warning to the firm and forfeiting the security amount in favour of the State. On 12.8.1998 cognizance was taken by Special Court under Clause 7 of Delhi Specified Articles (Regulation of Distribution) Control Order 1981 to explain as to why his license should not be cancelled for the offence committed. On 8.12.1998 petitioner and his father pleaded guilty before Special Judge, who was pleased to grant benefit of Section 4 of the Prohibition of Vendors Act and did not impose any sentence of fine or imprisonment on the petitioners, but costs of proceeding was imposed. Thereafter on 23.2.2006 the licence of the petitioner was renewed upto 26.2.2009 on the same terms and conditions. On 27.8.2007 a show cause notice was issued to the petitioners and finally on 27.10.2007 impugned cancellation order has been passed by respondent no.1 on an administrative side.

15. Admittedly, no administrative action was taken by the respondents against the petitioner for more than 15 years and in fact the license of the petitioner was renewed from time to time.

16. A careful reading of Clause 7 of Delhi Specified Articles (Regulations of Distribution) Order, 1981, would show that the word, which has been used is 'may' and not 'shall' and, thus, it is not for the Court to substitute its interpretation or to give a meaning to a word unless the clause is unhappily worded or requires an interpretation to be given. In my view the word 'may' is to be read as it is and should not be substituted for 'shall' for the reason that the nature of offence committed by an individual would depend on the facts of each case.

17. In this case, there is gross delay on the part of the department i.e. as long

as approximately 15 years. In my view the respondents have condoned the acts of the petitioner by renewing the license of the petitioner year after year and moreover there is no explanation for the gross delay in the matter and further from the date of inspection, which took place in the year 1992, there is no complaint against the petitioner till date. Any action of cancellation would, therefore, cause great prejudice to the petitioner. Even otherwise the petitioners cannot be punished twice for the same offence, as pursuant to a show cause notice the warning was issued to the firm and the security amount was forfeited. Accordingly, impugned order dated 27.10.2007 is quashed.

18. Petition is allowed. The rule is made absolute.

G.S.SISTANI, J MARCH 21, 2014 ssn