WPMS/1289/2018
2021 Latest Caselaw 2222 UK

 IN THE HIGH COURT OF UTTARAKHAND
              AT NAINITAL
                ON THE 5th DAY OF JULY, 2021

                              BEFORE:

     HON'BLE SHRI JUSTICE MANOJ KUMAR TIWARI


            Writ Petition (M/S) No.1289 of 2018


BETWEEN:
  Venu Charitable Society                              ....Petitioner
        (Mr. Sudhir Kumar, Advocate)



AND:

     State of Uttarakhand & Ors.                 .....Respondents

        (Mr.   T.S.   Phartiyal,  Addl. C.S.C. for  the     State of
        Uttarakhand/respondent nos.1 and 2 and Mr. Chitrarth Kandpal,
        Advocate for respondent no.3)




                            JUDGMENT

1. Petitioner is a landlord, who has challenged the order passed by Secretary, Medical, Health & Family Welfare on 18.04.2018, whereby appeal, filed by respondent no. 3 against rejection of his application for renewal of drug licence, has been allowed.

2. This writ petition has been filed by Venu Charitable Society, which runs a hospital at Ram Nagar (Nainital). Petitioner owns the hospital building, which has been constructed over lease land.

3. In the year 2010, respondent no. 3 was inducted as tenant by the petitioner in respect of a shop, which is part of the hospital building. Tenancy of respondent no. 3 was subsequently terminated and petitioner filed a suit for eviction against respondent no. 3. The said suit was decreed by learned Judge, Small Cause Court, Ram Nagar vide judgment dated 24.05.2018. Respondent no. 3 challenged the said judgment by filing CLR No. 61 of 2018 and a coordinate Bench of this Court stayed the execution of the judgment passed by learned court below vide order dated 13.06.2018.

4. In the year 2011, respondent no. 3 was granted licence for retail sale of medicines under the provisions of Drugs and Cosmetics Act and the Rules framed thereunder. Upon expiry of term of licence, respondent no. 3 applied for its renewal. His application for renewal was rejected by the Competent Authority vide order dated 12.01.2017. The reason assigned for rejecting the said application was that the application is not in accordance with provision contained in Rule 64 and Rule 65-A of Drugs and Cosmetics Rules, 1945 (hereinafter referred to as "Rules").

5. Respondent no. 3 challenged the rejection of his renewal application by filing WPMS No. 245 of 2017. The said writ petition was disposed of on the ground of alternative remedy with liberty to respondent no. 3 to approach the Appellate Authority. Respondent no. 3 thereafter filed Statutory appeal, which was allowed by Secretary,

Medical, Health & Family Welfare vide order dated 18.04.2018. Feeling aggrieved by the order passed by the Appellate Authority, petitioner Venu Charitable Society has filed this writ petition.

6. Heard Shri Sudhir Kumar, learned counsel for the petitioner, Shri T.S. Phartiyal, Additional Chief Standing Counsel for the State and Shri Chitrarath Kandpal, learned counsel for respondent no. 3 through video conferencing and perused the record.

7. Appeal filed by respondent no. 3 has been allowed on the premise that the Licensing Authority had misread the provision contained in Rule 65-A of the relevant Rules.

8. Rule 65-A of the Drugs and Cosmetics Rules, 1945 is reproduced below for ready reference:-

[65A. Additional information to be furnished by an applicant for licence or a licensee to the licensing authority.--The applicant for the grant of a licence or any person granted a licence under this Part shall, on demand, furnish to the licensing authority, before the grant of the licence or during the period the licence is in force, as the case may be, documentary evidence in respect of the ownership or occupation on rental or other basis of the premises, specified in the application for licence or in the licence granted, constitution of the firm, or any other

relevant matter which may be required for the purpose of verifying the correctness of the statements made by the applicant or the licensee which applying for or after obtaining the licence, as the case may be.]

9. Perusal of Rule 65-A indicates that an applicant for the grant of licence or a licensee is under the duty to furnish to the Licensing Authority, whenever asked, the documentary evidence in respect of ownership or occupation on rental or other basis of the premises specified in the application/licence, besides other aspects.

10. The Appellate Authority has rightly held that even though there is a dispute regarding tenancy between petitioner and respondent no. 3, however, respondent no. 3 is continuing in possession of the shop on the strength of interim order passed by this Court and no application can be rejected merely because there is a tenancy dispute pending between person making application for renewal and his landlord.

11. This Court concurs with the reasoning given by the Appellate Authority. Rule 65-A of the Rules merely provides that an applicant or a licensee shall furnish such additional information to the Licensing Authority, as required by the Licensing Authority, which includes documentary evidence in respect of ownership or occupation on rental or other basis of the premises.

12. Rule 65-A of the Rules, however, does not provide that due to pendency of tenancy dispute between the person making application for licence and his/her landlord, the person making such application will be rendered ineligible. However, the Licensing Authority had misread the provision contained in Rule 65-A of the Rules for rejecting the application filed by respondent no. 3 merely on the ground that some tenancy dispute was pending.

13. In my humble opinion, the view taken by the Appellate Authority is correct and an application for licence cannot be rejected on the sole ground that tenancy dispute is pending before a court of law.

14. In the present case, respondent no. 3 is continuing in possession over the shop in question on the strength of the stay order passed by this Court in CLR No. 61 of 2018. Thus, petitioner cannot achieve the purpose of evicting respondent no. 3 from the shop in question by having recourse to collateral proceedings under Drugs and Cosmetics Act and the purpose can be achieved only after dismissal of the CLR No. 61 of 2018 filed by respondent no. 3.

15. Shri Sudhir Kumar, learned counsel for the petitioner then submits that the application filed by respondent no. 3 was rejected also on the ground that his application is not in accordance with third proviso to Rule 64(2) of the Rules. He has drawn attention of this Court to third proviso to Rule 64(2) of the Rules, which is reproduced below:-

"[Provided also that-

(i) in respect of an application for grant of a licence in Form 20 or Form 21 or both, the licensing authority shall satisfy itself that the premises are on an area of not less than 10 square metres, and

(ii) in respect of an application for the grant of a license-

(a) in Form 20 or Form 21 or both, and

(b) in Form 20B or Form 21B or both, the licensing authority shall satisfy itself that the premises are of an area not less than 15 square metres:"

16. Learned counsel for the petitioner submits that the area of the premises in question, which is used by respondent no. 3 for retail sale of medicines, has area less than 10 square metres which is not sufficient for grant of a licence as per third proviso to Rule 64(2) of the Rules. He thus submits that Licensing Authority was justified in rejecting application filed by respondent no. 3; however, the Appellate Authority has overlooked this aspect of the matter. He further submits that order passed by Appellate Authority is absolutely silent as regards Rule 64(2) of the Rules and there is no discussion on this aspect of the matter.

17. Perusal of the order passed by the Appellate Authority supports the contention raised by learned counsel for the petitioner. Whether the

premises in question meets the requirement of third proviso to Rule 64(2) of the Rules or not has not been considered and discussed by the Appellate Authority. Since the Statute specifies the minimum area requirement for grant of licence, therefore, before granting licence, it is incumbent upon the Competent Authority to examine, whether respondent no. 3 fulfils the requirement regarding area or not.

18. In such view of the matter, the impugned order dated 18.04.2018 passed by Secretary, Medical, Health & Family Welfare is set aside on the sole ground that the area requirement, as specified in third proviso to Rule 64(2) of the Drugs and Cosmetics Rules, 1945, has not been considered by the Appellate Authority.

19. Accordingly, writ petition is allowed. The matter is remitted back to Secretary, Medical, Health & Family Welfare to decide the appeal filed by respondent no. 3 afresh in the light of the provision contained in third proviso to Rule 64(2) of the applicable Rules.

20. For ascertaining the area of the premises in question, Appellate Authority can rely upon report of inspection made in the past and/or Appellate Authority can make/order fresh inspection. It is also made clear that before taking any decision on the appeal, filed by respondent no. 3, petitioner shall also be heard. Respondent no. 3 as well as petitioner shall be at liberty to produce documentary evidence through affidavits before the Appellate Authority

within two weeks. The Appellate Authority shall decide the appeal as early as possible, but not later than ten weeks from the date of production of certified copy of this order.

21. Let certified copy of this order be issued to the parties within 48 hours.

(MANOJ KUMAR TIWARI, J.) Rajni