Ram Chander Pawar v. The Assistant Commissioner of Food & Supplies South Delhi

G.S. SISTANI, J. DECEMBER 17, 2013 'ssn' Signed By:RAM DATT Certify that the digital and physical file have been compared and the digital data is as per the physical file and no page is missing. * IN THE HIGH COURT OF DELHI AT NEW DELHI % JudgmentDeliveredon: 17.12.2013 [1J+ W.P.(C)948/2008&CM. no.1863/2008 RAJENDERPRASADSURINDERKUMAR Mr.NitinSehgal,Advocate TIIE ASSISTANCECOMMISSIONERFOOD &SUPPLIES Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents f2J •W.P.(C)5157/2008&CM.No.9860/2008 AGGARWALSTORE Mr.PradeepGuptaand Mr.SureshBharti, Advocates for petitioner GOVT. OF NCT OF DELHI& ANR Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [3] W.P.(C)8386/2007&CMNo.15850/2007 MAIiENDERKUMAR Mr.AnuragMangla,Advocate GOVT. OF N.C.T.OFDELHI& ORS. Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents [4] W.P.(C) 8478/2007 SHOBHA KUMARI Mr.SanjayGoel,Advocate. W.P.(C) 948/2008&ors. ^ THE GOVT. OF NCT OF DELHI&ORS Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [5] W.P.(C)8554/2007 ASHOKPROVISIONSTORE rw! Mr.PradeepGuptaandMr.SureshBharti, Advocates for the petitioner. GOVT OF N.C.T.OF DELHI&ORS. Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [6] W.P.(C)8611/2007&16227/2007 ISHWARCHAND /j " Mr.AnuragMangla,Advocate. GOVT. OF N.C.T.OF DELHI&ORS. Mr.SushilDuttSalwanandMi.Neeraj Chaudhary,Advocatesfor respondents [7] W.P.(C)8634/2007 SfflVSTORE Mr.PradeepGuptaandMr.SureshBharti, Advocates for the petitioner. GOVT. OF N.C.T.OF DELHI& ORS. Mi'.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents [8J W.P.(C)8635/2007 KANTADEVI Mr.PradeepGuptaandMr.SureshBharti, Advocates for the petitioner. W.P.(C)948/2008& ors. GOVT. OF N.C.T. OF DELIH & ORS. Mr.SushilDutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents [9] W.P.(C)9456/2007& CM.No.17820/2007 AGGARWAL STORE Mr.Pradeep Gupta and Mr.SureshBharti, Advocates for the petitioner. GOVT. OF NCT OF DELHI & ORS Mr.Sushil Dutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents [10] W.P.(C) 9616/2007 & CM.No.18087/2007 RIKHAB CHAND PROP. OF M/S J.N.U. CAMPUS STORE Mr.Sanjay Goel, Advocate THE GOVT. OF NCT OF DELHI Mr.Sushil Dutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents [11] W.P.(C) 8820/2007 PAWAN RATION STORE Mr.Pradeep Gupta and Mr.Suresh Bharti, Advocates for the petitioner. POVT. OF NCT OF DELHI & ORS Mr.Sushil Dutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents [12] W.P.(C) 8985/2007 & CM.No. 16923/2007 ASHOK KUMAR AGGARWAL Mr.Sanjay Goel, Advocate. W.P.(C) 948/2008 & ors. THE GOVT. OFNCT OFDELHI& ORS Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocates for respondents [13] W.P.(C)8714/2007& CM.No.16430/2007 DEVINDER GOEL GOVT. OF NCT OF DELHI & ORS Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary, Advocates for respondents [14] W.P.(C) 8646/2007 JANTA STORE Mr.PradeepGuptaandMr.SureshBharti, Advocates for the petitioner. GOVT. OF N.C.T. OF DELHI & ORS. Mr.SushilDutt Salwanand Mr.Neeraj Chaudhary, Advocates for respondents [15] W.P.(C)8819/2007 & CM.No.16625/2007 SARASWATI GENERAL STORE Mr.PradeepGuptaand Mr.SureshBharti, Advocates for the petitioner. GOVT. OF NCT OF DELHI & ORS Through:. Mr.SushilDutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents [16] W.P.(C)8264/2007& CM.No.15614/2007 ANIL KUMAR MISHRA W.P.(C) 948/2008&ors. of Through; Mr.S.K.Chaudhary,Advocate. GOVT. OF N.C.T.OF DELHI&ORS. ' flTw Through; Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [17] W.P.(C)8046/2007&CM.No.15855/2007 SUMERCHANDMOHANLAL Through; Mr.SanjeevKumarGupta,Adv. GOVT. OF NOT OF DELHI Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [18] W.P.(C)262/2008&CM.No.506/2008 SHRISHERSNGH Through; Mr.AnilKumarJangra,Adv. GOVT. OFNCT OFDELHI& ORS ' Through; Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [19] W.P.(C)8523/2007 MEHARCHANDBAL KISHORE - , . Through; Mr.PradeepGuptaandMr.SureshBharti, Advocates for the petitioner. GOVT. OF NCT OF DELHI & ORS • Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [20] W.P.(C)8628/2007&CM.No.16252/2007 RAMDASS GUPTAPROP. OF MOHANSTORE JV.P.(C)948/2008 & ors. Mr.SanjayGoel,Adv. GOVT. OF N.C.T.OF DELHI&ORS. Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesforrespondents [21] W.R(e) 8644/2007 RAM CHANDERPAWAR Mr.NitinSehgal,Adv. THE ASSISTANT COMMISSIONER OF FOOD AND SUPPLIESSOUTHDELHI Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents [22] W.P.(C)620/2008&CMAPPL.1214/2008 RAM AVTAR KAILASH CHAND FPS NO 8184 CIRCLE2 Mr.NitinSehgal,Adv. ASSISTANT COMMISSIONER FOOD AND SUPPLIESDELHI AND ANR Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocates for respondents [23] W.P.(C) 291/2008 LAXMISTOREFPS Mr.Nitin Sehgal,Adv. THE COMMISSIONER FOOD AND SUPPLIES DELHI AND ANR. Respondents Tlirough: Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents W.P.(C) 948/2008 & ors. [24] W.P.(C)5505/2008&CMAPPL.11408/2009 DAYA PRAKASH GUPTA Mr. SanjayMishra,Advocate STATE ANDORS. Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [25] W.P.(C)8645/2007 RADHEYSHYAMANAND Mr.PradeepGuptaandMs.SoniaSharma, Advocates for petitioner GOVT. OF N.C.T. OF DELHI AND ORS. Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [26] W.P.(C)530/2008 CHUNILAL iN Mr.PradeepGuptaandMs.SoniaSharma, Advocates for petitioner GOVT. OF N.C.T. OF DELHI AND ORS. Mr.SushilDuttSalwanand Mr.Neeraj Chaudhary,Advocatesfor respondents [27] W.P.(C)30/2009 M/S SHREEDURGASTORE ••- Petitioner Mr.PradeepGuptaand Ms.SoniaSharma, Advocates for petitioner GOVT. OF N.C.T. OF DELHI W.P.(C) 948/2008 & ors. Page 7of 16 AND ORS Through; Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents [28] W.P.(C)9502/2007 TILAKRAJ Mr.SanjayGoel,Advocate GOVT. OF N.C.T. OF DELHI AND ORS Through; Mr.SushilDuttSalwanandMr.Neeraj Chaudhary,Advocatesfor respondents CORAM: HON'BLEMR. JUSTICEG.S.SISTANI C.S.STSTANl.'J, (ORAL)

¶1Counsel for the parties submitthat facts in all these matters are smiilar. All these petitionsraiseacommonlegal question,which can be disposed of by a commonorder.

¶2Rule. With the consentof counselfor the parties,the writ petitionsare takenup for finalhearingand disposal.

¶3As agreed,the facts of the Writ PetitionNo.948/2008are being noticed. Thepetitionerhas beenrumiingaFairPriceShop sincetheyear 1987. On

19.3.1997,the shopwas visitedand inspectedby officialsofdepartmentof respondentand someirregularitieswere found. Ashowcausenotice-cum-suspension memo dated 31.3.1997 was issued by the then Assistant Commissionerfor violation,as mentionedand simultaneouslyan FIR was lodgedagainstthe authorisation/licenceholder. Reply to the show cause notice was submittedand hearingwas grantedby the Department. Upon hearing,the AssistantCommissioner,Food and Suppliespassedan order W.P.(C)948/2008& ors. dated 25.4.1997 forfeiting entire security amount of Rs.500/- and thereafterrestoredthe Ucenceofthe petitioner. Afterpassingofthe order, the Assistant Coinmissionerdid not resort to any further penal action againstthepetitionerfor cancellationofthe fairpriceshop. Thereafter,the petitionercontinuedto carryon its businesson the basisofhcencegranted by therespondent,withoutany complaintfromthecard-holders. 4, In the meanwhile,in the ciiminalproceedings,initiatedupon registration of the FIR, a judgment dated 22,8.1998 was passed by which the petitioner,thoughconvicted,was releasedon probationfor one year and on paymentofcostsofRs.500/-. Intheyear2007,afteragap ofmorethan 10 years,afresh show causenoticewas issuedon 10.9.2007calhngupon thepetitionerto showcauseas to whythehcencebe notcancelled.

¶5After hearing, by an impugnedorder dated 1.2.2008 hcence of the petitionerhas been cancelled. It is acommoncase ofthe petitionersthat th? impugned order of cancellationpassed by the respondentis unfair, unjustandcontraryto lawand liableto be setaside. 6, Counsel for the petitioners firrther submitted that while passing ttie judgment,the SpecialCourthad madeit clearthatthe orderofconviction couldnot affectthe operationofthe fairpriceshop.

¶7Attentionofthiscourthas been drawnto the judgmentdated22.8.1998,a copy of which has been placed on record. Concludmgportion of the judgmentdated22,8.1998readsas under: "In respectof sentence,accused,SuridnerKumar,Idirectto he shall be releasedon enteringinto apersonalbond mthe sum of Rs 5000/-with asecurityoflike amountandto appear sentencewithinaperiodof1yearswhenevercalledupon to do so and duringtimeto keeppeaceand be ofgoodbehaviour. Accused, Tr^inderLmar shaU also pay Rs.500/-ascosts of proceedings. This shouldnot affectoperationofF.P.S.

¶8It is submittedby counselforthe petitionersthatoncethe respondentshad fV.P.(C)948/2008&ors. issuedshowcausenotice-cum-suspensionmemo dated31.3.1997and after due hearing a penalty of forfeiture of security amount was imposed, petitionerscannot be punishedtwice for the same offence. The second argumentofcounselfor the petitionersis that in view ofSection12 ofthe Probation of Offenders Act, 1958, petitioners do not suffer any disqualification.The third argumentofcounselfor the petitionersis that the show cause notice issued and cancellation order passed is liable to be quashed, as firstly the action initiatedhas become stale; and secondly, violation, if any, of the petitioners stands condoned as licences were renewed subsequentlyfor 10 years and more.

¶9While counsel for the respondent submits that in addition to the administrative action, respondents were entitled to take action as per Clause 6 of Delhi Kerosene Oil (Export and Price) Control Order 1962 dated 5.12.1962, which reads as under; "6. Contravention of the terms and conditions of licence:

(1) If any licenceeor his agent or servant or any other person acting on his behalf contravenes any of the terms and condition or directions or any provisions of this order then without prejudice to any other action that may be taken against licensee according to law, his licence can be suspendedby orderin writingby the Commissioner. Proviso to clause 6(1) order vide Dt. 15.2.80.

(2) Without prejudiceto the provisionsof sub-clause 1 if the Commissioner is satisfied that the licensee has contravened any of the terms and conditionsof a licenceor the directions issued under clause 3-D or any provision of this order and cancellation of his licence is called for, may after giving the licencee a reasonable opportunity of stating his case against the proposed cancellationby order in writing cancel his licence and shall forward a copy thereof to the licensee. W.P.(C)948/2008&ors. 10of16

(3) Notwithstandinganything contains in this clause, where a licencee is convicted by a court of law for breach of the terms and conditions of the licence or contravention of the provisionofthis order the licensingauthoritymay by order in writing, cancel his licence. Provided that no such order shall be passed until the appeal,if any, filed againstsuch convictionis dismissedand whereno suchappealis fileduntilthe periodoflimitationfor filing an appeal expires."

¶10Counsel for the respondentalso relied on Clause 7 of the 1981 Order dated

12.01.1981, i.e. Delhi Specified Articles (Regulations of Distribution)Order, 198! which reads as follows, and submitsthat once the petitioners had committed breach and he/she was convicted the respondentswere boundto cancelthe licenceofthe petitioner: "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 contraventionof any of theprovisions of this Order or any other order madf 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. "

¶11Counselfor the respondentsubmitsthatthe delay is procedural,as in the period of 18 years, 24 AssistantCommissionershad been transferredin one zone, and in another zone 12 Assistant Commissioners were transferred in 10 years. W.P.(C) 948/2008&ors. Page11 of16

¶12In responseto the above,the counselfor the petitionersstatedthatin case the respondentswereto relyupon Clause6ofDelhiKeroseneOil (Export and Price)ControlOrder 1962 and Clause7ofthe orderdated 12.1.1981, the same should have been invokedby them within a shortestperiod of time from the date of the cause of action and in any case within a reasonableperiod of time. It is further contendedthat on account of delay, the respondentsare estopped from relying on Clause 6 of Delhi KeroseneOil (Exportand Price) ControlOrder 1962 and Clause7 ofthe Order dated 12.01.1981,whichwould deem to have been givenup by the respondents,by virtueoftheir conduct;and on the contrary,vestedrights have been createdin favour of the petitionersby continuousrenewal of licenses,whichcannotbetakenaway atthisbelatedstage.

¶13I have heard counselfor the partiesand also perusedthe petitionas also the annexures filed along with the petitions.

¶14The basic facts are not in dispute that the licenses were grantedto the petitionersto run fair price shops/Kerosene,Oil Depots. Upon inspection havingbeen carriedout and some irregularitieshaving been found, show cause notice was issued; hearing was granted and the petitioners were penalized by forfeiting'their security amount or some administrative action was taken. Thereafter, licences of the petitioners were renewed from time to time and only after a gap of more than 10 years, fresh show cause for cancellation of the Fair Price Shop/KODs was issued and the licences were cancelled as according to the respondent, petitioners had incurreda disqualificationhaving been convictedby a criminalcourt, in ttos of the 1962 and 1981 Orders.

¶15Admittedly,action was taken by the AssistantCommissioneragainstthe petitionersand a penalty of forfeitureof securityamount was imposed. No furtheractionagainstthe petitionerswas taken for more than a period W.P.(C) 948/2008 & ors. of 10 years. Thus in my viewhavingnottakenactionfor 10 yearsand on the contraryhavingrenewedlicencesof the petitionerswould amountto condoningthe acts ofthe wrong doer; and after 10 years,the respondents are estoppedfrom takingactionagainstthe petitionershavingwaivedoff their rights by their own conduct, and the respondentsby their own act have condonedthe acts of the wrongdoer and are now estopped from changing their position.

¶16It is settledlaw that astatutoryauthorityis requiredto act reasonablyand fairly.The Apex Courtin PowerControlAppliancesv. SumeetMachines

(P) Ltd.,(1994)2see 448 has held as under: ''Acquiescenceis sittingby, when anotheris invadingthe rightsand spendingmoneyon it. It is a courseofconductinconsistentwith the claim for exclusive rights in a trade mark, trade name etc. It implies positive acts; not merely silence or inaction such as is involvedin laches.InHarcourtv. WhiteSr.JohnRommillysaid: "It is important to distinguish mere negligence and acquiesce." Therefore,acquiescenceis onefactofdelay.Iftheplaintiffstoodby knowinglyand let the defendantsbuildup an importanttrade until it had become necessaryto crush it, then the plaintiffswould be stopped by their acquiescence. If the acquiescence in the infringementamounts to consent, it will be a completedefence as was laid down in Mouson(J.G.) & Co. v. Boehm. The acquiescence must be such as to lead to the inference ofa license to create a new rightin the defendantas was laiddown in Rodgersv. Nowill.

¶17Accordingly,the respondentshave not only sleptover its rightsand, thus, waivedit but also by agreeingto transferthe licensesin the name ofthe W.P.(C) 948/2008&ors. 13 of16 petitionershave reasonablyand fairlygivenarightto petitioners.Further, the respondentsin the presentpetitionshave givena reasonablebeliefto the petitionersthattheirrightsandtitleis good and shallnot be disturbed.

¶18Consequentto raids carried out on different dates in different cases, proceedingswere initiatedagainstdifferentpersonsby respondents.The matters were pursued by the respondentsand the order(s) was/were so passed, were within the knowledge of the respondents. In case the respondents/departmentwas of the view that in addition to the administrativeactionlicenceof authorizationis also to be cancelled,then the respondent/departmentwouldhave been well withinits rights to take appropriateaction within a reasonableperiod of time. Whereas in the presentcases,the departmentin many caseshas onlytakenadministrative actionand passedordersofforfeitureofsecuritydeposit,but decidednot to take extremeactionof cancellationof licence.At this belatedstage,the action ofthe respondenthas becomestale and more so the authorization of person who was actually convictedhas already been transferredto another, which transfer has been' carried out by the respondents department and the new proprietor authorization holder has been continuously running KOD/ Fair Price Shop for years. The above narration of facts would show that the department has been extremely careless and casual in enforcingthe terms of the license, in accordance withlaw, and, thus,respondents'actioncannotbe sustained.

¶19Moreover, in my view the petitioners have not incurred the disqualificationofgrantoflicense/authorizationdue to conviction,as it is settledlaw that a person releasedon probationunder Section 12 of the Probation of Offenders Act shall not suffer any disqualification. In the case of Gulzar v. State of M.P., (2007) 1 SCC 618, it has been held as under: W.P.(C) 948/2008&ors. 14of16 ''....While Section 12 of the PO Act states that the person found guiltyof an ojfenceand dealt with underSection3 or 4 of the PO Act shall not suffer disqualification, if any, attached to the conviction ofan ojfence under any law...."

¶20Respondents counsel has placed rehance upon the report of Justice Wadhwa Committee constituted by the Supreme Court of India. Due to the aforesaid facts and observations, respondents cannot at this stage get benefit of their inaction or the findings on the report.

¶21In view of the aforesaid, present petitioners cannot be penalized, at this stage even more so since the published acts, in some cases, were never committed by the present license holders. A party is bound to act reasonably more so a statutory authority. The authority was under a duty to act reasonably and without prejudice to the rights of the petitioners. Given that the authority has itself renewed to license(s) of the petitioners, they themselves have condoned the earlier convictions. Further by not acting within a reasonable period of time and by agreeing to renew the licenses in the name of petitioners have given the petitioners a reasonable cause to believe that a right has accrued in their favour. Petitioners are also entitled to the benefit of Section 12 of the Probation of Offenders Act. Accordingly, the impugned orders of show cause notices/cancellation orders are quashed.

¶22Rule is made absolute. All the petitions and the applications stand disposed of in above terms. Parties shall bear their own costs.

¶23It is informed that in the case of WP(C)No.9502/2007 in addition to the order of cancellation, other proceedings are also pending. It is clarified that in addition to the order of cancellation, all other proceedings which are stated to be pending in the case of WP(C)No.9502/2007 shall be W.P.(C) 948/2008& ors. decided unaffected by the orders passed by this court in the present proceedings. G.S. SISTANITX DECEMBER 17, 2013 'ssn' W.P.(C) 948/2008 & ors.

Op * IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment Delivered on: 17.12.2013 + W.P.(C) 8644/2007 RAMCHANDERPAWAR Mr.Nitin Sehgal, Adv. THE ASSISTANT COMMISSIONER OF FOOD AND SUPPLIESSOUTHDELHI Mr^SushilDutt Salwan and Mr.Neeraj Chaudhary, Advocates for respondents CORAM: HON'BLE MR. JUSTICE G.S.SISTANI G.S.SISTANI, J. (ORAL) For Order see detailed judgment passed in the matter [W.P.(C) 948/2008].