Simplified Explanation of the Judgment
The Patna High Court in February 2021 delivered an important ruling concerning the cancellation of a Public Distribution System (PDS) shop licence in Rohtas district, Bihar. The matter revolved around whether the Sub-Divisional Officer (SDO) had lawfully cancelled the petitioner’s licence, and whether the District Magistrate was correct in upholding that cancellation in appeal.
The petitioner had been granted a PDS licence (Licence No. 1 of 2015). In February 2016, the licensing authority issued him a show-cause notice regarding a discrepancy in his father’s date of birth. The notice required him to reply within two days but did not specifically inform him that the proposed consequence could be cancellation of his licence. Despite his reply, the SDO passed an order on 09.07.2016 cancelling the licence. The petitioner’s subsequent appeal before the District Magistrate was dismissed on 16.09.2016.
Before the High Court, the petitioner argued that the cancellation was unsustainable because:
- The show-cause notice never warned him about the proposed action of licence cancellation.
- He was thus deprived of a fair opportunity to defend himself, violating the Principles of Natural Justice.
The petitioner relied on the earlier decision in Ram Bachan Ram v. State of Bihar & Ors., 2018 (4) PLJR 516, where the Patna High Court had held that cancellation of a PDS licence requires a proper show-cause notice mentioning the proposal of cancellation, and that failure to do so amounts to denial of fair hearing.
The State defended the action, contending that the petitioner’s reply had been duly considered before cancelling the licence. However, it did not dispute the legal requirement under the Bihar Targeted Public Distribution System (Control) Order, 2016, which explicitly mandates sufficient opportunity to be given against the proposal of cancellation.
The High Court, after reviewing Clause 27 of the 2016 Control Order, found that the petitioner was indeed denied reasonable opportunity since the show-cause notice lacked mention of cancellation as a possible action. This omission vitiated the entire proceedings.
Consequently, the Court quashed the orders of both the SDO (dated 09.07.2016) and the District Magistrate (dated 16.09.2016). However, it granted liberty to the authorities to initiate fresh proceedings in accordance with law, if they deemed necessary.
In essence, the Court held that no matter how minor the alleged irregularity, the cancellation of a PDS licence must strictly comply with statutory safeguards and principles of natural justice.
Significance or Implication of the Judgment
- For Fair Administrative Process: The judgment reinforces that government authorities must issue clear, category-specific show-cause notices that explicitly state possible punitive consequences. Otherwise, any adverse order will be struck down.
- For PDS Licence Holders: It offers a safeguard against arbitrary cancellation of ration shop licences. Licence holders are entitled to full and fair opportunity to defend themselves.
- For the Public Distribution System: Ensures that cancellation decisions are not taken hastily or without due process, which in turn safeguards continuity of essential supplies to beneficiaries.
- For Government Officials: Serves as a reminder that even if irregularities are suspected, action must comply with statutory procedure. Shortcuts in procedure can lead to judicial interference and delay.
Legal Issue(s) Decided and the Court’s Decision
- Whether cancellation of a PDS licence without expressly mentioning the proposal of cancellation in the show-cause notice is valid.
- Court’s Decision: No. Clause 27(ii) of the Bihar Targeted PDS (Control) Order, 2016 requires sufficient opportunity against the proposal of cancellation. Since the notice omitted this, the cancellation was illegal.
- Whether the appellate authority could sustain the cancellation.
- Court’s Decision: No. Since the original cancellation was void for violating natural justice, the appellate order had “no legs to stand.”
- Whether authorities can take fresh action.
- Court’s Decision: Yes. Authorities may proceed afresh, but only in accordance with law and after issuing a proper show-cause notice.
Judgments Referred by Parties
- Ram Bachan Ram v. State of Bihar & Ors., 2018 (4) PLJR 516.
Judgments Relied Upon or Cited by Court
- Same: Ram Bachan Ram v. State of Bihar & Ors., 2018 (4) PLJR 516.
Case Title
Akhalakh Ansari v. State of Bihar & Ors.
Case Number
Civil Writ Jurisdiction Case No. 23891 of 2018
Citation(s)
2021(1)PLJR 746
Coram and Names of Judges
Hon’ble Mr. Justice Mohit Kumar Shah
Names of Advocates and who they appeared for
- For the Petitioner: Mr. Sanjay Kumar Tiwary, Advocate
- For the Respondents (State Authorities): Mr. Arvind Ujjwal, SC-4
Link to Judgment
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