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Gopi v. State Of U.P. And Others - WRIT - C No. 23069 of 2007 [2007] RD-AH 9219 (15 May 2007)


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Precedent means

Per incuriam

Right of hearing before suspension of licence of fair price shop - no




Gopi       -------------         Petitioner              


State of U.P. & Ors.        -------------      Respondents


Hon'ble Dr. B.S. Chauhan, J.

Hon'ble  Rajes Kumar, J.

(By Hon'ble Dr. B.S. Chauhan, J.)

This writ petition has been filed for quashing the impugned suspension order passed by Sub Divisional Magistrate, Maharajganj and for directing the Divisional Commissioner, Gorakhpur Region, Gorakhpur to decide the appeal.

The facts and circumstances giving rise to this case are that the petitioner is a licensee of fair price shop. The Sub Divisional Magistrate (respondent no. 3) vide order dated 28.11.2006 suspended the said licence/agreement. Being aggrieved, petitioner filed Appeal No. 12/M of 2006 before the respondent no. 2, wherein, vide order dated 15.12.2006, passed by the respondent no.2, the suspension order dated 28.11.2006 has been kept in abeyance. However, the appeal has not been decided. Hence this petition.

Shri Krishna Nand Yadav, learned counsel for the petitioner has raised large number of issues and submitted that the order of suspension dated 28.11.2006 is liable to be set aside on the ground that the said order had been passed without giving any opportunity of hearing to the petitioner. In support of his submission Shri Yadav has placed a very heavy reliance on the judgments of this Court in Shiv Raj Singh Vs. State of U.P. & Ors, (2007) 1 AWC 54; and Suresh Kumar Gupta Vs. State of U.P. & Ors., 2000 RJ 334. It is submitted that in these judgments the Division Benches of this Court have held that the suspension order cannot be passed without giving opportunity of hearing to the licensee/agent.

We have examined the submissions made by the learned counsel for the petitioner. The judgment in Suresh Kumar Gupta (Supra) has been delivered against the order of cancellation of the licence of fair price shop, granted under the provisions of Essential Commodities Distribution Order, 1990 (hereinafter called the Distribution Order 1990). In the said case no specific period had been prescribed in the show cause notice for submitting the reply. Order of cancellation in such a fact-situation, was held to have been passed in violation of principles of natural justice. Therefore, the facts of the said case were completely distinguishable, and thus the ratio of the said judgment has no application in the facts of the present case.

The judgment in Shiv Raj Singh (Supra) has been delivered by Division Bench of this Court holding that licence of a fair price shop cannot be cancelled without giving opportunity of hearing to the agent. The said judgment has been delivered placing reliance upon the earlier Division Bench judgment of this Court in Ganesha Vs. District Magistrate, Mahoba & Anr., (2001) 2 AWC 996 which was delivered dealing with suspension of the licence issued under the provisions of U.P. Scheduled Commodities Dealers (Licensing & Restriction on Hoarding) Order, 1989 (hereinafter called the Order 1989). The licence of a fair price shop in Shivraj Singh's case had been granted under the provisions of Distribution Order 1990 and not under the provisions of Order 1989. Shiv Raj Singh's case was decided on 11th October, 2006. The Court was not informed, while deciding the said case, that the Government Order 1990 had been repealed by the U.P. Scheduled Commodities Distribution Order, 2004, and therefore, the Order 1990 was not in force. It had also not been pointed out  that the ratio of Ganesha (Supra) was not applicable, for the reason that the Order 1989 contained a provision putting a condition precedent for suspension to give an opportunity of hearing under clause (8) thereof. The said provisions were not applicable in the case of Shiv Raj (Supra). Clause 8 (2) of the Order 1989 reads as under:-

"8 (2) If the licensing authority is satisfied that any such licensee or his agent or servant or any other person setting on his behalf has contravened any provision of this order or the terms and conditions of the licence, it may without prejudice to any other action that may be taken against him by order in writing cancel o suspend his licence either in respect of all scheduled commodities covered by it or in respect of such of these commodities as it may think fit.

Provided that no order shall be made under this sub-clause unless the licensee has been given a reasonable opportunity of stating his case against the proposed cancellation or suspension as the case may be:" (Emphasis added)

Thus, it is evident that giving an opportunity of hearing before passing the order of suspension is mandatory in a case where the licence has been granted under the Order 1989. The said Order 1989 does not apply to fair price shops. No provision analogous to the same has been brought to our notice in Government Order 1990. Even if such a provision was there, Shivraj Singh's case ought to have been decided by making reference to the Government Order 2004.

The relevant provisions of the Government Order 2004 are as under:

"3. Setting up of fair price shop.- With a view to effecting fair distribution of Scheduled Commodities the State Government may issue directions under Section 3 of the Act to set such number of fair price shops in an area and in the manner as it deems fit.

       4. Running of fair price - (1) A fair price shop shall be run through such person and in such manner as the Collector, subject to the directions of the State Government may decide.

(2) A person appointed to run a fair price shop under sub-clause (1) shall act as the agent of the State Government.

(3) A person appointed to run a fair price shop under sub-clause (1) shall sign an agreement, as directed by the State Government regarding running of the fair price shop as per the draft appended to this order before the competent authority prior to the coming with effect of the said appointment.


21. Monitoring in accordance with the order issued by the State Government- (1) A Food Officer shall ensure proper monitoring of fair price shops and prescribe model sale register, stocks register and ration card register in accordance with the order issued by the State Government.   --------------------

22. Power of entry, search, seizure, etc.-     ---------------------

25. Conditions to be observed by the agent- The agent shall observe such conditions as the State Government or the Collector may by an order in writing direct from time to time, in respect of  of opening of shop maintenance of stocks, supply and distribution of Scheduled Commodities, maintenance of accounts, keeping of the registers filing returns and issue of receipt of Identity Card holder and other matters.


27. Penalty- Contravention of provisions of this order shall be liable to punishment in accordance with the orders issued by the State Government from time to time.

28. Appeal- (3) Any agent aggrieved by an order of the competent authority suspending or cancelling agreement of the fair price shop may appeal to the Appellate Authority within thirty days from the date of receipt of the order.


30. Savings.-  Any act performed under the provisions of the Uttar Pradesh Scheduled Commodities Order, 1990, which is hereby repealed prior to commencement of this order shall be deemed to have been validly performed under the provisions of this order."

Government Order 2004 does not contain any specific provision for  suspension or cancellation. However, it is implicit in clause 28 (3), as it provides for appeal against the order of suspension and cancellation. There is no provision analogous to clause 8 (2) of the Order 1989 in Government Order 2004. Therefore, the submissions made by the learned counsel for the petitioner are not worth acceptance.

In Union of India & Ors. Vs. Dhanwanti Devi & Ors., (1996) 6 SCC 44, the Hon'ble Supreme Court examined the issue of precedent observing as under.

"It is not everything said by a Judge while giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. According to the well-settled theory of precedents, every decision contains three basic postulates- (i) findings of material facts, direct and inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is only an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in the judgment.................. The enunciation of the reason or principle on which a question before a court has been decided is alone binding as a precedent. The concrete decision alone is binding between the parties to it, but it is the abstract ratio decidendi, ascertained on a consideration of the judgment in relation to the subject matter of the decision, which alone has the force of law and which, when it is clear what it was, is binding. It is only the principle laid down in the judgment that is binding law under Article 141 of the Constitution. A deliberate judicial decision arrived at after hearing an argument on a question which arises in the case or is put in issue may constitute a precedent, no matter for what reason, and the precedent by long recognition may mature into rule of stare decisis. It is the rule deductible from the application of law to the facts and circumstances of the case which constitutes its ratio decidendi." (Emphasis added).

A similar view has been taken by the Constitution Bench of the Supreme Court in State of Orissa Vs. Sudhansu Sekhar Misra & Ors., AIR 1968 SC 647.

In Uttaranchal Road Transport Corporation Vs. Mansaram Nainwal, (2006) 6 SCC 366 the Hon'ble Supreme Court expressed the same view observing that the enunciation of the reason or principle on which a question before a Court has been decided is alone binding as a precedent.

A Full Bench of this Court in Ganga Saran Vs. Civil Judge, Hapur, Ghaziabad & Ors., AIR 1991 All 114 considered as to whether the judgment of the Hon'ble Supreme Court in Qamruddin Vs. Rasul Baksh & Anr., 1990 All WC 308 was having any binding effect as the law laid down therein had impliedly overruled the Full Bench decision of this Court in M/s. Jupiter Chit Fund (Pvt) Ltd. Vs. Dwarka Diesh Dayal & Ors., AIR 1979 All 218 and came to the conclusion that as the Hon'ble Apex Court decided a case without taking note of the amendment in the Code of Civil Procedure made by the State of U.P., the said judgment did not have binding effect nor it had overruled the Full Bench judgment of this Court on the issue in Jupiter Chit Fund Private Limited (Supra). The Court observed as under:-

"It would not be reasonable to say that the Supreme Court would debar or descent from its earlier decision without even reference to them or without even referring to the relevant provisions of law........ "

It is settled proposition of law that an issue, which has not been considered by the Court while delivering a judgment, cannot be said to be binding as a decision of the Court takes its colour from the questions involved in the case in which it is rendered and while applying the decision to a later case, the Court must carefully try to ascertain the true principle laid down by the decision of the Court. The Court should not place reliance upon a decision without discussing as to how the factual situation fits in with a fact situation of the decision on which reliance is placed, as it has to be ascertained by analyzing all the material facts and the issues involved in the case and argued on both sides. The judgment has to be read with reference to and in context with a particular statutory provisions interpreted by the Court as the Court has to examine as what principle of law has been decided and the decision cannot be relied upon in support of a proposition that it did not decide (Vide H.H. Maharajadhiraja Madhav Rao Jivaji Rao Scindia Bahadur & Ors. Vs. Union of India, AIR 1971 SC 530; M/s. Amar Nath Om Parkash & Ors. Vs. State of Punjab & Ors., AIR 1985 SC 218; Rajpur Ruda Meha & Ors. Vs. State of Gujarat, AIR 1980 SC 1707; C.I.T. Vs. Sun Engineering Works (P) Ltd., (1992) 4 SCC 363; Sarva Shramik Sangh, Bombay Vs. Indian Hume Pipe Co. Ltd. & Anr., (1993) 2 SCC 386; Haryana Financial Corporation & Anr. Vs. M/s. Jagdamba Oil Mills & Anr., AIR 2002 SC 834; Mehboob Dawood Shaikh Vs. State of Maharastra, (2004) 2 SCC 362; ICICI Bank & Anr. Vs. Municipal Corporation of Greater Bombay & Ors., AIR 2005 SC 3315; M/s. MaKhija Construction and Enggr. Pvt. Ltd. Vs. Indore Development Authority & Ors., AIR 2005 SC 2499; and Shin-Etsu Chemical Co. Ltd. Vs. Aksh Optifibre Ltd. & Anr., (2005) 7 SCC 234).

In Jawahar Lal Sazawal & Ors. Vs. State of Jammu & Kashmir & Ors., AIR 2002 SC 1187, Hon'ble Supreme Court  held that a judgment may not be followed in a given case if it has some distinguishing features.

In Bhavnagar University Vs. Palitana Sugar Mill (P) Ltd., AIR 2003 SC 511, the Hon'ble Supreme Court held that a decision is an authority for which it is decided and not what can logically be deduced therefrom. A little difference in facts or additional facts may make a lot of difference in the precedential value of a decision. While deciding the said case the Court placed reliance upon its earlier judgment in Delhi Administration Vs. Manohar Lal, AIR 2002 SC 3088.

In Union of India Vs. Chajju Ram, AIR 2003 SC 2339, a Constitution Bench of the Hon'ble Supreme Court  held as under:-

"It is now well settled that a decision is an authority for what it decides and not what can logically be deduced therefrom. It is equally well settled that a little difference in facts may lead to a different conclusion."

In Ashwani Kumar Singh Vs. U.P. Public Service Commission  & Ors., AIR 2003 SC 2661, the Apex court held that a judgment of the Court is not to be read as a statute as it is to be remembered that judicial utterances have been made in setting of the facts of a particular case. Substantial flexibility; one additional or different fact may make a world of difference between the conclusions in two cases. Disposal of cases by blindly placing reliance upon a decision is not proper.

  While dealing with a similar situation, i.e. the observations made by a Seven Judges' Bench in India Cement Ltd. Vs. State of Tamil Nadu, AIR 1990 SC 85, the five Judges' Bench in State of West Bengal Vs. Kesoram Industries Ltd., (2004) 10 SCC 201, observed as under:-

"A doubtful expression occurring in a judgment, apparently by mistake or inadvertence, ought to be read by assuming that the Court had intended to say only that which is correct according to the settled position of law, and the apparent error should be ignored, far from making any capital out of it, giving way to the correct expression which ought to be implied or necessarily read in the context, also having regard to what has been said a little before and a little after . .......... A statement caused by an apparent typographical or inadvertent error in a judgment of the Court should not be misunderstood as declaration of such law by the Court."

In view of the above, it is evident that as the judgment in Shiv Raj Singh's case has been delivered without making reference to any provision contained in Government Order 2004, it remained per in curiam.

The concept of "per in curiam" in all those decisions given is ignorance or forgetfulness of some inconsistent statutory provisions or of some authority binding on the Court concerned, i.e., previous decisions of the Court i.e. its own Court or by a Court of co-ordinate or higher jurisdiction or in ignorance of a term of a statute or by a rule having the force of law. "Incuria", literally means "carelessness". In practice, per incuriam is taken to mean per ignoratium. (Vide Mamleshwar Prasad & Anr Vs. Kanhaiya Lal, (1975) 2 SCC 232; A.R. Antule Vs. R.S.Nayak, (1988) 2 SCC 602; State of U.P. & Ors. Vs. Synthetics and Chemicals Ltd., (1991) 4 SCC 139; B. Shama Rao Vs. Union territory of Pondichery, AIR 1967 SC 1480; Municipal Corporation of Delhi Vs. Gurnam Kaur, (1989) 1 SCC 101; Ram Gopal Baheti Vs. Girdharilal Soni & Ors, (1999) 3 SCC 112; Sarnam Singh Vs. Dy. Director of Consolidation & Ors., (1999) 5 SCC 638; Government of Andhra Pradesh Vs. B. Satyanarayana Rao, (dead) by L.Rs, & Ors; AIR 2000 SC 1729; M/s. Fuerst Day Lawson Ltd. Vs. Jindal Exports Ltd., AIR 2001 SC 2293; Suganthi Suresh Kumar Vs. Jagdeeshan, AIR 2002 SC 681; State of Bihar Vs. Kalika Kuer, AIR 2003 SC 2443; Director of Settlements, A.P. & Ors. Vs M.R. Apparao & Anr., 2002 4 SCC 638; Manda Jaganath Vs. K.S. Rathnam & Ors (2004) 7 SCC 492; Sunita Devi Vs. State of Bihar & Ors., 2004 AIRSCW 7116; Central Board of Dawoodi Bohra Community & Anr Vs. State of Maharashtra & Anr., (2005) 2 SCC 673; K.H. Siraj Vs. High Court of Kerala & Ors., AIR 2006 SC 2339; and Union of India & Anr. Vs. Manik Lal Banerjee, AIR 2006 SC 2844.

In State Vs. Ratan Lal Arora (2004) 4 SCC 590, the Hon'ble Supreme Court held that where in a case the decision has been rendered without reference to statutory bars, the same cannot have any precedent value and shall have to be treated as having been rendered per in curiam.    

In N. Bhargavan Pillai Vs. State of Kerala, AIR 2004 SC 2317, the Hon'ble Supreme Court held that in view of the specific statutory bar, the view, if any, expressed without analysing the statutory provision cannot, in our view, be treated as a binding precedent, and at the most is to be considered as having been rendered per in curiam.

A similar view has been reiterated in Mayuram Subramanian Srinivasan Vs. CBI, AIR 2006 SC 2449, wherein the Apex Court has observed as under:-

"Incuria" literally means "carelessness". In practice per incuriam is taken to mean per ignoratium. English Courts have developed this principle in relaxation of the rule of stare decisis. The ''quotable in law", as held in Young Vs. Bristol Aeroplane Co. Ltd., (1944) 2 All ER 293, is avoided and ignored if it is rendered, ''in ignoratium of a statute or other binding authority". Same has been accepted, approved and adopted by this Court while interpreting Article 141 of the Constitution of India, 1950 (in short "the Constitution") which embodies the doctrine of precedents as a matter of law. The above position was highlighted in State of U.P. Vs. Synthetics and Chemicals Ltd., (1991) 4 SCC 139 . To perpetuate an error is no heroism. To rectify it is the compulsion of the judicial consigns. The position was highlighted in Nirmal Jeet Kaur Vs. State of M.P., (2004) 7 SCC 558."

In view of the above, we are of the considered opinion that the judgment in Shivraj Singh (Supra) is per in curiam and has not been decided in correct prospective.

Realising the importance of the Public Distribution System, Parliament while bringing about the 73rd constitutional amendment included the Public Distribution System as one of the primary functions of the Gram Panchayat and it has been incorporated in Article 243-G of Part 9 of the Constitution. The Public Distribution System is obviously a avowed function of the State in order to ensure the distribution of essential commodities fairly. The object is clearly to provide benefit to the public at large in order to ensure supply of essential commodities which is necessary for the sustenance of daily life. The aforesaid object, therefore, has to be fulfilled keeping in view the intention of the legislature which is to promote public awareness and ensure distribution of essential commodities. In essence, the object is to provide benefit to the public at large. As a necessary corollary to the same, the object is not to set up any trade for the benefit of any individual. It may be that by virtue of this licensing system, an individual also gets the opportunity to benefit himself by setting up a fair price distribution unit. However, such a licence does not fall within the category of a fundamental right to carry on trade and business as understood under Article 19 -1(g) of the Constitution of India. The Government Order which has been issued under the provisions of the Essential Commodities Act, is to regulate the supply and distribution of essential commodities fairly. The suspension of such a licence, pending inquiry is a step in the process of eliminating any such discrepancy which affects the public at large. The authorities while proceeding to suspend a licence, have the authority to attach a fair price shop to another Agency, in order to ensure that the public at large does not suffer on account of such suspension. Thus, viewed from any dimension, the power of suspension if exercised bona fidely in public interest does not by itself cause prejudice to a licensee in as much as he has a remedy by filing an appeal against such an order and even otherwise upon the satisfaction of the authority after hearing the objections, the authority can still restore the licence subject to a satisfactory reply being submitted by the licensee.

In this view of the matter, the contention raised on behalf of the petitioner that suspension order without providing opportunity curtails the right of a licensee cannot be accepted. Even otherwise, since there is a remedy by way of appeal and the petitioner has a right to object to the charges on which the licence has been suspended, it is not necessary to read the principles of natural justice by implication at the stage of suspension. The order of suspension is not a final order of termination and therefore, there is no permanent cessation of the licence. The petitioner has an opportunity to contest the matter and get his licence restored in the event he is able to establish that the grounds of suspension cannot be sustained in law.

Keeping in view the object for which the Government Order has been promulgated in order to ensure a sound Public Distribution System, we find that it will not be a sound exercise of discretion to interfere at the instance of the petitioner at the stage of suspension. We do not find any merit in the petition.

The writ petition is accordingly dismissed.  




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