TMI Blog2015 (9) TMI 1737X X X X Extracts X X X X X X X X Extracts X X X X ..... igher authority and the rule clothes him with more authority. Needless to say, the said paragraph has to be read in juxtaposition with other paragraphs. It is clear from paragraph 5 that the Director alone is authorised to grant a licence to an agent whereas a dealer's licence can be granted either by the Director or by the District Magistrate. Sub-para 3 of Paragraph 5 of the Control Order is also indicative of the fact that the agent operates at a larger scale than the dealer. An agent can sell, supply or transfer kerosene to a dealer, holder of a permit or delivery order and no other person. If it is held that the order would become a nullity, it really does not serve the purpose of the Control Order. On the contrary, it frustrates it and, therefore, the interpretation placed by the High Court on Paragraph 9 in juxtaposition with Paragraph 10 to treat the order has null and void is neither correct nor sound. It is desirable that the authority shall pass an order within 30 days from the date of show cause. Be it noted that there are two contingencies when the show cause is issued for violation or when an order of suspension is passed. There can be no trace of doubt that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seeking explanation about the discrepancy pointed out by the Area Inspector. On receipt of the said show cause notice, the first Respondent submitted his explanation on 16.4.2013. The SCFS afforded an opportunity of personal hearing to the dealer on 3.5.2013 and the same was availed of. After conducting the enquiry, the SCFS forwarded the entire record to the District Controller, Food and Supplies Department, Burdwan, who in turn sent the entire case records to the Director of Consumer Goods for appropriate decision. After scrutiny of the records, the Director of Consumer Goods issued a show cause notice to the dealer on 26.6.2013. The first Respondent replied to the same on 28.6.2013 through his counsel stating, inter alia, that under the Control Order, after the licence is issued to an agent by the Office of the Director, the District Magistrate having jurisdiction or any officer authorised by him, is alone empowered to look into the functioning of the said agency and to give directions to him and/or initiate action against the concerned agent. Additionally, it was also put forth that the second show cause notice on the self-same allegations was untenable in law and accordingly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that was initiated had lapsed after expiry of 30 days after the date of issuance of the show cause notice by the Director; and that in any case the proceeding was initiated by SCFS and he could not have sent the record to the Director after expiry of 30 days when the proceeding stood lapsed. It was also urged that the order in question was served on the first Respondent on 12.8.2013 and, therefore, the date mentioned in the order could not validate the same as it was not dispatched within 30 days. The submissions put forth by the first Respondent before the Division Bench of the High Court were seriously contested by the learned Counsel for the Department. 6. The Division Bench posed the following two questions: a. Who is the competent authority to take disciplinary action either by cancellation or suspension of the licence of a S.K. Oil agent appointed in a district outside the Calcutta? b. Whether the order of cancellation or suspension of licence in terms of Paragraph 9 of the West Bengal Kerosene Control Order will become effective on the date of passing of the said order or when the said order is communicated to the concerned party? 7. After posing the aforesaid tw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be set aside since the said Director had no authority and/or jurisdiction to pass any order under paragraph 9 of the West Bengal Kerosene Control Order, 1968 in respect of S.K. Oil agent of Burdwan. Therefore, the impugned order dated 22nd July, 2013 issued by the Director of Consumer Goods in respect of the Appellant/writ Petitioner No. 1 is quashed. Being of this view, it allowed the appeal and set aside the judgment of the learned Single Judge of the High Court. 8. We have heard Mr. Mohan Parasaran, learned senior Counsel along with Mr. Anip Sachtey, learned Counsel for the Appellants and Mr. Vivek K. Tankha, learned senior Counsel along with Mr. Rajan K. Choursia, learned Counsel for the first Respondent. 9. At the outset, it is obligatory on our part to state that when the final hearing of the appeal took place, we were apprised at the Bar that SCFS who represents the District Magistrate, has issued a fresh show cause notice in respect of self-same lis and accordingly the following order was passed: In course of hearing we have been apprised that the Sub-Divisional Controller, Food and Supplies, Burdwan, who represents the District Magistrate, Burdwan, has issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistrate includes the Deputy Commissioner of a district and also includes any person not below the rank of a Sub-divisional Controller of Food and Supplies in the Department of Food and Supplies, Government of West Bengal, authorised by the District Magistrate or Deputy Commissioner, as the case may be, in writing to perform all or any of the functions of the District Magistrate under this Order. 13. Paragraph 5 of the Control Order deals with grant of licence to an agent. It reads as under: 5. Grant of licence to agent - (1) The Director may grant a licence to any agent in West Bengal authorising him to carry on trade in kerosene as such agent. (2) A licence granted under sub-paragraph (1) shall be in Form A and shall be subject to such conditions as are specified therein and such other conditions as the Director may lay down from time to time in the interest of fair distribution of kerosene within the State. (3) No agent shall sell, supply or transfer kerosene to any person other than a dealer duly licensed under paragraph 6 of this Order, or a holder of a permit or delivery order issued under paragraph 11 of this Order. 14. Paragraph 6 deals with grant of licence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he order is passed by the District Magistrate or the Deputy Commissioner of a district, to the State Government, (ii) where the order is passed by any other officer authorised by the District Magistrate or the Deputy Commissioner of a district under Clause (e) of paragraph 3, to the District Magistrate or the Deputy Commissioner, as the case may be, of the district. 17. We have reproduced the relevant paragraphs of the Control Order to understand the schematic purpose and effect of the Control Order. Paragraph 5, as it envisages, empowers the Director to grant licence to any agent in West Bengal authorising him to carry on trade in kerosene as such agent. Paragraph 6 empowers the Director or the District Magistrate having jurisdiction to grant the licence to any person as a dealer. As the scheme would reflect there is a distinction between an agent and a dealer , for the agent is granted licence under paragraph 5 of the Control Order whereas dealer is granted licence under paragraph 6 of the Control Order. Paragraph (7) provides for renewal of licences, licence fees, etc. The relevant part of the said paragraph is as follows: 7. Renewal of licences, licence fees, etc.- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s licence can be granted either by the Director or by the District Magistrate. Sub-para 3 of Paragraph 5 of the Control Order is also indicative of the fact that the agent operates at a larger scale than the dealer. An agent can sell, supply or transfer kerosene to a dealer, holder of a permit or delivery order and no other person. Sub-para 2 of Paragraph 6 of the Control Order is differently worded as it postulates that conditions can be specified by the Director or the District Magistrate having the jurisdiction. The conditions imposed may vary from time to time for the sake of fair distribution of kerosene. The authorities are also different as per the dictionary clause. 19. In this backdrop, we are required to understand the language employed in paragraph 9 of the Control Order. The said paragraph, as we perceive, is rather loosely and ambiguously worded. It becomes obvious when we appreciate the Control Order on the bedrock of schematic interpretation. It is worth noting that while paragraph 5 deals with grant of licence to an agent by the Director, paragraph 6 deals with grant of licence to a dealer by the Director or the District Magistrate. The term District Magistrate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inance and Investment Co. Ltd. and Ors. (1987) 1 SCC 424, wherein it has succinctly been stated thus: Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statute-maker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so exercise the right to cancel or suspend the licence. As has been stated earlier, on a cursory reading it may appear that paragraph 9 confers concurrent jurisdiction. The said paragraph deals with suspension or cancellation of licence and is a composite paragraph, which applies to licence granted to an agent as well as the dealer. It refers to the power of a Director and District Magistrate having jurisdiction. The words District Magistrate having jurisdiction are also used in paragraph 6. The expression District Magistrate having jurisdiction reflects the legislative intent that District Magistrate having jurisdiction under paragraph 9 would be the same District Magistrate or authority which has the power to grant licence to a dealer in Form B under paragraph 6. Read in this manner, we have no hesitation in holding that it is the Director alone who could have issued the show cause notice under paragraph 9 and has the authority and jurisdiction to pass an order in terms of paragraph 9 of the Control Order. The earlier notice issued by SCFS has to be regarded at best a show cause notice to ascertain and affirm facts alleged and it ensured a response and reply from the first Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of the order. Therefore the phrase by an order in writing to be made appearing in the proviso to the Paragraph 9 is to be construed as by an order in writing to be communicated and so long the order is not communicated, it should be presumed that the order has not been passed and consequently, a duty is cast upon the authority concerned to communicate the order to the aggrieved, either direct or constructively. Mere passing of an order and keeping it in the file will not fulfil the requirement of the said Paragraph 9. 30. Mr. Banerjee, the learned advocate appearing for the Petitioners, has in this connection placed strong reliance upon a decision of the Supreme Court in the case of Assistant Transport Commissioner, Uttar Pradesh v. Nand Singh [reported in 179 ELT (510) where the Apex Court while considering Section 35 of the Central Excise and Salt Act, 1944 held that the date of communication of the order will be the starting point of limitation for filing an appeal and not the date of the order, because, the order would be effective against the person affected by it only when it comes to the knowledge either direct or constructively, otherwise not. The Supreme Court fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court was interpreting the word made occurring in Section 126(4) of the Delhi Municipal Corporation Act, 1957, which stipulated that no amendment Under Sub-section 1 shall be made in the assessment list in relation to certain aspects. It was contended before this Court on behalf of the Municipal Corporation of Delhi that the use of the expression made occurring in the said Sub-section would necessitate communication of the order. It was contended before this Court by the Corporation that the distinction must be made between communication of order and making thereof inasmuch as whereas communication may be necessary so as to enable an Assessee to prefer an appeal against the order of assessment but only signing of the order would subserve the purpose of saving the period of limitation. The submission was that the expression no amendment Under Sub-section (1) shall be made should be given a liberal interpretation. Reliance was placed on the pronouncement in CCE v. M.M. Rubber and Co. (1992) Supp. (1) SCC 471 The said stand was controverted on the ground that the Act having been enacted for the purpose of controlling the abuse of power on the part of the Commissioner, the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n be said to have left his hand. The date of communication of the order to the party whose rights are affected is not the relevant date for purposes of determining whether the power has been exercised within the prescribed time. xxx 18. Thus if the intention or design of the statutory provision was to protect the interest of the person adversely affected, by providing a remedy against the order or decision any period of limitation prescribed with reference to invoking such remedy shall be read as commencing from the date of communication of the order. But if it is a limitation for a competent authority to make an order the date of exercise of that power and in the case of exercise of suo motu power over the subordinate authorities' orders, the date on which such power was exercised by making an order are the relevant dates for determining the limitation. The ratio of this distinction may also be founded on the principle that the Government is bound by the proceedings of its officers but persons affected are not concluded by the decision. Eventually, the Court came to hold thus: An order passed by a competent authority dismissing a government servant from services re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (9th Edn., 2004) while dealing with mandatory and directory provisions: The study of numerous cases on this topic does not lead to formulation of any universal rule except this that language alone most often is not decisive, and regard must be had to the context, subject-matter and object of the statutory provision in question, in determining whether the same is mandatory or directory. In an oft-quoted passage Lord Campbell said: 'No universal rule can be laid down as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience. It is the duty of courts of justice to try to get at the real intention of the legislature by carefully attending to the whole scope of the statute to be considered.' (p. 338) 'For ascertaining the real intention of the legislature', points out Subbarao, J. 'the court may consider inter alia, the nature and design of the statute, and the consequences which would follow from construing it the one way or the other; the impact of other provisions whereby the necessity of complying with the provisions in question is avoided; the circumstances, namely, that the statute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly incorrect and wholly unsustainable. 29. Apart from above, the words used in Paragraph 10 are date of the order . In the scheme of the Control Order, the order comes into effect from the date of receipt by the agent or the dealer. Once that becomes the decision, the commencement of limitation of 30 days for the purpose of Paragraph 10 would be the date when the order is effective. The High Court in Rani Sati Kerosene Supply Company and Ors. (supra) has opined that if the order of cancellation is not served on the affected person and the appeal period expires, there is the possibility that the adverse order would become unassailable. The reasoning is totally fallacious. An appeal can only be preferred when the order is effective. The ineffective order, that is to say, uncommunicated order cannot be challenged. Therefore, the reasoning given by the court in earlier judgment is erroneous and hence, the reliance thereupon by the impugned order is faulty. There has to be a purposive construction of the words from the date of order . To place a construction that the date of an order would mean passing of the order, though not made effective would lead to an absurdity. 30. In vi ..... 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