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TMI Blog1968 (11) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner gave rise to disputes regarding the location of the shop. According to the petitioner, he all along kept his shop in village Babupur, but according to the Excise Inspector, the shop was outside the limits of Babupur and was kept in a neighbouring village Nimmi. On 24th May, 1968 the Excise Inspector seized the petitioner's licence and the stock of liquor present in the shop. The licence was however, restored by the District Excise Officer on 27tb May, 1968. The petitioner wrote to the Collector and other excise authorities requesting them to specify the site where he should keep his shop, but no reply was given to him. Then on 1st July, 1968 the Collector passed the impugned order under Section 31(1)(b) of the Excise Act 1915 cancelling the petitioner's licence. The order is based on the report of the Excise Inspector, Satna that the petitioner located his shop in village Nimmi, although the licence required him to keep the shop in village Babupur, and that he committed other breaches of the conditions of the licence mentioned in the report. It is not disputed that the Collector before cancelling the petitioner's licence did neither issue him any notice requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section. Section 31 reads as follows: "Power to cancel or suspend licence, etc.-- (1) Subject to such restrictions as the State Government may prescribe, the authority granting any licence, permit or pass under this Act may cancel or suspend it.-- (a) if any duty or fee payable by the holder thereof be not duly paid; or (b) in the event of any breach by the holder thereof or by any of his servants, or by any one acting on his behalf with his express or implied permission, of any of the terms or conditions thereof; (c) if the holder thereof, or any of his servants, or any one acting on his behalf with his express or implied permission, is convicted of any offence under this Act or any other law for the time being in force relating to revenue, or of any offence (under the Dangerous Drugs Act, 1930 (II of 1930)), or under the Indian Merchandise Marks Act, 1889 (IV of 1889), or under any section which has been introduced into the Indian Penal Code (XLV of 1860), by Section 3 of that Act; or (d) if the holder thereof is convicted of any cognizable and non-bailable offence; or (e) if the holder thereof is punished for any offence referred to in Clause (8) of Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng's Bench Division exercised in these writs;" Rex v. Electricity Commissioners 1924 1 KB 171 at p. 205." Lord Radcliffe, who delivered the judgment of the Privy Council in Nakkuda Airs case 1951 AC 66 quoted the following observations of Hewart, C. J., on this passage: "In order that a body may satisfy the required test it is not enough that it should have legal authority to determine questions affecting the rights of subjects; there must be superadded to that characteristic that the body has the duty to act judicially; Bex v. Legislative Committee of the Church Assembly (1928) 1928 1 KB 411 at p. 415." and then said: "It is that characteristic that the Con" troller lacks in acting under reg. 62. In truth, when he cancels a licence he is not determining a question: he is taking executive action to withdraw a privilege because he believes, and has reasonable grounds to believe, that the holder is unfit to retain it. But, that apart, no procedure is laid down by the regulation for securing that the licence holder is to have notice of the Controller's intention to revoke the licence, or that there must be any inquiry, public or private, bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it will be justifiable to classify the revocation of a licence as a judicial act, imposing upon the competent authority an implied obligation to give the licensee prior notice and opportunity to be heard, even though no corresponding implied obligation is imposed in relation to the initial application for licence; for the practical effect of the revocation of a licence is likely to be far more serious for the licensee than is the effect of a refusal to grant him a licence in the first instance. In any event, it is manifestly unsatisfactory to hold that the revocation of a licence is not the determination of a question affecting "rights" and is therefore not a judicial act, merely because it consists analytically in the withdrawal of a privilege. Nevertheless, this brand of sterile conceptualism has commended itself to the courts in some recent cases". (S. A. De Smith, Judicial Review of Administrative Action, p. 280) Judicial disapproval of Nakkuda Ali's case, 1951 AC 66 came in Ridge v. Baldwin 1963 2 All ER 66 . After a thorough review of cases Lord Reid in his speech demonstrated that the gloss put by Lord Hewart. C. J., on the classic passage of Atkin, L. J. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trative act is of a judicial nature since it depends upon the ascertainment of the existence of certain past or present facts upon which a decision is to be made and rights and liabilities determined. It is clearly not a merely administrative act concerned with the internal functioning of the agency itself, but it is a judicial or quasi-judicial function of the administrative body." (quoted from Schwartz, American Administrative Law, P. 116). As regards the federal administrative agencies in America, the matter is governed by the Administrative Procedure Act which was enacted by the Congress in 1946, In regard to revocation or cancellation of licences. Section 9 (b) of that Act provides as follows: "Except in cases wilfulness or those in which public health, interest or safety requires otherwise, no withdrawal, suspension, revocation, or annulment of any license shall be lawful unless, prior to the institution of agency proceedings therefor, facts or conduct which may warrant such action shall have been called to the attention of the licensee by the agency in writing and the licensee shall have been accorded opportunity to demonstrate or achieve compliance with all law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing the conclusion that the function of licensing under Section 39 of the Calcutta Police Act was administrative. Following these decisions of the Supreme Court, a Division Bench of our High Court held that the Excise Commissioner in confirming or refusing to confirm an auction-sale of liquor shops under the Central Provinces Excise Act does not perform any judicial or quasi-judicial function (see, State of Madhya Pradesh v. Board of Revenue 1964 MPLJ 237). If the matter rested with these cases it would have been difficult for us to hold, in face of the approval of Nakkuda Ali's case 1951 AC G6 in AIR 1961 SC 705 (supra), that the act of the Collector in cancelling a licence under Section 31 of the Central Provinces Excise Act is quasi-judicial in nature. But in two later, cases the Supreme Court has accepted as correct Lord Reid's disapproval of Nakkuda Ali's case 1951 AC 66 in 1963 2 All ER 66 (supra); (see Associated Cement Companies v. P. N. Sharma AIR 1965 SC 1595 at p. 1601 and Shri Bhagwan v. Ramchand AIR 1965 SC 1767 at p. 1770). In Ramchand's case AIR 1965 SC 1767 their Lordships observed: "But it is not necessary that the obligation to follow the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in Cooverjee B. Bharucha v. Excise Commissioner AIR 1954 SC 220 whether there is any fundamental right in a citizen to carry on liquor business. That doubt has now been cleared by the decision in Krishna Kumar v. J and K. State AIR 1967 SC 1368 where it has been held that dealing in liquor is busiress and a citizen has a right to do business in that commodity but the State can make a law imposing reasonable restrictions on the said right in public interests. With this background we now come back to the question raised in this case regarding the nature of the duty imposed on the licensing authority by Section 31 (1) of the Central Provinces Excise Act in the matter of cancellation or suspension of a licence. We are here essentially concerned with Clause (b) of Section 31 (1) as the petitioner's licence was cancelled under that clause. That provision enables the licensing authority to cancel a licence "in the event of any breach by the holder thereof or by any of his servants, or by any one acting on his behalf with his express or implied permission, or any of the terms or conditions thereof". It must be noticed that the charge of breach of terms or conditions of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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