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Bombay High Court

GURUNANAK DAIRY AND SWEETS THR ITS PROPRIETORversusTHE UNION OF INDIA THR THE SECRETARY AND ORS

Decided
Disposal
Disposed Off

Holding

The suspension order is vacated, the pending appeal is deemed withdrawn, and the petitioner is awarded compensation, with the licence modification to be processed within 72 hours.

Summary

M/s. Gurunanak Dairy & Sweets, a retailer of sweets and dairy products, had its food licence suspended by the Food Safety and Standards Authority of India (FSSAI) after an inspection revealed sanitation and hygiene deficiencies. The petitioner appealed the suspension and subsequently submitted a comprehensive compliance report, achieving a 98% compliance score in a re‑inspection. Despite the compliance, the authorities refused to lift the suspension, citing the pendency of the appeal. Relying on a recent judgment in M/s. Pind Punjab, the Court held that a pending appeal does not justify continuation of a suspension when the deficiencies have been remedied. The Court vacated the suspension order, ordered the withdrawal of the appeal, directed payment of Rs 5 lakh as compensation for loss of business, and instructed the FSSAI to process the petitioner’s request to remove the ‘general manufacturing’ category from its licence within 72 hours.

Issues considered

  • Whether a suspension order can remain in force despite the petitioner having remedied the deficiencies and achieved a high compliance score.
  • Whether the pendency of an appeal bars the administrative authority from revoking a suspension.
  • Whether the petitioner is entitled to compensation for loss of business caused by the suspension.
  • Whether the petitioner’s application to modify the FSSAI licence should be entertained promptly.

Legislation cited

Subjects

  • Food Safety
  • Licence Suspension
  • Administrative Appeal
  • Compliance Score
  • Compensation
  • FSSAI
  • Regulatory Law

Judgment

                                                                     916-WP.9905.2026.odt

JVS.
                IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                        CIVIL APPELLATE JURISDICTION
                        WRIT PETITION NO. 9905 OF 2026

       M/s. Gurunanak Dairy & Sweets                     }     Petitioner
             Versus
       The Union of India & Ors.                         }     Respondents

       Mr. Abhijeet Desai with Mr. Vijay Singh, Ms. Mohini R. and
       Mr. Deepesh Ramakhiani, for the Petitioner.
       Mrs. A. P. Thipsay, ‘B’ Panel Counsel for Respondent Nos. 2, 3,
       4, 5 & 6-State.

                   CORAM : RAVINDRA V. GHUGE, ACJ. &
                           GAUTAM A. ANKHAD, J.
                   DATE       : 17th AUGUST, 2026
       P.C.:
       1.          The Petitioner is a dealer of sweets and dairy products. The

       Petitioner commenced business in 2006. The food licence was renewed on

       12th October, 2022, which is to last until 12 th October, 2027 under the Food

       Safety and Standards Act, 2006.




       2.          On 11-12th June, 2026, the Food Safety Officer, Smt. A. D.

       Jhanjhurne, FDA, Pune inspected the Petitioner’s premises pursuant to a

       complaint of food poisoning and recorded negative observations regarding

       sanitation, record-keeping, labelling and staff hygiene. On 12 th June, 2026,

       Respondent No. 4 passed the impugned order of suspension and directed

       closure of business.



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3.          On 15th June, 2026, the Petitioner preferred Appeal No. 25 of

2026 before Respondent No. 6, the Commissioner, Food and Drug

Administration. On 9th July, 2026, the Petitioner tendered a comprehensive

full compliance report addressing every observations/objections recorded in

the inspection. On 13th July, 2026, Respondent No. 5 re-inspected the

Petitioner’s premises and an auto generated inspection report ID No.1253428

recorded 35 out of 36 marks and indicated the compliance score of 98%. An

observation was recorded that the Petitioner needs to seek change its licence

since it is active only in retail business and does not carry out any

manufacturing process.




4.          The learned Advocate for the Petitioner has relied upon an order

passed by this Court dated 16th July, 2026 in Writ Petition No. 8360 of 2026

(M/s. Pind Punjab vs. Union of India & Ors.) . He points out the observations

of this Court in Paragraph Nos. 3 to 7, which read as under: -

            3.     The Petitioner preferred an Appeal before the
            Commissioner of Food and Drug Administration on 28th
            June, 2026. The learned AGP informs us that the
            concerned Commissioner passed an order directing a
            fresh inspection. The learned Advocate for the Petitioner
            submits that he has obtained a copy of the fresh
            inspection report with reference to the inspection carried
            out on               8th July, 2026, bearing Report ID
            No.1251494, which is an auto generated inspection
            report. The eight pages report is tendered across the Bar
            which is marked as ‘X’ for identification. He points out
            that in the inspection, the maximum score was 112


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           marks. The Petitioner obtained 112 marks, and the
           percentage, as per the final result, is 100%.

           4.     The learned Advocate appearing on behalf of
           Respondent Nos.1 and 2 and the learned AGP appearing
           on behalf of Respondent Nos.3 to 5 submit, on
           instructions, that the auto generated inspection report
           marked ‘X’ cannot be disputed.

           5.    In fact, after the report was generated on 8 th July,
           2026, the concerned officer, Mr. N.R. Sarkate, should
           have issued a consequential order restoring the license.
           He probably has not done so because the Appeal was
           pending.

           6.     Proceedings initiated vide the Appeal, need not be
           taken forward since the Petitioner has cured all the
           deficiencies and he has been granted 100% compliance
           report.

           7.    As such, this Petition is partly allowed, with the
           following directions :

                   (a) The impugned suspension order dated 23rd
                   June, 2026 shall lose its efficacy and the license
                   shall stand restored forthwith;

                   (b) The pending Appeal before the
                   Commissioner,        Food      and      Drug
                   Administration, has achieved its purpose and
                   the same stands disposed off;

                   (c) The concerned Commissioner would issue a
                   formal order disposing off the said Appeal
                   from its file.


5.          Mrs. A. P. Thipsay, the learned ‘B’ Panel Counsel appearing on

behalf of Respondent Nos. 2, 3, 4, 5 and 6 submits, on instructions from the

concerned officers present in the Court Hall, that the suspension order has

not been revoked because the Petitioner has preferred an Appeal. The Appeal

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has been heard and closed for judgment on 11 th August, 2026. Because the

Appeal was filed, though the Petitioner is 98% compliant to the extent of

retail business and does not indulge in the manufacturing activities, the

suspension was not revoked. Even the Application of the Petitioner dated 16 th

July, 2026 seeking removal of ‘general manufacturing’ category from the

food licence, for which the requisite fees of Rs. 1,000/- was paid, is also not

dealt with because the Appeal is pending.




6.          We find the submissions of the Respondents to be unconvincing.

On 12th June, 2026, the Petitioner’s food licence was suspended because of

deficiencies. Thereafter, the Petitioner removed all the deficiencies and

tendered a comprehensive compliance report dated 9 th July, 2026. The

authorities themselves visited the premises and carried out an inspection on

13th July, 2026. If pendency of the Appeal was not an impediment for the

Respondent authorities in inspecting the premises of the Petitioner, we find

no reason for the authorities to continue with the suspension of the retail

food licence only because an Appeal was pending. If the said logic is to be

applied, the authorities should not have even inspected the premises of the

Petitioner on the plea that the Appeal was pending. If re-inspection was

permissible notwithstanding the pendency of the Appeal, the Petitioner

scoring 98% compliance marks, should have fetched an order of instant



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recalling of the suspension order.

             A lame excuse that an Appeal is pending should not have been

put-forth. If the Petitioner had not preferred an Appeal, would the

Respondent authorities      still    have   sat   over   the suspension      order

notwithstanding the fact that the re-inspection has revealed 98% compliance?

The compliance and removal of deficiencies was a lawful ground for

immediate revocation of the suspension.




7.           The Petitioner’s reliance on the order of this court in M/s. Pind

Punjab (supra), is well placed. The learned Advocate for the Petitioner points

out that the Petitioner, which is a small business, earns around Rs. 25,000/-

per day and lost its business for almost 35 days. The total loss of revenue is

around 9,00,000/-.




8.           In view of the above, considering the entire report, which deals

with several aspects including cleanliness, hygiene, maintenance and

sanitation, wherein the Petitioner has secured 98% compliance score, we

deem it appropriate to direct the Food and Drug Administration of the State

of Maharashtra to compensate the Petitioner’s loss of Rs.9 lakhs, with a

compensatory payment of Rs. 5 lakh only.




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                      9.           This Petition is allowed. The impugned suspension order stands

                      vacated forthwith. The Petitioner is at liberty to restart its retail business in

                      dairy and sweets. The Food and Drug Administration shall deposit the

                      amount of Rs. 5 lakh in this Court within 30 days from today. The Petitioner

                      is at liberty to withdraw the said amount without any condition.




                      10.          The learned Advocate for the Petitioner submits that the

                      Petitioner desires to withdraw the pending Appeal. In view of the above, the

                      said Appeal is disposed off as withdrawn, on request. A formal order shall be

                      passed by Respondent No. 6 declaring that the Appeal is disposed off, having

                      been withdrawn by the Petitioner.




                      11.          The Petitioner’s Application for modification of the FSSAI

                      licence for removal of the ‘general manufacturing’ category, shall be dealt

                      with within 72 hours and if the application is allowed, the modified FSSAI

                      licence shall be issued to the Petitioner.
JAYANT
VISHWANATH
SALUNKE
Digitally signed by
JAYANT VISHWANATH
SALUNKE
Date: 2026.08.18
16:55:47 +0530




                            [GAUTAM A. ANKHAD, J.]                  [ACTING CHIEF JUSTICE]




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