Supreme Court of India
STATE OF WEST BENGAL AND OTHERSversusR.K.B.K. LTD. & ANR.
- Citation
- 2015 INSC 643
- Decided
- 4 September 2015
- Disposal
- Appeal(s) allowed
- Bench
- DIPAK MISRA
Holding
The Director of Consumer Goods alone has jurisdiction to issue a show‑cause notice and pass an order under Paragraph 9, and an order takes effect only upon communication, making the 30‑day limitation run from the date of communication.
Summary
The State of West Bengal appealed against an order of the Director of Consumer Goods that imposed a penalty on R.K.B.K. Ltd., a licensed kerosene oil agent, for alleged excess distribution. The dispute centered on whether the Director or the District Magistrate had authority under Paragraph 9 of the West Bengal Kerosene Oil Control Order, 1968 to issue a show‑cause notice and cancel or suspend the licence, and on when an order under that paragraph becomes effective for the purpose of the 30‑day limitation in Paragraph 10. The Supreme Court held that the Director alone, as the authority that grants licences to agents, also has the exclusive power to cancel or suspend those licences; the District Magistrate’s jurisdiction is limited to dealers. An order is not effective until it is communicated to the affected party, so the limitation period runs from the date of communication, not merely from the date of signing. Consequently, the Director’s order was valid, the appeal was allowed, and the High Court’s decision was set aside.
Issues considered
- The identity of the competent authority to cancel or suspend a licence of a kerosene oil agent under the West Bengal Kerosene Oil Control Order, 1968.
- Whether an order passed under Paragraph 9 becomes effective on the date of signing or on communication, and how the 30‑day limitation in Paragraph 10 is to be interpreted.
- Whether the Director of Consumer Goods had jurisdiction to issue the show‑cause notice and impose the penalty.
- Whether an order passed beyond the prescribed 30‑day period is void.
Legislation cited
Subjects
Kerosene Oil Control Orderlicence cancellationjurisdictionharmonious constructionlimitation periodcommunication of orderessential commoditiesstatutory interpretation
Judgment
[2015] 9 S.C.R. 309
STATE OF WEST BENGALAND OTHERS A
v.
R.K.8.K. LTD. &ANR.
(Civil Appeal No.2825 of 2015)
SEPTEMBER 04, 2015 8
[DIPAK MISRA AND PRAFULLA C. PANT, JJ.]
West Bengal Kerosene Oil Control Order, 1968:
Paragraphs 5, 6, 7 and 9- Competent authority to initiate C
disciplinary action in terms of Paragraph 9-Against the agent
holding licence for carrying on business of superior kerosene
oil - Show Cause Notice issued to the agent by Sub-
Divisional Controller, Food and Supplies (SCFS) (who
represents the District Magistrate) - Seeking explanation D
about the discrepancy found in distribution of superior
kerosene oil- Explanation submitted- SCFS forwarded the
record to Director of Consumer Goods - Director passed
order imposing penalty in exercise of power conferred on him
under paragraph 9(ii) - Jurisdiction of Director questioned E
by the agent- Held: The power to grant a licence to an agent
as per Paragraph 5 is Director and to a dealer as per
Paragraph 6 is the Director or the District Magistrate
[including the authon"ties mentioned in Paragraph 3(e)]- But F
the power to cancel or suspend such licence is given to the
Director as well as the District Magistrate (including authon"zed
officer) by a composite paragraph- s.21 of General Clauses
Act also indicates that issuing authority would exercise the
n"ght to cancel or suspend the licence unless the statute G
provides to the contrary- Therefore, it would be incongruous
to hold that even when the licence of an agent is granted by
a superior authority (Director), a District Magistrate in
309 H
310 SUPREME COURT REPORTS [2015] 9 S.C.R.
A exercise of concurrent jurisdiction can cancel or suspend that
licence - Such an interpretation of Paragraph 9 would be
contrary to legislative intent and would lead to absurdity and
anomaly- Instead of adopting literal interpretation, a logical
and reasonable interpretation, in consonance with the
B principles of harmonious construction has to be adopted -A
harmonious reading of Paragraphs 5, 6, 7 and 9 leads to the
interpretation of Paragraph 9 that it is Director alone who had
authority to show cause notice and pass an order in terms of
Paragraph 9 - Interpretation of Statutes - Literal
C interpretation; Harmonious construction - General Clauses
Act, 1897-s. 21.
Paragraphs 9 and 10 - Limitation for passing order
under Paragraph 9 - Prescribed as 30 days from the date
D the show cause notice was issued - The order in question
was passed within 30 days but communicated after 30 days
- High Court held that passing an order on the file would not
tantamount to an order unless communicated; and that the
order having not been communicated within 30 days was not
E within limitation and hence null and void - On appeal held:
An order comes into effect only when it is communicated -
The words "date of the order" used in Para 10 has to be given
purposive meaning- The expression "date of the order" would
F construe the date on which the order comes into effect i.e.
the date of its communication to the agent or dealer -
Declaring the order as nullity being barred by limitation, would
not serve the purpose of the Control Order or Essential
CommoditiesAct, 1955.
G Interpretation of Statues - Purposive interpretation -
Held: The purpose of any Act or Rule or Order has its own
sanctity - While interpreting the same, the text and context
have to be kept in mind.
H Allowing the appeal, the Court
STATE OF WEST BENGALAND OTHERS v. R.K.B.K. LTD.311
HELD: 1.1 As the scheme of the Control Order would A
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 B
fees, etc. The power conferred on the Director and the
District Magistrate are different, for the Director is a higher
authority and the rule clothes him with more authority. It
. is clear from paragraph 5 that the Director alone is
authorised to grant a licence to an agent whereas a C
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. Sub-
0
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 E
authorities are also different as per the dictionary clause.
[Paras 17 and 18] [326-E-F; 328-A-D]
1.2 Paragraph 9 of the Control Order is rather loosely
and ambiguously worded. While paragraph 5 deals with F
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" as
per paragraph 3(e) of the Control Order includes
authorities mentioned therein. Paragraph 9 which G
pertains to cancellation or suspension of licence is a
composite paragraph and stipulates when and who can
cancel or suspend a licence of an agent or a dealer. The
said power is exercised, when an agent or dealer has
indulged in any kind of malpractice or contravened any H
312 SUPREME COURT REPORTS [2015) 9 S.C.R.
A provision of the Control Order or conditions applicable,
etc. A literal reading of paragraph 9, may convey that
Director as well as the District Magistrate including the
authorised officers mentioned in paragraph 3(e), have
concurrent jurisdiction to cancel or suspend the licence
B granted to an agent or a dealer. However, such an
interpretation could not be occurred with the legislative
intent and would lead to absurdity and anomaly.
Therefore, such kind of an interpretation has to be
C avoided. [Para 19] [328-D-H; 329-A,B]
1.3 To place a construction on Paragraph 9 that the
Director as well as the District Magistrate would have
concurrent jurisdiction would be inapposite. A logical
and reasonable interpretation to paragraph 9 of the
D Control Order has to be preferred instead of adopting
the loose meaning in the literal sense. Such an
interpretation would be in consonance with the
principles of harmonious construction, that is,
harmonious reading of paragraphs 5, 6, 7 and 9 of the
E Control Order. It is based on the premise that the
authority who has the right to grant licence has the
authority to suspend or cancel the licence. [Para 19] [329-
D-F]
F Reserve Bank of India v. Peerless General Finance and
Investment Co. Ltd. and Ors. (1987) 1 SCC 424: 1987 (2)
SCR 1 - relied on.
1.4 The intent of the Control Order is to totally prohibit
G creation of any kind of situation which will frustrate the
proper distribution of kerosene oil. The purpose of any
Act or Rule or Order has its own sanctity. While
interpreting the same, the text and context have to be
kept in mind. The words of a statute, when there is a
H doubt about their meaning are to be understood in the
sense in which they best harmonise with the subject of
STATE OF WEST BENGALAND OTHERS v. R.K.B.K. LTD.313
the enactment and the object which the legislature has A
in view. Therefore, it would be incongruous to hold that
even when the licence of an agent at the State level is
Qranted and issued by the Director, a District Magistrate,
as defined in paragraph 3(e) of the Control Order, in
exercise of concurrent jurisdiction can suspend or B
cancel the State level licence. As per Section 21 of the
General Clauses Act, power to. issue notification/ order/
rules/bye-laws, etc. includes the power to amend/ vary
or rescind. The said provision is indicative that generally
unless the statute or rule provides to the contrary, either C
expressly or impliedly, issuing or appointing authority
would also exercise the right to cancel or suspend the
licence. [Paras 20 and 21] [330-F-G; 331-B, D-F]
Workmen v. Dimakuchi Tea Estate AIR 1958 SC 353: D
1958 SCR 1156 - relied on.
1.5 The expres"sion "District Magistrate having
jurisdiction" in Paragraph 6, reflects the legislative intent
that District Magistrate having jurisdiction under E
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, it is
· the Director alone who could have issued the show
cause notice under paragraph 9 and has the authority F
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 respondent. The said G
notice by SCFS could not have culminated in the order
under paragraph 9, for he has no authority and
jurisdiction to pass an·order suspending or cancelling
the licence. Therefore, the matter was rightly referred to H
314 SUPREME COURT REPORTS [2015] 9 S.C.R.
A the Director for action, if required, in terms of paragraph
9 of the Control Order. (Para 21) (332-A-D] ·
2.1 Paragraph 9 of the Control Order requires the
competent authority to pass an order within 30 days from
B the date. of serving the show cause notice or the
suspension of licence. The word used is "shall".
Paragraph 10 of the Control Order enables the aggrieved
person to prefer an appeal against an order passed
under Paragraph 8 or 9 within 30 days to the State
C Government in Food and Supplies Department [Para 24)
[335-8-D]
2.2 It is desirable that the authority shall pass an
order within 30 days from the date of show cause. The
o order will take effect from the date when it is served. The
order passed by the authority comes into effect when it
is communicated. An order passed in file in case of this
nature would not be an effective order, for it is adverse
to the interest of the dealer or agent and, therefore,
E .paragraph 10 has to be given a purposive meaning. It
has to convey that 30 days from the date of the order
which is an effective order and that is the date of
communication. Unless such an interpretation is placed,
the intention of the rule making authority and also the
F intention behind the object and reasons behind the
Control Order and the Essential Commodities Act, 1955
would be frustrated. Apart from above, the words used
in Paragraph 10 are "date of the order". There has to be
a purposive construction of the words "from the date of
G 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. In the scheme of
the Control Order, the order comes into effect from the
H date of receipt by the agent or the dealer. Once that
becomes the decision, the commencement of limitation
STATEOFWESTBENGALANDOTHERSv. R.K.B.K. LTD.315
of 30 days for the purpose of Paragraph 10 would be the A
date when the order is effective. 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 B
Paragraph 10 to treat the order as null and void is neither
correct nor sound. [Paras 28 and 29] [340-G-H; 341-A]
2.3 The respondent No.1 is granted liberty to prefer
an appeal within the prescribed period before the State C
·Government. The Control Order has been amended in
2014 whereby the period of limitation has been extended.
However, it is directed that the period of limitation shall
commence from the date of this judgment. [Para 31] [342-
D-E] D
MCD v. Qimat Rai Gupta and Ors. (2007) 7 SCC 309:
2007 (8) SCR 570; Kai/ash v. Nankhu andOrs. (2005) 4 SCC
480; CCE v. M.M. Rubber and Co. (1992) Supp. (1) SCC
471; Surendra Singh v. State of U. P AIR 1954 SC 194: 1954 E
SCR 330; Harish Chandra Raj Singh v. Dy. Land Acquisition
Officer AIR 1961SC1500: 1962 SCR 676; K.Bhaskaran v.
Sankaran Vaidhya Ba/an (1999) 7 SCC 510: 1999 (3) Suppl.
SCR 271 - relied on.
F
Rani Safi Kerosene Supply Company and Ors. vs. The
State of West Bengal and Ors. 2005 (4) CHN 264 - held
inapplicable.
3. As the Director alone has the jurisdiction to pass G
the order, the passed by SCFS in a fresh show cause
notice for the self-satne alleations order remains a valid
order and can be challenged in an appeal under
Paragraph 10 and the appellate authority would be the
State Government. [Para 30] [342-C-D] H
316 SUPREME COURT REPORTS [2015] 9 S.C.R.
A Case Law Reference
200·5 (4) CHN 264 held inapplicable. Paras 7
and 26
1987 (2) SCR 1 relied on. Para 19
B
1958 SCR 1156 relied on. Para 20
.
2007 (8) SCR 570 relied on . Para 24
c (1992) Supp. (1) sec 471relied on. Para 24 ·
1954 SCR 330 relied on. Para 25
1962 SCR 676 relied on. Para 25
D 1999 (3) Suppl. SCR 271 relied on. Para 25
1966 SC 1313 relied on. Para 25
CIVIL APPELLATE JURISDICTION: Civil Appeal No.
2825 of 2015.
E
From the Judgment and Order dated 29.08.2014 of the
High Court of Calcutta in AST No.177 of2013.
Mohan Parasaran, Anip Sachthey, Saakaar Sardana for
F the Appellants.
Vivek K. Tankha, Ramanand Agarwal, Pijush K. Roy,
Nibedita Pal, Kakali Roy, Rajan K. Chourasia for the
Respondents.
G The Judgment of the Court was delivered by
DIPAK MISRA, J.1. In this appeal, by special leave, the
legal substantiality and acceptability of the judgment and order
dated 29.08.2014 passed by the Division Bench of the High
H Court of Calcutta in AST No. 17712013 whereby it has
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 317
[DIPAK MISRA, J.]
overturned the decision of the learned Single Judge requiring A
the respondent-writ petitioner to knock at the doors of the
alternative forum by way of appeal, on the foundation that the
authority that had passed the adverse order against the first
respondent had no jurisdiction, and assuming he had the
jurisdiction, it stood extinguished by expiration of the time limit B
stipulated in certain paragraphs of the West Bengal Kerosene
Oil Control Order, 1968 (for brevity, 'the Control Order'), is
called in question.
2. The facts which need to be exposited for adjudication C
of this appeal are that the first respondent was granted the
licence for carrying on the business of superior kerosene oil
as an agent by the Joint Director of Consumer Goods, West
Bengal in accordance with the paragraph 5(1) of the Control
Order. The monthly allocation of public distribution system of D
superior kerosene oil to the said respondent was fixed by the
Director of Consumer Goods, West Bengal at 1,82,000 litres
per month. On 10.8.2012 a physical inspection was carried
out by the Area Inspector attached to the office of the Sub
Divisional Controller, Food and Supplies, Burdwan (for short, E
"SCFS") at the depot of the respondent. The concerned
Inspector submitted the report to the SCFS stating that 71,494
litres of superior kerosene oil had been delivered in excess
by the dealer. On 8.4.2013, the SCFS issued a notice seeking F
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 G
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 H
318 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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,
B 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 prayer was made to
C withdraw and/or rescind the notice and take steps for disposal
of the matter in terms of the provisions of the Control Order.
3. As the factual matrix would further undrape, the Director
of Consumer Goods, vide order dated 22. 7.2013 narrated the
D facts in detail and came to hold that SCFS has the authority to
ask for explanation regarding distribution of superior kerosene
oil in his jurisdiction; and that the Director of Consumer Goods
being the Licensing Authority, can exercise the power to issue
show cause notice and after giving the delinquent agent a fair
E opportunity of being heard, pass appropriate orders. The said
order also would reflect that the counsel for the first respondent
had appeared before the Director on 17.7.2013. The
concerned Director analysed the factual matrix and in exercise
F of power conferred on him under paragraph 9(ii) of the Control
Order imposed a penalty of Rs.26,08,816.00 and further
directed reduction of monthly allocation of superior kerosene
oil of the agent by 12,000 litres for a period of one year.
4. The order passed by the Director was assailed by the
G agent in W.P.No. 25204 (W) of 2013. The learned Single Judge
vide order dated 22.08.2013 referred to paragraph 10 of the
Control Order which provides for an appeal to be preferred
and accordingly directed that if the agent prefers an appeal by
H 6.9.2013, the appellate authority shall dispose of the same by
31.12.2013. The learned Single Judge further directed that
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 319
[DIPAK MISRA, J.]
the agent shall maintain with utmost care an inventory of stocks A
and accounts for periodical submission to the authorities and
the penalty amount should be deposited by 6.9.2013 and the
said penalty amount shall be kept in a separate interest bearing
account.
B
5. Being aggrieved by the aforesaid order, the
respondents 1 and 2 preferred an appeal being AST No. 177
of 2013 before the Division Bench. It was urged in the intra-
court appeal that the proceeding before the Director of
Consumer Goods was p~tently without jurisdiction, for power C
of cancellation or suspension could only be exercised by the
Director or District Magistrate having jurisdiction and in the
case at hand the District Magistrate, Burdwan is the competent
authority to exercise the power under paragraph 9 of the
Control Order and not the Director of Consumer Goods; that D
assuming the Director had jurisdiction, the proceeding 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 E
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. F
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:-
G
"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?
H
320 SUPREME COURT REPORTS [2015] 9 S.C.R.
A b. \/Vhether 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?"
B
7. After posing the aforesaid two questions, the Division
Bench took note of the fact that the respondent-dealer was
authorised to carry on the business as an agent of super
kerosene oil in the district of Burdwan and the SCFS had
C issued a show cause to the respondent and instead of taking
the final decision himself, forwarded the records to the Director
of Consumer Goods for necessary action who issued a fresh
show cause notice on the self-same allegations and passed a
order on 22.07.2013 which was without jurisdiction in view of
D ·the conjoint reading of the language employed in paragraphs
8, 9 and 10 of the Control Order. Thereafter, the Division Bench
proceeded to deal with the issue whether the Director had
passed the order imposing penalty within 30 days from the
date of serving the show cause notice in terms of paragraph 9
E of the Control Order, for the same was served on the dealer on
12.8.2013. The Court took note of the contention of the
advanced by the learned counsel for the appellants therein that
the order under Paragraph 9 passed by the competent
F authority in writing within 30 days from the date of serving the
show cause notice should mean the communication of the
order in writing within the said period of 30 days and not from
the signing of the order and accepted the same. To arrive at
the said conclusion, the appellate Bench placed reliance on
G Rani Sati Kerosene Supply Company and Others v. The
State of West Bengal and Others 1 • It referred to paragraphs
27 and 29 of the said decision and thereafter came to hold
thus:-
H 1
2005 (4) CHN 264
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 321
[DIPAK MISRA, J.]
"For the reasons discussed hereinabove, we hold thatthe A
Sub-Divisional Controller, Food and Supplies. Burdwan
lawfully initiated the proceeding against the appellanVwrit
petitioner no. 1 by issuing show cause notice but did not
conclude the same within 30 days as required under
paragraph 9 of the West Bengal Kerosene Control Order, B
1968.
We further hold that the Director of Consumer Goods had
no jurisdiction and/or authority to initiate any proceeding
against the appellanVwrit petitioner no. 1 in terms of C
paragraph 9 of the West Bengal Kerosene Control Order
since the licence was granted to the appellant/writ
petitioner no. 1 for carrying on business as S.K. Oil agent
in the district of Burdwan which is outside Calcutta.
D
In the result, the impugned order dated 22nd July, 2013
passed by the Director of Consumer Goods cannot survive
and is liable 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, E
1968 in respect of S.K. Oii 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."
F
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 G
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 H
when the final hearing of the appeal took place, we were
322 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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:~
B "In course of hearing we have been apprised that the Sub-
Divisional Controller, Food and Supplies, Burdwan, who
represents the District Magistrate, Burdwan, has issued
a fresh show cause notice on the self-same lis and against
its notice to show cause, an appeal has been preferred
C before the Director of Consumer Goods in Kolkata. Be it
noted, the show cause number is Memo No. 4159/
SCF&S/BDN/14. The appeal arisen out of the said show
cause notice before the appellate authority, shall remain
stayed till the pronouncement of the judgment."
D
10. We shall advert to the legal permissibility of the second
show cause in respect of the same alleged deviation by the
agent at a later stage, if required. As the factual foundation
would exposit, the thrust of the controversy is whether the
E Director of Consumer Goods, Food and Supplies Department
has the jurisdiction to take action in the manner he has taken;
and whether the order has to be passed and communicated
within 30 days under the Control Order and the consequence
of failure in such a situation. The Control Order was brought
F into force on 26.6.1968 in exercise of powers conferred by
sub-section 1 of Section 3 of the Essential Commodities Act,
1955 read with clauses (d), (e), (h) and 0) of sub-section 2 of
that Section and Section ?'(1) of the said Act and the Order
No. 26(11)-Com.Genl/66, dated ·1a1h June, 1966 feeling the
G necessity and expediency for proper maintenance of supplies
and for securing the equitable distribution and availability at
fair prices of kerosene in West Bengal. Paragraph 3(a) of the
Control Order defines "agent" which reads as under:-
H "3(a) "agent" means a person who has been appointed
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 323
[DIPAK MISRA, J.]
as an agent of an oil distributing company by such company A
and has been granted a licence under paragraph 5 of this
Order."
11. Paragraph 3( c) of the Control Order defines "dealer"
which reads as follows:- B
"3(c) "dealer" means a person who has been granted a
licence under paragraph 6 of this Order authorising him
to carry on trade in kerosene.
12. Paragraphs 3(d) and 3(e) of the Control Order define C
the "Director" and the "District Magistrate" respectively, which
reads as follows:-
3(d) "Director" means the Director of Consumer Goods,
Department of Food and Supplies, Government of West D
Bengal and includes any officer, not below the rank of
Assistant Director, Directorate of Consumer Goods, Food
and Supplies Department, Government of West Bengal
who can perform all the functions of the Director and this
order including cancellation of licence. E
3(e) "District Magistrate" 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, F
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."
G
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 H
324 SUPREME COURT REPORTS [2015] 9 S.C.R.
A him to carry on trade in kerosene as such agent.
(2)Alicence 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
B 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
c 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 to a dealer. It
is as follows:-
D "6. Grant of licence to dealer- (1) the Director or the
District Magistrate having jurisdiction may grant a licence
to any person authorsing such person to carry on trade in
kerosene as a dealer.
E (2)A licence granted under sub-paragraph (1) shall be in
Form B and shall be subject to such conditions as are
specified therein and such other conditions as the Director
or the District Magistrate having jurisdiction may impose
from time to time for the sake of fair distribution of
F kerosene."
15. Paragraph 9 of the Control Order deals with
cancellation or suspension of licence. The same being of
significance, is reproduced in entirety herein below:-
G
"9. Cancellation or suspension of licence - If it
appears to the Director or the District Magistrate having
jurisdiction that an agent or a dealer has indulged in any
malpractice or contravened any provision of this Order or
H any condition of the licence or any direction given under
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 325
[DIPAK MISRA, J.]
paragraph 12 of this Order, he may forthwith as the Agent A
or Dealer to show cause for violations made or suspend
the licence:
Provided that the agent or the dealer who has been asked
to show-cause or whose licence has been suspended B
shall be given an opportunity of being heard and the
Director or the District Magistrate having jurisdiction shall
pass an order in writing within 30 days from the date of
serving the show-cause notice or suspension of the
licence taking any or all of the actions given below. C
(i) He may let off the Agent or Dealer if sufficient cause
has been shown.
(ii) He may pass an order by imposing a penalty which
0
according to the gravity of the violations made will
not be less than Rs.10,000/- in case of an Agent and
Rs.2,000/- in case of a Dealer and revoke the
suspension order if already served.
(iii) He may cancel the licence: E
Provided that the order shall be passed ex parte if the
Agent or the Dealer whose licence has been so
suspended or on whom show-cause notice has been
served fails to appear at the hearing." F
16. Paragraph 10 of the Control Order which provides for
appeal is extracted hereunder:-
"10. Appeal - (a) Any person aggrieved by an Order G
passed under paragraph 8 or paragraph 9 of this Order,
may within 30 days from the date of the order, prefer an
appeal to the State Government in the Food and Supplies
Department.
H
326 SUPREME COURT REPORTS [2015] 9 S.C.R.
A (b) elsewhere, -
(i) where the order is passed by the District Magistrate or
the Deputy Commissioner of a district, to the State
Government,
B
(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,
c 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
D the Director to grant licence to any ag_ent 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
E 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:-
F
"7. Renewal of licences, licence fees, etc. - ( 1) Every
licence issued under paragraph 5 or paragraph 6 of this
Order shall be valid up to 31s1 December next following
the date of issue and may, at the discretion of the authority
G by which the licence was granted, be renewed for
successive periods of one year on an application made
in that behalf to such authority in the manner provided
hereinafter before the expiry of the date of validity of the
licence:
H
Provided that -
STATE OFWEST BENGALAND OTHERS v. R.K.B.K. LTD. 327
[DIPAK MISRA, J.]
(i) the Director may, by notification in the Official Gazette, A
extend the period of validity of existing agents' licences
issued under paragraph 5 of this Order for such period,
... not exceeding 60 days, beyond the 31st December,
hereinbefore mentioned, as he may, for reasons to be
recorded in writing, think fit; and B
(ii) the Director, or the District Magistrate having
jurisdiction, may, by notification in the Official Gazette,
extend the period of validity of existing dealers' licences
issued under paragraph 6 of this Order for such period, C
not exceeding 60 days beyond the 31st December,
hereinbefore mentioned, as he may; for reasons to be
recorded in writing, think fit: Provided further that the
Director or the District Magistrate, as the case may be,
may, by notification in the Official Gazette, extend the time D
for filing of application for renewal of licences:
Provided also that on an application made by a licensee
in that behalf, the authority by which the licence was issued
may, if he considers it expedient so to do, renew a licence E
issued under paragraph 5 or paragraph 6 of this Order,
for a maximum period of three years at a time on payment
in non-judicial stamps of the fees for renewal of licences
referred to in sub-paragraph (3) of this paragraph, for each
year of renewal or part thereof. F
(2) Every application for the issue of licence under
paragraph 5 or paragraph 6 of the Order or for the renewal
of such licence under this paragraphs shall be made to
the appropriate authority in Form C". G
18. On a reading of that paragraph it is clear that power
conferre·d on the Director and the District Magistrate are
different, for the Director is a higher authority and the rule
clothes him with more authority. Needless to say, the said H
328 SUPREME COURT REPORTS [2015) 9 S.C.R.
A 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 grc:inted either by the Director or by the DistriG1
Magistrate. Sub-para 3 of Paragraph 5 of the Control Order
B 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
C 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.
D 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.
E 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" as per paragraph
F 3(e) of the Control Order includes authorities mentioned
therein. Paragraph 9 which pertains to cancellation or
suspension of licence is a composite paragraph and stipulates
when and who can cancel or suspend a licence of an agent or
a dealer. The said power is exercised, when an agent or dealer
G has indulged in any kind of malpractice or contravened any
provision of the Control Order or conditions applicable, etc.
On a literal reading of paragraph 9, it may convey or one may
be emboldened to urge that Director as well as the District
Magistrate including the authorised officers mentioned in
H paragraph 3(e), have concurrent jurisdiction to cancel or
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 329
[DIPAK MISRA, J.]
suspend the licence granted to an agent or a dealer. However, A
such an interpretation could not be occurred with the legislative
intent and would lead to absurdity and anomaly. Therefore, such
kind of an interpretation has to be avoided. We are disposed
to think so inasmuch as an agent, as noted above, is appointed
by the Director and has the authority to carry on trade of B
kerosene within the entire State. But a dealer, cannot supply,
sell or transfer kerose.ne to any person other than a holder of a ·
permit, delivery order or through a dealer specified in
paragraph 6. That apart, it is noticeable that sub-paragraph
(e) of paragraph (3) a District Magistrate would include a sub- C
Divisional Controller of Food and Supplies, authorised by the
District Magistrate or Deputy Commissioner and District
Magistrate is for a specified small area within the State. He
cannot exercise jurisdiction in respect of an area beyond the D .
geographical boundaries of the. area/district. In.such a situation
to place a construction on Paragraph 9 that the Director as
well as the District Magistrate would have concurrent
jurisdiction would be inapposite. In our considered view, a
logical and reasonable interpretation to paragraph 9 of the E
Control Order has to be preferred instead of adopting the loose
meaning in the literal sense. Such an interpretation would be
in consonance with the principles of harmonious construction,
that is, harmonious reading of paragraphs 5, 6, 7 and 9 of the
Control Order. It is based on the premise that the authority who F
has the right to grant licence has the authority to suspend or
cancel the licence. In this regard, we may fruitfully reproduce
a passage from Reserve Bank of India v. Peerless General
Finance and Investment Co. Ltd. and Others2 , wherein it
has succinctly been stated thus:- G
"Interpretation must depend on the text and the context.
They are the bases of interpretation. One may well say if
2
(1987) 1 sec 424 H
330 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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
B 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
c 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
D
say as to f~t into the scheme of the entire Act. No part of a
statute and no word of a statute can be construed in
isolation. Statutes have to be construed so that every word
has a place and everything is in its place."
E 20. We have referred to the said passage, for the Control
Order was brought into force for maintenance of supplies and
for securing the equitable distribution and availability of
kerosene at fair prices in West Bengal. It has controlling
F measures and it subserves the public purpose. The intent of
the Control Order is to totally prohibit creation of any kind of
situation which will frustrate the proper distribution of kerosene
oil. The purpose of any Act or Rule or Order has its own sanctity.
While interpreting the same, the text and context have to be
G kept in mind. In this regard, we may usefully .refer to an
authority in Workmen v. Dimakuchi Tea Estate3, wherein the
three-Judge Bench while interpreting the expression "any
person" occurring in Section 2(k) of the Industrial DisputesAct,
H ' AIR 1958 SC 353
STATE OF WEST BENGALAND OTHERS v. R.K.B.K. LTD. 331"
[DIPAK MISRA, J.]
1947 observed that the definition clause must be read in the A
context of the subject matter and scheme of the Act, and
consistently with the objects and other provisions of the Act.
Elaborating further, the Court proceeded to state:-
"lt is well settled that "the words of a statute, when there is B
a doubt about their meaning are to be understood in the
sense in which they best harmonise with the subject of the
enactment and the object which the legislature has in view.
Their meaning is found not so much in a strictly
grammatical or etymological propriety of language, nor C
even in its popul<ir use, as in the subject or in the occasion
on which they are used, and the object to be attained".
(Maxwell, lnterp1etationofStatutes, 9th Edn., p. 55)."
21. Keeping in view the aforesaid rule of interpretation, D
we are constrained to think that it would be incongruous to
hold that even when the licence of an agent at the State. level is
granted and issued by the Director, a District Magistrate, as
defined in paragraph 3(e) of the Control Order, in exercise of
concurrent jurisdiction can suspend or cancel the State level E
licence. Be it noted, as per Section 21 of the General Clauses
Act, power to issue notification/ order/rules/bye-laws, etc.
includes the power to amend/ vary or rescind. Though the said
provision is not applicable, yet it is indicative that generally
unless the statute or rule provides to the contrary, either F
expressly or impliedly, issuing or appointing authority would
also 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 G
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 H
332 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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
B manner, we have no hesitation in holding thatit 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
C cause notice to ascertain and affirm facts alleged and it
ensured a response and reply from the first respondent. The
said notice by SCFS could not have culminated in the order
under paragraph 9, for he has no authority and jurisdiction to
D pass an order suspending or cancelling the licence. Therefore,
the matter was rightly referred to the Director for action, if
required, in terms of paragraph 9 of the Control Order.
22. Having held that, we think it appropriate to refer to the
aspect of communication pertaining to period as prescribed
E in paragraphs 9 and 10. The High Court has taken note of the
fact that SCFS had issued the notice of show cause to which
the agent had replied. The said authority has forwarded the
matter to the Director, Consumer Goods for his perusal and
F necessary action, who in exercise of his authority had passed
the order on 22.7.2013 which was received by the first
respondent on 12.8.2013. The Division Bench has opined that
as per Paragraph 9, the order has to be passed within 30
days after the issue of the notice to show cause and same has
G to be communicated within the said period and passing an
order on the file would not tantamount to an order.
23. The Division Bench, as it appears, has been guided
by the decision in Rani Sati Kerosene Supply Company
H and Others (supra). In the said case the agent had challenged
the order of suspension-cum-show cause notice and the order
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 333
[DIPAK MISRA, J.]
of cancelling the agency licence. The High Court had taken A
note of the contention that assuming the Director had
Jurisdiction, the order having been communicated beyond 30
days from the issue of the order of suspension, it was liable to
be set aside. After stating the facts, the earlier Division Bench
proceeded to interpret Paragraphs 9 and 10 of the Control B
Order and opined thus:-
"29. After going through the aforesaid two paragraphs, I
find that against an order of cancellation of licence, there
is a provision of appeal to be availed of within 30 days C
from the date of the order. There is, however, no power
conferred upon the appellate authority to entertain such
appeal after the period of limitation by condoning the delay.
If I accept the contention of Mr. Chakraborty, the learned
Counsel appearing for the State that the date of D
communication of the order is insignificant, in that case,
the right of appeal conferred upon the aggrieved agent
against an order of cancellation can easily be frustrated
by communicating the order after th~ expiry of 30 days
from the date of the order. Therefore the phrase "by an· E
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 F
not been passed and consequently, a duty is cast upon
the authority concerned to communicate the order to the
aggrieved, eitber direct or constructively. Mere passing
of an order and keeping it in the file will not fulfil the
requirement of the said Paragraph 9. G
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 Transporl Commissioner, Uttar Pradesh v. H
Nand Singh, [reported in 179 ELT (510) where the Apex
334 SUPREME COURT REPORTS [2015] 9 S.C.R.
A Court while considering Section 35 of the Central Excise
and Salt Act, 1944 heid 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
B when it comes to the knowledge either direct or
constructively, otherwise not. The Supreme Court further
held that mere writing of an order in the file, kept in the
office of the authorities, is no order in the eye of law.
c 31. The aforesaid decision of the Supreme Court supports
the contention of the petitioners that the order of
cancellation, for all practical purposes, should be deemed
to have been passed on January 30, 2004 when the same
was faxed for communication to the petitioners and served
D upon them. Thus, the order of cancellation of licence was,
in the eye of law, passed beyond 30 days from the date of
passing the order of suspension and consequently, the
order of suspension had automatically ceased to have any
effect from January 10, 2004, and the order of cancellation
E not having been passed in accordance with law within 30 .
days from December 10, 2003, the Director could not
pass any such order beyond that date. Thus, the order
impugned is liable to be quashed also on the aforesaid
ground."
F
The said judgment is the fulcrum of reasoning of the
impugned judgment.
24. The aforesaid decision, as is evident, lays down that
G passing of the order and communication thereof must be within
30 days and on that basis has opined that the order passed
on the file and not communicated to the person aggrieved is
not an order that can be taken cognizance of. There can be
no scintilla of doubt that unless an adverse order is
H communicated that does not come into effect. Passing of an
STATE OF WEST BENGALAND OTHERS v R.K.B.K. LTD. 335
[DIPAK MISRA, J.]
order on the file does not become an order in the eye of law. A
But the core question would be, if an order is passed within 30
days and. communicated thereafter, what would be the effect.
In the instant case, as the factual matrix would unveil, the order
was passed before expiration of 30 days, but the same was
served on the first respondent beyond 30 days. The thrust of B
the matter is whether the order has to be passed and
communicated within 30 days. Paragraph 9 of the Control
Order requires the competent authority to pass an order within
30 days from the date of serving the show cause notice or the
suspension of licence. The word used is "shall". Paragraph C
10 of the Control Order enables the aggrieved person to prefer
an appeal against an order passed under Paragraph 8 or 9
within 30 days to the State Government in Food and Supplies
Department. ·in this context, reference to the authority in r.t/CD D
v. Qimat Rai Gupta and others4 is of significance. In the said
case, 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. E
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 F
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 G
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.
• (2007) 7 sec 309 H
336 SUPREME COURT REPORTS (2015) 9 S.C.R.
A Rubber and Co. 5 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 same should be given purposive meaning so as to fulfil the
purport and object of the legislation. While dealing with the
B period of limitation, the Court observed:-
"16. In interpreting a provision dealing with limitation, a
liberal interpretation in a situation of this nature should be
given. Although an order passed after expiry of the period
C of limitation fixed under the statute would be a nullity, the
same would not mean that a principle of interpretation
applied thereto should not (sic) be such so as to mean
that not only an order is required to be made but the same
is also required to be communicated.
D
17. When an order is passed by a high ranking authority
appointed by the Central Government, the law presumes
that it would act bona fide. Misuse of power in a situation
of this nature, in our opinion, should not be readily inferred.
E It is difficult to comprehend that while fixing a period of
limitation, Parliament did not visualise the possibility of
abuse of power on the part of the statutory authority. It
advisedly chose the word "made" and not "communicated".
They, in ordinary parlance, carry different meanings."
F
25. After so stating, the Court proceeded to interpret the
term "made" and observed that meaning of a word depends
upon the text and context and it will also depend upon the
purport and object it seeks to achieve. The two-Judge Bench
G referred to Surendra Singh v. State of U.P. 6 , Harish Chandra
Raj Singh v. Dy. Land Acquisition Officer7 and
s (1992) supp. (1) sec 471
6 AIR 1954 SC 194
H 1
AIR 1961SC1500
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 337
[DIPAK MISRA, J.]
K.Bhaskaran v. Sankaran Vaidhya Ba/an 6 • The Court A
reproduced paragraphs 12 and 18 from M.M. Rubber and
Co. (supra). They read as follows:-
" 12. It may be seen therefore, that, if an authority is
authorised to exercise a power or do an act affecting the B
rights of parties, he shall exercise that power within the
period of limitation prescribed therefor. The order or
decision of such authority comes into force or becomes
operative or becomes an effective order or decision on
and from the date when it is signed by him. The date of C
such order or decision is the date on which the order or
. decision was passed or made: that is to say when he
ceases to have any authority to tear it off and draft a
different order and when he ceas~s to have any locus
paetentiae. Normally that happens when the order or D
. · decision is made public or notified in some form or when
it can 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 E
the prescribed time."
)()()()()( xxxxx )()()()()(
"18. Thus ifthe intention or design of the statutory provision F
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 G
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
• (1999) 7 sec s10 H
338 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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
B decision."
Eventually, the Court came to hold thus:
· "An order passed by a competent authority dismissing a
C government servant from services requires communication
thereof as has been held in State of Punjab v. Amar Singh
Harika 9 but an order placing a government servant on
suspension does not require communication of that order.
(See State of Punjab v. Khemi Ram 10 .) What is, therefore,
D necessary to be borne in mind is the knowledge leading
to the making of the order. An order ordinarily would be
presumed to have been made when it is signed. Once it
is signed and an entry in that regard is made in the
requisite register kept and maintained in terms of the
E provisions of a statute, the same cannot be changed or
altered. It, subject to the other provisions contained in the
Act, attains finality. Where, however, communication of an
order is a necessary ingredient for bringing an end result
to a status or to provide a person an opportunity to take
F recourse to law if he is aggrieved thereby, the order is
required to be communicated."
26. We have referred to the aforesaid authority in extenso
as the Division Bench has in one line stated that the said
G decision makes it clear that communication of an order is
necessary ingredient for bringing an end result to a status or
to provide a person an opportunity to take recourse to law if
9
• AIR 1966 SC 1313
H 10
(1969) 3 sec 20
\
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 339
[DIPAK MISRA, J.]
he is aggrieved thereby, then the said order is required to be A
communicated. To arrive at the said conclusion, as has been
stated earlier, the Division Bench has found support from Rani
Sati Kerosene Supply Company and Others (supra)
wherein it has been held that if an order is communicated after
30 days, an ·order of cancellation can easily be frustrated and, B
therefore, the phrase by an order in writing to be made
appearing in proviso to Paragraph 9 of the Control Order is to
be construed as by an order in writing to be communicated.
27. The Division Bench has read the prescription of 30 C
days passing of an order in writing within 30 days from the
date of serving the show cause notice or suspension of licence
to be mandatory. To elaborate, if the order is not passed within
the said period, the a.uthority cannot pass any order or if it
passes an order, it is a nullity. In this context, we may fruitfully D
refer to a passage from G.P. Singh's book, as has been
reproduced by the three-Judge Bench in Kai/ash v. Nankhu
and others11 • It reads as under:-
"Justice G.P. Singh notes in his celebrated work Principles E
of Statutory Interpretation (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 F
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 G
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
11
(2005) 4 sec 480
H
340 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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',
B points out Subbarao, J. 'the court may consider intera/ia,
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;
c the circumstances, namely, that the statute provides for a
contingency of the non-compliance with the provisions; the
fact that the non-compliance with the provisions is or is
not visited by some penalty; the serious or the trivial
consequences, that flow therefrom; and above all, whether
D the object of the legislation will be· defeated or furthered'.
If object of the enactment will be defeated by holding the
same directory, it will be construed as mandatory, whereas
if by holding it mandatory serious general inconvenience
will be created to innocent persons without very much
E furthering the object of enactment, the same will be
construed as directory." (pp. 339-40)"
28. Keeping in view the aforesaid principles, if it is held
that the order would become a nullity, it really does not serve
F 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
G 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 the order will take effect from the date when
H it is served. The order, unless it is served, definitely neither
the agent nor the dealer would suspend its activities or obey
STATE OF WEST BENGAL AND OTHERS v. R.K.B.K. LTD. 341
[DIPAK MISRA, J.]
any order, for he has not been communicated. Regard being A
had to this aspect, it is to be seen whether the prescription of
30 days from the date of order as provided in Paragraph 10
would make the order null and void. The order passed by the
authority comes into effect when it is communicated. An order
passed in file in case of this nature would not be an effective B
order, for it is adverse to the interest of the dealer or agent
and, therefore, paragraph 10 has to be given a purposive
m_eaning. It has to convey that 30 days from the date of the
order which is an effective order, and that is the date of
communication. Unless such an interpretation is placed, the C
intention of the rule making authority and also the intention
behind the object and reasons behind the Control Order and
the Essential Commodities Act, 1955 would be frustrated.
Thus, we are of the considered opinion that the view expressed
0
by the High Court on this score also is absolutely 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 E
or the dealer. Once that becomes the decision, the
commencement of limitation of 30 days for the purpose of
Paragraph 1Owould be the date when the order is effective.
The High Court in Rani Sati Kerosene Supply Company F
and Others (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 G
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". H
342 SUPREME COURT REPORTS [2015] 9 S.C.R.
A 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 view of the aforesaid analysis, we arrive at the
B irresistible conclusion that the High Court has erroneously
interpreted Paragraph 9 and 10 of the Control Order and that
is why it has arrived at an erroneous conclusion. When we
had reserved the judgment, we were apprised that a fresh show
cause notice had been issued for the self-same allegation by
C the SCFS and an appeal has been preferred against them.
As we have held, the Director alone has thejurisdiction to pass
the order, the said order remains a valid order and can be
challenged in an appeal under Paragraph 10 and the appellate
authority would be the State Government.
D
31. Consequently, the appeal is allowed and the order
passed by the Division Bench in AST No. 177/2013 is set aside
and the respondent no.1 is granted liberty to prefer an appeal
within the prescribed period before the State Government. Be
E it noted, the Control Order has been amended in 2014 whereby
the period of limitation has been extended. Be that as it may,
we direct that the period of limitation shall commence from
today. There shall be no order as to costs.
F Kalpana K. Tripathy Appeal allowed.
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