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Sanjay Kumar v. State Of U.P And Others
Judgment Summary — Dr. B.S. Chauhan, J.
Factual and Procedural Background
The petitioner holds a licence to carry on the fireworks business which was valid up to 31 March 2003. In June 2000, authorities determined that fireworks businesses should be shifted out of residential/congested areas for security and public interest. A show-cause notice was issued and, following a hearing, the petitioner’s licence was cancelled by order dated 21-6-2000 with a 15-day direction to clear stock and a possibility to apply afresh after shifting. Several licensees appealed to the Divisional Commissioner, who on 13-11-2000 directed that those willing to shift outside congested areas may be entitled to fresh licences and ordered formation of a committee to examine public interest and consider applications.
Subsequent administrative orders (including ones dated 6-7-2001 and 12-11-2001) imposed conditions requiring shifting from congested areas as a condition for renewal. The Divisional Commissioner on 8-8-2003 directed the District Collector to decide renewal applications within 30 days on the committee’s report, and provided that in the absence of a decision licences would be deemed automatically renewed. Pursuant to this framework, the District Magistrate issued the impugned order dated 12/15-9-2003 directing the petitioner and others not to run the fireworks business in the densely populated area and stating that applications for renewal would be considered only upon shifting outside the city; otherwise the renewal would be deemed rejected. The petitioner filed the present writ petition to quash that direction and to seek protection from interference with his business inside the city.
Legal Issues Presented
- Whether the licensing authority could pass an order (the impugned order dated 12/15-9-2003) directing licence-holders to shift out of the congested area and stating that failure to shift would result in their application for renewal being deemed rejected, when the statute and rules do not expressly provide for a deeming rejection/cancellation.
- Whether the doctrine of "deeming" or creation of legal fictions by administrative action (or by court interpretation) is permissible in the absence of an express statutory provision.
- Whether the petitioner’s challenge is maintainable in this Court given the existence of appellate/administrative remedies and prior orders by the Divisional Commissioner which imposed similar conditions and had attained finality.
Arguments of the Parties
Petitioner's Arguments
- The petitioner (through Shri V.P. Srivastava) submitted that the impugned order cannot validly ask him to close his business during peak festival periods (Dussehra and Diwali), which are the most lucrative times for fireworks sales.
- It was argued that it is difficult for the petitioner to obtain alternative accommodation outside densely populated areas within the short time provided.
- The petitioner contended that the impugned order is neither an express rejection nor a renewal of his licence, and that the statute does not envisage the passing of such an order; therefore the order is liable to be quashed.
Respondents' Arguments
- The learned Standing Counsel contended that the impugned order is appealable before the Divisional Commissioner and that the petitioner has not exhausted statutory remedies, having approached several authorities previously.
- It was submitted that the petitioner has been repeatedly asked over three years to shift his business outside the densely populated area and has not provided an adequate explanation for failing to do so.
- The respondents emphasised that the order was passed in the larger public interest and that the Court should not grant any indulgence to the petitioner on that basis.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Rana Pratap Singh v. State of U.P., 1995(2) JCLR 569 (All) : 1995 (1) Civil and Revenue Cases 732 | That in the absence of an express statutory provision or rule, a deeming fiction/refusal should not be read into the statute. | The Court relied on this Constitution Bench view to hold that absent statutory sanction a deeming rejection cannot be accepted. |
| State of Jammu and Kashmir v. Triloki Nath Khosa, AIR 1994 SC 1 | Creation of legal fictions by judicial interpretation may amount to legislating, which courts must avoid. | Referenced to support the proposition that courts/authorities should not create a fiction where statute is silent. |
| Ajaib Singh v. Sirhind Co-op. Marketing-cum-processing Service Society Ltd., (1999)6 SCC 82 | Similar principle that judicial creation of fictitious deeming may usurp legislative function. | Cited alongside Triloki Nath Khosa to caution against judicial or administrative creation of deeming fictions. |
| Union of India v. Deoki Nandan Aggarwal, AIR 1992 SC 96 | Courts must not enlarge the scope or recast plain legislative language; courts cannot legislate. | Quoted (including the extract) to reinforce that the Court cannot rewrite legislation to create a deeming effect where none exists. |
| Radhakissen Chamria and others v. Durga Prasad Chamria and another, AIR 1940 PC 167 | That even when statutes provide for a legal fiction, it must be limited to the purposes indicated by context. | Used to show limitations on the application of deeming provisions and that they cannot be given larger effect than intended. |
| State of Travencore- Cochin v. S.V. Cashewnut Actory Quilon, AIR 1953 SC 333 | Same principle regarding limits on legal fictions provided by statute. | Invoked to support the Court's caution in applying deeming provisions only within their contextual limits. |
| Bengal Immunity Co. Ltd. v. State of Bihar and others, AIR 1955 SC 661 | Authority on limits of legal fictions and presumptions. | Referenced as part of the jurisprudence delineating the boundaries of deeming provisions. |
| Modi Cement Ltd. v. Kuchil Kumar Nandi, AIR 1998 SC 1057 | Explained distinction between "deeming provisions" and "presumption". | Relied upon to underline that deeming and presumption are distinct concepts and must be applied according to legislative intent. |
| State of Kerala and others v. Dr. S.G. Sarvothama Prabhu, AIR 1999 SC 1195 | Consistent position by the apex Court on the limits of judicial/administrative creation of legal fictions. | Cited to demonstrate the settled approach of the Supreme Court on deeming provisions. |
| Commissioner Of Income Tax v. Mysodet (P) Ltd., Bangalore., AIR 1999 SC 1271 | Same line of authority regarding legal fictions and their proper scope. | Referenced as part of the consistent Supreme Court view relied upon by the Court. |
| Garden Silk Mills Ltd. and another v. Union of India and others, (1999)8 SCC 744 | Another Supreme Court authority on the proper scope and limits of deeming provisions. | Used to corroborate the Court's stance that deeming/provisional fictions cannot be extended beyond statutory intent. |
Court's Reasoning and Analysis
The Court proceeded in a stepwise manner:
- Observation of administrative history: The Court noted repeated administrative actions and directions requiring licence-holders to shift out of congested areas, including the Divisional Commissioner’s earlier orders and formation of an official committee to report on suitability of locations.
- Identification of the impugned action: The impugned District Magistrate order dated 12/15-9-2003 directed licence-holders not to run business in densely populated areas and stated that if they did not shift, their renewal applications would be deemed rejected.
- Legal principle on "deeming": The Court emphasized the settled legal proposition that a deeming fiction or refusal cannot be read into a statute or rules by implication unless the statute expressly provides for it. The Court relied on several authorities (including Rana Pratap Singh and Deoki Nandan Aggarwal) to underscore that courts and administrative authorities must not create legal fictions by interpretation where the statute is silent, as doing so would amount to legislation.
- Statutory framework specific to the matter: The Court examined Rule 165 of the Explosives Rules, 1983, which provides that where an application for renewal has been filed in time and is not disposed of, the licence shall be deemed to be in force until renewal or until an intimation that renewal is refused is communicated. The Court observed that this rule provides a limited fiction only for a transitory period and that neither the Explosives Act nor the rules envisage a deemed cancellation or deemed renewal beyond the transitory context.
- Assessment of the impugned order against statutory scheme: The Court held that the licensing authority’s order purporting to treat an application as "deemed rejected" unless the licence-holder shifted was not in conformity with the statutory scheme and amounted to passing orders without complying with statutory requirements.
- Consideration of prior appellate order and finality: The Court noted that the Divisional Commissioner’s order dated 12-11-2001 imposing various conditions (including shifting) had attained finality and had not been challenged by the licensees; consequently, the Court queried on what basis the petitioner could seek relief later to avoid a binding condition.
- Public interest and conduct of the petitioner: The Court observed that the demand to shift had been made repeatedly over three years in the larger public interest and that the petitioner had not shown any record of attempt to shift outside the densely populated area. The Court emphasized the primacy of public interest over individual convenience where justified.
- Conclusion from reasoning: Balancing statutory interpretation, the limits on creating deeming fictions, the finality of prior administrative orders, and the absence of demonstrated effort by the petitioner to comply, the Court concluded that the impugned order required no interference.
Holding and Implications
Holding: Petition dismissed.
Direct implications for the parties:
- The impugned administrative direction of 12/15-9-2003 stands and the Court declined to quash it.
- The Court observed that if the petitioner arranges an alternative location and shifts his business outside the densely populated area and satisfies the licensing authority that he meets the conditions for grant of a licence, his application for renewal shall be considered strictly in accordance with law.
Broader implications:
The opinion reiterates established principles limiting the judicial or administrative creation of deeming fictions in the absence of express statutory authority and stresses adherence to the statutory scheme (noting Rule 165’s limited transitory fiction). The Court did not indicate that it was laying down a new or broader precedent beyond applying these established authorities; its decision is grounded on applying settled principles to the administrative facts and prior final administrative orders.
End of summary based exclusively on the provided opinion.
Dr. B.S. Chauhan, J. -
This writ petition has been filed for quashing order dated 12-9-2003 (Annexure-17), by which the District Magistrate, Ghaziabad has issued a direction to the petitioner to shift his premises for carrying on the business of the fireworks out of the residential area, otherwise his licence shall be deemed not to have been renewed and further to issue a direction to the respondents not to interfere with his business inside the city.
2. Facts and circumstances giving rise to this case are that petitioner is a licence holder for fireworks and it was valid only upto 31st March, 2003. In June 2000, need was felt that the licence under the provisions of the Explosives Act, 1884, should be shifted outside the residential/congested area and they should not be permitted to have their business within the densely populated area for the purpose of security and in larger public interest. Show-cause notice was issued to the petitioner alongwith other similarly situated persons and after giving an opportunity of hearing to him vide order dated 21-6-2000, (Annexure-1), the licence of the petitioner was cancelled.
3. However, it was made clear that within a period of 15 days, the licence holders should clear off their stock and after shifting their business outside the congested area, then they will be entitled to apply for the licence a fresh. Being aggrieved and dis-satisfied, some of the licensees approached the appellate Court i.e., Divisional Commissioner, Meerut and the matter was disposed of vide order dated 13-11-2000, issuing a direction that in case licensees are willing to shift their business outside the congested area, they may be entitled for having a fresh licence, but to examine their grievances, it was directed to have a committee of officers including the City Magistrate, Police Officers and Fire Officer, and to examine as to whether it was in public interest to permit them to have their business on the places outside the residential area and then to consider their application for licenxce.
4. A similar order was passed in another connected appeal on 6th July, 2001, however, on 12-11-2001, the appeal was considered by the Divisional Commissioner, imposing certain conditions including the condition that the licensees shall shift out of the congested area. The issue was again considered by the District Collector in respect of 23 licensees, it was held that under certain circumstances the order of the Divisional Commissioner, that the licence of the licensees are being renewed only upto 31-3-2002, and it pointed out that there will be committee of officials consisting of the Additional City Magistrate, Circle Officer, Police Station, Ghaziabad and Fire Officers and they were directed to submit a report.
5. The Divisional Commissioner again passed an order dated 8-8- 2003, directing the District Collector to decide the applications for renewal within a period of 30 days, on the basis of the report submitted by the committee and in case no order is passed, the licences shall be deemed to be automatically renewed. In pursuance of the order, the impugned order dated 12/15-9-2003, has been passed by the District Magistrate directing the petitioner and others not to run the business in the congested area which is thickly populated and in case they are willing to shift outside the city, applications for their renewal shall be considered, otherwise it will be deemed to have been rejected. Hence this petition.
6. Learned Counsel for the petitioner Shri V.P. Srivastava, has submitted that the petitioner cannot be asked to close his business at the festival times i.e., Dussehra and Diwali, which is the most conducive period for the business and more so, it is difficult for the petitioner to get an alternative accommodation outside the thickly populated area within such a short period. The order is neither rejecting the application for renewal nor renewing the application and the act does not envisage for passing such an order, therefore, the order is liable to be quashed.
7. On the contrary, the learned Standing Counsel has submitted that the order is appellable before the Divisional Commissioner. Petitioner has earlier approached several authorities several times, and no explanation can be made in this regard. Petition has been filed without exhausting the statutory remedies. Petitioner is being asked for the last 3 years to shift his business outside the thickly populate area. Order is being passed in the larger public interest, therefore, this Court should not grant any indulgence whatsoever.
8. We have considered the rival submissions made by the learned Counsel for the parties and perused the record. It is not a case of utter surprise, but shocking that the statutory authorities are not passing the order having strict adherence to the statutory requirement. The appellate authority had earlier passed the order that in case certain action is not taken by the Licensing Authority, the licence would be deemed to have been renewed automatically.
9. Similarly, in the impugned order, the licensing authority has passed the order that in case the petitioner does not shift his business outside the thickly populated area his application for renewal of license shall be deemed to have been rejected.
10. It is settled legal proposition of law that unless that statute provides for a deeming clause, the Court should be very slow in accepting such a contention, as laid down by a Constitution Bench of the Allahabad High Court in Rana Pratap Singh v. State of U.P., 1995(2) JCLR 569 (All) : 1995 (1) Civil and Revenue Cases 732. The Court held that had the intention fiction/deeming sanction/refusal, specific in the Act or the Rules. In absence of any statutory provision/rule, it should not be construed as to provide for a fiction in such an eventuality.
11. More so, creating a fiction by judicial interpretation may amount to legislation, a field exclusively within the domain of the legislature. (Vide State of Jammu and Kashmir v. Triloki Nath Khosa, AIR 1994 SC 1; and Ajaib Singh v. Sirhind Co-op. Marketing-cum-processing Service Society Ltd., (1999)6 SCC 82).
12. In Union of India v. Deoki Nandan Aggarwal, AIR 1992 SC 96, the Hon'ble apex Court observed as under :
"It is not the duty of the Court either to enlarge the scope of the legislation or the intention of the legislature when the language of the provision is plain and unambiguous. The Court cannot rewrite, recast or reframe that legislation for the very good reason that it has no power to legislate. The power to legislate has not been conferred on the Court."
13. Even if the statute provides for a legal fiction/deeming provision, it must be limited to the purposes indicated by the context and cannot be given a larger effect. (Vide Radhakissen Chamria and others v. Durga Prasad Chamria and another, AIR 1940 PC 167; State of Travencore- Cochin v. S.V. Cashewnut Actory Quilon, AIR 1953 SC 333 and Bengal Immunity Co. Ltd. v. State of Bihar and others, AIR 1955 SC 661). In Modi Cement Ltd. v. Kuchil Kumar Nandi, AIR 1998 SC 1057, the Hon'ble apex Court explained the distinction between the “deeming provisions” and `presumption' and held that the distinction was well discernible.
14. Similar view has been taken by the Hon'ble apex Court in State of Kerala and others v. Dr. S.G. Sarvothama Prabhu, AIR 1999 SC 1195; Commissioner Of Income Tax v. Mysodet (P) Ltd., Bangalore., AIR 1999 SC 1271 and Garden Silk Mills Ltd. and another v. Union of India and others, (1999)8 SCC 744.
15. Rule 165 of the Explosive Rules, 1983, provide that if an application for renewal has been filed within time and it is not being disposed of by the licensing authority, the licence shall be deemed to be in force until such date as the licensing authority renews the licence or until an intimation that the renewal of the licence is refused and is communicated to the applicant. The rules provide for a fiction only for the transitory period, but neither the Explosives Act nor the rules framed thereunder envisage deemed cancellation or deemed renewal of a licence, thus the authorities have been passing the order without complying the requirement of the statutory provisions which cannot be held to be a sign of good governance.
16. The Divisional Commissioner i.e., appellate authority in his order dated 12th November 2001, had imposed large number of conditions and one of them contained in Clause 5 has been that the application of the licensees for the renewal shall be considered only if they shift from the present premises to a safer place and close their business in the existing premises.
17. The said order had never been challenged by any of the licensees and attained finality. We fail to understand as on what basis the petitioner can claim any relief at subsequent stage and how he can be permitted to agitate the issue that the said condition was not binding upon him.
18. Undoubtedly, in the instant case the petitioner is being asked for the last 3 years to shift his business outside the thickly populated area and the order is being passed in the larger public interest and it is settled legal proposition that the public interest is much higher than the interest of the individual. We fail to understand how the petitioner has not yet made an appropriate arrangement for shifting his business outside the thickly populated area. There is nothing on record to show that during the last 3 years, any attempt has been made by the petitioner to shift his business outside the densely populated area.
19. Undoubtedly, orders are being passed time and again only in larger public interest and the public interest is the Supreme law and Courts' should not come to rescue such an individual, if the public interest demands for a particular action on the part of the statutory authority.
20. Thus, in view of the above, we are of the considered opinion that the impugned order does not require any interference by this Court.
21. Needless to say, that if petitioner makes an alternative arrangement and shifts his business outside the densely populated area and satisfies the licensing authority that he would fulfill all the conditions for grant of licence and his application shall be considered for renewal strictly in accordance with law.
Petition dismissed.
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