Facts of the Case
A trader was carrying on his business under a valid licence issued by the competent Licensing Authority under the relevant statute. Subsequently, the Licensing Authority passed an order cancelling the trader’s licence. However, the authority did not supply a copy of the cancellation order to the trader, nor were reasons communicated for such cancellation. The trader preferred an appeal before the appellate authority as provided under the statute. The appeal was summarily rejected without assigning any reasons. Aggrieved by the arbitrary cancellation and non-speaking appellate order, the trader proposes to approach the court seeking judicial review of the administrative action.
Issues in the Case
- Whether non-supply of the cancellation order violates the principles of natural justice.
- Whether rejection of an appeal without reasons amounts to a non-speaking order.
- Whether cancellation of a licence affects the trader’s right to livelihood and business.
- Whether the trader can successfully invoke the writ jurisdiction of the court.
Legal Principles Covered to Support Case Proceedings and Judgements
A licence granted by the State creates valuable civil consequences, and its cancellation must comply with the principles of natural justice, particularly audi alteram partem. Supplying a copy of the order is essential to enable the aggrieved party to understand the reasons and to file an effective appeal.
In Siemens Engineering v. Union of India (1976), the Supreme Court held that every administrative order affecting rights must be a reasoned or speaking order. Similarly, in Kranti Associates v. Masood Ahmed Khan (2010), it was held that recording of reasons is an indispensable part of fair administrative decision-making.
Further, in Maneka Gandhi v. Union of India (1978), the Court ruled that any procedure affecting livelihood under Article 19(1)(g) and Article 21 must be just, fair, and reasonable. Rejection of an appeal without reasons shows arbitrariness and violates Article 14.
Possible Judgement
The court is likely to hold that the cancellation of the trader’s licence and rejection of the appeal suffer from serious procedural infirmities. Non-supply of the cancellation order and absence of reasons in the appellate order amount to a clear violation of natural justice and constitutional guarantees. Consequently, the trader will succeed before the court, and the impugned orders are likely to be quashed. The matter may be remanded to the authority for fresh consideration after supplying the order and passing a reasoned decision.
About lawgnan
Administrative Law problems on licence cancellation, natural justice, and reasoned orders are frequently tested in LLB and judiciary exams. Mastering these concepts helps students answer problem questions with precision and authority. For more exam-ready Administrative Law notes, case-based answers, writ jurisdiction explanations, and simplified legal concepts, visit lawgana.in. LawGana is designed exclusively for Indian law students preparing for LLB, judiciary, and competitive examinations. Follow lawgana.in to strengthen your understanding and improve your legal answer-writing skills.
