1. This petition has been filed by Sri Abdul Salam praying that the order dated 8th July, 1971 and order dated 16th August, 1971 passed by the opposite party No. 1 be quashed.
2. The petitioner held a licence for selling stamp in the Civil Court compound, Pratapgarh, since 1963. On 28th April, 1971, the Inspector of Stamp and Registration, made inspection of the office of the Sub-Registrar, Pratapgarh and found that the petitioner had sold stamps worth Rs. 90/- to Shri Shital Prasad Singh for executing a gale-deed in favour of Shri Dwarika Singh in respect of some land. The numbers of these stamps, their denominations and date on which they were purported to have been sold were as follows :
1. 132 Value 25/- Dated 26-9-1970
2. 133 Value 25/- Dated 27-9-1970
3. 134 Value 25/- Dated 28-9-1970
4. 135 Value 15/- Dated 29-9-1970
3. Similarly on 3-10-1970, the petitioner sold stamps worth Rs. 90/- again to Shri Shital Prasad Singh for executing another sale-deed in favour of Dwarika Singh. The particulars of these stamps were as follows :--
1. 136 Value 25/- Dated 30-9-1970
2. 137 Value 25/- Dated 1-10-1979
3. 138 Value 25/- Dated 2-10-1970
4. 139 Value 25/- (sic) (15?)
4. According to the terms of the licence granted to Abdul Salam, he could not sell stamps worth more than Rs. 25/- on any date. The Inspector of Stamp and Registration suspected that the four stamps, on which the sale-deed dated 29th September, 1970 was scribed were sold on one and the same date and similarly the four stamps, on which the sale-deed dated 3rd October, 1970 was scribed, were also sold on a single day and, since it constituted violation of his condition of licence, the petitioner wrongly had shown those stamps to have been sold on different dates. The Inspector of Stamp and Registration accordingly, made a report to the Dy. Commissioner, Pratapgarh for inquiry into the matter.
5. The Deputy Commissioner, Pratapgarh forwarded the report of the Inspector of Stamp and Registration to the District Stamp Officer for inquiry. The District Stamp Officer issued a notice to the petitioner to appear before him with all the papers on 17th June, 1971. Having heard the petitioner and having examined his papers, the District Stamp Officer submitted a report to the Dy. Commissioner stating that in his opinion all the four stamps on which the sale-deed dated 29th September. 1970 was scribed were sold on the same date, similarly all the four stamps on which the sale-deed dated 3rd October, 1970 was scribed were sold on one and the same date, and that Abdul Salam thus violated the condition of his licence. The Deputy Commissioner concurred with the findings of the District Stamp Officer and in the result, cancelled the licence of the petitioner by his order dated 8th July, 1971. The petitioner then submitted a representation dated 23rd July, 1971 to the Deputy Commissioner wherein he said that his licence had been cancelled with-out show cause opportunity having been given to him. This was rejected by the Deputy Commissioner vide his order dated 16th August, 1971. The petitioner, by the present writ petition, has challenged both the orders viz. order dated 8th July, 1971 as also that passed on 16th August. 1971.
6. The contention raised by the learned counsel for the petitioner before us was that the petitioner was granted a licence under the statutory rules framed under the Indian Stamp Act and, consequently, the licence granted to him could not be cancelled without a proper show cause opportunity having been granted to him. The learned counsel pointed out that even though the petitioner was summoned through a notice to appear before the District Stamp Officer on 16th June, 1971 along with his papers, he was neither given any copy of the report submitted by the Inspector of Stamp and Registration nor was he told that the accusation against him was that even though he had shown to have sold the eight stamps in eight different dates, he had sold four of them on one day and the remaining four on another day, and had thus committed breach of the conditions subject to which the licence was granted to him.
7. The learned counsel also urged that On the own showing of the report of Inspector of Stamp and Registration and the findings of the District Stamp Officer, all the 8 stamps were sold on different dates and neither the Inspector of Stamp and Registration, nor the District Stamp Officer recorded the statements of the persons, to whom the stamps had been sold, nor of any other person in whose presence they might have been sold, and thus the District Stamp Officer and the Deputy Commissioner actually acted on no evidence in order to hold that the petitioner had violated the condition of his licence by selling stamps worth more than Rs. 25/- on a single day.
8. Having given our careful thought to the contentions raised, we feel inclined to agree that proper show cause opportunity was not granted to the petitioner. As already indicated by us earlier, all the 8 stamps, on which two sale-deeds were scribed, were shown to have been sold on different dates. The Inspector of Stamp and Registration made a report for an inquiry against the petitioner on the, assumption that four stamps were sold on one date and four on another date and the petitioner had thereby violated the condition of his licence. The petitioner explicitly averred in his affidavit that no copy of report of the Inspector of Stamp and Registration was furnished to him. This was not controverted on behalf of the State and should be accepted as true. Since a copy of the report was not furnished to the petitioner, he could not know the assumptions made by the Inspector of Stamps and Registration against him. Merely by receipt of a simple notice, the petitioner could not know what was the precise charge which the petitioner had to answer. We also perused the report of the District Stamp Officer contained in the original file produced by the learned Standing counsel. That report does not show that the petitioner was told at the time of the hearing that the charge against him was that even though all the stamps purported to have been sold on 8 different dates, four of them were actually sold on one date and four on another date and he had thereby violated the condition of his licence. Since the petitioner was not told about the precise nature of the charge against him even at the time of hearing, he could not offer any explanation about the same, nor could he lead evidence to substantiate that all the 8 stamps had actually been sold by him on different dates. If the petitioner had been told about the charge, it is quite likely that he would have examined the persons to whom the stamps were sold, or some other person in whose presence they were sold, in order to substantiate his plea that all the eight stamps were sold on eight different dates. There is thus no escape from the conclusion that the proper show cause opportunity was not granted to the petitioner. The learned Standing counsel referred us to a decision of this Court in Civil Misc. Writ Petn. No. 7450 of 1973 (All) 'Ram Kumar Gupta v. Zila Stamp Adhikari' decided by Yashodanandan, J. in which he held that a stamp vendor has no rights which could not be withdrawn without following a procedure in accordance with the principles of natural justice. Referring to Rule 154 of the Stamps Rules, he said ;
'Under Rule 154 of the U.P. Stamp Rules the State Government or the authority which grants a licence may revoke it at any time. The licensing authority while passing an order revoking licence is not required by the rule or statute under the Act, which have been made applicable, to record reasons for revoking the licence.'
9. Relying on the aforesaid decision, the learned standing counsel contended that whether or not the principles of natural justice were complied with in this case, the petitioner did not possess any rights to be enforced through this petition. Having given our careful thought to the contention raised and to the observations contained in the aforesaid case cited by the, learned standing counsel, we find ourselves unable to agree with the view taken by his Lordship.
10. It is well settled that principles of natural justice would apply unless excluded by the statute, and these principles apply not only to quasi-judicial orders but also to administrative orders. In the case of 'A. K. Kraipak v. Union of India' (AIR 1970 SC 150) (on page 157) the Supreme Court said :
'If the purpose of the rules of natural justice is to prevent miscarriage of justice one fails to see why those rules should be made inapplicable to administrative inquiries.'
In the case of Kesava Mills Co. v. Union of India (AIR 1973 SC 389), the Court said (at p. 393) :
'It is true that the order of the Government of India that has been challenged by the appellant was purely an executive order embodying an administrative decision. Even so, the question of natural justice does arise in this case. It is too late now to contend that the principles of natural justice need not apply to administrative order or proceeding.'
Licences for stamp vending are granted under Rule 151 (b) of the Stamp Rules which are of statutory nature. It is under Rule 154 of the aforesaid rules that a licence granted under Rule 151 (b) can be cancelled. Accepting that while cancelling it, the licensing authority acts administratively, all the same he acts in due discharge of statutory duties which require that he should act fairly. Indeed, when a statutory authority passes an order against any person without giving him an opportunity to show cause, it cannot be said that he acted fairly. We may add that while Rule 154 confers on the licensing authority a power to cancel the licence, it does not say that the licensing authority can do so without assigning any reason or without calling upon the licensee to show cause. To interpret Rule 154 as conferring cancellation of a licence without complying with the principles of natural justice tantamounts to saying that the rule confers a power on the licensing authority to act arbitrarily. Ours, however, is a welfare State and we do not think that the makers of the rule intended to confer arbitrary power on the licensing authority.
11. We accordingly hold that while cancelling the licence of the petitioner, it was incumbent upon the Deputy Commissioner District Stamp Officer to give a proper show cause opportunity to the petitioner. As already held earlier, such opportunity was not given. Consequently the two impugned orders cannot be maintained.
12. This petition is accordingly allowed and the orders passed by the opposite party No. 1 are quashed. It is, however clarified that this order will not stand in the way of the opposite parties to restart the inquiry but it shall be necessary in that case that a proper show cause opportunity as already indicated earlier, is given to the petitioner. There will be no order as to costs.