Judgment:
ORDER
1. The petitioner's Sri Shanmu-gha Rice Mills is situated in Thondamandurai Village, Perambalur Taluk. Through thepower agent of the petitioner's maternal grandfather the petitioner purchased therice mill under a registered sale deed on 12-5-1993. It is alleged in the affidavit that the rice mill has been in exclusive possession, managemenl and enjoyment of the petitioner's vendor ever since 1970 and that the petitioner had purchased the mill for a valuable consideration of Rs. 2,01,000/-along with the accessories, licence etc. It seems the rice mill stands in the name of one Krishnaswmi Reddiar (petitioner's vendor's grandfather) for the period ending with 31-3-1994. The petitioner had applied for the grant of licence in accordance with the condition No. 6 stipulated in the licence in Form IV under Rule 4(4) of the Rice Milling Industry (Regulation and Licensing) Rules, 1959. The application has been made in Form III as prescribed by the said Rules, by the petitioner. The petitioner has been informed by the respondent on 22-6-1993 that the application dated 'nil' of the petitioner will be enquired and the licence will be transferred to the petitioner's name, a copy of which has been sent to the District Supply Officer for making an enquiry and submit a report within 15 days. Aggrieved by this order the petitioner is before this Court.
2. The petitioner alleges in the affidavit filed in support of the writ petition that the impugned proceedings initiated by the respondent to hold the enquiry for issuance of licence under S. 6 of the Rice Milling Industry (Regulation) Act, 1958, hereinafter called the Act, is illegal and unwarranted and that the respondent as Licensing Authority is bound to grant licence without holding any enquiry. It is also stated that the Licensing Authority is bound to grant licence so long as the petitioner continues to be the owner of the rice mill and there cannot be any extraneous consideration for grant of licence. It is also stated that the respondent is only concerned with the registered sale deed and other documents placed before him to prove the ownership of the rice mill and in other words, the subjective satisfaction of the Licensing Authority. It is also stated that the respondent has no jurisdiction to withhold the licence indefinitely and thereby stall the operation of the rice mill.
3. Mr. V. P. Venkat, learned counsel for the petitioner contends that once a permit has been granted to run a rice mill under the Act and the licence has been issued under S. 6 of the Act whenever a transfer of licence or a fresh licence is applied for, the Licensing Authority has no Jurisdiction to hold any enquiry. According to learned counsel, once an application for licence is made in Form III under Rule 4 !he Licensing Authority has no option but to grant or renew a licence and it is not open to the licensing Authority to make any sort of enquiry. Learned counsel refers to sub-sec. (3) of S. 6 of the Act and states that on receipt of any such application for the grant of a licence, the licensing Officer shall grant the licence on such conditions. In other words, learned counsel states that the Act does not contemplate any enquiry when a licence is applied for. Enquiry is contemplated under S. 5 of the ACI only. According to learned counsel, the impugned intimation to the petitioner has been made wholly without jurisdiction, and the respondent is bound to grant the licence immediately as soon as as the application is made according to the rules.
4. Considering the arguments of learned counsel for the petitioner and after going through the affidavit filed by the petitioner, under S. 5 grant of permits is contemplated in respect of new or defunct rice mills. 'Defunct rice Mill' is defined under S. 3(1) of the Act, which reads as follows: -
'(a) defunct rice mill' means -
(i) a rice mill in existence at the commencement of this Act but in which rice-milling operations have not been carried on for a continuous period of one year prior to such commencement; and
(ii) a rice mill (whether established before or after such commencement) in which rice-milling operations are not carried on for a continuous period of one year at any time after the commencement of the Rice-Milling Industry (Regulation) Amendment Act, 1968'
Section 3(b) defined the 'existing rice mill' as thus:
'existing rice Mill' means a rice mill carrying on rice-milling operations at the commencement of this Act, and includes a rice mill in existence at such commencement which is not carrying on rice-milling operations but in which rice-milling operations have been carried on at any time within a period of one year prior to such commencement;
Provided that if in any such rice mill, rice milling operations are not carried on for a continuous period of one year at any time after the commencement of the Rice-Milling Industry (Regulation) Amendment Act, 1968 (Act No. 29 of 1968), then such mill shall on the expiry of the said period of one year, cease to be an existing rice mill and be deemed to be a defunct rice mill.'
The term 'owner is defined in S. 3(g) of the Act thus:
' 'owner' in relation to a rice mill, means the person who, or the authority which, has the ultimate control over the affairs of the rice mill, and where the said affairs are entrusted to a manager, managing director or managing agent shall be deemed to be the owner of the rice mill.'
Section 6 of the Act provides for grant of licence, which reads as follows:
'(I) Any owner of an existing rice mill or of a rice mill in respect of which a permit granted u/ S. 5 is effective may make an application to the licensing Officer for the grant of licence...'
(2) Every application under sub-sec. (1) shall be made in the prescribed form......'
The form is prescribed under sub-rule (2) of Rule 4, the form being Form No. III. The form contains the applicant's name, nature of ownership, name of the rice-mill, and the details of milling machinery etc. The licence itself is prescribed under Form IV which is prescribed under sub-rule (4) of Rule 4 of the Rules framed under the Act. One of the conditions of the licence is sub-clause (6) of clause (3) of the licence which states as follows:
'This licence shall not be transferred to anyother person by the person to whom it is issued and in case of change in the ownership of the mill, by transfer, lease or otherwise, a fresh licence shall be applied for by the person who has acquired such ownership.'
In view of the condition of the licence i.e., sub-cl. (6) of cl. (3) of the conditions of licence the petitioner as a transferee has to apply for a fresh licence in pursuance of the sale deed stated supra. The petitioner has applied for a licence in form III. Rule 4 contemplates four types of applications for the grant of licence. So far as the present case is concerned, the petitioner comes under rule 4(c) which reads as follows:
'in application for grant of a licence may be made:
(c) by the owner of an existing rice-mill, within such period after the commencement of the Act as may be specified in the order under the proviso to sub-sec. (2) of S.8 of the Act.'
because the petitioner comes under the term 'owner' as defined in S. 3(g) of the Act. As such in my view, when the petitioner has applied under Form III for a fresh licence, 1 am not able to understand the argument of Mr. Venkat, learned counsel that no enquiry at all can be conducted by the respondent. It is seen that Rule 6 is mandatory but that does not mean that the application need not be verified at all by the subordinates of the Licensing Authority. What has been done in this case, is, the application has been forwarded to the District Supply Officer for verification. That is all. In the form of application for the grant of licence, number of details have to be given and it is for the Licensing Authority to satisfy himself whether the petitioner satisfies the application given in Form III. Though it is a subjective satisfaction of the Licensing Authority he has to satisfy himself before issuing licence. I do not think the petitioner can contend that a roving enquiry is made by the licensing Authority as it is made with regard to the grant of permit under S. 5 of the Act for establishment of a rice mill. It is not alsopermitted under the statute. This is what the Supreme Court has said in Chandrakant Saha v. Union of India, : [1979]1SCR751 . Though the learned counsel for the petitioner relies upon the judgment of the Supreme Court that no enquiry can be done and that the issue of licence is mandatory, I do not think the Supreme Court has gone to the extent of stating that a verification cannot be made by the licensing Authority through its Subordinates before issuing the licence. Learned Counsel relies upon a Division Bench Judgment of ihe Orissa High Court in Anadi Charan Rout v. Collector, : AIR1972Ori202 which supports the contentions raised by learned counsel for the petitioner. It was a case where after licence was granted a fine was imposed without passing an order of revocation or suspension of the licence by the Appellate Authority. It is seen that the Division Bench of the Orissa High Court states that there is no provision under S. 6 as to an enquiry and inviting objections from rival claimants or say outsider before grating the licence. As I have already stated, the respondent cannot make such an enquiry. But to say that the respondent has no jurisdiction at all to satisfy himself before issuing licence, in my view, is not acceptable. Though it is mandatory on the part of the Licensing Authority to issue the licence under the Rules, but, yet. in rny view, the Licensing Authority has to prima facie satisfy whether the petitioner is entitled to the licence as that stage and he has to call for a report from the District Supply Officer. That has been done in this case. I do not see any infirmity in his taking such an action. It is true that the Licensing Authority should act quickly in such matters for the issue of licence at the earliest. But that does not mean that he has no jurisdiction assuming it is the subjective satisfaction of the licensing Authority to have some material before him to satisfy himself. In my view, such sort of enquiry to prima facie I satisfy himself to issue licence is an implied power to grant of licence itself. In the view 1 have taken, instead of the prayer asked for in the writ petition, the respondent is directed to issue licence within a period of four weeks from the date of receipt of a copy of this order,provided the papers are in order. This writ petition is ordered accordingly.
5. Order accordingly.