- In Radhey Shyam v. State of UP Thru. Prin. Secy. Food and Civil Supplies Lucknow, the Hon'ble HC observed that the primary objective of the public distribution system is to serve the public, primarily the poor sections of society, by maintaining the supply of essential commodities at affordable prices, rather than setting up any business for the advantage of any individual.
- Article 19 (1)(g) of the Indian Constitution talks about the fundamental right to carry on trade and commerce. Therefore, the license of the fair price shop does not fall under the category of the fundamental right as it is not operated for earning profits and, thus, doesn't constitute a trade or business.
- In this case, an inquiry was conducted in response to a complaint wherein inconsistencies in the distribution of essential committees in the stock registry and the information recorded in the E-Pos machine for food grain distribution were uncovered. The petitioner was prosecuted under Section 3/7 of the Essential Commodities Act, following which their license of the fair pricing store was canceled. Section 3 of the Essential Commodities Act addresses compliance of orders issued by anybody who sells any essential commodity, and Section 7 of the Essential Commodities Act specifies the penalties for violating an order issued under Section 3 of the Essential Commodities Act.
- A plea was filed under Article 226 of the Indian Constitution, seeking to overturn the ruling of the Joint Commissioner (Food) Lucknow, which upheld the order of the District Supply Officer, Lakhimpur Kheri, to suspend the petitioner's license for the fair pricing store. The petitioners' counsel pleaded that the petitioner was not allowed to cross-examine the witnesses, nor was he granted an oral hearing during the inquiry.
- In another instance, Smt. Radha Devi v. State of UP and others, the Hon'ble Court ruled that it was apparent from the record that the petitioner's fair pricing store was suspended without the petitioner being given a chance to be heard. As a result, the Hon'ble Court granted the writ petition under Article 226 of the Indian Constitution. The petitioners' counsel stated that the premise for suspending the license was solely based on the FIR filed against the petitioner. The counsel wished to attain remedy via citing the decision in Bajrangi Tiwari vs. Commissioner Devi Patan Mandal, Gonda, and others, which stated that a fair price shop agreement should not be suspended just because an FIR was filed against the shop holder.
- According to the respondent's allegation, the petitioner breached the terms and conditions of the license and the requirements of the Control Order, 2016, by failing to efficiently distribute the essential commodities from the fair pricing shop. During the proceedings, it was noted by the bench that the license of the fair pricing store is subject to be revoked if the license holder fails to comply with the terms and conditions of owning the fair price shop, as has transpired in this case.
- In Puran Singh v. State of UP, 2010 (3) ADJ 659 (FB), it was held that the licensing system provides a possibility for a person to profit himself by establishing a fair pricing distribution unit. However, such a license does not fall under the definition of fundamental right under Article 19 (1)(g) of the Indian Constitution.
- In virtue of the facts of the case, the Hon'ble Court rejected the petitioner counsel's argument for a mandatory hearing before suspending the shop license. Further, it stated that two competent authorities determined that the petitioner was not operating the fair pricing shop adequately and failed to adhere to the terms and conditions of the license. Hence, the petitioner's license was revoked.
- Therefore, the petition was rejected.
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