Fair-price-shop eligibility requirements under Clause 6 cannot be applied selectively among applicants.

The petitioner, a co-operative society established in 1989, applied for authorization to operate a Fair Price Shop following a notification issued by the Deputy Director.

The Deputy Director rejected its application, citing failure to maintain a minimum bank balance of ₹2,00,000 continuously for the preceding two years and the absence of a Fair Price Shop provision in its bye-laws, but granted authorization to respondent No. 4.

The petitioner challenged that order under Articles 226 and 227 of the Constitution. Respondent No. 5, whose application had also been rejected and whose appeal was pending, was impleaded.

1. Whether the Deputy Director’s grant of authorization to respondent No. 4 was consistent with the minimum-balance requirement in amended Clause 6 of the Karnataka Essential Commodities (Public Distribution System) Control Order, 2016, when the order recorded respondent No. 4’s balance as ₹1,57,711.

2. Whether the petitioner’s application could be rejected because its bye-laws did not provide for operating a Fair Price Shop, when amended Clause 6 did not prescribe that condition.

3. Whether the petitioner should be relegated to the statutory appellate remedy despite the asserted patent illegality in the impugned order.

Amended Clause 6(1)(b)(ii)(b)(ii)(5) of the Karnataka Essential Commodities (Public Distribution System) Control Order, 2016 requires a society seeking authorization to be more than three years old and to have maintained a minimum balance of ₹2,00,000 continuously for the preceding two years.

The High Court also applied the principle in Whirlpool Corporation v. Registrar of Trade Marks, Mumbai, (1998) 8 SCC 1: although the existence of an effective alternative remedy ordinarily weighs against entertaining a writ petition, it does not bar writ jurisdiction in specified circumstances, including where proceedings are wholly without jurisdiction; the High Court retains discretion to entertain a petition where patent illegality is shown.

The impugned order rejected the petitioner for failing to satisfy the ₹2,00,000 continuous-balance requirement, yet recorded respondent No. 4’s balance as only ₹1,57,711 and nevertheless granted it authorization.

The Court therefore considered the order, on its face, inconsistent with the requirement in amended Clause 6.

It also found that Clause 6 did not appear to require a society’s bye-laws to specifically provide for Fair Price Shop business, so that ground did not support rejecting the petitioner’s application.

Given these apparent legal defects, relegating the parties to the alternative remedy would be futile.

It remitted the applications of the petitioner and respondents 4 and 5 to respondent No. 3 for reconsideration, directing that all concerned parties be given an opportunity to be heard, including a personal hearing if required, and that a reasoned order be passed in accordance with amended Clause 6 within 60 days of receipt of the certified order.