Renewal of stamp vending license cannot be denied based on grounds not prescribed by governing statutory rules.

The petitioner, a licensed stamp vendor since 2007 under the Indian Stamp Act, 1899, sought the renewal of his license.

By an order dated 15.09.2020, the respondent refused the renewal based on a police report citing an FIR registered against the petitioner under Sections 5(1)(a), 8(4), 9, and 10 of the Prevention of Cruelty to Animals Act.

The petitioner challenged this communication under Articles 226 and 227 of the Constitution, contending that he had complied with Rule 6 of the Gujarat Stamp Supply and Sales Rules, 1987, and that the pending FIR did not constitute a legal disqualification for renewal under the said Rules.

Whether the respondent authority is legally permitted to refuse the renewal of a stamp vending license on grounds of a pending FIR under the Prevention of Cruelty to Animals Act when such a ground is not provided for in the governing Rules?

Rule 6 and Rule 10 of the Gujarat Stamp Supply and Sales Rules, 1987, which stipulate the eligibility criteria and the procedural mechanism for the grant and renewal of stamp vending licenses.

Rule 11 regarding revocation and the overarching constitutional protections against arbitrary administrative action under Articles 14 and 19 of the Constitution of India.

The court noted that the petitioner’s license had expired in 2020 and that the respondent’s refusal was based strictly on the FIR registered under the Prevention of Cruelty to Animals Act.

Upon examining the statutory framework, the court found that Rule 6 of the Gujarat Stamp Supply and Sales Rules, 1987, contains no provision or prohibition that justifies the refusal of a license renewal based on the pendency of such criminal proceedings.

The court concluded that the respondent had relied on "extraneous" and "impermissible" considerations not found within the Rules to deny the petitioner's application.

Therefore, the respondent failed to act within the scope of the authority granted by the 1987 Rules.

The court disposed of the petition with a direction that the petitioner submit a fresh application to the respondent authority within four weeks.

The respondent was ordered to consider the application afresh, strictly in adherence to the Gujarat Stamp Supply and Sales Rules, 1987, without being influenced by the previous impugned order or the pending FIR, within a period of eight weeks from the date of the new application.