Suspension of an excise licence for alleged breach requires prior opportunity to show cause.

The petitioner, authorised person of M/s Chandramas Bar and Restaurant, operated an IMFL on-bar-cum-restaurant known as “Cheers Crossroads” under Licence No. 11/2004–05 at R.P. Road, Dispur, Guwahati.

The petitioner claimed to have paid the up-to-date licence fees and the additional amount for extended operating hours.

On 4 July 2026, the District Commissioner, Kamrup Metropolitan, suspended the petitioner’s licence “until further orders” on the basis of a complaint made by the Deputy Commissioner of Police, East Police District, Guwahati.

The petitioner contended that the suspension was ordered without issuing a show-cause notice or granting an opportunity of hearing. His representation dated 7 July 2026 was allegedly not considered, leading to the filing of the writ petition challenging the suspension order.

1. Whether the suspension of the petitioner’s excise licence under Section 30 of the Assam Excise Act, 2000, for an alleged breach of licence conditions could be ordered without giving the petitioner a prior opportunity to show cause.

2. Whether an order suspending the licence “until further orders,” without specifying a duration or stating that it was pending initiation of cancellation proceedings, was legally sustainable.

The Court applied Section 30 of the Assam Excise Act, 2000, which empowers the authority that granted a licence, permit or pass to cancel or suspend it for the specified statutory grounds.

Since Clauses (a), (b) and (d) were inapplicable, the relevant provision was Section 30(c), concerning breach of the terms or conditions of the licence by the licensee, his servants, or persons acting with his express or implied permission.

The Court held that where suspension or cancellation is founded on an alleged breach under Section 30(c), the licensee must ordinarily be given an opportunity to show cause before the power is exercised, because the decision depends upon the authority’s subjective satisfaction.

The principles of natural justice were treated as a facet of Article 21 of the Constitution.

The impugned order was based on an alleged violation of the licence conditions and therefore fell within Section 30(c), rather than the other statutory grounds under Section 30.

Because the authority’s decision required satisfaction that a breach had occurred, it could not validly be made unilaterally without first informing the petitioner of the allegations and allowing him to respond.

The Court further found the order defective because it suspended the licence “until further orders,” without prescribing any period and without indicating that the suspension was provisional pending cancellation proceedings.

These deficiencies demonstrated non-compliance with natural justice and rendered the order violative of Article 21.

It granted liberty to the respondent authorities, particularly the licensing authority, to proceed in accordance with law if any violation of the licence conditions was established.

The petitioner’s undertaking that he would not violate the licence conditions, the Assam Excise Act, 2000, or the applicable Rules was recorded, and the Court clarified that quashing the suspension did not authorise any such violation.

No order as to costs was made.