Statutory authority for dealer cancellation requests was absent, so the High Court quashed the impugned letters as ultra vires.

Administrative action affecting a dealer's authorisation must have clear statutory backing under the Andhra Pradesh General Sales Tax Act, 1957. The High Court noted that the first respondent could pursue recovery or alleged tax evasion proceedings, but no provision empowered it to request other dealers to cancel the petitioner's sub-dealership. On that basis, the impugned letters dated 4 June 1991 were held to be without jurisdiction and were quashed, while lawful action under the taxing statute remained open.

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Issues: Whether the first respondent had authority under the Andhra Pradesh General Sales Tax Act, 1957, to send letters requesting cancellation of the petitioner's sub-dealership, and whether those letters were liable to be quashed.

Analysis: The request letters were not shown to be traceable to any provision of the Act. The Court noted that, while the authority could take steps for recovery of tax or for alleged evasion proceedings, no statutory provision empowered it to seek cancellation of the petitioner's dealership by addressing such a request to other dealers.

Conclusion: The impugned letters dated June 4, 1991 were quashed as being without jurisdiction. The authority was left free to take appropriate action in accordance with law, including proceedings for alleged tax evasion.

Final Conclusion: The petition succeeded only to the extent of invalidating the impugned request letters, while leaving open lawful proceedings under the taxing statute.

Ratio Decidendi: Administrative action affecting a dealer's authorisation must have clear statutory backing, and any request made without such authority is ultra vires and liable to be quashed.

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