Mandatory sampling and hearing requirements govern dealership termination; procedural breaches can render administrative action invalid.

Where a mandatory search, seizure and sampling procedure is prescribed under the Motor Spirit and High Speed Diesel Control Order, non-compliance with that procedure can invalidate a dealership termination founded on the resulting test reports. The Court treated the use of an officer below the prescribed rank, defective sampling, and failure to furnish proper samples to the dealer as serious breaches of the governing order. It also held that terminating the dealership without a show-cause notice or hearing violated natural justice and fair administrative action. The termination was therefore invalid and liable to be set aside.

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Issues: Whether the termination of the dealership was vitiated for non-compliance with the mandatory sampling and seizure procedure under the Motor Spirit and High Speed Diesel (Regulation of Supply and Distribution and Prevention of Malpractices) Order, 1999 and for breach of natural justice.

Analysis: The dealership was terminated immediately after the raid and test reports, without issuance of a show-cause notice or grant of a hearing. The record showed that the search and seizure were carried out by an officer below the prescribed rank, the sampling procedure was not followed in the manner required by the Order, and the prescribed samples were not properly furnished to the dealer. The Court treated these departures from the mandatory procedure as serious violations affecting the foundation of the termination. The abrupt action, taken against a long-standing dealership with an earlier unblemished record, was held to be inconsistent with fair play and the standards governing public action.

Conclusion: The termination was invalid and liable to be set aside.

Final Conclusion: The dealership termination could not stand because it was founded on procedurally defective sampling and seizure and was effected in breach of the requirement of fair hearing and lawful administrative action.

Ratio Decidendi: Where a statute or binding order prescribes a mandatory procedure for search, seizure and sampling, the action based on non-compliance with that procedure, especially when taken without notice or hearing, is liable to be quashed as arbitrary and contrary to natural justice.

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