Procedural infirmity in licence cancellation led to refund of licence fee and security deposit after deduction for actual use.

Cancellation proceedings were vitiated by inconsistent records and denial of proper personal hearing, so a fresh show-cause notice and decision were required on a correct factual basis. As the excise year had already expired, restoration of the licence was not possible. The operator had used the shop only from 1 April 2017 to 18 May 2017 and was liable for licence fee only for that period. The balance basic licence fee and the security deposit were therefore refundable after deduction of the fee attributable to actual use, and costs were awarded.

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Issues: Whether, after the cancellation proceedings were found to suffer from procedural infirmity and the licence year had expired, the petitioner was entitled to refund of the basic licence fee and security deposit after deducting the fee relatable to the period during which the shop was operated.

Analysis: The record showed inconsistency between the seizure memo, the show cause notice, and the cancellation order, and it was also noticed that no proper personal hearing had been afforded. In such circumstances, the proper course was to issue a fresh show cause notice and take a fresh decision on the basis of a correct and consistent factual foundation. Since the excise year had already expired, restoration of the licence was not possible. The petitioner had operated the shop from 1.4.2017 until 18.5.2017, and was liable to pay licence fee only for that period. The remaining licence fee and the security deposit were therefore refundable, after due calculation and deduction of the fee for the period actually enjoyed.

Conclusion: The petitioner succeeded and was entitled to refund of the basic licence fee and security deposit, subject to deduction of licence fee for the period from 1.4.2017 to 18.5.2017; costs were also awarded.

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