Licensing discretion under Gold Control rules cannot be applied mechanically where relocation requests merit lawful reconsideration.

Rule 2(f) of the Gold Control (Licensing of Dealers) Rules, 1969 was treated as conferring discretion on the licensing authority, not as imposing rigid mandatory conditions. On the facts described, existing licence holders sought relocation to Greater Bombay by surrendering licences at Amritsar and Navsari, and the surrounding circumstances, including market conditions and prior similar relief, supported sympathetic consideration. A mechanical refusal based on the rule was therefore not justified. The rejection was unsustainable in law and the applications were required to be reconsidered for grant of Bombay licences subject to surrender of the existing licences.

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Issues: Whether rejection of the application for a gold dealer's licence under Rule 2(f) of the Gold Control (Licensing of Dealers) Rules, 1969 was sustainable, and whether the appellants were entitled to consideration for licence at Greater Bombay on surrender of their existing licences.

Analysis: Rule 2(f) was treated as conferring discretion on the licensing authority rather than laying down rigid mandatory conditions. The record showed that the number of dealers and turnover in Bombay had increased, and that the appellants were existing licence holders seeking relocation from disturbed or inconvenient places. The circumstances of the case, including the Government circular and prior instances of similar relief, supported the view that the applications deserved sympathetic and lawful consideration. The authority's refusal was not supported by any legal bar preventing the grant of licence in such cases.

Conclusion: The rejection was held to be unsustainable in law, and the matter was directed to be reconsidered for grant of licences on surrender of the existing Amritsar/Navsari licences.

Final Conclusion: The appellants succeeded to the extent that the refusal was set aside and the licensing authority was required to reconsider their applications for Bombay licences within the stipulated time.

Ratio Decidendi: Criteria in a licensing rule that are framed as relevant factors for consideration do not operate as inflexible mandatory conditions, and a refusal based on a mechanical application of such criteria is invalid where the surrounding circumstances justify grant of the licence.

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