Parveez Ahmad Baba vs. Union Territory Ofj And K And Ors. (Health And Medical Education Department)

Held

The Court held that neither the petitioner nor respondent No. 5 is entitled to have a license under the Food Safety and Standard Act, 2006, or registration under the Central Goods and Services Tax Act, 2017, to the exclusion of the other, as long as the dispute over the premises remains unresolved. The Court reasoned that a person must be permitted to run a business legitimately and attain the required turnover to be eligible for GST registration. Since the ownership and operation of "Samci Restaurant" are disputed, neither party can claim exclusive rights. The Court suggested that the parties should settle their dispute amicably or through court intervention, or they could jointly apply for the license and registration. If they fail to resolve the dispute, the authorities should refuse to grant license and registration to either party individually. The Court did not adjudicate on the complicated disputed questions of fact but disposed of the writ petition based on the peculiar facts and circumstances, directing the authorities to act accordingly.

Facts

The petitioner, Parveez Ahmad Baba, challenged orders related to a food license and GST registration for "Samci Restaurant." The petitioner and respondent No. 5, his brother, jointly purchased the property in 1993, with the petitioner claiming to have paid the entire consideration. The petitioner rebuilt the property and operated the restaurant solely, obtaining various licenses and loans, with respondent No. 5 acting as a guarantor. The petitioner alleges respondent No. 5, in connivance with officials, managed to get the food license transferred and his GST registration cancelled, leading to a fresh GST registration in respondent No. 5's name. The petitioner sought restoration of his licenses and GST registration and an injunction against respondent No. 5's interference.

Key Issues

1. Whether the Designated Officer/State Licensing Authority was justified in issuing a license under the Food Safety and Standard Act, 2006, to respondent No. 5 for "Samci Restaurant" and subsequently intimating the petitioner that his name should be inserted as in-charge of operations, and later cancelling the petitioner's GST registration and issuing a fresh one to respondent No. 5, despite the petitioner's claim of sole proprietorship and operation of the restaurant. Petitioner's arguments: The petitioner contended that he is the sole owner and operator of Samci Restaurant, supported by various documents including loan guarantees where respondent No. 5 acknowledged him as the sole proprietor. He argued that respondent No. 5 obtained the food license and GST registration through deception and connivance with officials. Revenue/State's arguments: The respondents argued that since there is a dispute over the ownership and operation of the premises between the petitioner and respondent No. 5, neither party is entitled to exclusive license or registration. They contended that the authorities acted appropriately by not granting exclusive rights to either party until the dispute is resolved.