PUNE: A city civil court has granted an interim injunction order restraining the Pune Cantonment Board (PCB) from "obstructing business" and "forcefully closing" the iconic Kayani Bakery on East Street in Pune Camp.
Joint civil judge (senior division) Jaydip J Mohite also directed the PCB to decide upon the bakery's application for issuance of a trade licence within the parameters of section 277 (2) of the Cantonment Act, 2006.
On the PCB's plea seeking time to enable it move an appeal in the district court, Mohite granted a week's stay on the execution and operation of the interim injunction order with a rider that "the PCB shall not ask for any extension of said order".
Lawyer Dara Irani, who appeared for Kayani Bakery, told TOI on Sunday, "The court order restrains the PCB from shutting down the bakery. The board had sought one month's time to file an appeal but the court gave them one week. The bakery will soon reopen."
Prior to the interim injunction order on November 17, the civil court had rejected on November 14 the PCB's application that the civil suit filed by the bakery was not maintainable on account of want of cause of action. The board had argued that the Cantonment Act, 2006 gave it the right to grant or reject an application for trade licence.
The court observed that it was a matter of merit whether the PCB has the right to grant or reject trade licence pleas and under what circumstances the right can be exercised. "At this juncture, the only question before the court is whether the plaint is disclosing the cause of action or the cause of action shown is illusory. After having scrutinized the averments, it can be inferred that the plaint is disclosing the cause of action and it is specifically stated therein," Mohite said.
In the suit, Pervez H Kayani, a partner in the bakery, stated that the firm was doing business for the last 61 years from the premises, which was granted on a perpetual lease on June 17, 1930 in favour of his predecessor. The PCB had been issuing a trade licence to the bakery on an annual basis till March 31, 2007 under the Cantonment Act, 1924. The trade licence was valid on December 18, 2006 when the Cantonment Act, 2006 came into force. The shutdown was ordered verbally without issuing any notice or an opportunity for a hearing, he stated, adding that the closure had affected the firm's reputation, business and livelihood of its partners and 40-odd employees.
Kayani furnished copies of the trade licences issued earlier by the PCB and also the applications made every year thereafter for renewal of the licence (the last one was made on February 22 this year) which the PCB neither rejected nor accepted. It was argued that this was in contravention of the provisions under sections 277 of the Cantonment Act, 2006, which allows the board to withhold a trade licence only if the business is offensive and dangerous or if the premises is unfit or unsuitable.
Kayani said sub-section 3 of section 277 provides that the plaintiff was not even required to apply for a licence until a written notice is received from the board three months in advance. Still, the firm kept moving applications for a trade licence, he stated.
The PCB sought to justify its action, claiming that the lease-holders had flouted the lease conditions by sub-letting a part of the premises to another establishment and that the application for renewing the licence was held up for procedural matters, including a DEO's report relating to the premises and inspection by assistant health officer.
The judge said the PCB may take action if the plaintiff had committed breach of licence agreement but the grant of trade licence was a different issue. "The PCB cannnot remain silent on the application of issuance of a trade licence for years together. Being a government body, the PCB is expected to react on the application immediately before expiration of earlier tenure," he said.
The court also said that the power to shut down a business cannot be used "high-handedly and arbitrarily without following the principles of natural justice".
Joint civil judge (senior division) Jaydip J Mohite also directed the PCB to decide upon the bakery's application for issuance of a trade licence within the parameters of section 277 (2) of the Cantonment Act, 2006.
On the PCB's plea seeking time to enable it move an appeal in the district court, Mohite granted a week's stay on the execution and operation of the interim injunction order with a rider that "the PCB shall not ask for any extension of said order".
Lawyer Dara Irani, who appeared for Kayani Bakery, told TOI on Sunday, "The court order restrains the PCB from shutting down the bakery. The board had sought one month's time to file an appeal but the court gave them one week. The bakery will soon reopen."
Prior to the interim injunction order on November 17, the civil court had rejected on November 14 the PCB's application that the civil suit filed by the bakery was not maintainable on account of want of cause of action. The board had argued that the Cantonment Act, 2006 gave it the right to grant or reject an application for trade licence.
The court observed that it was a matter of merit whether the PCB has the right to grant or reject trade licence pleas and under what circumstances the right can be exercised. "At this juncture, the only question before the court is whether the plaint is disclosing the cause of action or the cause of action shown is illusory. After having scrutinized the averments, it can be inferred that the plaint is disclosing the cause of action and it is specifically stated therein," Mohite said.
In the suit, Pervez H Kayani, a partner in the bakery, stated that the firm was doing business for the last 61 years from the premises, which was granted on a perpetual lease on June 17, 1930 in favour of his predecessor. The PCB had been issuing a trade licence to the bakery on an annual basis till March 31, 2007 under the Cantonment Act, 1924. The trade licence was valid on December 18, 2006 when the Cantonment Act, 2006 came into force. The shutdown was ordered verbally without issuing any notice or an opportunity for a hearing, he stated, adding that the closure had affected the firm's reputation, business and livelihood of its partners and 40-odd employees.
Kayani furnished copies of the trade licences issued earlier by the PCB and also the applications made every year thereafter for renewal of the licence (the last one was made on February 22 this year) which the PCB neither rejected nor accepted. It was argued that this was in contravention of the provisions under sections 277 of the Cantonment Act, 2006, which allows the board to withhold a trade licence only if the business is offensive and dangerous or if the premises is unfit or unsuitable.
Kayani said sub-section 3 of section 277 provides that the plaintiff was not even required to apply for a licence until a written notice is received from the board three months in advance. Still, the firm kept moving applications for a trade licence, he stated.
The PCB sought to justify its action, claiming that the lease-holders had flouted the lease conditions by sub-letting a part of the premises to another establishment and that the application for renewing the licence was held up for procedural matters, including a DEO's report relating to the premises and inspection by assistant health officer.
The judge said the PCB may take action if the plaintiff had committed breach of licence agreement but the grant of trade licence was a different issue. "The PCB cannnot remain silent on the application of issuance of a trade licence for years together. Being a government body, the PCB is expected to react on the application immediately before expiration of earlier tenure," he said.
The court also said that the power to shut down a business cannot be used "high-handedly and arbitrarily without following the principles of natural justice".
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