License Stands Automatically Cancelled When Licensee Ceases To Have Right To Site For Storing Petroleum: Kerala High Court

The petitioners had filed the Writ petition seeking a Writ of Mandamus to the Respondents to vacate and deliver possession of the leased premises covered by the Registered Lease Deed in favour of the first Respondent and seeking a Writ of Mandamus to the Deputy Chief Controller of Explosives to cancel the Explosive License issued in favour of the Respondents for conducting Petroleum Retail Outlet in the leased premises.

The Single Bench of Justice M.A. Abdul Hakhim held, “When the licensee ceases to have any right to the site for storing petroleum, the license stands cancelled automatically without any formal order for the same by the Licensing Authority in view of Clause (iii) of Rule 152(1). Hence, the question of following a procedure for cancellation or granting an opportunity of hearing to the Respondent No.1 does not arise.”

Advocate K.M. Sathyanatha Menon represented the Petitioner while Senior Advocate S.Sreekumar represented the Respondent.

Factual Background

The Registered Lease Deed dated January 21, 2004, executed by the Petitioners in favour of the first Respondent, which was for a period of 20 years, expired on January 31, 2024. The first Respondent had been conducting a Petroleum Retail Outlet in the leased premises as a dealer of the Oil Marketing Company (second respondent).

Reasoning

The Bench found nothing on record to prove that there was any sublease in favour of the second Respondent. It was the first Respondent who had the leased premises, and it was he who was to be evicted from the leased premises on expiry of the Lease Deed. The Bench stated, “Since Respondent No.1, who is a private individual, has been in possession of the leased premises, it is the Respondent No.1 who is to be evicted from the leased premises and not the Respondent No.2 Oil Marketing Company. Hence, the first prayer for eviction of the Respondent No.1 could not be granted in this Writ Petition, and hence the said prayer is disallowed.”

Dealing with the issue of cancellation of the Explosive License issued to the Respondents, the Bench reiterated that the Court can issue a Writ of Mandamus only if the Petitioners have made their demand and the Respondent Authority has refused the said demand. “When the Authority does not respond to the demand of the Petitioners within a reasonable time, it is well within the right of the Petitioners to seek a Writ of Mandamus against such Authority, treating that the Authority has refused the demand of the Petitioners”, it held.

The Bench further explained that the Proviso to Rule 152(1), which states that the holder of a license is entitled to an opportunity of being heard before cancelling the license is applicable only in the case of suspension or cancellation of license under Clause (iii) of Rule 152(1) by the Licensing Authority for any contravention of the Act or of any rule thereunder or of any condition contained in such license or by order of the Central Government, if it is satisfied that there are sufficient grounds for doing so.

“When the licensee ceases to have any right to the site for storing petroleum, the license stands cancelled automatically without any formal order for the same by the Licensing Authority in view of Clause (iii) of Rule 152(1). Hence, the question of following a procedure for cancellation or granting an opportunity of hearing to the Respondent No.1 does not arise”, it added.

Referring to the judgment in C. Albert Morris v. K. Chandrasekaran and Others (2006), the Bench held that the Petitioners are entitled to get their second prayer seeking a Writ of Mandamus to the Deputy Chief Controller of Explosives to cancel the Explosive License issued in favour of the Respondents for conducting a Petroleum Retail Outlet in the leased premises.

Cause Title: Choorapilan Jameela v. Padavanna Shamseer (Neutral Citation: 2026:KER:1428)

Appearance

Petitioner: Advocate K.M. Sathyanatha Menon

Respondent: Senior Advocate S.Sreekumar, Advocates P. Martin Jose, Nithin George, M.V. Haridas Menon, Rithu Jose, P.Prijith, Thomas P. Kuruvilla, R.Githesh, Anna Linda Eden, Ajay Ben Jose, Manjunath Menon, Anavadya Sanil Kumar, Anjali Krishna, Government Pleader G. Sheeba

Click here to read/download Order