154-NLR-NLR-V-48-MOHAMED-HUSSAIN-CO.-Petitioner-and-THE-CONTROLLER-OF-TEXTILES-Respondent.pdf
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Mohamed Hussain & Co. v. The Controller of Textiles.
1947Present: Canekeratne J.
MOHAMED HUSSAIN & CO., Petitioner, and THE CONTROLLEROF TEXTILES, Respondent.
S. C. 115—Application for a Writ of Certiorari on the Controller of
Textiles.
Certiorari—Cancellation of textile licence—Inquiry—Sufficiency of evidence—When Court will interfere—Defence (Control of Prices) Regulations—Regulation 62.
Where the Textile Controller acting under regulation 62 of the Defence(Control of Textiles) Regulations after inquiry into allegations againstthe petitioner cancelled his licence on the ground that he was found to beunfit to hold a licence—
Held, on application for a writ of certiorari, that his decision could notbe challenged on the ground that the evidence was insufficient. TheCourt would not interfere unless it was shown that the Controller hadeither broken a rule laid down by the regulations under which hs actedor that he had failed to pay due regard to the dictates of natural justice.
1 (1938) 39 N. L. R. 457.
CANEKERATNE J.—■Mahomed Hussain & Co. v. The Controller of Textiles. 487^^PPLICATION for a writ of certiorari on the Controller of Textiles.
H. V. Perera, K.C. (with him C. Suntheralingam), for the petitioner.
Walter Jayawardene, C.C., for the respondent.
Cur. adv. vult.
October 8, 1947. Canekeratne J.—
This is an application by the petitioner for a mandate in the nature of awrit of certiorari quashing the order made by the respondent by his letterdated March 10, 1947.
The petitioner is a partner of the firm of S. Mohamed Hussain & Co.which carried on business as textile dealers in the Pettah, Colombo, theother partner being Mohammed Hussain.
The firm of S. Mohamed Hussain & Co.—and I will call them the firm—sent to the office of the Controller certain textile coupons on twooccasions for the purpose of surrendering them to the Coupon Bank.According to the petitioner these coupons were taken by his employee oneAlliyar, with a paying-in slip consisting of foil and counterfoil. It appears,according to the affidavit of the respondent, that the firm was suppliedwith a paying-in book containing slips and that coupons are broughtto the office with the book. The slip and the coupons were handed to areceiving clerk by Alliyar on November 30, 1946 ; this clerk counted thecoupons and checked the number handed with that entered in the paying-in slip ; he then entered the number in a scroll book with various otherparticulars and obtained the signature of the depositor to the book.After this he passed on the paying-in slip together with the couponsto the Assistant Shroff. The latter checked the number of the coupons,passed the paying-in slip, foil and counterfoil, to the Shroff. The Shroffentered in a register the number of points as they appear in the paying-in slip, signed foil and initialled counterfoil to both of which he affixedthe serial number 7,150 ; he passed them to the Chief Clerk. Accordingto the affidavits of the receiving clerk, and the Shroff, the amount ofcoupons surrendered by the firm on this day was 669. On December 21,1946, further coupons were surrendered by the firm amounting, accordingto the receiving clerk and Shroff, to 992 ; the same procedure was followedby them as on the first occasion ; the foil ■ contains the signature of theofficiating Shroff and of M. Aliyar, the initials of the Ledger Clerk and aStaff Assistant; the counterfoil, the signature of the receiving clerk,initials of Shroff and of Staff Assistant. The serial number affixed tothis was 7,415. The signatures and the initials of the officers appear onthe foil and counterfoil in 7,150, too. The Staff Assistant is perhaps theChief Clerk. The Chief Clerk, according to the affidavit of the Controller,countersigns the paying-in slip, detaches the foil of it which he passes tothe Ledger Clerk and at the same time returns the book and counter-foil to the dealer ; the Ledger Clerk enters in the dealer’s ledger account asa credit the number of points appearing in the foil. The number of points,that was entered in the firm’s ledger account on the first occasion was 5,669,on the second occasion 2,992 and the foils and counterfoils now producedcontain the amounts (in letters and figures) 5,669 and 2,992 couponsrespectively.
'488 CANEKERATNE J.—Mohamed Hussain & Co. v. The Controller of Textiles.
The contentions advanced on behalf of the petitioner were that theController when he sent the notice dated February 22, 1946, took the viewthat he was an officer performing administrative duties, alternativelythat he did not inform the firm the reasons on which he acted, or thegrounds on which he proceeded to act and thus no opportunity was givento the firm to meet the case. The contentions on the other side werethese ; the person who was responsible for taking the prima facie viewon February 22, was different from the one who made the order that wascanvassed in the case of Abdul Thassim v. Rodrigo ' that officer hadhimself stated in the course of that irder that he was performingadministrative functions ; the Controller was not acting on suspicion,he had not failed to give an opportunity to the firm to meet thecharge, it was for the petitioner to show that there were facts—ifsuch . there be—which were not disclosed to him, this the petitionerhas failed to allege, the firm was given an opportunity of- examining thebooks and meeting all the evidence upon which the Controller acted.
By a notice sent by the Controller dated February 20, 1947, but served,according to the note on the notice (marked A 1 in the petitioner’saffidavit), at 12 a.m. on February 22, the firm was prohibited frompurchasing or selling any regulated textiles from or to any person withoutthe previous written authority of the Assistant Controller of Textiles,Colombo Town—the prohibition to be valid for two weeks.
On February 22, 1947, the Controller sent a notice (letter marked Bin the petitioner’s affidavit) to the firm, it was served on the firm accord-ing to the note, at 12 a.m. on February 22. The letter gives informationto the firm (a) that the number of coupon points surrendered by thefirm on November 30, 1946, was 669, on December 21, 1946,. was 992; (b)that the office books kept by the receiving clerk, the Assistant Controllerand the Shroff show that these were the amounts received on the twodates ; (c) that interpolations have been made in the slips (the foils andcounterfoils) in figures as well as letters so as to show that in one case5,669 points were surrendered, in the other 2,992 points ; (d) that theinterpolations and the original entries appear to be in the same hand-writing ; (e) that the amounts credited in the ledger account of thefirm were 5,669 and 2,992 points respectively whereas the amountsthat should have been entered ought to be 669 and 992 respectively.The letter proceeds thus: —
“ I have reason to believe that you got these interpolations madewith the object of obtaining in your ledger account credit for a largeramount than the amount you were entitled to on the coupons youactually surrendered.
If you have any explanation to offer in respect of these matters,please send it in to me in writing on or before 4 p.m. on Tuesday, the25th instant.
If you desire to see the documents referred to above, you maydo so at this Office at any time during office hours on application tomy Office Assistant. ”
{1947) 48 AT. L. R. 121
CANEKERATNE J.—Mohamed Hussain & Co. v. The Controller of Textiles 489
It appears that the firm after receipt of the two letters sent Counsel tointerview the Controller. It also appears that at some time probablybefore February 22, S. Mohamad Hussain, Nakkuda Ali, and Aliyar madestatements to the Assistant Controller or to the Controller. The firmby its lawyer sent a reply (letter dated February 25, 1947, marked C) ;it stated that Nakkuda Ali, on the first mentioned date surrendered5,669 points and entered up the paying-in slip in foil and counterfoil,on the second mentioned date he surrendered 2,992 points and entered upthe paying-in slip in foil and counterfoil. “ They were entered in thehandwriting of my client, the proprietor, Mr. Nakkuda Ali. Invariablywhen the paying-in slips are handed over to the Coupon Bank, the signa-ture of my client’s employee, namely, M. O. Aliyar, is written in the slips.There were no interpolations when he wrote the paying-in slips and sentthem to the Coupon Bank.
“ Apparently what has happened is that someone else has destroyedthese two paying-in slips and written out 2 fresh ones for lesser amounts,namely, 669 points on November 30, 1946, and 992 points on December21, 1946, and subsequently interpolated the 5,000 and 2,000 respectivelyon the said dates.
“My client, nor any office employes of his is responsible for the writingof these fresh paying-in slips which contained interpolations. They arenot in the handwriting of my client nor any of his employees. It is note-worthy that the interpolations slips do not contain ths signature of myclient’s employee M. O. Aliyar.
“ When the paying-in slips and the coupons are . surrendered, thesignature of my client’s employee (M. O. Aliyar) is obtained in a bookkept by the Bank Clerk at the counter, sometime the amount is enteredand my client’s man puts his signature without verifying the actualamount of Coupons actually entered. Sometimes the amount is notentered immediately and the actual amount is entered by the Clerksubsequently. In these two particular instances one or the other ofthese things may have happened. ”
Certain English authorities were referred to at the argument, also thedecision of My Lord the Chief Justice in In re application No. 75 (decidedon September 19, 1947).1 It was not disputed that the facts of the lastcase and of the present were not similar and that there was a distinction.Mr. Perera contended that the decision applies to the present case ;Mr. Jayewardene the contrary. The question is, how thin is the linedividing the realms of the two—is it so,thin as to reach the vanishingpoint or is it so marked as to create a well defined distinction ? Therespondent in both cases was the same, in both cases a larger number ofcoupons than the amount recorded as having been surrendered accordingto the registers kept by the receiving clerks, the Shroff and the ChiefClerk of the Coupon Bank was entered in the ledger account of the dealers.One of the impeached transactions in both cases is alleged to havehappened on the same date. There the similarity ends.
Perusal of the foils and counterfoils suggests that interpolations havebeen made. It appears on an examination of the counterfoil of 7150that a line drawn across the blank space below “ S. M. Hussain & Co. ”
1 Vide {1947) 48 N. L. R. 461—Ed.
490 CANEKERATNE J.—Mohamed Hussain & Co. v. The Controller of Textiles.
has been partly erased and the words “ five thousand ” have been writtenover it and that the slope and size of the letters in five thousand aredifferent to those in “ Six hundred and sixty-nine On March 10, 1947,the Controller sent the notice (marked D) to the firm. It states that therespondent finds the firm a person unfit to hold a textile licence. “Itherefore order the revocation of your licence, under Regulation 62, witheffect from March 10, 1947.
“ 2. Please hand over to my officer your Licence, Identity Card,Coupon Issue Card, Coupon Account Register and any coupons you mayhave in your possession.
“ 3. You are also informed that you can keep any of your own stocksin your possession for 15 days after the date of revocation. Meanwhile,if you can make suitable arrangements to deliver the goods to anotherdealer, on such terms as you like, I shall sanction the transfer before thatdate on condition that:
You surrender the remaining coupons in your hand and the
coupons you obtain by the sales with my sanction
The transferee surrenders the coupons for the goods transferred.
Possession of the goods after 15 days will be regarded as unlicensed
possession, and the goods will' be seized and a prosecutionentered.”
Regulation 62 is as follows: —“ Where the Controller has reasonablegrounds to believe that any dealer is unfit to be allowed to continue as adealer, the Controller may cancel the textile licence or textile licencesissued to that dealer ”.
Information was given to the firm as to what the books at the officerevealed in respect of the delivery of coupons on the two occasions,as to the condition of the paying-in slips and as to the addition of 7,000coupons to their ledger account. The firm was informed what documentsinduced the Controller to form a prima facie view and that they wereavailable for inspection and examination. One of the main questionsthe respondent had to decide was, did the firm surrender to the CouponBank 5,669 coupons on November 30, 1946, and 2,992 coupons onDecember 21, 1946 ? There was the entry in the scroll book kept bySepala Rajapakse and in the register kept by K. A. D. Perera as regardsthe delivery on the former date, the entry in the scroll book kept by C. E.Rajapakse and in the register kept by Jayewardene as regards the laterdelivery; statements made by these persons corroborating the entriesin the books would also be before the Controller. On the other handwere the statements made by the petitioner, Mohamed Hussain andAlliyar. The respondent had these two versions before him at the timeof the making of the order. He had also the signature of Alliyar to thescroll book on both occasions, the signature of Alliyar to the two foils(7150 & 7415) and the books in the office (the register kept by the ChiefClerk too). It. is not surprising that the respondent did come to theconclusion that there was no delivery of 5,669 coupons or 2,992 coupons.He was entitled to believe one version in preference to the other. Theother question the respondent had to decide was, did the firm get theinterpolations made ? He had the statements made by the petitioner,
CANEKERATNE J.—Mohamed Hussain & Co. v. The Controller of Textiles. 491
his co-partner and Alliyar, also the explanation given in letter C; on theother hand he had the documents already mentioned and the versiongiven by the two Rajapakses, Perera, and Jayewardene. There werealso the following circumstances :—(1) there was no delivery by the firmof 5,669 coupons or of 2,992 coupons ; (2) who would benefit by theinaccurate entries in the ledger account—the firm, the Chief Clerk, someone else ? The scarcity of textiles and the readiness with which theycan be disposed of at high prices makes dishonesty abnormally profitable.A coupon point, it was asserted at the argument, was a salable article.On a sale of textiles a dealer must obtain the required number of coupons.If coupons were available at or near a dealer’s shop, would-be purchasersof textiles would be considerably helped; (3) the firm has been creditedwith an excess of 5,000 coupons on the first occasion and 2,000 on thesecond; (4) when the paying-in book was returned the petitioner wouldsee an increase in the number of coupons—for the firm did not send 5,669or 2,992 coupons—he would further notice the interpolations in thecounterfoil of 7150 and the writing on the other counterfoil. Could therespondent, on a consideration of these matters, and on the versionsbefore him, not reasonably come to the conclusion that the firm got theinterpolations made ?
One thing is clear that the decision of the Controller is not impeachablein the Courts on the grounds on which a judicial decision might beimpeached. It would be impossible for a person like the petitioner toattempt to get the decision set aside on the ground that the evidenceat the inquiry, or the evidence put before the Controller in his quasi-judicial capacity was insufficient to support his decision. It cannot bechallenged in the Courts unless he has acted unfairly in the sense ofhaving while performing quasi-judicial functions, acted in a way whichno person performing such functions, in the opinion of the Court, oughtto act'—unless he breaks a rule laid down by the regulations underwhich he acts or a rule laid down by the Court for the behaviour of a quasi-judicial officer, that is, unless he has failed to pay due regard to “ thedictates of natural justice ”. “ Eminent Judges have at times used thephrase ‘the principles of natural justice’. The phrase is, of course, usedin a popular sense and must not be taken to mean that there is anyjustice natural among men. The truth is that justice is a very elaborateconception; the growth of many centuries of civilization; and evennow the conception differs widely in countries usually described ascivilized …. The phrase can only mean in this connectionthe principles of fair play . . . that a provision for an inquirynecessarily imports that the ‘ person charged ’ should be jpven his chanceof defence and explanation ” There must be due inquiry. Theperson charged must have notice of what he is accused ; he must have anopportunity of being heard. With respect to the charge made, thecharge of which the firm had notice—this was not disputed—it is a chargeof non-delivery of coupons on two occasions and of getting interpolationsmade ; the particulars of the conduct alleged against it were brought toit attention and it was given an opportunity of sending an explanation
1 Johnson <tr /!o.. Ltd. v. Minister of Health (1947) 2 A. E. R. 395, p. 400.
* Maclean v. The Workers' Union (1929) 1 Ch. 602, pp. 624, 625.
492
Mohamed Miya v. The Controller of Textiles.
and of seeing the documents referred to in letter B. If one sees that therequisite conditions have been fulfilled by the authority which institutedthe inquiry, the functions of a Court are at an end. It appears to methat the Court has no power to review the evidence any more than theCourt has a power to say whether the authority came to a right conclusion.
Passages from the judgment in Board of Education v. Rice1 andAlridge v. Local Government Board1 were read at the argument. It isnot. amiss to refer to what Lord Greene M.R. said in a very recent case *: —“ I ought, however, to refer to one matter, because Counsel for therespondent placed great reliance on it, viz., the well known observationsof Lord Loreburn L.C. in Board of Education v. Rice (supra). I shallnot read the passage but it is clear, to my mind, that Lord Loreburn wasthere dealing with a different type of matter from that which we have todeal here. He was dealing with something which was a lis in a muchtruer sense, because, as he said ‘ The Board is in the nature of an arbitraltribunal Apart from that his observations were not directed to the sortof statute we are dealing with, nor do I think the language which heused is in any way applicable to the consideration of the present case.”
There has been no departure from the rules of “ natural justice ” inthis case and the rule nisi must be discharged with costs.
Rule discharged.