Auto LPG Stations Required To Get Trade License From Municipality: Karnataka HC [Read Order]

Karnataka High Court held in Sipani Energy Ltd v The Commissioner BBMP that the auto LPG stations are required to get the trade license from Municipality. It said that the power to grant/refuse license vested in the Commissioner as per Section 353 of the Karnataka Municipal Corporations Act, 1976 is wide and trade license can be refused where the proposed activity is likely to cause nuisance.

Bench of Justice Sunil Dutt Yadav passing the order said that it is settled that the purpose and the frame of an enactment must be kept in mind while interpreting its provisions and going by the requirements of the Act and its interpretation, petitioner is required to obtain trade license from the respondent BBMP (Bruhath Bengaluru Mahanagara Palike) in terms of Section 353 read with Schedule X of KMC Act for vending of Auto gas.

It was answering question whether petitioner, a distributor of Liquefied Petroleum Gas (LPG) running auto gas station, was required to obtain trade license to carry on his business. Court said that scheme of the KMC, Act makes it clear that the state legislature intends to regulate activities which are hazardous, risk public health and safety, or have the possibility of disturbing peace and tranquility. Towards that end, KMC Act, 1976 under Section 353(1) requires that all persons engaging in activities mentioned under Schedule X be required to apply for a license.

Court, however, accepted the petitioner's contention that its property comes within the "Commercial Axes Zone" as per the revised Master Plan 2015 and that the neighbours' consent is not required for obtaining license when the property is located in such a commercial zone. The Chapalamma and Sri Plegamma Devasthanagala Abhivrudhi Sangha Trust, which claimed to be in petitioner's neighborhood had made complaint to BBMP and had then filed writ seeking directions to respondent BBMP to consider its complaint directing petitioner to stop his business as it was creating nuisance in neighborhood.

Petitioner was issued notices by BBMP to close his business and latter was reluctant issuing trade license to petitioner given the complaint by Temple Trust, saying it could issue license only after petitioner gets NOC from the complainant. On this court said that BBMP should reconsider application for granting license to petitioner as petitioner has already taken No Objection Certificate from neighbours on three sides before starting business. Court also said that even under the Scheme "Suvarna Arogya Paravanige", which provides for obtaining trade licenses, the requirement of NOC from the neighbour is applicable only in case of commercial activities in the residential zones and not to other circumstances like that of petitioner. It said that the insistence on obtaining an NOC from the temple trust and refusal to consider the application of the petitioner solely on such ground is impermissible in the absence of any statutory requirement.

"Although the non-obtainment of NOC cannot by itself be a ground for refusal to consider petitioner's application for trade license, objection from neighbours or inability of applicant to source NOCs from them by an applicant can be taken into account by the appropriate authority whilst considering the likelihood of nuisance in the neighbourhood. Any such determination of likelihood of nuisance must be done by appropriate authorities themselves by due application of mind."

Court noted that respondent BBMP has been unable to provide any statutory provision or delegated legislation which mandates obtainment of NOCs from third parties, like applicants' neighbours.

Court placed reliance, besides others, on decision of Kerala High Court decision in Faseela v. The Chief Town Planner reported in 2014, wherein court had struck down a requirement for obtainment of NOCs from neighbours for vending LPG saying there was no statutory provision regarding same.

Court directed BBMP to consider application of petitioner for trade license afresh in accordance with law and in light of the observations made by the court. However, court made it clear that respondent BBMP while considering the application of petitioner is entitled to take note of the objections raised by the complainant temple trust as per law and strictly in light of the observations made by the court.

Petitioner was represented by senior advocate G. Krishna Murthy with Rakesh Bhatt while respondents by advocate K.N. Puttegowda in the case.