The Bombay High Court has established crucial precedent for food licence suspension cases, ruling that suspension cannot continue indefinitely once deficiencies are rectified. A division bench of Justice Sharmila U. Deshmukh & Justice Neeraj P. Dhote heard a petition filed by Hotel Alankar challenging the suspension of their FSSAI license. The court quashed the appellate authority's order dated August 19, 2026, revoked the suspension order dated July 8, 2026, and restored the licence. The establishment had initially scored 69% during a surprise inspection on July 7, 2026, after which its licence was suspended under Section 32(3) of the Food Safety and Standards Act, 2006. However, the re-inspection conducted on July 31 recorded 97% compliance, with the court noting that compliance as per the respondent's own grading is 'exemplar'.
The law provides exceptions to the normal process, allowing authorities to act swiftly in public health emergencies. As reported by Business Standard, the Designated Officer may suspend a licence forthwith in the interest of public health, for reasons to be recorded in writing. A suspension of the licence does not entitle the FBO to any compensation or refund of fees paid in respect of the registration certificate or its renewal. The authority must record the reasons for suspension and furnish a copy to the concerned FBO, then direct an inspection within a reasonable period not less than 14 days from the suspension order.
The law provides comprehensive appeal mechanisms for affected food businesses. According to Business Standard, a person aggrieved by an Improvement Notice, refusal to issue a certificate of improvement, or the cancellation, suspension or revocation of a licence may appeal to the Commissioner of Food Safety. An appeal must generally be filed within 15 days from the date on which notice of the decision is served on the person seeking to appeal. In cases of Improvement Notice appeals, the appeal must be filed within 15 days or the period specified in the Improvement Notice, whichever expires earlier.
The Food Safety and Standards Act establishes clear compensation guidelines for unsafe food incidents. As reported by Business Standard, Section 65 states that if any person manufactures, distributes, sells or imports any article of food that causes injury to a consumer or the consumer's death, the Adjudicating Officer or court may direct that person to pay compensation to the victim or legal representative. The compensation structure includes ₹5 lakh for death cases, ₹3 lakh for grievous injury, and ₹1 lakh for other injury cases. The compensation must be paid at the earliest and within six months from the incident date, with interim relief of ₹30,000 to next of kin within 30 days of the incident.
Recent court proceedings have clarified that suspension of food licences for non-compliances having the propensity to harm public health cannot be continued indefinitely once the deficiencies have been rectified. According to Business Standard, in Siddharth Agro v State of Maharashtra (2026), the Bombay High Court ruled that the FDA must immediately revoke licence suspension or cancellation orders once an establishment fixes the deficiencies. The court emphasized that the consequence of compliance should result in revocation of suspension with continued monitoring as mandated by law. The court noted that continued operation of an establishment during suspension could invite proceedings under Sections 55 and 63, but did not justify continued suspension once compliance is achieved.
