(1) Where the District Collector, either suo motu or on public representation or otherwise, has reason to believe that a licensee has violated or failed to comply with the conditions of the licence or any provisions of the Act or these rules, he shall call upon the licensee by notice in writing, addressed by registered post to the address given in his licence, stating grounds, to show cause within such period not less than fifteen days from the date of receipt of such notice as to why the licence should not be cancelled and also shall give the licensee an opportunity of being heard.
(2) If the District Collector is not satisfied with the reply received from the licensee, or if no reply is received from the licensee within the time limit specified in sub-rule (1), he may cancel the licence or refuse to renew the licence.