PRAVEEN KUMAR LAKHOTIA Vs. INDIAN OIL CORPORATION LTD

JUDGEMENT

(1.) The petitioners Praveen Kumar Lakhotia & Pradeep Kumar Lakhotia, who are partners in M/s Ashirwaad Agency, have preferred three writ petitions Nos. 1925/03, 613/2001 & 47/2001 under Articles 226/227 of the Constitution of India. By writ petition No. 1923/2003 the petitioners have challenged the termination order of dealership dated 02.05.2001 (Annexure P-10), by writ petition No.613/2001 the petitioners have prayed for direoting the respondents Corporation to restore the supply of agreed petroleum products by issuing a writ of mandamus and by writ petition No.47/2001 the petitioners have prayed for quashment of the show cause notice Annexure P-7 and further prayed to direct the respondent Corporation to regularize the supply of petroleum products i.e. Diesel (HSD) & Petrol (MS) etc. Brief facts leading to filing of these writ petitions are that by an agreement dated 01.02.1997 (Annexure P-1) the petitioners and respondents-Indian Oil Corporation Ltd. entered into an agreement whereby the respondents Corporation awarded a dealership of petroleum products namely Diesel (HSD) & Petrol (MS) to the petitioners' firm M/s Aashirwaad Agency situated at Bemetra District Drug. The respondents Corporation, Raipur issued a show cause notice dated 28.04.2000 (Annexure P-2) to the petitioners mentioning therein that on 14th / 15th of April 2000 the Deputy Manager (Vigilance) Headquarter Mumbai along with Area Manager, Indane Area Office, Raipur carried out inspection and suspended the sales and supplies due to variation in density of MS & HSD beyond permissible limit, accordingly, on 15.04.2000 Deputy Manager (S), Bhilai along with Deputy Manager (TS). Raipur visited the petitioners' retail outlet and carried out inspection of the retail outlet and samples of MS & HSD were also taken for lab test/research octane No. (R.O.N.) and on receiving a communication from Nishadpura Lab vide letter dated 25.04.2000 to the effect that the sample of MS fails to meet the specification requirement in respect of R.O.N., therefore, a show cause notice was issued to the petitioners to explain the reasons as to why the product mentioned was found not meeting the required specifications, and as to why penal action as per the Corporation rules and guidelines should not be taken against your dealership as deemed fit by the Corporation.

(2.) The petitioners submitted their explanation dated 12.05.2000 (Annexure P-3) in which it was mentioned that the samples which were taken by respondent No.2 were neither sealed nor taken in presence of the petitioners or their representative employee and the test was carried out by the laboratory in their absence, therefore, it was not binding on the petitioners agency. Thereafter, the petitioners agency was served with the final show cause notice dated 27.11.2000 (Annexure P-6) to which the petitioners have also submitted their reply dated 04.12.2000 (Annexure P-7) and challenging the said final show cause notice Annexure P-6 the petitioners herein filed a writ petitions under Article 226/227 of the Constitution of India, which came to be registered as W.P. No.47/2001. Thereafter, respondent No.1 & 2 in continuation of their show cause notice on 27.11.2000 took a decision to terminate the dealership of the petitioners, therefore, the petitioners had filed a writ petition bearing W.P. No.613/2001 challenging the show cause notice dated 27.11.2000. However, during the pendency of these two writ petitions the respondent Corporation on 02.05.2001 (Annexure P-10) terminated the dealership of the petitioners' agency. The petitioners vide application dated 31.07.2001 requested respondent No.1 to refer the matter for arbitration, accordingly, Shri Shinde was appointed as Sole Arbitrator, who after hearing both the parties was pleased to submit the award on 14.11.2002 (Annexure P-11), in that award the Arbitrator reached to the conclusion that the action taken by respondent No. 1 was not justified, however, in view of the decision of the Hon'ble Apex Court reported in : 1991 (1) SCC 533, he decline to restore the dealership. Against this award the petitioners filed an application under Section 34 of the Arbitration & Conciliation Act, 1996 before the District Judge, Drug, who transferred the same to the Court of 4th Additional District Judge, Drug, which is pending for consideration on the date of filing of this writ petition.

(3.) Further case of the petitioners is that the respondent Corporation without making the said award rule of court proceeded to execute the said award on 10.05.2003, forcibly took the possession of the petrol pump and remove the fixtures/outlets, broke locks etc. Against this action of the respondents, the petitioners moved a contempt petition bearing Contempt Petition No.50/2003, which is still pending Ultimately, the petitioners prayed that the termination order dated 02.05.2001 (Annexure P-10) be quashed and respondent-Corporation be directed to restore the' supply of petroleum products. Return has been filed on behalf of the respondent Corporation wherein the actual position is almost admitted by the respondent i.e. issuance of show cause notice, termination of the dealership & petitions filed by the petitioners. It has further been mentioned in the return that after termination of the dealership by the respondent Corporation vide Annexure P-10, the dispute was referred to the Arbitrator in pursuance of the petitioners' application dated 31.07.2001 invoking Clause-69 of the dealership Agreement dated 01.02.1997 (Annexure P-1). On 14.11.2002 the Arbitrator passed the award (Annexure P-11) and against which the petitioners had preferred an application before the District Court, Drug, which is still pending for consideration. Their further case is that on sudden inspection carried out by the respondents at the retail outlet of the petitioners, samples of the petroleum products were taken and through the laboratory same were found adulterated and much below the standard specifications. Therefore, a show cause notice was issued and ultimately, the dealership was terminated as per terms and conditions of the agreement. On 10.04.2003 the petitioners sent the consent in writing to respondent No.3 for lease or sale of the land in favour of the respondent No.1 & 2, accordingly, on 16.04.2003 respondent No.3 Collector sent a memo to respondent No.2 to restart the said petrol pump considering the hassles faced by general public of the area. Copy of the consent letter dated 10.04.2003 and Memo dated 16.04.2003 are Annexure R1-1 & R1-2 to the return. On 17.04.2003 by another memo respondent No.3-Collector issued no objection certificate in favour of respondent No.1 & 2 for the use of land survey No. 1207 area 3480 sq. ft. at Bemetara vide Annexure R1-3 Respondent No.3 also informed about the non-renewal of the lease in favour of the petitioners and transfer of the land in favour of the respondent Corporation vide Annexure R1-4. On 07.05.2003 the petitioners once again reiterated and reaffirmed their consent for the use of the land in question by the respondent Corporation vide Annexure R1-6 and on 09.05.2003 the Sub Divisional Officer, Bemetara directed the Tehsildar Bemetara to deliver the possession of the site to respondent No.2 for the purpose. However, the petitioners suddenly reversed their position, questioned their own consent by letter-dated 09.05.2003 addressed to all the concerned parties (Annexure R1-8). On 10.05.2004 Tehsildar delivered the possession of the land to respondent No.2 by preparing Panchnama and on the same day respondent Corporation put respondent No.4 in-charge of the said petrol pump as job contractor on the COCO basis (Annexure R1-9). Therefore, the petition of the petitioners be dismissed. I have heard Shri V.G. Tamaskar, learned counsel for the petitioners and Shri Bhisma Kingar, learned counsel for respondents.