Calcutta High Court (Appellete Side)
Escromato Private Ltd vs Suma Ghosh & Ors on 3 April, 2019
Author: Soumen Sen
Bench: Soumen Sen
1
03.04.2019
S/L No.03
Court No.37
(gc)
MAT 198 of 2019
With
CAN 1373 of 2019
Escromato Private Ltd.
Vs.
Suma Ghosh & Ors.
Mr. Tilak Kumar Bose, Sr. Adv.,
Mr. Anubhav Sinha,
Mrs. Reshmi Ghosh,
... for the Appellant.
Mr. Naba Kumar Das,
Mr. Pathik Bandhu Banerjee,
...for the Respondent/Writ Petitioner.
Mr. Prasun Mukherjee
Mr. Deepak Agarwal ........ for HPCL
The flip-flop of the Oil Company and its unsatisfactory stand in
relation to allotment of the LPG Distributorship has triggered
litigations that were avoidable. In the process the customers of the
locality were deprived of the benefit of having a LPG distributor at
Chanditala, District-Hooghly for the last six years.
A notice inviting tender for LPG distributorship was published
at 'The Telegraph' dated 10th September, 2013 for Chanditala,
District-Hooghly. The advertisement mentions the location as
Chanditala, District-Hooghly.
The appellant and the private respondent had responded to the
said notice in respect of Serial No.14 which relates to LPG
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Distributorship at Chanditala, District-Hooghly in unreserved
category. By communication dated 8th January, 2015, the writ
petitioner was informed that two candidates were found eligible for
draw of selection of LPG Distributorship. By a further
communication also dated 8th January, 2015, nine candidates
were found to be ineligible, the appellant, was one of them. The
appellant did not challenge the communication dated 8th January,
2015. As natural consequence of the earlier communication dated
8th January, 2015, it is only natural and expected that a draw
would take place between the eligible candidate and thereafter
necessary steps are to be taken for allotting LPG Distributorship to
the successful candidate. Surprisingly for almost three and half
months, the Oil Company did nothing. The Oil Company
contended that Ministry of Petroleum and Natural Gas,
Government of India by a letter dated 20th April, 2015 addressed to
the Oil Companies have requested the said companies to keep in
abeyance draws/redraws for selection of regular distributorship
location advertised prior to March, 2015. If the larger public
interest were considered for deferment in the first place, we find
no reason for the Oil Company to take almost one and half years
to prepare a list of eligible candidates and then again waited three
and half months for the draw of lots. However, this
communication of Ministry of Petroleum and Natural Gas,
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Government of India dated 20th April, 2015 has been shown as an
excuse for not going ahead with the advertisement in time. The Oil
Company appears to have contended before the learned Single
Judge as well as before us that Ministry of Petroleum and Natural
Gas, Government of India by a communication dated 25th April,
2016 addressed to the Oil Companies informed them that for the
locations which were due for draw/redraw, the Oil Companies
should conduct scrutiny of application forms with the Guide Lines
of March, 2015 pertaining to (a) ownership of land (b) approach
road (c) Funds in bank and (d) lease period reckoning. It is not in
dispute that the advertisement was prior to March, 2015. The
eligibility criteria of the candidates have to be decided on the basis
of the existing norms and/or guidelines of 2013 and not on the
basis of guideline of March, 2015. In between there was no
guideline. It was on the basis of the then existing norms, the
appellant was found ineligible. This time, the Oil Company with
reference to the communication dated 25th February, 2016
prepared another list which included two more names on the
purported ground that on the basis of March, 2015 guidelines, the
appellant becomes eligible. The eligibility criteria in respect of the
two new persons, one of whom is the appellant, was on the basis
of Clause 7.2(X) the guidelines of 2015 by which the advertised
location was stated as "within the municipal/town/ village limits
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of the place which is mentioned under the column to location in
the advertisement". However, in the 2013 Guideline it only refers
to advertised location or locality and the Oil Company on the basis
of such guideline found the writ petition eligible along with another
person.
It is not in dispute that there exists a separate and distinct
Mouza, namely, Mouza Chanditala. The documents furnished by
the writ petitioner in the writ application in support of his
candidature also shows that the writ petitioner owes the land in
question in Mouza Chanditala as opposed to the land document
furnished by the appellant to show his eligibility. In course of
argument, the Oil Company has contended that the land of the
appellant would also come within the purview of location
Chanditala, Hooghly as in district Hooghly, there are two Blocks,
namely, Chanditala-I and Chanditala-II and since the land for the
showroom as proposed by the appellant is situated at Mouza -
Kalachara, Chanditala, the appellant is also eligible to participate
in the tender.
This was an improvement by way of oral submission as it is
not in dispute that at the time when the list for eligible candidates
was prepared, namely, on 8th January, 2015, the Oil Company was
under no misapprehension or misconception that for the purpose
of eligibility "Mouza-Chanditala" is the location which also
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conforms to the definition of Gram and Panchayat under the West
Bengal Panchayat Act, 1973. However, for some unknown reason,
the Oil Company did not proceed with the candidature of the
short-listed candidates for draw. In the meantime, the new
guideline has come into effect and the Oil Company in order to
accommodate, the appellant has now interpreted, applied the said
guideline to include the appellant in the list of eligible candidates
for the draw. There cannot be any doubt that if the March, 2015
Guideline is to be applied in the instant case, the Oil Company
would be required to make a fresh advertisement as persons who
would otherwise eligible in view of extended definition of location
in the advertisement would be prevented from participating in the
tender. Although, Mr. Tilak Kumar Bose, learned Senior Counsel
appearing on behalf of the appellant has relied upon Section 42(2)
of the Petroleum and Natural Gas Regulatory Board Act, 2006 (in
short "PNGRB Act, 2006) in the context of saying that Central
Government has the power to issue directions in the public
interest for securing equitable distribution and ensuring adequate
availability to justify that the change guideline would only benefit
the public need but looking differently it is clear that the Oil
Company did not discharge its function as perceived under Section
42(2) of the said Act by keeping quiet on the selection process for
almost one and half years and then for a further period of three
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and half months. If the public interest is paramount then the Oil
Company ought to have on the basis of the selection of the
candidates made on 8th January, 2015 immediately proceed for the
draw and complete the process. If the Oil Companies were of the
opinion that the guideline of March, 2015 would be applicable and
a larger participation is required then it was open for them to
recall the earlier advertisement as by that time more than two
years have passed and issued a fresh advertisement with clarity.
We have noticed in many matters the advertisement as to location
suffers from clarity. Mis-description or lack of clarity in the
advertisement has resulted in large number of litigations and we
are sure that the Oil Companies in future would be more cautious
in describing the location with precision. It shall state clearly the
municipal/town/village limits within which the candidates would
be required to possess land or shop as the case may be in the
advertisement itself.
Mr. Bose has urged before us that the writ petitioner having
participated in the fresh process could not be allowed to question
and/or challenge the selection of the appellant. Mr. Bose, in this
regard, has relied upon the decisions in G.J. Fernandez Vs. State
of Karnataka & Ors. reported at (1990) 2 SCC 488 and D.
Sarojakumari Vs. R. Helen Thilakon & Ors. reported at (2017)
9 SCC 478. Mr. Bose submits that the writ petitioner has
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knowingly participated in the subsequent selection process and
now being unsuccessful in the draw cannot be heard to contend
that the selection of the appellant was de hors the terms of the
advertisement. In the impugned judgment, Justice Sinha has
addressed this issue. His Lordship observed that the writ
petitioner's case was that she was declared eligible candidate with
one other for determining her fate on draw. Thereafter, other
candidates, declared ineligible earlier, were made eligible to be
included in the draw cannot be countenanced. It is this act of the
Oil Company that has been challenged in the writ petition. His
Lordship has further held that regarding draw and her
participation, facts recorded would show that she was made
known at the time of draw that other ineligible candidates would
also be made to participate at the draw.
Mr. Bose in this regard has referred to Clause 9.3 and Clause
9.6 of the 2013 Guideline and submits that in terms of the said
clauses, the list of ineligible applicants and applicants eligible for
draw of lot are made available on the notice board of the concerned
office of the Oil Company as well as on the website of the Oil
Company and, accordingly, the contention of the writ petitioner
that he was not aware that the ineligible candidates would be
allowed to participate at the draw should not be believed. If these
contentions were correct and had come from the Oil Company with
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supporting documents we would have accepted the submissions of
Mr. Bose. On the contrary, the Oil Company has failed to
demonstrate that at the time of draw, the fact that six candidates
who were initially found to be ineligible and now were made
eligible on the basis of the March, 2015 Guideline and hence was
allowed to participate at the draw was, in fact, communicated to
the writ petitioner or these facts were brought to her notice. On
such considerations, we are in agreement with the learned Single
Judge that these decisions would not apply to the facts of this
case. Even on looking from larger public perspective, a tender is
floated with the idea of larger participation and once the Oil
Companies have decided that they would follow March, 2015
Guideline, it was just and proper for the Oil Companies to recall
the earlier tender and go for a fresh tender so that persons who
would be otherwise ineligible would now have the benefit of the
extended definition of location and could now participate at the
said tender. This is also keeping in consonance with the object of
Section 42(2) of the said Act, 2006. Before we depart, we only
remind ourselves of the prophetic words in Ramana Dayaram
Shetty Vs. International Airport Authority of India reported
(1979) 3 SCC 489 that:
"12. ....... It must, therefore, be taken to be the law that where
the Government is dealing with the public, whether by way of giving
jobs or entering into contracts or issuing quotas or licences or
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granting other forms of largesse, the Government cannot act
arbitrarily at its sweet will and, like a private individual, deal with
any person it pleases, but its action must be in conformity with
standard or norms which is not arbitrary, irrational or irrelevant.
The power or discretion of the Government in the matter of grant of
largesse including award of jobs, contracts, quotas, licences, etc.
must be confined and structured by rational, relevant and
nondiscriminatory standard or norm and if the Government departs
from such standard or norm in any particular case or cases, the
action of the Government would be liable to be struck down, unless
it can be shown by the Government that the departure was not
arbitrary, but was based on some valid principle which in itself was
not irrational, unreasonable or discriminatory.
.......
34. It is, therefore, obvious that both having regard to the constitutional mandate of Article 14 as also the judicially evolved rule of administrative law, respondent I was not entitled to act arbitrarily in accepting the tender of respondents 4, but was bound to conform to the standard or norm laid down in paragraph 1 of the notice inviting tenders which required that only a person running a registered IInd Class hotel or restaurant and having at least 5 years' experience as such should be eligible to tender....... The action of respondent 1 in accepting the tender of respondents 4, even though they did not satisfy the prescribed condition of eligibility, was clearly discriminatory, since it excluded other persons similarly situate from tendering for the contract and it was also arbitrary and without reason. The acceptance of the tender of respondents 4 was, in the circumstances, invalid as being violative of the equality clause of the Constitution as also of the rule of administrative law inhibiting arbitrary action." 10
It is true that no third party has come and challenged the selection process but they would not be aware of the existence of such revised policy or relaxation of the terms or the benefit of the modified definition of location as there was no advertisement at all in the first place. Even in G.J. Fernandez (supra) while referring to Ramana Dayaram Shetty, (supra) the following observation was made:-
"It is true that the relaxation of the time schedule in the case of one party does affect even such a person in the sense that he would otherwise have had one competitor less. But, we are inclined to agree with the respondent's contention that while the rule in Ramana case will be readily applied by courts to a case where a person complains that a departure from the qualifications has kept him out of the race, injustice is less apparent where the attempt of the applicant before court is only to gain immunity from competition."
It is also recognized that where there is non-conformity with, or relaxation from, the prescribed standards and it would likely to cause substantial prejudice or injustice to any of the parties involved or to public interest in general, the Court can always interfere. There cannot be any doubt that the writ petitioner was firstly not made aware that the appellant would be allowed to participate at the time of draw and secondly, the appellant was included on the basis of the Guideline of 2015. However, we cannot lost sight of the fact that six years have passed without any LPG Distributor at the said location 11 because of the indiscreet approach of the Oil Companies in not completing the process prior to March, 2015 for reasons best known to them. We feel that a fresh advertisement should be made at the earliest and the fresh selection process be initiated on the basis of the existing guidelines with wide publicity and precision about the locality so that the public interest is protected. We could have allowed the writ petition as we find that there is no infirmity in the order passed by the learned Single Judge but for the reasons as indicated above, we adopt this approach and we feel that such course of action is necessary in the public interest.
The learned Counsel for the parties has submitted that they have already deposited money for field verification and have prayed for refund of the said money. The Oil Companies shall refund the said monies deposited with them within two weeks from date.
The appeal being MAT 198 of 2019 and the application being CAN 1373 of 2019 are disposed of.
Urgent Photostat certified copy of this order, if applied for, be given to the parties on usual undertaking.
(Soumen Sen, J.) (Ravi Krishan Kapur, J.)