Calcutta High Court (Appellete Side)
Om Prakash Agarwala vs Union Of India & Ors on 8 August, 2013
Author: Dipankar Datta
Bench: Dipankar Datta
1
11 08.8.13
Sc W. P. No. 9660 (W) OF 2013
With
CAN 5506 OF 2013
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Om Prakash Agarwala
- vs.-
Union of India & Ors.
Ms. Lopita Banerjee Mr. Avijit Chakraborty.
....For the Petitioner.
Mr. Sanjib Kumar Mal Mr. Bimalendu Das.
....For the Respondents No.2 to 8.
In pursuance of an agreement dated 6th December, 2010 (hereafter the said agreement) entered into by and between the petitioner and Bharat Petroleum Corporation Limited (hereafter the 'Corporation'), licence was granted in favour of the former to enter into the premises of the latter mentioned in the schedule thereto (hereafter the retail outlet) for the purpose of selling motor spirit, high- speed diesel and/or other petroleum products.
On May 4, 2011 samples had been drawn from the dispensing units/tanks in course of a mobile inspection conducted at the retail outlet wherefrom the petitioner was selling motor spirit and high-speed diesel. It was concluded upon testing of such samples that the same did not conform to the prescribed standards of the Corporation. The retail outlet was immediately sealed and, thereafter, show cause notice was issued calling upon the petitioner to explain why the said agreement shall not be terminated. The petitioner duly replied to the show cause notice and lodged objections including making a prayer for re-testing of the samples. The samples were re-tested whereupon the Corporation arrived at a finding of breach having been committed by the petitioner in respect of compliance with the terms and conditions of the said agreement. Consequently, the licence was terminated by the Corporation by 2 its letter dated 16th March, 2013. This order of termination forms the subject-matter of challenge in this writ petition.
A learned Judge of this Court considered the writ petition for the first time on 16th May, 2013. It is recorded in the order passed on that day that 'complaint of the petitioner is that his prayer for retesting had not been granted on the ground that the samples submitted by the petitioner were found to be tampered'. Despite preliminary objection to the maintainability of the writ petition having been raised on behalf of the Corporation by citing the arbitration clause in the agreement, His Lordship wished to test 'the case of the petitioner on the limited issue as to whether testing of the samples claimed to have been submitted by the petitioner was rejected on proper ground or not'. A direction followed that the writ petition would be listed on 11th June, 2013 when the Corporation would produce the records relating to issuance of the order of termination. An ad interim order was also passed restraining the Corporation from making any appointment on ad hoc basis for the retail outlet and to maintain status quo till 14th June, 2013.
The interim order was extended from time to time and lastly on 17th June, 2013 until further orders by me. The Corporation has filed an application (CAN 5506 of 2013) for dismissal of the writ petition with a further prayer to refer the dispute to the arbitration of the Director (Marketing) of the Corporation in terms of the said agreement.
The application together with the writ petition has been listed for consideration.
Ms. Banerjee, learned advocate for the petitioner submits that the samples which had been retained by the petitioner i. e. the dealer's sample did match with the density shown in the invoice that had been produced at the time of loading of the petroleum products in the tanks at the retail outlet and, therefore, the order of termination is illegal and arbitrary.
3Per contra, Mr. Mal, learned advocate for the Corporation has made serious endeavour to establish before the Court that the samples drawn at the time of mobile inspection did not match with the samples that were retained at the territory and since it did not conform to the prescribed standards, the order of termination was rightly passed. He has also attempted to impress the Court that the petitioner had been instrumental in tampering the seals of the wooden box in which the samples at the dealers' end were required to be retained and, therefore, no credence ought to be given to the contention raised on his behalf.
Mr. Mal has cited the decisions reported in (2007) 14 SCC 680 (Empire Jute Company Limited & Anr.-vs.- Jute Corporation of India Limited & Anr.) and (2008) 8 SCC 172 (Pimpri Chinchwad Municipal Corporation and Ors.- vs.-Gayatri Construction Company & Anr.) to contend that the writ petition should not be entertained.
Answering the contention of Mr. Mal that the writ petition ought not to be entertained because of existence of an arbitration clause, Ms. Banerjee has relied on the decision of the Supreme Court reported in (2003) 2 SCC 107 (Harbanslal Sahnia-vs.- Indian Oil Corporation Limited & Ors.) and the decision of an Hon'ble Division Bench of this Court reported in (2010) 3 WBLR (Cal) 350 (M/s. Friend's H.P. Station & Anr.-vs.- The Senior Regional Manager (Retail) Hindustan Petroleum Corporation Limited & Ors.). According to her, it has been held in the cited decisions that a writ petition would be maintainable notwithstanding the existence of an arbitration clause if it is found that the action impugned in the writ petition seeks to deprive the petitioner of his bread and butter and that the writ petition is for enforcement of a fundamental right, which is exactly the case here.
Having heard the parties at length and perused the decisions that have been cited, I do not feel inclined to entertain the writ petition.
4I propose to deal with the decisions cited by Ms. Banerjee, first.
In Harbanslal Sahnia (supra), the Supreme Court found as a matter of fact that two Government Orders referred to in paragraph 5 of the decision were violated in respect of the samples drawn on 11th February, 2000. The said orders required, in the interest of natural justice, testing of the sample for quality and density at the retail outlet itself in the presence of the dealer with necessary equipment. No tests were carried out at the retail outlet itself. This along with others referred to in paragraph 6 of such decision formed the ground for the Supreme Court to observe that the licensee had been penalised for an irrelevant and non-existent cause. Here, however, the situation is absolutely different. The mobile inspection was conducted and the drawn samples were tested at the site of the retail outlet itself, when the petitioner was also present thereat. The plea of the petitioner in paragraph 3 of the writ petition is not admitted by Mr. Mal and hence a disputed factual question arises, which cannot be decided on affidavit evidence. That apart, no Government order or binding rule has been shown to have been contravened by the Corporation. It is, therefore, clear that the decision in Harbanslal Sahnia (supra) does not come to the rescue of the petitioner.
In so far as the decision in Friend's H.P. Station & Anr. (supra) is concerned, it appears that the dealer's agreement was terminated by the respondents even violating their own norms and even the opportunity of re-testing was refused without any sufficient ground. Having regard to the factual narrative in relation to surprise inspection and re-testing of the samples by the Corporation as above, I am minded to hold that the decision has no application on facts and in the circumstances of the present case.
The Corporation's version here is that it has proceeded to take action in conformity with its Marketing Discipline Guidelines and terminated the dealership on the ground that 5 there has been adulteration of petroleum products at the end of the dealer. There is also an allegation of tampering of the seal of the wooden box in which the dealer's sample had been retained. If, at all, in the process of coming to such conclusion the Corporation has committed any act of omission/commission that could be urged as not in accordance with such guidelines or its action is deficient on any count, the same cannot be regarded as an action inherently lacking in jurisdiction. If any error has been committed in the exercise of its jurisdiction, it is an error within jurisdiction. The distinction is fine, but real. Since disputed questions of fact require investigation and having regard to the said agreement between the parties that any dispute or difference ought to be resolved by way of arbitration, the petitioner is not without a remedy and the writ Court would not interfere unless a gross case of commission of illegality or arbitrariness is demonstrated before it. Reliance in this connection may be made to the decisions referred to by Mr. Mal. That apart, the dispute emanates from a contract and the writ court must stay at a distance unless rights are shown to have been infringed brazenly.
In view thereof, I am not inclined to admit the writ petition and call upon the Corporation to file its affidavit.
The writ petition stands dismissed, while the application stands allowed without costs.
This order shall not preclude the petitioner to approach the Corporation for having the inter-se dispute between him and the Corporation referred to arbitration in terms of clause 19 of the said agreement.
It is made clear that all points are left open for the parties to be urged before the arbitrator for a decision by him.
Urgent photostat certified copy of this order, if applied for, be furnished expeditiously.
(Dipankar Datta,J.)