Bombay High Court
Ramniklal Keshavlal Lathiwala, ... vs The General Manager, Bharat Petroleum ... on 4 July, 2019
Author: Sunil B. Shukre
Bench: Sunil B. Shukre, S.M. Modak
wp.6094.14.jud 1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR
WRIT PETITION NO.6094 OF 2014
Petitioner : Ramniklal Keshavlal Lathiwala,
Proprietor of M/s. K.T. Lathiwala,
BPCL Dealer (A Proprietorship Concern),
having its Pump near Post office,
Darwah-Karanja Road, Darwah,
District Yavatmal.
-- Versus -
Respondents : 1] The General Manager,
Bharat Petroleum Corporation Ltd.,
A Government Company and
Public Sector Undertaking,
having registered Office at Bharat Bhavan,
4 & 6, Currimbhoy Road, Ballard Estate,
Mumbai - 400 001.
2] Mr. S. Ramesh (Deleted),
Executive Director (Retail),
In-Charge, Bharat Petroleum Corporation Ltd.
12/E & F, 12th Floor, Maker Towers,
Cuffe Parade, Mumbai - 400 005.
Deleted as 3] Mr. Dinakara L. Tonse (Deleted)
per Court's Territory Manager (Retail), Nagpur,
Order dated Bharat Petroleum Corporation Ltd.,
30/08/2016.
"Sunny Side", 7, Chitnis Marg,
Civil Lines, Nagpur - 440 001.
4] Mr. Pravin Singh (Deleted)
Dy Manager (Sales),
(Previously Asst. Manager (Sales),
Bharat Petroleum Corporation Ltd.,
Akola Giagaon Depot, District Akola.
5] Shri Rajiv A. Moghe,
Amended as per
At Post : Vasantpur Kharda,
Court's Order dated
30/06/2016. Taluka : Digras, District Yavatmal : 445 203.
::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 :::
wp.6094.14.jud 2
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Shri S.M. Puranik, Advocate for the Petitioner.
Shri Abhay Sambre, Advocate for Respondent Nos.1 & 3.
Shri A.M. Gordey, Senior Advocate with Smt. R.D. Raskar,
Advocate for Respondent No.5
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
CORAM : SUNIL B. SHUKRE & S.M. MODAK, JJ.
DATE : 4th JULY, 2019.
ORAL JUDGMENT :- (Per Sunil B. Shukre, J.)
Heard Shri Puranik, learned Counsel for the petitioner, Shri Sambre, learned Counsel for respondent Nos.1 & 3 and Shri Gordey, learned Senior Counsel for respondent No.5, who is presently running the outlet or the petrol pump on behalf of respondent No.1 - Company. Remaining respondents have been deleted as per the order passed by this Court.
02] The petitioner is a proprietor of M/s. K.T. Lathiwala, who has been running the petrol or motor spirit outlet of respondent No.1 - Company since the year 1955 on the address given in the petition. In the year 2010, the Assistant Sales Manager of respondent No.1 - Company paid a visit to the petrol outlet and made inspection. It was a surprise check and was done on 19/03/2010. The motor spirit dispensing unit was installed by respondent No.1 - Company and it is an admitted position that it is maintained by and is kept in custody by respondent No.1 - ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 3 Company and the dealer like the petitioner is only given a charge of the same as a trustee for respondent No.1 - Company. During the surprise check, samples of the motor spirit dispensed by the unit were taken. They were taken eight times consecutively and on all the occasions, it was found that the delivery of the motor spirit was short by 220 ml per five litres of the measure. At that time, the dispensing unit was running on the power supply through a generator set, as the regular power supply was disrupted. When the samples were taken, the underground tank was also not completely full and that one tanker full of motor spirit had already arrived there and it was waiting to decant it's contents into the underground tank.
03] After the eight samples were taken consecutively, the contents of the tanker were emptied in the underground tank and by that time, the regular electricity supply had also been restored. On the insistence of the petitioner, one more sample from the dispensing unit was taken and this time, the reading of the sample showed that delivery of the motor spirit was short by only 20 ml per five litres of the measure.
04] All these facts were recorded by the Assistant Sales Manager and he sent his report to respondent No.1 - Company. ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 4 After considering the report, respondent No.1 - Company felt that action for termination of the petrol pump licence given to the petitioner be taken and, therefore, a 'show cause notice' was issued by it to the petitioner on 04/05/2010. A detailed reply was given by the petitioner. But, the explanation was not accepted and by the order issued on 23/03/2013, the licence of the petitioner was cancelled. Thereafter, the petitioner had approached this Court by filing Writ Petition No.3239/2013, but it was allowed to be withdrawn by the petitioner, as a remedy of appeal was available to the petitioner and he was relegated to that remedy. The appeal filed by the petitioner before the higher authority of the Company came to be rejected and this is how the petitioner is now before this Court.
05] The basic issue which lies at the centre of the controversy, which could be culled out from the arguments canvassed before us on behalf of both sides, is about the need for involving the manufacturer of the dispensing unit for determining as to whether or not the dispensing unit or the microchip contained in the dispensing unit had been tampered with by the petitioner so as to derive undue gains in the matter.
::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 5 06] It is submitted by Shri Puranik, learned Counsel for the petitioner that sending of the microchip to the manufacturer, a Company known as "MIDCO", was necessary, as there was a vast difference between reading of the samples taken on the same day, at two different times, with some relevant factors intervening in between. Shri Sambre, learned Counsel for respondent No.1 - Company submits that this was not necessary as the seal pasted on the chip of dispensing unit was found to be tampered with and it gave a clear indication of tampering with the chip which was further confirmed by the short delivery of 220 ml per 5 litres of measure discovered from the samples taken eight times consecutively. Shri Gordey, learned Senior Counsel submits that although there were intervening factors, the tampering with the seal pasted on the microchip was sufficient for the Company to reach the conclusion about tampering with the insides of the chip and it was also demonstrated by short delivery of motor spirit per 5 litres measure.
07] Upon consideration of the admitted facts, we find that there is great substance in the argument of the learned Counsel for the petitioner and no merit in the arguments canvassed on behalf of respondent No.1 and respondent No.5 by their respective learned Counsel and learned Senior Counsel.
::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 6 08] The admitted facts show that there were two sets of samples taken in the present case and they were taken on one and the same day with a gap of some time in between them. The first set of samples consisted of eight samples taken consecutively or one after another and the second set of samples comprised only one sample taken some time after the first set of sample. There was a huge difference in reading recorded by the first set of samples and the reading noted by second set of samples. The first set of samples indicted that delivery was short by 220 ml and whereas the second set of samples showed that the delivery was short by 20 ml per five litres. It is also an admitted fact that the first set of samples was drawn when the power was being supplied through the diesel generation set, whereas the second set of sample was taken when the power was being supplied by the M.S.E.B., which was a normal power supply. It is also an admitted fact that the reading of 20 ml short shown by second sample was within the permissible limit. These admitted facts could be seen from the order of the appellate authority dated 30 th April, 2014 (Para 4).
09] When there is such a huge difference between the readings of two different sets of samples in respect of the same ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 7 dispensing unit, a doubt arises. The doubt is veritable as the difference is quite large and is between samples taken on the same day and, therefore, it is necessary for an authority taking a drastic decision having civil consequences like the decision of terminating of the old licence of a petrol pump dealer, that the doubt is cleared by it through proper means. The only proper way available in this case for removal of the doubt was that of getting the chip examined by it's manufacturer. In such a case, it is only a manufacturer, who would be in a position to give an opinion like an expert, as to whether or not, there is really any tampering with the microchip which has resulted in showing of a short delivery beyond permissible limit. This has not been done in the present case. 10] Then, there were also intervening factors when the two different sets of samples were taken. The first set of samples had different environment and while the second set of sample had another. The environment of the first sample consisted in energy being provided through a diesel generator set, which was, our common knowledge would indicate, in the form of a direct current and whereas the energy, which was provided at the time of drawing of the second sample, was through regular power supply made by the M.S.E.B., which was based upon, again our common ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 8 knowledge would indicate, alternating current system. At the time, when the first set of samples was taken, the underground tank, from which the motor spirit was pumped out by the dispensing unit, admittedly was almost empty with only about 900 litres of the motor spirit left in it and this tank had a capacity of 12000 litres. At the time, when the second sample was obtained, the underground tank was admittedly full to the brink or to the capacity. Such difference in the environments, it is possible, may have resulted in giving of two different kind of readings in two different sets of samples. Then, the question would be - which reading of the two is correct? This would give rise to a doubt regarding the conclusion to be made. Such doubt did exist here.
11] The law is that for removal of such doubt, it was essential on the part of respondent No.1 - Company, once again we would say, to refer the concerned part to it's manufacturer for it's opinion. If this had been done by respondent No.1 - Company, definite conclusion could have been reached in this case and this conclusion would have been based upon the empirical evidence collected by the Company. In fact, the Marketing Discipline Guidelines - 2005 also refer to the same thing. A copy of these guidelines has been filed on record and our attention has been ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 9 invited to note (ii) appearing below the clause 6.3.5 which deals with situations of stock variation between physical stock and book stock. This note reads as under - (Page 109).
ii) All cases of irregularities needs to be established before any penal action is taken against a dealer. 12] It is clear that the own guideline of respondent No.1 - Company cautions it's officials against taking any penal action on the basis of doubtful data. The guideline says that every case of irregularity must be established before any penal action is taken and it would mean that the irregularity must be supported by a scientific data and not the personal opinion arrived at without making any effort to remove the doubt or rule out the possibility which may speak in favour of the concerned dealer. 13] In the circumstances, we find that the termination order cannot be sustained in the eye of law and it deserves to be quashed and set aside.
14] Now, it is necessary to know if any equity has been created in favour of respondent No.5 and if so, the question would be as to how it be dealt with. An answer is provided by the Pursis ::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 10 filed on record by respondent No.1. It places on record an important fact in the nature of respondent No.5 being aware of this dispute at the time when the dealership was allotted to him. It also shows that respondent No.5 was made aware of the possible consequence of cancellation occurring, with 30 days notice given to him, if any order adverse to the Company would be passed by this Court. The Pursis is accompanied by an undertaking given on the same lines by respondent No.5. This would not result in creation of any equity in favour of respondent No.5. Therefore, we see no difficulty in allowing this petition by cancelling the termination order.
15] In the result, the following order is passed :
i. The writ petition is allowed.
ii. The impugned termination order is hereby quashed and set aside with the consequence of restoration of the dealership of the petitioner, subject to payment of necessary charges, fees and observance of all the conditions of the original licence and other applicable regulations.
::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 ::: wp.6094.14.jud 11 iii. We would also direct respondent No.1 to consider allotment of alternative outlet to respondent No.5. iv. The restoration of the original licence in pursuance of this order would take place after expiry of period of three months from the date of the order. v. Rule is made absolute in the above terms with no order as to costs.
(S.M. Modak, J.) (Sunil B. Shukre, J.)
*sandesh
::: Uploaded on - 10/07/2019 ::: Downloaded on - 13/07/2019 03:20:37 :::