Rajasthan High Court - Jodhpur
M/S Banshiwal Indane vs Indian Oil Corp. Ltd. (Iocl) ... on 2 January, 2024
Author: Nupur Bhati
Bench: Nupur Bhati
[2024:RJ-JD:138]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Civil Writ Petition No. 6748/2022
M/s Banshiwal Indane, Through Its Proprietor Mrs. Chanda
Bansiwal W/o Bharat Kumar Banshiwal, Aged About 45 Years, R/
o Bagol, Senior Secondary School Road, Tehsil Nathdwara
District Rajsamand, At Present Residing At Gayatri Temple Road,
Mota Miya Mangrol, District Surat, Gujarat- 394410.
----Petitioner
Versus
1. Indian Oil Corp. Ltd. (Iocl), Through Its Chief General
Manager, Lpg Operations, Head Office At Indian Oil
Bhavan, G-9, Ali Ywar Jung Marg, Bandra East, Mumbai.
2. The Chief General Manager, Lpg Operations, Head Office
At Indian Oil Bhavan, G-9, Ali Yawar Jung Marg, Bandra
East, Mumbai.
3. Shri Lks Chouhan, The Chief General Manager, Lpg
Operations, Head Office At Indian Oil Bhavan, G-9, Ali
Yawar Jung Marg, Bandra East, Mumbai.
----Respondents
For Petitioner(s) : Mr. Deelip Kawadia
For Respondent(s) : Mr. Nishant Bora
HON'BLE DR. JUSTICE NUPUR BHATI
Judgment 02/01/2024
1. The instant writ petition has been preferred by the petitioner under Articles 226 of the Constitution of India with the following prayers:-
(a) Issue writ of Mandamus or any other appropriate writ, order or direction, the impugned termination orders dated 09.03.2022 (Annex. -15) may kindly be quashed and set-aside.
(b) the respondent Company may kindly be directed to proceed with issuance of fresh LOIs if (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (2 of 8) [CW-6748/2022] required and to proceed pursuant to the same permitting the petitioner to go ahead with establishment of bottling plants at Kota and Udaipur.
(c) That all the consequential proceedings, if taken by the respondents during pendency of the writ petition and adverse to the interest of the petitioner, the same may kindly be declared illegal.
(d) Allow the present petition costs.
(e) Allow such further and other reliefs as the nature and circumstances of the Petitioner case may require.
2. Brief facts of the case are that the petitioner had applied for registration as "Small Enterprise" under Micro, Small and Medium Enterprise (MSME) in the light of the provisions under the MSME Development Act, 2006 and accordingly, the petitioner was issued MSME Certificate on 19.09.2018 with Udhyog Aadhar Memorandum (UAM). A complaint was made by a complainant in respect to the registration of the petitioner unit as "Small Enterprise" whereafter, a site inspection was carried out by the Officers of the District Industries Centre, Surat. The Development Commissioner (MSME) issued a letter dated 03.10.2019 addressed to the General Manager, District Industries Centre, Surat to provide the petitioner an opportunity of hearing in order to amend the business activity in the Memorandum or accordingly, cancel the registration. The petitioner was accordingly granted an opportunity of hearing and thereafter, the petitioner was issued the amended certificate (printed on 08.11.2019) with the same UAM number which was duly deposited by the petitioner to the respondent. The petitioner submitted the bid in pursuance to the tender floated by the respondent-IOCL for the purpose of bottling (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (3 of 8) [CW-6748/2022] of the LPG Cylinders at Udaipur and Kota in Rajasthan which were duly accepted by the respondent-IOCL. The petitioner stood qualified as a successful bidder and the LOI was also issued for both the locations. As per Clause 9 of the tender document, exemption is granted from payment of the Earnest Money Deposit (EMD) to the MSME Units and the petitioner was also extended the waiver of Earnest Money Deposit as being a MSME Unit. The petitioner was issued a show cause notice for the termination of Letter of Intent (LOI) on the ground that DIC, Surat has been directed to proceed in respect to amendment or to cancel the MSME certificate issued in favour of the petitioner. The petitioner preferred a writ petition before the Hon'ble Rajasthan High Court, Jodhpur, being aggrieved of the show cause notice dated 22.12.2020 and the Hon'ble Court vide order dated 03.02.2021, restrained the respondents from taking any coercive action against the petitioner.
3. The respondents, on 03.02.2021 i.e. on the same day, terminated the Letter of Intent (LOI) issued in favour of the petitioner. The petitioner again preferred a writ petition while assailing the termination order dated 03.02.2021 before the Hon'ble Rajasthan High Court, Jodhpur and the Court allowed the writ petition vide order dated 25.01.2022, while directing the respondent-IOCL to consider the petitioner's amended MSME Certificate in accordance with law. The petitioner submitted the detailed representation before the respondents, however, vide impugned order dated 09.03.2022, the respondents have terminated the Letter of Intent (LOI) issued in favour of the (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (4 of 8) [CW-6748/2022] petitioner and the petitioner being aggrieved of the same, has preferred the present writ petition.
4. Learned counsel for the petitioner submits that the respondents have terminated the LOI issued in favour of the petitioner on the basis of surmises and conjectures that the DIC, Surat is likely to cancel the registration of the petitioner. He further submits that the IOCL does not have the domain/authority to invalidate the certificate duly issued by MSME Authorities as the certificate has been issued after duly scrutinizing the documents submitted by the petitioner. Learned counsel for the petitioner also submits that the MSME Certificate bearing UAM No. GJ22E0233138 was valid at the time of submission of the bid and is valid till date and thus, the respondent-IOCL by way of creating confusion in respect to the date of issuing of the certificate, have proceeded to cancel the LOI issued in favour of the petitioner and have not appreciated that the date of filing for the amendment in the certificate and printing of the certificate from the website of MSME does not have any bearance on the status of the petitioner as a MSME unit as the registration UAM No.GJ22E0233138 has remained the same throughout.
5. Learned counsel for the petitioner submits that during the pendency of the writ petition, an application was preferred for taking certain documents on record as on 02.10.2022, a certificate was issued by the District Industries Centre (DIC), Surat in favour of the petitioner with a copy marked to the respondent-IOCL reiterating that the MSME Certificate issued to the petitioner has never been cancelled and withdrawn and the same stands valid till (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (5 of 8) [CW-6748/2022] date right from the date of issuance. He also submits that in the said certificate, it has specifically been mentioned that the petitioner has been registered as MSME as a "Small Enterprise"
since 19.09.2018. Learned counsel for the petitioner also submits that in the impugned order dated 09.03.2022 (Annexure-15), it has been mentioned that the LOI may be withdrawn and the work order may be cancelled even at a later stage, if the MSME registration is found to be invalid and a bare look at the certificate dated 02.08.2022 reflects that the certificate issued in favour of the petitioner has never been declared as invalid and thus, the respondents have wrongly cancelled the LOI.
6. Per contra, learned counsel for the respondents submits that the petitioner obtained the amended certificate on 05.11.2019 which also reflects that the earlier MSME certificate dated 19.09.2018 submitted by the petitioner was not valid. He submits that the amended certificate was issued with effect from 05.11.2019 which is much after the issue date of tender i.e. 28.09.2018, therefore, the subsequent issued amended certificate cannot be taken into consideration. Learned counsel for the respondents submits that as per the admission of the petitioner by way of letter dated 16.11.2019, the petitioner claims the nature of work as Indian Oil Corporation Agency for distribution of LPG gas and repair of gas stoves and subsequent to the amendment made in the MSME certificate, the business activity has been amended to "repair and servicing of gas stoves". He submits that repair and servicing of LPG gas stoves is a part and parcel of LPG distributors provisions and, therefore, it is concluded that the status of the (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (6 of 8) [CW-6748/2022] petitioner on the date of tender was that of a trader and the documents submitted by the petitioner for qualifying as a MSME Unit were not justified and thus, the petitioner cannot be extended the benefit of exemption from depositing EMD and purchase preference etc.
7. Heard learned counsel for the parties as well as perused the material available on record.
8. Upon perusal of the application filed by the petitioner, while taking on record the recently issued certificate dated 02.08.2022 (Annexure-P/17), there is no iota of doubt that the petitioner's enterprise fell in the category of "Small Category" and has also been classified as "Service Enterprise" since 19.09.2018. The said certificate/communication also reiterates that the registration certificate UAM No. GJ22E0233138 which was issued in favour of the petitioner on 17.09.2018 and later on amended was never cancelled or withdrawn and the amendment in the certificate was only in respect to the status of enterprise and the UAM Certificate number are not changed and the petitioner remains as a "Service Enterprise" since 19.09.2018.
9. It is also seen as mentioned in the order dated 09.03.2022 (Annexure-15) that the respondents had the authority to cancel the work order or withdraw the LOI in case the MSME certificate furnished by the petitioner is found to be invalid at any point of time and in the present case, the respondents are unable to establish or demonstrate that the MSME certificate dated 19.09.2018 and amended MSME certificate was found to be invalid rather the certificate/communication dated 02.08.2022 duly issued (Downloaded on 08/01/2024 at 08:33:39 PM) [2024:RJ-JD:138] (7 of 8) [CW-6748/2022] by the Deputy Commissioner of Industries and General Manager, District Industries Centre, Surat clearly mentions that the certificate dated 19.09.2018 (Annexure-1) was never cancelled or withdrawn and thus, in such circumstances, the certificate cannot be said to be invalid.
10. The pre-requisite for qualifying in the tender was having a duly issued MSME registration and the petitioner had duly submitted a valid MSME registration to the respondents. The cancellation of LOI by the respondents on the ground that the amended MSME certificate was issued in favour of the petitioner on 05.11.2019 was much after the tender closing date i.e. 28.09.2018 and approval of issuance of LOI i.e. 17.05.2019 is not acceptable as the petitioner was in possession of a valid MSME certificate since 19.09.2018 with the same UAM certificate number even after the MSME certificate was amended and duly submitted to the respondents.
11. As an upshot of the discussion made hereinabove, the present writ petition deserves to be accepted and is hereby allowed and the impugned termination order dated 09.03.2022 (Annexure-15) is hereby quashed and set aside.
12. The respondent-IOCL is directed to re-issue fresh Letter of Intent (LOI) in favour of the petitioner and also permit the petitioner to go ahead with the establishment of bottling plants at Kota and Udaipur respectively within a period of one month from today.
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[2024:RJ-JD:138] (8 of 8) [CW-6748/2022]
13. Stay application as well as all pending applications, if any, stand disposed of.
(DR.NUPUR BHATI),J 50-Ajay Singh/-
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