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With Civil Appeal Nos. 3104-3105, 3089, 3090, 3117, 3097, 3102, 3086, 3106, 3085, 3094, 3099, 3103, 3092 & 3101 of 2000.

JUDGMENT PATTANAIK, J.

In this batch of appeals the judgment of Delhi High Court, canceling the allotment made by the concerned minister from out of his so- called discretionary quota on petroleum dealership as well as LPG dealership is under challenge. Prior to 1995, the Minister of Petroleum in exercise of his discretion had been allotting retail outlets for petroleum products, LPG dealership and SKO dealership, without having any prescribed norms. A Public Interest Litigation had been filed in this Court by Centre for Public Interest Litigation under Article 32 of the Constitution, praying that guidelines to regulate the exercise of discretion in the matter of such allotment, which results in exercise of the discretion arbitrarily be fixed. It may be stated that initially a prayer had also been made in that application to cancel the dealership in favour of respondent No. 4, but that prayer stood deleted and an amended petition was filed as the said respondent did not accept the dealership in question. This Court after hearing the counsel for the petitioner, and the learned Attorney General, issued a set of guidelines for discretionary allotment of petroleum products agencies to ensure that the exercise of discretion in making such allotments are in conformity with the rule of law and by excluding the likelihood of arbitrariness and minimising the area of discretion. The said decision of this Court has since been reported in the case of Centre for Public Interest Litigation vs. Union of India and Ors., 1995 Supp.(3) S.C.C. 382. In para (4) of the aforesaid Judgment, the Court had directed as under:

We hereby direct that the above-quoted norms/guidelines etc. shall be followed by the Central Government in making all such discretionary allotments of retail outlets for petroleum products, LPG Dealership and SKO Dealership, hereafter.
The Common Cause had filed a petition under Article 32 on the basis of a news item which appeared in a national newspaper that the Minister of Petroleum was personally interested in making allotment of petrol pumps in favour of 15 persons, who were either the relations of his personal staff or sons of the Ministers, or sons/relations of the Chairman and Members of the Oil Selection Boards, praying for cancellation of allotments made inter alia on the ground that the allotments had been made by the concerned minister, mala fide and the decision is arbitrary and motivated by extraneous considerations. The Court ultimately cancelled the allotments made in favour of the 15 persons mentioned in the petition, on a conclusion that the allotments are arbitrary, discriminatory, mala fide and wholly illegal. The Court also issued certain other directions in relation to the allottees and called upon the concerned minister to show cause as to why a direction be not issued to the appropriate police authority to register a case and initiate prosecution against him for criminal breach of trust or any other offence under law and in addition, why he should not be liable to pay damages for his mala fide action in allotting petrol pumps to 15 persons mentioned therein. This judgment of the Court is reported in 1996(6) SCC 530. While the Common Cause case was pending in this Court, Civil Writ Petition Nos. 4003 and 4430 of 1995 had been filed in Delhi High Court by the Centre for Public Interest Litigation, as public interest litigation, which were pending in Delhi High Court. In those two petitions, allotment of petrol pumps/gas agencies to various persons during the period 1992-93, 1993-94, 1994-95 and 1995-96 had been challenged. A Transfer Petition had been filed in this Court, which was registered as Transfer Petition No. 127/96 and this Court had issued notice in the transfer petition and stayed further proceedings before the High Court. In an affidavit filed by the Ministry of Petroleum in the aforesaid transfer petition, the then Joint Secretary had stated that in 1995-96 under the discretionary power of the Government, allotment had been made to 99 persons and further orders had already been made in favour of 61 more persons, allotting petrol pumps/gas agencies. One Mr. Srinivasan, Advocate had filed an affidavit giving a long list of persons who are related to the then Prime Minister/Ministers and other V.I.Ps and who had been allotted petrol pumps and gas agencies. On behalf of petroleum ministry, an affidavit had been filed, stating that due inquiry had been made through the oil companies and after due inquiry, the concerned minister had made the allotment. This Court ultimately held that since the two writ petitions are pending before the High Court, wherein the allotment made to all these persons have been challenged, it would not be necessary for this Court to get the writ petitions transferred and decide the matter. The Court, therefore, vacated the stay order granted and directed the Registry of the Court to send all affidavits filed by the parties in the transfer petition along with the annexures to the High Court. The Court observed:
593.

Pursuant to the directions of this Court in Common Cause case, 1996(6) S.C.C. 530, the Delhi High Court took up the writ petitions which had been filed as Public Interest Litigation by the Centre for Public Interest Litigation. On examination of the relevant files dealing with the allotment of retail outlets of petrol, LPG distributorship and SKO/LDO dealership under the discretionary quota made by the minister concerned, it was revealed that between January 1993 till 1996, 179 retail outlets (petrol pumps), 155 LPG distributorships and 45 SKO/DLO dealerships had been allotted by the concerned minister under the discretionary quota. In its order dated 29th of August, 1997, the Division Bench of Delhi High Court came to the conclusion that the examination of files clearly shows that these are not the cases of aberrations here or there but are cases which show a pattern of favouritism. From the judgment of Delhi High Court in C.W. 4003/95 dated 29.8.1997, it transpires that even before the Supreme Court stayed the proceedings by order dated 6th December, 1995 , the High Court had called upon the respondents by order dated 2nd November, 1995 to produce the list of allotments made under the discretionary quota of the petroleum minister for allotment of petrol retail outlets, LPG distributorship and Kerosene distributorship from the date of the tenure of the minister which was 18th of January, 1993. Before the Delhi High Court, it had been contended by the allottees as well as by the Government that the judgment dated 31st March, 1995 of the Supreme Court laying down the guidelines, since reported in 1995 Supp.(3) S.C.C. 382 would indicate that the Supreme Court had implidely regularised the allotments made prior to 31st March, 1995 and consequently the validity of the said allotments need not be gone into. The High Court however was not persuaded to agree with the submissions and in our view rightly, particularly, when in the Common Cause case [1996(6) SCC 530] this Court has positively directed the High Court to examine the issues involved and dispose of the two pending writ petitions in accordance with law. Since the allottees were required to be noticed before any decision is taken, the High Court by its order dated 11th December, 1996, constituted a Committee of three advocates and directed them to examine all the files and submit a report in a Proforma which had been prepared by the Court itself, after discussion with the counsel appearing for the parties. The said Committee submitted its report, on the basis of which the Court issued notices to various persons by its order dated 27th of February, 1997 and 20th of March, 1997 and the Court was to deal with the cases of about 400 allottees. Pursuant to the notices issued, the allottees filed their respective show causes and then the Court heard the respective counsel for the allottees as well as examined the report of the Committee and scrutinized the same by perusing the original file and finally disposed of the cases of about 100 allottees by its judgment dated 29th of August, 1997. The Court on examination of the materials before it and on perusal of the original files, appears to have taken the view in several cases that the discretion had been exercised on sufficient materials and after inquiry and held those allotments to have been proper exercise of the discretion and accordingly discharged the notices of cancellation. But in those cases, where the Court found either there were no materials before the concerned minister in support of the applications filed to justify the exercise of power for allotment under the discretionary quota or such allotments had been made on account of political patronage or some other extraneous considerations, the Court cancelled the allotment made with certain directions therein. It would be appropriate at this stage to notice the observations of the High Court:

So far as the first question is concerned, the entire emphasis is on the directions given by the Court in paragraph (4) of the Judgment, which is quoted hereunder:

We hereby direct that the above-quoted norms/guidelines etc. shall be followed by the Central Government in making all such discretionary allotments of retail outlets for petroleum products, LPG Dealership and SKO Dealership, hereafter.
The appellants contention is that while the writ petition was filed in public interest, the exercise of discretion in allotment of retail outlets for petroleum products, LPG Dealership and SKO Dealership had been challenged and a prayer for laying down the guidelines to regulate the exercise of discretion had been made, the Court only laid down the guidelines and further observed that the norms and guidelines would be followed hereafter and necessarily, therefore, there has been a tacit approval to the earlier allotments made under the discretionary quota inasmuch as the Court never cancelled the allotments made nor had issued any direction in that respect. This contention in our considered opinion, cannot be sustained for two reasons. Firstly, the amended petition which the Centre for Public Interest Litigation has filed, merely prayed for laying down the guidelines to regulate exercise of discretion in the matter of such allotments. Secondly, which is rather more important is that this judgment was delivered by the Court on 31st of March, 1995. The Common Cause had filed another petition under Article 32, alleging arbitrary exercise of discretion in favour of 15 allottees and that petition was entertained by this Court and disposed of by Judgment dated 25th September, 1996 and the Court cancelled all such allotments on a finding that the Minister without keeping in view any guidelines, allotted in exercise of his discretion in a cluster manner and the public property have been doled out in wholly arbitrary and discriminatory manner. If the earlier Judgment is susceptible of the construction, as contended by the appellants, then it would not have been possible in the Common Cause case to examine the legality of such allotments which had been made in favour of 15 persons. Instead of construing the judgment in the Centre for Public Interest Litigation to the effect that it accords a tacit approval of the allotments made prior to the judgment in the Common Cause case, the Court relied upon the earlier judgment in 1995 Supp.(1) S.C.C. 382, and ultimately cancelled the orders of allotment, having found that the allotments were made arbitrarily and for extraneous considerations. In this view of the matter, it is difficult for us to sustain the contention of the learned counsel, appearing for the appellants. We, therefore, hold that the judgment of this Court in Centre for Public Interest Litigation, 1995 Supp.(3) S.C.C. 382, cannot be construed by any stretch of the imagination to be a tacit approval of the discretionary allotments made prior to that judgment. We, therefore, do not find any substance in this submission of the learned counsel for the appellants.