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7. Under Clause 26 of the above agreement, the respondent Corporation has a right to control the quality or take such measures for controlling the quality of the products supplied by the Corporation which are in the custody of the dealer/the appellant.

8. In exercise of such a right to keep a track of maintenance of the quality of the product supplied by the Company, samples of Petrol (Motor Spirit - MS) and Diesel (High Speed Diesel - HSD) were drawn by the employees of the Company on 26.09.2007. It appears that such samples were subjected to a test by a Mobile Laboratory of the Company and also at the Company's Quality Control Laboratory located at Irumpanam Terminal. The reports of the abovementioned two testing agencies are marked as Exts.P3 and P7. It appears from the abovementioned two reports that one of the tests conducted was the final boiling point of the sample drawn. It appears from the abovementioned two documents that the final boiling point was found to be 220o C and 224o C respectively by the abovementioned two agencies. Pursuant to such a result, the respondent Corporation issued a show cause notice dated 30.10.2007. The relevant portion of the notice reads as follows:

" As you are aware, the Industry Mobile Lab inspected your outlet on 26.09.2007 and drawn samples of products viz., MS, HSD and Turboject for testing on various parameters such as appearance, colour, density, initial and final boiling point and residue. In the Mobile Lab test carried out on 26.09.2007, the MS sample fail to meet the specifications in Final Boiling Point by recording 224 against the specification of 215oC Max. The Industry Mobile Lab officer collected samples of MS, HSD and Turboject through the pump nozzles for carrying out further test at our Irumpanam Terminal. It was also observed and recorded in the Industry Mobile Test Report that the tanktruck retention samples of MS/HSD/Turboject were not properly collected by you and that the aluminium containers and wooden boxes were not sealed with tags as per the established procedure, and hence the tanktruck retention samples were not collected for testing at our Laboratory. In this connection, please refer to letter Ref. No. CRO/ML/DS-001 dated 26.09.2007 issued by Industry Mobile Lab Officer at the time of inspection which was acknowledged by you. The MS sample drawn from the outlet on 26.09.2007 was tested at our Irumpanam Terminal and the product failed to meet the specification in Final Boiling Point by recording 224oC Max. against the specification of 215oC Max. The reference samples kept at our Irumpanam Terminal pertaining to MS/HSD/ Turboject passed the quality tests. The copies of all the Test Reports are attached for your ready reference."