R. A. MEHTA, J. ( 1 ) THE petitioner-Firm was an authorised dealer of petroleum products of respondent-Corporation since 1964. The last of such dealership agreement is of 2-8-1976. During the working of the dealership a sample of petrol sold at the petitioners petrol pump was taken on 22 and was subjected to the laboratory test. The test report received on 30-10-1981 showed that the petrol sold at the petitioners petrol pump was adulterated. By the letter dated 10-11-1981 an explanation was called for and the supplies of the petroleum products were suspended. On 1-7-1982 a notice was issued to the petitioner to show cause as to why the dealership of the petitioner should not be terminated. The petitioner filed his reply on 7-7-1982 He also filed the present petition on 28-9-1980 praying that the respondent Corporation be directed to resume the supplies of the petroleum products and restrain the Corporation from terminating the arrangement with the petitioner-Firm. The respondent had filed an affidavit-in-reply dated 8-10-1982. Thereafter by an interim order dated 2-11-1982 this Court (Coram: A. M. Ahmadi J.) issued an interim direction. That order in its entirity is as follows:" It appears that certain guidelines have been issued by the Ministry of Petroleum vide Annexure A to the petition Similar guidelines also appear to have been issued by the respondent vide Annexure F to the affidavit-in-rejoinder. of course. the case of the respondent is that no such directive is issued by the Ministry and that the said directives have come into operation at a subsequent date. The sample was collected on 22nd July 2981 and the test report dated 30/10/1981 indicated adulteration. As such the suspension order was issued on 10 November 1981 Since th then the sale has been suspended. Show cause notice was served on the petitioner on 1/07/1982 and the reply thereto was filed on 7/07/1982 Even though the suspension order is of 10/11/1981 the petition was filed on 21st Sept 1982 in view of the guidelines directives issued by the Ministry of Petroleum Annexure A adopted by the respondent by Annexure T for the first lapse the retail outlet is required to be suspended for is days and if there is a second lapse the dealership agreement may even be terminated. After the show cause notice end the reply thereto it appears that the respondent has not taken any decision presumably because of the institution of the present petition. Be that as it may the respondent is by this interim order directed to take a decision within four weeks from today and in doing so the respondent may treat the present petition as the petitioners representation to the respondent. The respondent will make a speaking order specifically stating whether this Is a case of first lapse or a second lapse. If the respondent takes a decision to terminate the dealership agreement the implementation of that decision will be made effective fifteen days after the decision is communicated and placed on the record of the petition. Further orders will be passed after expiry of the period allowed to the respondent to take a decision on merits S. O. to 30/11/1982. ( 2 ) THEREAFTER the respondent-Corporation passed an order terminating the petitioner s dealership on 24-11-1982. The petition was amended on 13-12-1982. ( 3 ) IT may also be mentioned that after the order of termination of dealership and the amendment of the petition several preliminary contentions were raised at the time of admission of the petition before the learned single Judge. One preliminary contention upheld by the learned single Judge was that the relationship between the parties was governed by the contract and that excluded the writ petition and consequently the writ petition was dismissed on the ground of no jurisdiction. The petitioner had preferred Letters Patent Appeal No. 98 of 1984 which came to be allowed by the judgment reported in [1987 (1)1] 28 (1) GLR 375. The petitioner had preferred Letters Patent Appeal No. 98 of 1984 which came to be allowed by the judgment reported in [1987 (1)1] 28 (1) GLR 375. The Division Bench considered that apart from the contract which incorporated contingency of termination of dealership on account of the misconduct of the dealer the Division Bench emphasized the peculiar feature of the guidelines or executive instructions which were issued for guiding the discretion of the authorities of various petroleum companies owned by the Government and the contention of the petitioner was that the respondent-Corporation is an instrumentality of the State within the moaning of Art. 12 of the Constitution of India and it bad passed the impugned order of termination of dealership in violation of the executive instructions issued by Ministry of Petroleum Central Government which are binding to all petroleum companies and therefore the impugned order is contrary to the mandatory directions of the Central Government and is patently arbitrary and therefore it violates the mandate of Art. 14 of the Constitution of India. The Division Bench observed that this type of grievance cannot be styled as falling wholly within the domain of contractual rights and obligations of the respective parties under the dealership agreement and such instructions issued by the Petroleum Ministry are totally de hors the dealership contract between the parties and it cannot be suggested that these executive instructions issued by the Ministry of Petroleum flow from any contractual source. The Division Bench held that in fact the dealer has no contract whatsoever with the Petroleum Ministry. If these binding instructions are committed breach of and if that breach adversely affects any citizen of India grievance can be made under Art. 226 of the Constitution of India on the ground that such instrumentality has behaved in an arbitrary manner by not following the executive instructions of its principal which are binding on it. The Division Bench held that such a challenge against the authority of State like the respondent-Corporation cannot be shut out from the scrutiny of the Court under Art. 236 of the Constitution of India and such a challenge cannot be said to be raising purely a question of broach of contract based only on the contractual rights and obligations and which would be foreign to the scope of proceedings under Art. 226 of the Constitution. The Division Bench also considered the case of Radhakrishnan v. State of Bihar AIR 1977 SC 1496 wherein three categories of writ petitions between contracting parties were considered: (1) promissory estoppel (2) where the contract tendered into between the person aggrieved and the State is in exercise of a statutory power under certain Act or Rules framed thereunder and the petitioner alleges a breach on the part of the State and (3) purely a non statutory purely contractual case for breach of contrast. The petitioner had claimed that his case would fall within the second category whereas the Corporation had contended that his case would fall within the third category. However the Division Bench came to the conclusion that neither second or third category would be attracted and the present case would be he entirely a new category which would run as under:"where a contract is entered into between the instrumentality of the State which h is State within the meaning of Art. 12 of the Constitution and a private Party and the grievance of the private party to the contract is that the contract i. e terminated in an arbitrary manner by such instrumentality of the State acting contrary to the binding executive instructions issued by the principal viz the Government and which results in arbitrary exercise of power by the instrumentality of the State violating the guarantee of Art. 14 of the Constitution". The Division a ash held that such a new category would fall in line with categories 1 and 2 enumerated by the Supreme Court in Radhakrishnans case (supra) and hence the L. P. A. was allowed and the Writ Petition was admitted. That is now heard and is being disposed of on merits by this judgment. ( 4 ) THE order of termination of dealership is mainly challenged on the ground that it is in breach of binding executive directions regarding the penalty in the case of first lapse. Therefore first of all it would be necessary to ascertain as to what are the guidelines or instructions. For this purpose they can be divided into three parts; (1) Instructions dated 27-3-1980 (2) Instructions dated 1-3-1982 and (3) Instructions dated 4-10-1982. Therefore first of all it would be necessary to ascertain as to what are the guidelines or instructions. For this purpose they can be divided into three parts; (1) Instructions dated 27-3-1980 (2) Instructions dated 1-3-1982 and (3) Instructions dated 4-10-1982. ( 5 ) THE first set of instruction dated 27-3-1980 is the minutes of the meeting dated 27/03/1983 on the subject of marketing discipline and uniform action by field offices on reported case of malpractices at Petrol/hsd/kerosene retail outlet. It was attended by the representatives of the petroleum companies and a consensus was arrived at on an uniform action in the cases of malpractices and some of the illustrative irregularities and malpractices were noted arid against each of malpractices some broad guidelines were indicated. The illustrated malpractices were such as over-charging in prices short measure stock variation unauthorised purchase/sale/exchange of products issuance of product in excess of quantities permitted by State Government withholding of saleable stock display of daily stock and it was noted that the above list was only illustrative and not exhaustive. The guidelines against each of the items are to the effect as to how the malpractice is to be ascertained. Only in the case of display of daily stock prices the guidelines indicated that in the first instance warning letter should be issued and if repeated supplies to be suspended. It is also noted in the minutes that for uniformity of follow up action it was agreed that the field offices on receipt of report or irregularity would immediately suspend supplies to the outlet and get the incident fully investigated. They would then put up their recommendations alongwith investigation reports for resumption of supplies/termination of dealership to Head Offices in case of HPC and BPC and Regional Offices in case of IDO and IBP. ( 6 ) THESE instructions did not deal with the termination of dealership on the ground of serious misconduct of adulteration of petroleum products at the petrol pump but as mentioned in the minutes itself it was illustrative and not exhaustive and the oil companies were left free to determine the cases of misconduct of adulteration of petroleum products and discretion was depending on the facts of each case. ( 7 ) THESE were the guidelines prevailing on the date when the misconduct had taken place on 22-7-1981. ( 7 ) THESE were the guidelines prevailing on the date when the misconduct had taken place on 22-7-1981. The test report was received on 30-10-1981 and the explanation was submitted by the petitioner on 28-12-1981. ( 8 ) THE petitioner has produced at Annexure `i the second set off the Government guidelines (dt. 1-3-1982) for prevention of adulteration at retail outlets. The same are also found in Annexure `ii to the impugned order by way of Chapter V. It is at page 97. It reads as under :"prevention of adulteration at retail outlets MOTOR SPIRIT :1 Individual Oil Company/joint Inspection reams should carry out filter paper checks at the Retail Outlets2 If filter paper checks indicate possible adulteration signed and sealed 1 litre sample (3) should be collected from the Retail Outlet out of which one should be kept with the dealer one with Company and the third be sent for laboratory testing. 3 If the sample fails in the laboratory test the dealer should be issued 11 Caution Letter and supplies of oil products to the concerned Retail Outlet should be suspended for 15 days. 4 A repeat sample should be taken from the retail outlet where the first sample failed in the laboratory test. 5 If the repeat or any subsequent sample also fails in the laboratory test supplies of all problem products should immediately be suspended and; Show Cause Notice issued to the Dealer. Action (which may include even termination of dealership) should be taken based on investigations. The learned Counsel for the petitioner has strongly relied on paras 3 4 and 5 above and submitted that since this was the first lapse of adulteration this was the first misconduct of this kind on the part of the petitioner and be should have been only issued a caution letter and at the most supplies could have been suspended for 15 days and only if there was repetition of such misconduct of adulteration then only the supplies could be suspended indefinitely and the show. cause notice for termination should be issued. ( 9 ) THE third set of instructions is dated 4-10-19z2 issued by the Government of India Ministry of Petroleum. cause notice for termination should be issued. ( 9 ) THE third set of instructions is dated 4-10-19z2 issued by the Government of India Ministry of Petroleum. That letter is addressed to the respondent-Corporation and the material part reads as under:"the question of penal measures to be taken in case of proven adulteration was discussed in the meeting of the Chief Executives held on 21st-22nd Sept. 1982. It was agreed that in view of the increasing reports of the cases adulteration even for a first offence the punishment should be one of termination of supplies and dealership". "in view of this decision taken in the Chief Executives meeting the instructions contained in para 1 of Shri R. K. Bhargavs DO letter No. 24020- (3)/32 Dist. dated 1/03/1982 would stand amended". Under these instructions it is clear that the Chief Executives of the Government Petroleum Companies held a meeting on 22-9-1982 on the question of penal measures to be taken in cases of proven adulteration and it was agreed in that meeting that in view of the increasing reports of the cases of adulteration and with a view to effectively deal with these cases it was agreed that in cases of proven adulteration even for a first offence the punishment should be one of termination of supplies and dealership. ( 10 ) IT is further stated that in view of this decision taken in the Chief Executive meeting the instructions contained in para 1 of Shri R. K. Bhargavs on letter dated 1-3-1982 would stand amended. Thus the second set of instructions dated 1-3-1982 was amended by Central Government. In the light of the aforesaid three sets of guidelines the question of penalty of termination of dealership is required to be considered. The learned Counsel for the petitioner has not raised any question about the finding of adulteration and only argued on the question of penalty in violation of the guidelines. ( 11 ) ACCORDING to the learned Counsel for the petitioner the relevant applicable guideline is the guideline which as prevailing at the time of issuance of show cause notice and not those which were prevailing at the time when the misconduct was committed nor at the time when the authority proceeded to determine the question of penalty. ( 11 ) ACCORDING to the learned Counsel for the petitioner the relevant applicable guideline is the guideline which as prevailing at the time of issuance of show cause notice and not those which were prevailing at the time when the misconduct was committed nor at the time when the authority proceeded to determine the question of penalty. The learned Counsel for the petitioner has submitted that the show cause notice was issued on 1-7-1982 and at that time the second set of instructions dated 1-3-1982 was already operating and therefore there was no occasion for issuing the said notice of termination of the dealership since this was the first lapse of the kind of adulteration of petroleum product. As against that the contention of the respondent-Corporation is that on the date when the misconduct was committed namely 22-7-1981 it was the first act of guidelines dated 27-3-1980 which was prevailing and these instructions did not provide for any guidelines for cases of misconduct of adulteration and therefore the field was not occupied by those instructions and the matter falls purely in the realm of contract between the parties and every dealer including the petitioner would be knowing that even for the first lapse or misconduct of adulteration the likely result would be termination of dealership. Yet such misconduct was committed and therefore the Corporation was entitled to take into consideration the facts and gravity of the misconduct and pass an order of termination of dealership. Subsequent instructions would not be applicable because the misconduct had already taken place before the issuance of these directions. Alternatively it was contended by the Corporation that if subsequent instructions are to be taken into consideration then all the instructions upto the date of passing of the final order which are operative should be given effect and in either of these cases the action of the respondent is justified. ( 12 ) ONE more argument which is made by the learned Counsel for the petitioner is on the basis of the interim direction issued by A. M. Ahmadi J on 2-11-1982 and it is contended that it is no longer open to the Corporation to raise the questions now raised by the Corporation. ( 12 ) ONE more argument which is made by the learned Counsel for the petitioner is on the basis of the interim direction issued by A. M. Ahmadi J on 2-11-1982 and it is contended that it is no longer open to the Corporation to raise the questions now raised by the Corporation. The High Court had already issued directions in view of the guidelines dated 1-3-1982 which were produced by the petitioner for the first lapse and the respondent was directed to take a decision on the show cause notice and the reply and the petitioners representation by way of present petition and to pass a speaking order specifically stating whether this was a case of first lapse or a second lapse. The learned Counsel for the petitioner has therefore submitted that the question of applicability of guidelines of 1-3-1982 only is concluded and it is no longer open to the respondent to agitate the same question. It is also contended by the learned Counsel for the petitioner that even though the third set of guidelines is of 4-10-1982 and the affidavit-in-reply is filed on 8-10-1982 it did not disclose these guidelines and these guidelines were not relied upon by the respondent-Corporation and the aforesaid interim order came to be passed on 2-11-1982 directing the respondent to make a speaking order specifically stating whether this was a case of first lapse or a second lapse. The learned Counsel for the petitioner has also contended that the guidelines of 4-10-1982 are not operative and have not effectively amended the guidelines of 1-3-1982 and no procedure was followed to amend the earlier guidelines and therefore this guideline of 4-10-1982 had not come into force at all and therefore is in the nature of mere recommendation. ( 13 ) FIRST of all it is to be noted that the dealership is a contract which is liable to be terminated by the Corporation in terms of the agreement itself. Clause 55 of the agreement provides that notwithstanding any thing to the contrary therein contained the Corporation shall be at liberty to terminate this agreement forthwith upon or at any time after the happening of any of the following namely: xxx xxx xxx" (1) If the dealer shall contaminate or tamper with the quality of any of the products supplied by the Corporation". This contractual power of the Corporation is sought to be guided by laying down certain executive instructions. Those instructions cannot be framed amended read or enforced as a statute. They are executive instructions issued with a view to guide the discretionary powers which have been conferred on the Corporation by the consent of parties to the agreement. In fact the contracting parties had left it to the absolute discretion of the Corporation. That absolute discretion was not touched or guided by the first set of instructions dated 27-3-1980 illustrative cases and there was no case of adulteration of petroleum products and therefore so far as the termination of dealership on the ground of misconduct is concerned the contractual discretion and power of the Corporation had remained untouched at the time when the misconduct was committed namely 22-7-1981 and on that day the dealership agreement was liable to be terminated forthwith in terms of the contract. The show cause notice dated 1/07/1982 was issued to the petitioner and the petitioner had replied the same on 7-7-1982. Before issuance of the show cause notice guidelines of 1-3-1982 were issued wherein in para 3 it was indicated that if the sample of the petroleum product fails in the laboratory test the dealer should be issued a caution letter and supplies of all the products to the concerned Retail Outlet be suspended for 15 days. Para 4 provides for repeal samples and para 5 provides that if the repeat or any subsequent sample also fails in the laboratory test show cause notice shall be issued to the dealer for action based on the investigation including the action of termination of dealership. It is on the basis of these guidelines that the learned Counsel for the petitioner has submitted that the only notion that could have been taken was of suspension of supplies for a period of 15 days and issuance of a caution letter only; that the termination notice could not have been given. However before proceedings were finalised on 4-10-1982 revised guidelines were issued. However before proceedings were finalised on 4-10-1982 revised guidelines were issued. In fact the Government had realised the urgent necessity of dealing with increasing reports of adulteration of petroleum products and the necessity of deterent and penal measures and it was directed that in cases of adulteration of petroleum products even for the first time the punishment should be termination of supplies and licence and thus the contractual position of liability for termination even for a single lapse of adulteration was confirmed. In fact the guidelines of 1-3-1982 virtually gave a licence to the dealer to indulge in adulteration without any fear of termination of licence till i. e. was detected atleast once. Therefore if such guidelines of 1-3-1982 were to be given effect it would only mean that contractual term contained in para 55 of the agreement was virtually deleted and a licence is given to indulge in adulteration till it is detected atleast once. As far as the petitioner is concerned at the lime when the misconduct is committed namely 22 the guideline of 1-3-1982 was not there and therefore be was fully aware that even for a single act of adulteration his dealership agreement was liable to be terminated. Inspite of that and with full knowledge the misconduct of adulteration is committed. Therefore the authority was bound to comply with the guidelines which were operative on the date on which the action is taken. The impugned order as termination of agreement was passed on 24-11-1982 and the latest revised guidelines were issued on 4-10-1982. These guidelines were binding to the respondent-Corporation and it could not have ignored those guidelines and passed the order of not terminating the agreement. In fact the agreement of the petitioner as that the respondent. Corporation is bound to follow the executive instruction issued Corporation acted Contrary to the binding instructions issued by its principal seemly the Government the action would be arbitrary and subject to challenge under Art. 226 of the Constitution. Therefore while the Corporation acted and passed the impugned order on 24th 1982 the guidelines of 4-10-1982 issued by the Central Government was bound to be followed and it was binding to the Corporation and it could not have acted contrary to the guidelines. Therefore while the Corporation acted and passed the impugned order on 24th 1982 the guidelines of 4-10-1982 issued by the Central Government was bound to be followed and it was binding to the Corporation and it could not have acted contrary to the guidelines. The petitioner cannot make any grievance that these guidelines would rot be applicable in his case because these guidelines have not imposed anything more than which was existing at the time of misconduct. At the time of misconduct the field was occupied by the contract only and there were no guidelines which dealt with misconduct of adulteration. Therefore there was an absolute contractual discretion conferred by the parties on the Corporation to terminate the dealership agreement on the ground of misconduct of adulteration. The guideline of 4-10-1982 is also consistent with the contractual term and it directs that in cases of adulteration even for first offence the result should be termination of supplies and dealership agreement. Thus under the contract between the parties the Corporation was entitled to terminate the dealership. On the date of the misconduct of adulteration there were no executive guidelines and therefore the contract was liable to termination and when the impugned order of termination is passed on 24-11-1982 the operative guidelines of 4-10-1983 provided that even for the first act of adulteration there shall be termination of supplies 2nd dealership agreement. ( 14 ) THE learned Counsel for the petitioner tried to connect the guidelines of 1-3-1982 with reference to the date of show cause notice. The date of show cause notice is not at all relevant or material. The most material and relevant dates are the date of misconduct and the date on which the impugned order is passed. The Corporation is bound by the executive instructions which might be operating at the time when the action is taken. In the present cases the action was taken on 24-11-1982 and at that time the Corporation is bound to give effect to the executive instructions which were operating at that time. These instructions are executive instructions and they would apply even to the pending proceedings unless it is shown that these instructions are otherwise illegal. These instructions are not shown to be illegal and they are binding to the Corporation and the Corporation is bound to act in accordance therewith. These instructions are executive instructions and they would apply even to the pending proceedings unless it is shown that these instructions are otherwise illegal. These instructions are not shown to be illegal and they are binding to the Corporation and the Corporation is bound to act in accordance therewith. ( 15 ) THE learned Counsel for the petitioner has submitted that the instructions of 4-11-1982 were in the nature of recommendation and not effective and enacted instructions and therefore it Lad not superseded the earlier instructions of 1-3-1982. He bus submitted that the earlier instructions were formulated at a joint meeting of the representatives of the Government Petroleum Companies and the Government had issued formal instructions in terms of the minutes of that meeting whereas the instructions of 4-11-1982 have been issued by the Central Government suo moto without following the same procedure by which the earlier instructions were formulated. The learned Counsel for the petitioner submits that just as there is a set procedure for enacting the legislation and if a legislation is enacted by the Parliament it could not be superseded by any authority the earlier instructions which were formulated by following a certain procedure could be amended only by following the same procedure and not by any lesser procedure or authority. It is not possible to uphold this contention. The very nature of executive instructions and the guidelines is that it is not a statute or enacted law. The executive instructions and actions cannot he read like legislations nor are they enacted like legislation. They are broad execute guidelines formulated an exercise of the executive power with a view to guiding the authorities concerned. The guidelines of 1-3-1982 were laid down by the Government and the last guidelines of 4-10-1982 were also worked out in the meeting of Chief Executives of the Oil Companies held on 22-9-1982 and it was agreed in view of the increasing reports of adulteration to effectively deal with such cases. It was therefore decided that in cases of proven adulteration even for the first offence punishment should be of termination of supplies and dealership. It was therefore decided that in cases of proven adulteration even for the first offence punishment should be of termination of supplies and dealership. It was in view of this decision taken in the Chief Executives meeting that the instructions contained in guidelines of 1-3-1982 stood amended as stated in the Government of India letter of 4/10/1982 Therefore it can be said that these executive instructions were operative from 2-9-1982 but in any case the Government of India had by letter of Oct. 4 1982 made it clear that the instructions of 1-3-1982 would stand amended and even in case of first adulteration the dealership will be liable to termination. It is therefore not possible to uphold the contention that the executive instructions of 4-10-1982 do not have any force. ( 16 ) THE learned Counsel for the petitioner has also submitted that by the interim order dated 2-11-1989 (Coram: A. M. Ahmadi J.) this controversy was finalised and the Corporation was directed to find whether this was a case of first lapse. It is true that at that time the guidelines of 4-10-1982 were not brought to the notice of the Court. The reply was filed on 8-10-1982 and therefore it is likely that these instructions were not noticed at all. It is also to be noted that it was only an interim direction wherein no decision has been taken on merits and the Court has not decided the question as to whether the Corporation was bound to act in accordance with the guidelines of 1 In fact the Court was rot called upon to decide about the applicability of the guidelines of 4-10-1982 and the learned single Judge has not decided that question and therefore that interim order cannot be construed to have decided the question of guidelines of 4 It is not at all referred to and therefore it is not possible to hold that by that interim direction the guidelines of 4-10-1982 were held not applicable. It also cannot be said that by that order it was finally decided that the guidelines of 1-3-1982 were held to be applicable. Only interim direction was to decide the case by a speaking order and in that order the Corporation was also required to find out whether this was a first lapse. It also cannot be said that by that order it was finally decided that the guidelines of 1-3-1982 were held to be applicable. Only interim direction was to decide the case by a speaking order and in that order the Corporation was also required to find out whether this was a first lapse. The Court had not directed that if it was a case of first lapse the Corporation will not terminate the supplies and dealership. In fact the interim direction also took into consideration that an order of termination of dealership may also be passed and therefore there was a further direction that if the respondent takes a decision to terminate the dealership the implementation of that decision will be made effective 15 days after the decision is communicated. ( 17 ) IN view of the aforesaid discussion it is clear that on the date of the misconduct namely 27-7-1981 as well as an the date of termination i. e. 24-11-1982 the dealership agreement was liable to termination in accordance with the contract and in accordance with the prevailing guidelines and even though the misconduct of adulteration may be the first misconduct on the part of the dealer. In that view of the matter other questions arising in the petition do not survive. The Corporation had tried to show that in the past there were other misconducts and therefore this was not the first misconduct on the part of the petitioner. The petitioner had tried to counter the same by stating that no show cause notice was issued to the petitioner enumerating the past misconduct and secondly it was also tried to point out that those misconducts were not of adulteration and were too trivial to call misconduct falling within this series of category. In my view none of these questions are required to be considered in view of the fact that even if it is a first misconduct it attracts termination of dealership agreement. ( 18 ) IN the result the petition fails and is dismissed. Rule discharged with no order as to costs. Petition dismissed. .