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1998 DIGILAW 1118 (ALL)

RAJ ASHOK OIL COMPANY v. STATE OF UTTAR PRADESH

1998-09-21

G.P.MATHUR, S.R.ALAM

body1998
( 1 ) THE controversy raised in these petitions is identical and therefore, they are being disposed of by a common order. Writ petition No. 28679 of 1979 shall be treated as leading petition. The petitioners seek quashing of the government order dated 19. 5. 1990 (annexure-1 to the writ petition) in so far it directs the petitioners to make supplies of Kerosene from the Oil Depot to the business premises of the Distributors and they have made a further prayer that a writ of mandamus be issued restraining the respondents from enforcing clause-4 of the aforesaid government order. ( 2 ) FOR making easy availability of the Kerosene in the rural areas under the public distribution system, the State Govt. issued a government order on 19. 5. 1990. This provides that in order to facilitate the job of lifting of Kerosene by the retailers a Block Distributor or Wholesaler shall be appointed in each block. This arrangment will be done under the U. P. Kerosene Control Order, 1962 (hereinafter referred to as the control Order) except where a wholesaler of the oil companies is already functioning in a block. The government order lays down the order of preference for appointment of Block Distributors and first preference is to be given to the wholesalers/agents working in the district. An effort is to be made that the wholesalers/agents working in the district should work as Block Distributors so that there may not be any problem of co-ordination. Para-4 of the government order provides that F. O. R. delivery of Kerosene shall be made to the Block distributors for which necessary instructions shall be given to the wholesaler by the District Magistrate. The government order is a detailed one and contains instructions regarding the procedure which is to be adopted for attaching the retailers to a Block Distributor, fixation of price of Kerosene and fixation of transport charges etc. ( 3 ) SHRI M. K. Gupta, learned counsel for the petitioner has contended that the enforcement of the government order dated 19. 5. 1990 would result in violation of the Petroleum Act, 1934 and the Rules made thereunder and therfore, the government order deserves to be quashed or it should not be enforced against the petitioners. ( 3 ) SHRI M. K. Gupta, learned counsel for the petitioner has contended that the enforcement of the government order dated 19. 5. 1990 would result in violation of the Petroleum Act, 1934 and the Rules made thereunder and therfore, the government order deserves to be quashed or it should not be enforced against the petitioners. ( 4 ) IN order to appreciate the arguments raised by learned counsel, it is necessary to note few provisions of U. P. Kerosene Control order, 1962. Clause 2 (a) (aa), (d) and (f) of the Control Order read as follows: 2 (a): "agent" means an agent appointed by an oil Company for distribution of Kerosene to distributor or to retail dealers and holding licence in Form III; (aa): "distributor" means a person holding a licence in Form III-A to take Kerosene delivery from an agent for distribution thereof to retail dealers, and to such other persons as directed by the Licensing authority: (d) "licensee" means an agent or a distributor or a retail dealer; (f) "retail Dealer" means a person holding a licence in Form IV. ( 5 ) THE petitioners are "agent" and they have been appointed so by an oil Company for distribution of Kerosene to distributors or to retail dealers and hold licence in Form-Ill. As the definition shows "distributor" means a person holding a licence in Form III-A to take delivery of Kerosene from an agent for distribution thereof to retail dealers and to such other persons as directed by the Licensing authority. In exercise of powers conferred by Section 4 of the petroleum Act, the Central Government has made the Petroleum rules, 1976. Rule 76 provides that no person shall load or unload a tank vehicle with any class of Petroleum except at a place which is situated within premises licensed under these rules and is approved in writing, for loading or unloading of such class of petroleum, by the Chief Controller. ( 6 ) LEARNED counsel has submitted that under the impugned government order the petitioners, who are agent would be required to unload Kerosene at the business premises of a block distributor and it is likely that such block distributor may not hold or possed any licence as required by the Petroleum Rules. In such an event the agent would be liable to be punished for the same. In such an event the agent would be liable to be punished for the same. In our opinion, the contention raised has no substance. Para-3,7 of the government order provides that a block distributor would be required to have a licence under Form IX of the Petroleum Rules and he would be governed by all the provisions of the petroleum Act and Rules made thereunder. This shows that the State Govt. was fully conscious of the legal position and the government order itself contemplates compliance of rule 76 of the petroleum Rules. A person cannot be appointed as block Distributor unless he holds a licence in Form XI of the petroleum Rules and has complied with all the requirements of the petroleum Act and the Rules framed thereunder. Even otherwise, no government order can make such a provision the enforcement whereof may result in breach or violation of any statute or the rules. Therefore, the apprehension expressed by the petitioners that the enforcement of the government order may result in violation of the petroleum Act or the Rules is wholly baseless. ( 7 ) SHRI Gupta has next contended that the enforcement of the government order may result in financial loss to the petitioners as they will have to bear additional costs in transporting Kerosene from the Oil Depot to the place of storage of a Block Distributor. The government order contains several annexures and Clause 4. 1 of annexure-2 thereof provides that while attaching a Block Distributor to a wholesaler or ""agent" care should be taken that it should be done in such a manner that the transport charges are reduced to a minimum. Annexure-10 to the government order deals with fixation of price. Here a specific provision had been made for transport charges. They have to be calculated by taking into consideration the distance of the storage point of the wholesaler from the oil Depot multiplied by the cartage charges per kilolitre per kilometre. There is specific clause in this annexure regarding the price which an agent can charge from a Block Distributor and here it is provided that while calculating the transport charges, the District Magistrate shall take into consideration the distance of the oil Depot from the storage point of the Block Distributor. There is specific clause in this annexure regarding the price which an agent can charge from a Block Distributor and here it is provided that while calculating the transport charges, the District Magistrate shall take into consideration the distance of the oil Depot from the storage point of the Block Distributor. Therefore, the government order has taken care of the fact that an agent or wholesaler will have to incur additional expenditure in transporting the Kerosene oil to the storage point of a Block Distributor and the price which is to be paid by a block Distributor is to be fixed after taking into consideration the transport chartges. Thus the contention that the enforcement of the government order may result in financial loss to an agent is wholly unfounded. ( 8 ) LASTLY, it was contended that the government order may result in breach of the conditions of the licence which has been issued to an agent under Form III. It is urged that thecondition no. 2 (I) of the conditions of licence provides that licensee shall not carry on business or store Kerosene except in the premises specified in his licence but now he will berequired to supply Kerosene at the storatge point of a Block Distributor. The U. P. Kerosene Control Order has been issued by the U. P. Government in exercise of powers conferred by Section 3 read with Section 5 of Essential Commodities Act. The government order dated 19. 5. 1990 does not in any manner contravenes the provisions of Control Order. In fact, the conditions of licence is given in Form III, which is applicable to an agent, have been amended by a Notification issued on 10. 5. 1990. The second proviso to condition no. 2, after its amendment, reads as follows: "provided further that any specified stock of Kerosene may be delivered by the agent at the premises of the distributors or retail dealers with the permission of the Licensing Authority. " ( 9 ) IN view of this amendment, the supply of Kerosene by an agent to a Block Distributor would not amount to breach of conditions of licence as the State Govt. had taken care to amend the licence itself before issuing the government order. " ( 9 ) IN view of this amendment, the supply of Kerosene by an agent to a Block Distributor would not amount to breach of conditions of licence as the State Govt. had taken care to amend the licence itself before issuing the government order. Shri Gupta has also urged that the condition No. 3 of the licence requires an agent to maintain stock register in which the opening stock, quantities of Kerosene received from Oil Company and the quantities sold or delivered or otherwise disposed of each day has to be shown correctly. According to learned counsel if an agent delivers stock of Kerosene directly to a Block distributor from the Depot of an Oil Company, there may be difficulties in maintaining the stock register. The apprehension expressed by the petitioners in this regard is wholly baseless. Clause 13 of the conditions of the licence reads as follows: "the Licensee shall comply with any general or special directions issued by the Licensing Authority, from time to time, in regard to the disposal of any stocks of Kerosene held by him or in regard to the maintenance of any other records of returns, as required by the Licensing Authority. " ( 10 ) THE agent can bring to the notice of licensing authority any problem or difficulty which may arise in maintenance of record and the Licensing Authority is empowered to issued special directions in that regard. The problem contemplated by the petitioners for maintenance of the record is more imaginary than real and it can easily be solved by concerned licensing authority. It may be pointed out that the government order has been issued in order to facilitate delivery of Kerosene to retail distributors and fair price shop keepers in the rural area so that the people living in remote areas may get this essential commodity conveniently under the public distribution system. In absence of a Block Distributor the petty retailers have to collect their quota of kerosene from the storage point of agents and wholesalers which are situate at a great distances. The supply of kerosene by the agents or wholesalers to Block Distributors will reduce the distance which a retailer will have to cover in order to get his quota of Kerosene as his place of business is not likely to be at a great distance from the Block Headquarter. The supply of kerosene by the agents or wholesalers to Block Distributors will reduce the distance which a retailer will have to cover in order to get his quota of Kerosene as his place of business is not likely to be at a great distance from the Block Headquarter. The government order having been issued for the convenience of people living in the rural areas cannot be struck down on these technical grounds at the instance of agents and wholesalers who make easy money without much effort as the Kerosene is supplied to them by the government owned Oild Companies. ( 11 ) NO other point has been urged. ( 12 ) FOR the reason mentioned above, the writ petitions have no merit and are hereby dismissed. Stay order is vacated. .