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2006 DIGILAW 884 (PAT)

Pasupati Nath Singh v. Ibp Company Limited

2006-09-21

NAVANITI PRASAD SINGH

body2006
Judgment 1. The present writ application has been filed by the petitioner for quashing the order dated 11.7.2006 (Annexure-16) by which the respondent-General manager (Eastern Region) for IBP Company Limited has terminated the retail outlet/dealership of the petitioner for dealing in motorspirit (petrol slash, HSD and lubricants of the said Company). 2. I have heard Shri Y.V. Giri, Senior Advocate in support of the writ application, Shri K.D. Chatterjee appearing on behalf of IBP Company Limited and the learned State Counsel appearing on behalf of respondents No. 4, 5 and 6 who are State officials in the Department of Weights and measures, Government of Bihar and with consent of parties, the writ application is being disposed of at the stage of admission itself. Parties have exchanged affidavits and the pleadings are complete. 3. The short facts are that petitioner No. 1 was awarded the retail outlet/dealership of petroleum products of IBP Company Limited at Mirzapur (Sonbarsa) in the district of Gopalganj by appointment letter, as contained in Annexure-1. Clause-10 of the appointment letter reads as follows: 10. In the event of any product sold/to be sold from Retail Outlet being found contaminated, the companys decision in that behalf being final and conclusive, the company shall be entitled to terminate the Dealership forthwith. In addition, you have to observe the directives issued by the Company and/or the MOP & NG or State Government Authorities from time to time. Please note that non-compliance of the above rules/directives either by yourself or by your employees/representatives may constrain the Company to take necessary action against you, including forthwith termination of dealership. 4 It is not disputed that for dispensing diesel, the petitioner has two units being diesel dispensing unit No. 1 and diesel dispensing unit No. 2. These dispensing units have, apart from other seals, a seal referred to as the totalizer seal. On 8.5.2003, an inspection was carried out by IBP officials and the totalizer seal in the diesel dispensing unit No. 2 was repaired by them. This seal is a plastic seal with the name of Company embossed thereon. These dispensing units have, apart from other seals, a seal referred to as the totalizer seal. On 8.5.2003, an inspection was carried out by IBP officials and the totalizer seal in the diesel dispensing unit No. 2 was repaired by them. This seal is a plastic seal with the name of Company embossed thereon. On 21.5.2003, the State Government provided for payment of fee in respect of such totalizer seals thereby taking the power to verify and seal of the totalizer in the hands of the Weights and Measures Department under the provisions of the Standards of Weights and Measures (Enforcement) Act, 1985 and the rules framed thereunder. In view of the aforesaid, on 14.11.2004, the petitioner deposited fee with the Weights and Measures Department for verification and seal of all such dispensing units, in view of the change in law aforesaid, the seals put by the Company were now to be replaced by seals put by the Weights and Measures Department but it was not so done immediately. On 18.3.2005, inspection was conducted by the officials of IBP Company and all the plastic totalizer seals, as put by the Company, were found intact. On 20.10.2005, an inspection was conducted by the State officials of the Department of Weights and Measures and while verifying the seals, they inadvertently broke the totalizer seal of diesel unit No. 2. This was then replaced by State officials by their metal seal on 1.11.2005. On 22.10.2005, an inspection was conducted by the Sales Officer of IBP Company who found that the Companys plastic totalizer seal, as put on diesel dispensing unit No. 2, was broken and consequently recommended for initiation of proceedings for taking action against such unauthorised interference with the plastic totalizer seal of the Company. On 23.10.2005, the staff of the petitioner, on noticing the aforesaid fact, informed the Inspector of Weights and Measures Department that the petitioner had deposited fee for verification and sealing which had not been done and the same may be done and, as stated above, they came and verified and sealed the same on 1.11.2005. 5. A show cause dated 22.10.2005 was issued to the petitioner by IBP Company that by breaking the totalizer seal, they were liable to be punished by termination of their dealership in view of Marketing Discipline Guidelines 2005. 5. A show cause dated 22.10.2005 was issued to the petitioner by IBP Company that by breaking the totalizer seal, they were liable to be punished by termination of their dealership in view of Marketing Discipline Guidelines 2005. The initial reply was filed by the petitioner on 29.10.2005 in which he did not mention about the weights and measures inspection as allegedly he was not fully aware of what all they had seen and what all they had done. The matter was kept pending and then the petitioner was issued another show cause dated 10.2.2006 wherein, with reference to Clause-10 aforesaid, petitioner was noticed that the totalizer seal having been found damaged, action to terminate dealership was to be taken and explanation was called for. In its show cause filed this time, the petitioner disclosed that on 20.10.2005, an inspection was done by the Inspector, Weights and Measures. He was, however, not aware as to breaking of seal which was revealed subsequently and the totalizer was resealed on 1.11.2005 by the State officials. The petitioner obtained certificates to this effect that the seal was broken by the State officials on 20.10.2005 and resealed on 1.11.2005 which certificates were annexed to the show cause. The IBP Company then gave the petitioner an opportunity of hearing and being not satisfied with the explanation, by the impugned order dated 11.7.2006 (Annexure6), terminated the dealership. While doing so, they noticed the certificates granted by the State officials with regard to breaking of the disputed totalizer seal and resealing it sub-sequently but doubted the same. In spite of serious doubts raised by IBP Company with regard to the certificate issued by the State officials, they did not make any enquiry in this regard from the State official who was also a statutory functionary in this regard. Thus, being unsatisfied with the reply of the petitioner, they terminated the dealership for violation of Clause10 (abovementioned) of the letter of appointment. It may specifically be stated here that no allegation has been made that the diesel being sold from the said dispensing unit was either found adulterated or not of the correct quantity or any other malpractice in respect of sale of diesel. 6. It may specifically be stated here that no allegation has been made that the diesel being sold from the said dispensing unit was either found adulterated or not of the correct quantity or any other malpractice in respect of sale of diesel. 6. Shri Y.V. Giri, learned Senior Counsel submitted that the decision making process stood vitiated in view of the fact that the certificates granted by the Inspector, Weights and Measures, a statutory functionary with regard to breaking of totalizer seal and resealing it were rejected without even noticing the said functionary or soliciting his views in regards his certificates. Petitioner could not do more than produce the certificates. 7. On such submission of the learned counsel in support of the petition, this Court directed the State respondents being officials of the Weights and Measures Department, Government of Bihar to file appropriate counter affidavit, counter affidavit on behalf of respondents No. 4 to 6 was sworn by the Assistant Controller, Weights and Measures on behalf of the said respondents. The said respondents have categorically admitted that after July 2003, it was the responsibility of the Weights and Measures Department to verify and seal the totalizers of petrol pumps. They admitted specifically that it was in course of inspection conducted by them at the petitioners petrol pump that the seal was inadvertently broken on 20.10.2005 and as seal was not immediately available, it was replaced only on 1.11.2005. State, thus, fully supported and corroborated the defence of the petitioner which, as stated above, was not considered by IBP Company. 8. Shri Chatterjee appearing for IBP Company submitted that a reference to contemporaneous documents would show that apparently the story set up by the petitioner was an afterthought and could not be relied upon but faced with the specific counter affidavit on behalf of the statutory authority in support of the petitioner, he could only suggest that the matter be enquired into afresh. 9. I have considered the arguments and the various documents and certificates as well as the counter affidavits. The question is whether the seal was broken by the officers of the Department of Weights and Measures or not. The petitioner furnished certificates of the officials and the officials who are statutory functionary supported the defence of the petitioner in their counter affidavit before this Court as well. The question is whether the seal was broken by the officers of the Department of Weights and Measures or not. The petitioner furnished certificates of the officials and the officials who are statutory functionary supported the defence of the petitioner in their counter affidavit before this Court as well. It was for the IBP Company to make enquiries or get enquiries done about the certificates when they were filed before them. They chose not to make any enquiry in the matter and rejected the same outright. Now when their decision making process is attacked, they want an enquiry in the matter. It must be remembered that while dealing with matters like this which entails heavy civil consequences by reason of termination of dealership, the responsibility to act fairly and objectively is far greater when statutory authority has given a certificate though not happily worded, due weight ought to have been given on it and in case of any doubt before rejecting the same, proper enquiry ought to have been made. In my opinion, in the present case, the decision making process stands vitiated by not making full and complete enquiry in the matter before taking a decision of such serious consequence to the petitioner. In any view of the matter, in view of the positive stand taken by the respondents of the Weights and Measures Department, Government of Bihar, the bona fides of the petitioner can not be doubted. Thus, in my view, it is now to be accepted and stands established that the totalizer seal in question was broken by the officials of the Weights and Measures Department and replaced only after the inspection done by the IBP Company. For this, the petitioner cannot be penalised. The decision making process, thus, stands, vitiated as also the decision. 10. In view of the aforesaid, the impugned order dated 11.7.2006 and the consequential actions taken by IBP Company are liable to be quashed and are quashed. This writ application is consequently allowed.