JAYANT PATEL, J. ( 1 ) THE short facts of the case appears to be that the petitioner is the owner of Plot No. 4/a, situated at akota, Taluka Vadodara, and it is the case of the petitioner that the said land was purchased by the petitioner from one Jasumatiben Chandrakant Shah as well as Jayshree Dilip Sheth on 27. 11 2003. The petitioner was granted licence on 20. 11. 2005 by the respondent Bharat Petroleum corporation Ltd. (hereinafter referred to as the "corporation" for the sake of convenience ). It appears that based on the licence granted, the agreement was entered into and the petitioner was doing the business as per the said licence of distribution of petrol and diesels and other items. On 26. 05. 2006, the sample was drawn from petrol pump (popularly known as "retail outlet") run by the petitioner and thereafter, it was sent to the laboratory for testing. The said sample did not meet with the requisite standard of ron (Research Octane Number) for minimum requirement of 88 and in the report dated 10,07. 2006, it was found as 83. 0. Therefore, it appears that the respondent Corporation issued show-cause notice for taking action. It also appears that thereafter, on the basis of the request made by the petitioner, the another part of the sample which was retained by the Territory Manager was also sent for laboratory testing and as per the report dated 01. 11. 2006, it was found that the RON found was that of 87 as against the minimum requirement of 88, It also appears that based on the report, the explanation was called for of the petitioner by the respondent corporation. It appears that thereafter, third part of sample which was retained by the petitioner at the request of the petitioner was sent to the laboratory for testing and vide report dated 25. 04,2007, the said RON was found to be 87. 6 as against the minimum requirement of 88. The respondent corporation also called for the explanation of the petitioner based on the third report, It also appears that the petitioner did submit explanation in response to the show cause notices as well as the further correspondences entered into by the Corporation based on the subsequent reports. 6 as against the minimum requirement of 88. The respondent corporation also called for the explanation of the petitioner based on the third report, It also appears that the petitioner did submit explanation in response to the show cause notices as well as the further correspondences entered into by the Corporation based on the subsequent reports. The corporation thereafter took substantial time in taking decision arid the case of the petitioner is that the same took approximately 3 years and the samples were being taken for the subsequent period also, but, they were found to be of the requisite quality and specification, Ultimately, the respondent Corporation vide decision dated 04. 09,2009, communicated to the petitioner for termination of the contract entered into as per the agreement with immediate effect. It is under these circumstances, the petitioner has approached to this Court by the present petition, ( 2 ) HEARD Mr. Mohir Thakor, learned Senior Counsel appearing with mr. Unwala for the petitioner, Mr. Patel, learned AGP for the State authorities, Mr. Farcy Kavina, Senior counsel for Singhi and Company for respondent Corporation and Mr. Champaneri, Assistant Solicitor general for respondent No. 3 and Mr. Tolia for respondent No. 4. ( 3 ) AS such, following are undisputed position - (i) Entering of the agreement by the petitioner with the respondent corporation and the licence granted in favour of the petitioner by the respondent Corporation. (ii) Drawing of the sample from the retail counter run by the petitioner on 26. 05. 2006. (iii) The above referred three testing reports of the laboratory dated 10. 07. 2006, 01. 11. 2006 and 25. 04. 2007. (iv) RON at supply level for the sample was drawn from the retail depot, was 89 whereas as per the first report it was found to be 83, in the second report it was found to be 87 and in the third report, it was found to be 87. 6, as against the minimum requirement of 88. 04. 2007. (iv) RON at supply level for the sample was drawn from the retail depot, was 89 whereas as per the first report it was found to be 83, in the second report it was found to be 87 and in the third report, it was found to be 87. 6, as against the minimum requirement of 88. ( 4 ) ALL the three reports are of the different portions of the same lot inasmuch as the sample was divided into three parts; one was at the first instance sent to the laboratory testing and another portion was retained by territory Manager and third portion was given to the petitioner and all the aforesaid portions of the same samples were sent to the laboratory after the some period one by one and the reports, as referred to hereinabove have come. ( 5 ) IN the impugned decision of the respondent Corporation, there is no discussion whatsoever to the variation found in the laboratory test report of the same sample (in different portions)showing different RON content. There is no explanation or dealing with the said aspects in specific in the affidavit-in-reply of the respondent Corporation even after filing of the present petition. ( 6 ) IT is in the above factual scenario of undisputed position, the matter deserves to be examined. ( 7 ) THE law on the subject is by now well settled. It is true that the relationship of the petitioner and the respondent Corporation are governed by the agreement and also governed by the terms and conditions of the agreement. But, at the same time, it is also undisputed position that the the respondent Corporation is a 'state' within the meaning of Article 12 of the constitution on account of the deep and pervasive control as well as the financial stake involved of the government of India. If the State or any other agency of the State enters into contract with any private citizen, it would be expected for the State or such agency to act in a just, fair and reasonable manner. If the citizen who is party to the agreement is to invoke the right as per the agreement, the remedy may be available to such citizen ro approach before the competent civil court or to the proceedings of the arbitration as per the agreement. If the citizen who is party to the agreement is to invoke the right as per the agreement, the remedy may be available to such citizen ro approach before the competent civil court or to the proceedings of the arbitration as per the agreement. However, if the action is to be assailed of the State or such agency under article 226 of the Constitution, as a public law remedy, the judicial scrutiny shall be available to the extent of testing the action on the touchstone of arbitrariness or unreasonableness. At this stage, the reference may be made to the decision of this Court in the case of m. S. Desai and Co. Vs. Hindustan corporation reported in 2002 (4) GLR 6312, wherein the Division bench of this Court did reiterate the same principles as were laid down by the apex Court in the case of Tata Cellular vs. Union of India reported at AIR 1996 SC 11 and observed for the scope and ambit of the power of judicial review at para 18 inter alia, which reads as under: "the principle of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, as observed by the Supreme Court in Tata Cellular (supra) there are inherent limitations in exercise of that power of judicial review. Duty of the Court is to confine itself to the question of legality. Its concern should be: whether a decision making authority has (1) exceeded its powers, (2) committed an error of law, (3) committed a breach of the rules of natural justice, (4) reached a decision which no. reasonable Tribunal would have reached; or (5) abused its powers. " ( 8 ) AT this stage, reference may also be made to the decision of the Apex court in the case of Kisan Sahakari chini Mills Ltd. and Ors. Vs. Vardan linkers and Ors. reported at AIR 2008 sc 2160 . The question had arisen before the Apex Court for considering the scope and ambit of the remedy available to a party for the breach of the contract and the scope and ambit of the power of the Civil Court in such matters arid the public law remedy by way of writ petition under Article 226 of the constitution. The question had arisen before the Apex Court for considering the scope and ambit of the remedy available to a party for the breach of the contract and the scope and ambit of the power of the Civil Court in such matters arid the public law remedy by way of writ petition under Article 226 of the constitution. The Apex Court inter alia observed at para 15 onwards concluded at para 17, relevant of which reads as under:- "in exercising writ jurisdiction, if the High Court found that the exercise of power in passing an order of cancellation was not arbitrary and unreasonable, it should normally desist from giving any finding on disputed or complicated questions of fact as to whether there was a contract, and relegate the petitioner to the remedy of a civil suit. Even in cases where the high Court finds that there is a valid contract, if the impugned administrative action by which the contract is cancelled, is not unreasonable or arbitrary, it should still refuse to interfere with the same, leaving the aggrieved party to work out his remedies in a Civil Court. In other words, when there is a. contractual dispute with a public law element, and a party chooses the public law remedy by way of a writ petition instead of a private law remedy of a suit, he will not get a full fledged adjudication of his contractual rights, but only a judicial review of the administrative action. The question whether there was a contract and whether there was a breach may, however, be examined incidentally while considering the reasonableness of the administrative action. ( 9 ) THEREFORE, the facts of the present case and the impugned decision is required to be examined in light of the aforesaid limited scope of judicial scrutiny testing the decision in a contractual matter by an agency which is a State within the meaning of Article 12 of the Constitution as a public law remedy in writ powers of this Court under Article 226 of the Constitution. ( 10 ) IT appears from the facts referred to hereinabove and if such facts are considered in light of the aforesaid 5 undisputed positions to the court while exercising the judicial power, the other facts would not be of much relevance since there is no factual foundation for the same except that whether a decision reached by the authority which no reasonable authority would have reached and thereby, can it be said that the authority has exceeded in its power. Had it been a case where the aforesaid variance of the ron contents found in the sample was considered by the respondent corporation and thereafter, having considered the said material, the decision was taken, it could be termed as a conscious decision taken by the respondent Corporation after taking into consideration the ground relevant and germane to the exercise of the power and such might stand on different footing. But as observed earlier, it is undisputed position that neither in the impugned decision not even by the affidavit in reply filed any explanation is coming on record for consideration of such material and its impact there on the decision. It is true that this Court while exercising the power under Article 226 of the constitution can neither sit in appeal over the decision nor can express view as an expert body, but the action is to tested by applying the decree of reasonable prudence to the facts before it and ultimate decision making process is to be examined in that light reaching to a particular decision. ( 11 ) APPLYING the principles of reasonable prudence, it appears to the court that the variance in the contents of RON has remained unexplained in the whole process of decision making by the respondent Corporation. If the matter is examined on the basis of the reasonable prudence keeping in view the petrol or the motor spirit as perishable commodity, each portion of the sample which is from the same lot should contain the same RON, if tested at a time. If such samples are tested at the later period, i. e. one after another at the interval of reasonable period then the quality of the petrol or the motor spirit unless properly sealed and preserved would get deteriorated. If such samples are tested at the later period, i. e. one after another at the interval of reasonable period then the quality of the petrol or the motor spirit unless properly sealed and preserved would get deteriorated. Even if it is properly sealed and preserved, it would not contain the higher value which in the present case is RON than any other portion thereof which has been tested at the first instance. The facts as referred to hereinabove, goes to show that the contents of RON was 83 at the first instance when the sample was sent for testing on 12. 01. 2006 after having drawn from the retail outlet on 26. 05. 2006. The second one was sent for testing on 01-11. 2006, i. e. roughly after about a period of more than 4 months, where the contents of RON in the different portion of the very sample has increased from 83 to 87. Not only that, but in the third portion of the same sample, which was sent for laboratory testing on 04. 04. 2007, roughly after a period of about more than 4 months, the ron contents has further increased to 87. 6. Therefore, it is not clear as to whether the decision is taken after taking into consideration the variance in the contents of the RON and if yes, whether such could be possible and if possible, valid basis thereof. Applying of principles of reasonable prudence, it is not possible for anyone to conceive a situation of increase in the contents of ron of the different portions sealed separately of the same sample. This being an important and crucial aspect, has direct bearing to the decision making process of the respondent corporation as to whether it could be said that MS/hs found adulterated or not or could it be said to be off specification when the contents of RON is less by 0. 4, if the highest figure is considered, keeping in view the minimum requirement of 88. The aforesaid is coupled with the contention of the petitioner that as per the Indian standard methods of test for petroleum and its product, copy whereof is produced on page 810. if there is any interpolation in the figure and if the figure is that of 0. The aforesaid is coupled with the contention of the petitioner that as per the Indian standard methods of test for petroleum and its product, copy whereof is produced on page 810. if there is any interpolation in the figure and if the figure is that of 0. 50, it is to be rounded to the nearest even number, which would come to 88 since the RON contents found in the 3rd test report was 87. 6 and if such contention is accepted, it could be said that it was meeting with the requisite specification and in any case, beyond treating the same as adulterated. Further, the additional aspect in view of this factual scenario which was required to be considered as directly germane to the exercise of the power for termination of the contract or otherwise was that if the ron was found as that of 87. 6 as against the minimum requirement of 88, could it be termed as adulteration or could it be termed as off specification. It may be recorded that the aforesaid consideration would have not only direct bearing in the decision making process, whether to terminate the contract or not, but if such is not considered, it could be said that the decision is vitiated by non-consideration of the aspects which was germane to the exercise of the power. ( 12 ) THE attempt was made by the learned Counsel fro the respondent corporation to contend that even if one averages out the RON contents of 3 samples, i. e. 83+87+87. 6, divided into 3, the figure would come to 85. 86 and the same would be much lower than the minimum requirement of the RON content of 88. Therefore, he submitted that the decision could be maintained on such ground. ( 13 ) I am afraid such can be considered as a valid reason for supporting the order for the decision for termination of the contract. Firstly the basis of the decision is that the Lot of ms/hs is found adulterated, therefore, no such averaging out method can be applied as sought to be canvassed. The test would be whether it was adulterated or not. To arrive at the decision of MS/hs whether is adulterated or not, the contents of RON if to be considered, the figure, at best, which has highest content of 87,6 could be considered. The test would be whether it was adulterated or not. To arrive at the decision of MS/hs whether is adulterated or not, the contents of RON if to be considered, the figure, at best, which has highest content of 87,6 could be considered. Be it noted that the power is not exercised by the corporation as per the agreements to terminate the contract simplicitor for its administrative exigencies or otherwise but the power is invoked and exercised under clause 13 of the agreement, which his having a penal character and whenever any action is to be taken by way of penalty, the authority competent to exercise of power for imposition of penalty cannot take recourse of averaging out of the contents on the ground sought to be canvassed. Therefore, the said contention cannot be accepted. ( 14 ) IT was also submitted by the learned Counsel for the respondents mr. Kavina that even if the figure as per the RON content is considered as it is, then also the highest RON content is 87. 6 which in any case is less than 88 and therefore, it could not be said that the MS/hs was found containing requisite specification or not adulterated, therefore, he submitted that considering the case alternatively, by taking the base of the highest RON content in the third sample, the decision of the authority cannot be said as vitiated or the test of reasonable prudence if applied, would not make the decision vulnerable. ( 15 ) THE examination of the said contention shows that it is not a case where the Corporation has considered the matter accordingly on the ground as sought to be canvassed by the learned counsel for the respondent Corporation in his submission nor it is a case where such considerations are reflected in the impugned decision or even in the affidavit in reply. If the decision is to be considered as that of having administrative character, having element of penal measure for termination of the contract, normally it should be reflected in the decision itself in the decision and even if not elaborately reflected in the decision, there should be any iota of discussion though may be supported at the later stage by advancing further reasons. Neither exist in the present case. ( 16 ) FURTHER, if the said factum of 87. Neither exist in the present case. ( 16 ) FURTHER, if the said factum of 87. 06 RON content is to be considered, the question was required to be considered as to whether rounding of the RON contents in the main figure was permissible or not. It is an undisputed position that the figure exceeds 0. 50 in the last RON content, i. e. , 87. 6 and therefore, if the principles of rounding is to be applied as contended with the support of Indian standard Method for test of the petroleum and its product, it would come to 88, i. e. , at par with the requisite specification and consequently effect would be that the foundation of the decision would be lost. ( 17 ) UNDER these circumstances, when the decision making authority has not considered the aforesaid aspect at all, it is not possible for this Court to accept the contention of the learned counsel for the respondent corporation and even if highest figure is considered, as that of 87. 06, which is less than the specification and therefore, adulterated. ( 18 ) IN view of the aforesaid observations and discussions, it does appear that the relevant material having direct impact and germane to the decision making process has not been considered at all by the respondent corporation while taking the impugned decision. Therefore, the same could be termed as with non-application of mind to that extent. ( 19 ) IN addition to the above, two aspects may have bearing to the facts of the case. One is the opportunity of oral hearing before taking final decision in the matter and. the second is the proportionality of the punishment. ( 20 ) ON the first aspect, it was contended by the learned Counsel for the petitioner that the opportunity of hearing has not been given. ( 21 ) WHEREAS, it was contended on behalf of the respondent Corporation that the petitioner at no point of time had demanded any opportunity of hearing and therefore, if the authority has not given the opportunity of hearing, the order could not be said to be in breach of principles of natural justice. ( 22 ) IT is true that the observance of the principles of natural justice cannot be applied by way of straight jacket formula, but may vary from facts to facts. ( 22 ) IT is true that the observance of the principles of natural justice cannot be applied by way of straight jacket formula, but may vary from facts to facts. If in a given case, there is eminent danger or an immediate damage to be caused, the pre-decisional hearing may not be given at all and the action may be taken immediately. In a case where there is no such emergent requirement, in normal circumstance, if the adverse consequence is to follow which may have wide civil repercussions, the pre-decisional hearing or prior opportunity of hearing would be required to be given. Hearing does not mean in every case that the opportunity to reply to the show-cause notice and also opportunity of oral hearing. But such may also vary from facts to facts. It is true that in the present case, the opportunity of submitting reply has been given at all point of time by the respondent corporation to the petitioner after the second, first and third sample test result, but in view of the peculiar circumstances on the factual aspects, as referred to hereinabove, thai not only there is variance in the 3 test reports of the laboratory of different portions of the same sample, but if the highest figure is considered, the question was required to be taken into consideration by the respondent Corporation as to whether the rounding of the figure to 88 as per the Indian standard method for test of petroleum and its product was required or not and whether even if the figure of 87. 6 is considered as the highest RON contents of the petrol, could it be said to be off-specification or adulteration, since there is difference of 0. 4, between standard specification of 88 and the contents found of 87. 6. Further, it is undisputed position that after the sample was drawn in the month of May 2006, the impugned action is taken in the month of september 2009, i. e. 04. 09. 2009, roughly after 3 years, therefore, if the opportunity of hearing war given, no prejudice could have been caused but rather would have enabled the corporation to take a considered decision on the aspects of termination of the agreement or otherwise, more particularly when there is question to be considered of adulteration or off-specification in any case. 09. 2009, roughly after 3 years, therefore, if the opportunity of hearing war given, no prejudice could have been caused but rather would have enabled the corporation to take a considered decision on the aspects of termination of the agreement or otherwise, more particularly when there is question to be considered of adulteration or off-specification in any case. The aforesaid is coupled with the contention of the petitioner that for the period after the sample was drawn in May 2006, till the impugned decision taken on 04. 09. 2009, umpteen number of times, samples were drawn during such period of 3 years and they were found to be meeting with the specification and not a single irregularity or illegality was found. Therefore, the Corporation could have considered the question of lesser penalty keeping in view the principles of proportionality of punishment and the difference of the ron contents and the subsequent conduct of the petitioner. ( 23 ) IT appears to the Court that it is not necessary for this Court to express any final view on the said aspects and suffice it to state that the matter may be considered by the Corporation in its wisdom on the aspects of proportionality of punishment, but it does appear that it was a case where the opportunity of oral hearing would have enabled the Corporation to take considered view of the matter. ( 24 ) MUCH has been contended on behalf of the respondent Corporation that under the powers of the Civil court, as per the agreement or the arbitrator exercising the power as per the agreement at par with the powers of the Civil Court cannot put life to the agreement which is already terminated by giving directions to enforce the rights of the party as per the agreement by taking continuing the agreement. It was therefore submitted that if this court is to hold that the decision is vitiated for one reasons or another, the petitioner would not be entitled to the benefit of restoration of the contract or continuation of the contract or the agreement for supply of MS/hsd and it was contended that the same would be beyond the scope of the power of this Court under Article 226 of the constitution. It was also contended that if the Civil Court or the Arbitrator could not restore the contract while exercising the power under the agreement while adjudicating the civil rights of the parties, this Court would also not grant the relief under Article 226 on the principles that the things which cannot be done directly cannot be permitted to be done indirectly in a petition under Article 226 of the Constitution. ( 25 ) WHEREAS, the learned Counsel for the petitioner contended that such powers of this Court under Article 226 of the Constitution are wide enough to grant relief to the extent of restoration of the contract and such powers are not curtailed by the scope and ambit of the power as that of the Civil Court or the arbitrator. It was submitted that this court and the Apex Court also in exercise of the writ power when the decision was found to be illegal, in judicial review, has exercised the power for restoration of the contract after setting aside the decision. It was therefore submitted that that the contention of the learned Counsel for the respondent that this Court cannot order for restoration of the contract may not be accepted by this Court. ( 26 ) AS such, in view of the reasons recorded hereinabove, it does appear upon the judicial scrutiny that on account of the non-consideration of the relevant facts germane to the exercise of the power, the decision for termination of the contract is vitiated, therefore, such decision will be required to be quashed and set aside. But considering the peculiar facts and circumstances that the decision is rendered illegal or arbitrary because of the non-consideration of the facts which had direct bearing and germane to the exercise of the power, it appears to the Court that the matter will have to be reconsidered by the respondent corporation in light of the observations made hereinabove and a fresh decision will have to be taken on the aspects as to whether to terminate the contract or continue the contract or to impose lesser punishment or not etc. It is true that if the decision of termination of contract is found to be illegal, technically it can. It is true that if the decision of termination of contract is found to be illegal, technically it can. be said that the contract subsists and the rights of the parties may stand governed accordingly as per the contract, but it appears to the court that at the initial stage, when this court considered the matter ad interim relief was granted to the extent of directing the respondent Corporation to allow the petitioner to operate the petrol pump as was operating prior to the passing of the order dated 04. 09. 2009, but subsequently the matter was carried before the LPA Bench by the respondent Corporation and in the proceedings of LPA Np. 1720/09 with ca No. 9896/09, the Division Bench granted relief in terms of prayer 8 (c) of the petition, whereby the respondent corporation has been restrained to allot dealership of the disputed petrol pump to anyone else and if allotted, the same is ordered not to be implemented. It appears to the Court that such status can be continued until the decision is taken by the respondent Corporation afresh within a stipulated limit as may be directed by this Court hereinafter, and if ultimately at the fresh decision, the Corporation decides to impose any penalty other than termination or decides to withdraw the notice by continuing the contract, the rights of the parties shall stand governed accordingly, of course without prejudice to the rights of the petitioner to challenge the decision, if adverse to it, before the appropriate forum. Keeping in view the peculiar circumstance that at present the petrol pump is not being operated since september 2009, the same status may be continued. ( 27 ) IN view of the aforesaid observations and discussions, the impugned decision of the respondent corporation dated 04. 09. 2009 is quashed and set aside with the direction to the respondent Corporation to reconsider the matter and take appropriate decision in light of the observations made hereinabove and in accordance with law within a period of four weeks from the receipt of the order of this Court and pass appropriate orders. ( 28 ) PETITION is allowed to the aforesaid extent. Rule made absolute accordingly. Considering the facts and circumstances, no order as to costs. Petition is allowed.