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Madhya Pradesh High Court · body

2011 DIGILAW 222 (MP)

Swantika, Bhopal v. Indian Oil Corporation Ltd. , Mumbai

2011-02-15

A.K.SHRIVASTAVA

body2011
ORDER A.K. Shrivastava, J. 1. By this petition under Article 226 of the Constitution of India, the petitioner has sought direction directing the respondents to carry-out re-inspection of the retail outlet of the petitioner; quashment of inspection report dated 15-11-2009 and show cause notice dated 24-11-2009 and by amending the petition and relief clause, further it has been prayed that the order dated 15-1-2010 (Annexure-P/8) terminating the dealership of petitioner's retail outlet be quashed and lastly it has been prayed that action on the part of Indian Oil, Corporation Authorities on the basis of Marketing Discipline Guidelines is bad in the eye of law. 2. The case of the petitioner is that petitioner is a dealer of M/s Indian Oil Corporation Limited since the year 1995 and having unblemished record in customers' service and no allegation of malpractice has ever been alleged against it. 3. The dispensing unit installed at the retail outlet of the petitioner belongs to petroleum company and regular maintenance of machines are also carried out by the officials of the Indian Oil Corporation Ltd. (in short "Oil Corporation"). On 11-11-2009 the official of the Company carried out routine maintenance of dispensing Unit of the retail outlet and nothing incriminating was found. The maintenance report is, Annexure-P/2. The officers of Weights and Measures, Department also put their seals on the dispensing unit in respect of delivery. According to the petitioner in case of tampering with the delivery system in the machine, the seal of the Weights and Measures Department is required to be broken, but they were found intact. On the next day i.e. 12-11-2009 a team of officials belonging to the Oil Corporation carried an inspection and they allegedly found a wiring and a switch on three dispensing units. The report in that regard is filed as Annexure-P/3. The inspection team did not find any variation in the stock nor found any product which could be termed as adulterated, but, found that three machines were giving short delivery although seals were intact. 4. A show cause notice dated 24-11-2009 (Annexure-P/4) calling upon the petitioner to submit reply against the proposed termination of dealership was given. The allegation in the show cause notice is that on operating the switch by the inspection team, it was found that machines were delivering short delivery. 4. A show cause notice dated 24-11-2009 (Annexure-P/4) calling upon the petitioner to submit reply against the proposed termination of dealership was given. The allegation in the show cause notice is that on operating the switch by the inspection team, it was found that machines were delivering short delivery. According to petitioner, the show cause notice has been issued by respondent No. 2, who was not a member of the inspection team and the inspection report does not say that officials operated the switch of the machine and delivery was found to be short. The petitioner submitted its reply (Annexure-P/5) and brought the reality into notice of the authority. According to petitioner, a request dated 14-11-2009 (Annexure-P/6), which was in respect to reply of show cause notice, was made that Unit may be re-inspected. To verify the impact of the switches on the delivery system and then to take stringent action of the termination of dealership but the respondents have not re-inspected the Unit. 5. According to the petitioner some conspiracy has been made against it as the mechanic on contract with the Oil Corporation for maintenance of L & T Machines i.e. respondent No. 4 and 5 had visited the retail outlet of the petitioner on 11-11-2009 (a day earlier to the inspection) to attend a complaint about the leakage of petrol from multi dispensing machine and they had worked for hours on the machine unnecessarily though the problem was minor. After finishing the work on the multi-dispensing machine, the respondents No. 4 and 5 have insisted to open other machines also of L&T make to see if there is any problem or not. By making allegation against the respondents 4 and 5 it has been put-forth by petitioner that unusually long time to check the machines was taken by these respondents which raises a great doubt about their mischievous inspection and their intention was proved out by officers of the Oil Corporation, when on very next day early in the morning on the arrival of the inspection team of Oil Corporation, they found three switches (two on melting dispensing unit and one on another L&T make unit) fitted inside the machine on the places from where they cannot easily be seen by the workers or any other person working on those machines. The object behind this mischief is that anyhow the petitioner be debarred from retail outlet dealership. The object behind this mischief is that anyhow the petitioner be debarred from retail outlet dealership. On coming to know the foul game played by respondents No. 4 and 5 immediately additional reply to show cause notice was submitted by the petitioner before respondents No. 1 to 3 on 23-12-2009 (Annexure-P/7). It is the further case of the petitioner that during inspection done by the Oil Corporation seals were found intact and there cannot be any manipulation about breaking the seals and therefore the petitioner requested for re-inspection by the authorities of Oil Corporation. 6. On the date of inspection i.e. 12-11-2009 the Inspection Team of Oil Corporation could not find any switch or extra device fitted in the machine and then respondents No. 4 and 5 were called and they came to retail outlet of petitioner and have pointed-out to the inspection team, the places where switches are fitted in the machines. All these happenings were pointed-out and highlighted to respondents No. 1 and 2 but without considering the reply and the glaring mischief committed by respondents No. 4 and 5, the impugned order on 15-1-2010 (Annexure-P/8) terminating the retail outlet dealership was issued without taking into account the request of re-inspection which was repeatedly made by the petitioner. 7. According to the petitioner, the re-inspection in the facts and circumstances was required to be made. Further it is the case of petitioner that respondent No. 2, who issued the show cause notice was not having any occasion to inspect the units despite it notice was sent by him. The dispensing unit installed at the retail outlet of the petitioner belongs to the Oil Corporation for which regular maintenance of machines is being carried out by the officials of the Oil Corporation. Indeed, a day earlier to the inspection on 11-11-2009 officials of Company carried out the inspection, but, nothing was found incriminating in the unit. The officers of the Weights and Measures Department also put their seals on dispensing unit in respect of delivery and in case if any tampering is to be made with delivery system, first of all, the seal of Weights and Measures Department would be broken, but, in the present case seals were found to be intact and therefore the petitioner cannot be blamed. 8. 8. According to the petitioner, the action of respondents 1 and 2 terminating the retail outlet dealership by impugned order dated 15-1-2010 (Annexure-P/8) is bad in the eye of law for another reason that the stock of petroleum product was not found to be short or surplus which shows that no tampering/cheating was made by the petitioner in delivery of the petroleum products. The machines which were adopted by inspection team at the time of inspection were not got verified by the petitioner or the Weights and Measures Department and the order impugned terminating the retail outlet dealership runs de hors the principles of natural justice. 9. On these premised pleadings, it has been prayed by the petitioner that relief as sought by it be granted. 10. The return has been filed on behalf of respondents 1 to 3 but no return has been filed on behalf of other respondents. The stand of Oil Corporation is that after having passed the impugned order terminating the retail outlet dealership, the other reliefs which are sought have become redundant on account of subsequent event of termination of dealership. Even otherwise, the writ petition which was originally filed against issuance of show cause notice is not maintainable unless it is shown that the same is without jurisdiction. 11. According to respondent 1 to 3, the petitioner is a dealer of Oil Corporation for the retail sale or supply of certain petroleum products. The petitioner and Corporation have executed petrol/HSD Pump Dealership Agreement for Oil Corporation owned/leased sites on 24-12-2008 and the relationship between the parties is governed by the terms and conditions of the agreement and as per Clause 67 of the agreement all disputes arising between the parties under the agreement are referable to Sole Arbitration of Director (M) of Corporation or its nominee. According to Oil Corporation, in order to maintain discipline in the market and to ensure quality and quantity in the auto fuels and to prevent diversion of PDS kerosene, Oil Corporation has framed Marketing Discipline Guidelines 2005 (in short "guidelines") which includes regular and surprise inspections of retail outlets and this has also been mentioned in the dealership agreement. Agreement has been approved by MOP & NG which provides for termination of dealership in cases of adulteration being established. Agreement has been approved by MOP & NG which provides for termination of dealership in cases of adulteration being established. According to Oil Corporation, in view of the provisions in the agreement and guidelines, it is a paramount duty of dealer to dispense the correct quantity and quality of the products to the customers and because stamping of the measures is done by the Weights and Measures Department and there is every possibility that machines may fail and give erratic delivery, the Oil Corporation has evolved a procedure to ensure that the customers get the correct quantity of the product which is mentioned in MDG 2005. 12. Certain facts have been demonstrated by Oil Corporation in the return that the inspection was made on 12-11-2009 inasmuch as a written complaint dated 27-10-2009 was received at MPSO against the petitioner, as a result of which, General Manager MPSO formed a committee of Officers consisting of senior officers of Oil Corporation on 5-11-2009 (Annexure-R(3)/1). The said committee visited the petitioner's retail outlet on 12-11-2009 to investigate the complaint. The inspection report dated 12-11-2009 is Annexure-P/3. In the report, findings of the Inspecting Officer are based on the complaint. In the inspection report, the irregularities/malpractice were observed by the inspection team at the retail outlet which is mentioned in Annexure-P/3. After completion of inspection, AMO Bhopal had sealed the panels of the MPD and LT-Z Line where unauthorized fittings (on/off switches) were detected. The Oil Corporation received an undated letter of petitioner on 13-11-2009 (Annexure-R(3)/3) in which Proprietor of petitioner has not only admitted the irregularities, but has also put her apology and hence there is no case for adjudication. It has been further pleaded in the return that as per Clause 6.1.5 of the Guidelines any additional /unauthorized fittings/gears found in the dispensing unit with an intention of manipulating delivery, the panel action termination of dealership is shown in appendix 1 serial No. 4 and hence rightly the impugned order has been passed. 13. The unauthorized switches were found by inspecting officers at retail outlet during inspection, which confirms the manipulation of delivery by the dealership, as a result of which, approval for issuance of show cause notice for termination of dealership was taken from GM, MPSO on 18-11-2009 (Annexure-R(3)/4). Accordingly, the petitioner was asked to submit the reply within 7 days. 13. The unauthorized switches were found by inspecting officers at retail outlet during inspection, which confirms the manipulation of delivery by the dealership, as a result of which, approval for issuance of show cause notice for termination of dealership was taken from GM, MPSO on 18-11-2009 (Annexure-R(3)/4). Accordingly, the petitioner was asked to submit the reply within 7 days. The petitioner vide letter dated 25-11-2009 sought two weeks additional time to reply the show cause notice dated 24-11-2009 by submitting that they need some more time to give reply. The request was accepted and time was granted vide note dated 28-11-2009 approved by GM, MPSO (Annexure-R(3)/5. The reply of the petitioner and its contents were taken note of as well as additional reply dated 23-12-2009 was also taken into consideration by respondent/Oil Corporation. 14. According to respondents, the inspection report bears the signature of the petitioner and therefore the question of conducting inspection ex parte does not arise. Since extra switches and device were found to be installed in the dispensing Unit resulting into short delivery, the action of the respondents terminating the dealership has been rightly taken as per guidelines and the only remedy which is available to petitioner is to go in Arbitration as per the dealership agreement and hence, it has been prayed that this petition be dismissed. 15. I have heard learned counsel for the parties. The contention of learned counsel for petitioner is that in the present case there is clear-cut violation of principles of natural justice since the inspection was partially made in the absence of petitioner as it can be gathered from the inspection report (Annexure-R(3)/2) dated 12/13-11-2009. In this context, learned counsel for petitioner has placed reliance on Madhya Pradesh Industries Ltd. vs. Union of India, 1966 MPLJ (SC) 256: AIR 1966 SC 671 (para 8) and latest pronouncement of the Apex Court in Hindustan Petroleum Corpn. Ltd. & ors. vs. Super Highway Services & anr., JT 2010(2) 446.(Para 17) 16. The procedure has been given in the Weights and Measures Act and the rules framed thereunder that how search and seizure is to be made. Ltd. & ors. vs. Super Highway Services & anr., JT 2010(2) 446.(Para 17) 16. The procedure has been given in the Weights and Measures Act and the rules framed thereunder that how search and seizure is to be made. Learned counsel for petitioner by inviting my attention to Annexure-RJ-1 dated 15-11-2006 filed along with rejoinder has submitted that State of M. P. has issued a circular that inspection of retail outlets is to be made in accordance with the Standard of Weights and Measures Act, 1976 and the inspection will be made only by the officers nominated under this Act and therefore the inspection has been made de hors the provisions of the Standard of Weights and Measures Act. 17. Learned counsel further submits that nowhere in the inspection report it has been mentioned that the bulk of the stock was either tampered or was found to be excessive or less and there is no remark in that regard which would mean that if the short delivery is given to consumers, certainly the quantity of bulk should be found in excessive, although the metre of the machines would show that correct quantity of the petroleum product has been given to the consumers. But, the bulk was not found to be excessive and hence the business conduct of the petitioner is quite fair as she was not intending to cheat any of the customers. 18. Learned counsel for the petitioner further submits that only one day before, Oil Corporation sent respondents No. 4 and 5 who are the employees, from whom services are taken by Oil Corporation, visited the retail outlet of petitioner and nothing incriminating was found by them and in this regard my attention has been drawn to Annexure-P/2 and therefore learned counsel submits that there is specific averment against respondents No. 4 and 5 that a day earlier to the inspection made by the inspecting team these respondents did not find any infirmity and therefore if the bulk of stock was not found to be tampered, the intention of the petitioner cannot be said to be unfair so as to cheat consumers, therefore, the action of terminating dealership of retail outlet is arbitrary in nature and when it is arbitrary in nature, a judicial review is permissible. In this regard learned counsel has invited my attention to the decision of the Supreme Court Harbanslal Sahnia and another vs. Indian Oil Corpn. Ltd. and others, (2003) 2 SCC 107 . Learned counsel submits that arbitrary action of the Oil Corporation is contrary to Article 14 of the Constitution of India and therefore impugned order is bad in law. In this context my attention has been drawn to Mahabir Auto Stores and others vs. Indian Oil Corporation and others, (1990) 3 SCC 752 . Learned counsel further submits that as per respondents' own showing the seal of all units were found to be intact with a stamping of C-09, therefore, it cannot be said that extra switches were fitted by the petitioner. 19. On the other hand Shri Adhikari, learned counsel for Oil Corporation supported the impugned order and has submitted that the inspection report dated 12/13-11-2009 speaks for itself wherein two allegations were made. Firstly, 3% short delivery of normal MS, 4% short delivery of Xtrapremium and 2% short delivery of HSD and allegation No. 2 was in respect of additional equipment installed for short delivery in DUs (dispensing units). Learned Counsel submits that in the inspection report (Annexure-R(3)/2) the details of these allegations are given and therefore it has been submitted that as per the guidelines and the appendix-1 if additional/unauthorized unit gears found in the dispensing unit, the dealership of retail outlet is to be terminated. Learned counsel by inviting my attention to the retail outlet dealership agreement (Annexure-R(3)/7) executed between the parties has submitted that against the action of termination as per the guidelines and the retail dealership agreement the only remedy available to petitioner is to go in Arbitration as per arbitration clause. In this regard learned counsel has placed reliance on certain decisions of Supreme Court in Indian Oil Corporation Ltd. vs. Amritsar Gas Service and others, (1991) 1 SCC 533 and Empire Jute Company Limited and others vs. Jute Corporation of India Limited and another, (2007) 14 SCC 680 . Learned counsel further submitted that the dispute now in between the parties is a disputed question of facts and therefore the only remedy to petitioner is to avail the arbitration clause and this writ petition is not an appropriate remedy because an efficacious and alternative remedy is available to the petitioner. 20. Learned counsel further submitted that the dispute now in between the parties is a disputed question of facts and therefore the only remedy to petitioner is to avail the arbitration clause and this writ petition is not an appropriate remedy because an efficacious and alternative remedy is available to the petitioner. 20. In reply to the submission of learned counsel for respondents No. 1 to 3, learned counsel for petitioner by inviting my attention to some decisions of the Supreme Court submitted that even an alternative remedy is available to petitioner but that remedy cannot be said to be efficacious remedy because only damages can be claimed in that remedy and there cannot be any order to quash the termination of retail outlet dealership. By inviting my attention to decision of Supreme Court in ABL International Ltd. and another vs. Export Credit Guarantee Corporation of India Ltd. and others, 2004(3) SCC 553 learned counsel submits that even disputed question of fact would not debar this Court to exercise writ jurisdiction. By placing reliance on a decision of Apex Court in Gujarat State Financial Corporation vs. Lotus Hotels Pvt. Ltd., (1983) 3 SCC 379 it has been argued that despite there is an arbitration clause the writ of mandamus can be issued. Learned counsel for petitioner further submits that in the decision of Empire Jute Company Limited (supra) placed reliance by learned counsel for respondents, in that judgment itself it has been mentioned that writ petition would not be a bar and it would be maintainable and therefore even there is an arbitration clause, the Supreme Court has not shut down the doors of this Court and hence it has been prayed that impugned order (Annexure-P/8) terminating the dealership of retail outlet of petitioner be quashed, 21. Having heard learned counsel for the parties I am of the view that this petition deserves to be allowed. 22. The respondents have terminated the retail outlet dealership of the petitioner on two grounds. Firstly on account of some short delivery and second two extra buttons/switches were found fitted as per inspection report dated 12/13-11-2009 (Annexure-R(3)/2). The same was also found in inspection made at the retail outlet on 12-11-2009. 23. The entire action of the respondents is based on the guidelines of 2005 which has been annexed as Annexure-R(3)/6. Firstly on account of some short delivery and second two extra buttons/switches were found fitted as per inspection report dated 12/13-11-2009 (Annexure-R(3)/2). The same was also found in inspection made at the retail outlet on 12-11-2009. 23. The entire action of the respondents is based on the guidelines of 2005 which has been annexed as Annexure-R(3)/6. On bare perusal of these guidelines, it is gathered that it has been made so that dealers may supply products of correct quality and quantity and provide excellent customers' services. In the present case inspection was made on 12-11-1999 on account of two allegations made against petitioner. Firstly 3% short delivery of normal MS, 4% short delivery of Xtrapremium and 2% short delivery of HSD and secondly additional equipment installed for short delivery in DUs. On bare perusal of the inspection report (Annexure-R(3)/2 dated 12/13-11-2009 it is gathered that so far as allegation for short delivery is concerned, the finding is given in this report which reads, thus, Sr. No DU No Nozzle Findings 1 MS 1 MS 1 Short delivery of 20 ml/5lit. 2 MS 2 MS 2 OK 3 MS 3 MS 3 OK 4 MPD XP-A1 Could not be checked MPD XP-A2 Short delivery of 30 ml/5 lit. 5 MPD XP-B1 OK 6 MPD XP-B2 Short delivery of 30 ml/5 lit 7 HSD 1 HSD 1 OK 8 HSD 2 HSD 2 Out of order 9 HSD 3 OK 24. It is pertinent to mention here that although delivery of 20 ml per five litre was found short of MS1, MPD XP-A2 and XP-B2 but it was also found that units of W/M seals were found intact by stamping of C-09 which is of the Weights and Measures Department's officers. The guidelines is of year 2005 and after the operation of guidelines throughout the State of Madhya Pradesh, the State Government through Secretary of Food & Civil Supply Department has issued a letter/circular dated 25-11-2006 (Annexure-RJ/1) to all the Collectors that the officers of Indian Oil Corporations do not have any legal sanction to contemplate legal sanction and inspection and even then there being any authority they are doing it, therefore, it was directed that in the event of any inspection as per rules and regulations, the Weights and Measures Department Officers may also be directed to contemplate the inspection. 25. 25. The pleadings and averments made in the rejoinder have not been refuted by filing any additional return by respondents 1 to 3. According to me, the respondents 1 to 3 who are operating the retail outlet by providing its agencies to the suitable candidates are governed by the instructions issued by the State of M. P. from time to time. Since the letter/circular (Annexure-RJ/1) dated 25-11-2006 was issued lateron after coming into the force of guidelines of 2005 of Oil Corporation. Thus, I am of the view that due weightage should be given to it and without procuring the presence of officers of the Weights and Measures Department, the inspection should not have been done. This is more particular when the seal on the DUs unit were put by the Weights and Measures Department and they were found to be intact. 26. Apart from this, nothing has been brought on record that above said circular/letter dated 15-11-2006 issued by the Secretary of Food & Civil Supply Department has ever been superseded by any other letter or order of State of M. P. or it has been set aside by this Court being in contravention to the guidelines of 2005 of respondents 1 to 3. Admittedly, at the time of inspection of the retail outlet of petitioner, the compliance in terms of Annexure- RJ/1 was not made by the respondents No. 1 to 3 and therefore, according to me the action of these respondents runs de hors the direction given by State of M. P. in Annexure-RJ/1 which still holds the field throughout the State. 27. On bare perusal of guidelines (Annexure-R(3)6), it is gathered that as per Appendix-1 if an irregularity of short delivery of products (W/M seals intact) the penal action is 'sales and supplies should be suspended from the dispensing unit till re-calibration is carried out by the Weights and Measures Department in the presence of an officer of the Oil Company'. According to me, the guidelines itself show that if there is short delivery, straightway the retail outlet cannot be terminated but it would be suspended from the dispensing unit till re-calibration is carried out by the Weights and Measures Department in presence of Oil Corporation. According to me, the guidelines itself show that if there is short delivery, straightway the retail outlet cannot be terminated but it would be suspended from the dispensing unit till re-calibration is carried out by the Weights and Measures Department in presence of Oil Corporation. However, if additional /unauthorized fittings / gears are found in the dispensing unit, the penal action which is to be taken is to terminate the dealership of retail outlet and therefore if this Clause is taken into consideration in its stricto sensu the action of the respondents terminating the retail outlet dealership will not be illegal. 28. According to me, it is to be visualized and magnified from this angle also that why these guidelines 2005 have been made by Oil Corporation. On bare perusal of the opening Chapter of the said guidelines its aim and object and purpose of its enactment would become clear that it has been framed to confer the responsibility on dealers to supply the correct quantity and quality and to provide excellent customers' service. In other words, these guidelines have been framed so that a customer may not be cheated and he should be supplied with correct quality and quantity with excellent service. On going through the inspection report, it is found that quantity of the bulk stock was not found in excess or less, but and it was found correct, hence, even if some external device which according to petitioner, was not installed in its knowledge has been inserted, the action of the respondents terminating the dealership is arbitrary. 29. On bare perusal of ground 6.15 of memorandum of writ petition it is seen that a specific ground has been raised by the petitioner, which has also been substantiated during the course of arguments that if petitioner's unit was involved in short delivery of petrol there should have been difference in stock but no infirmity and surplus was found in the stock. It is pertinent to mention here that this ground which goes to the root of the matter has not been disputed by respondents 1 to 3 despite the return was amended from time to time. 30. I have also gone through the inspection note (Annexure-P/3) as well as inspection report (Annexure-R/3/2) dated 12/13-11-2009. Nowhere it has been mentioned that bulk of the stock in the tanks was found to be excessive. 30. I have also gone through the inspection note (Annexure-P/3) as well as inspection report (Annexure-R/3/2) dated 12/13-11-2009. Nowhere it has been mentioned that bulk of the stock in the tanks was found to be excessive. It is a matter of common parlance that if delivery of petroleum product was given short to the customers, certainly, the position of bulk of stock would be changed and it must be in excess and would not tally with the delivery report at the time of inspection. The Division Bench of this Court has already held that the guidelines of 2005 to be non-statutory guidelines in W. P. No. 6866/2009, Smt. Rajni Devi vs. Union of India & others decided on 17-11-2009 and therefore it is only an administrative guidelines and since the aim and object and the purpose for framing these guidelines is not forfeited, I am of the view that the action of the Oil Corporation terminating the dealership of the retail outlet is arbitrary in nature. Certainly the position would have been different if bulk of stock would have been found in excessive then certainly one could infer that in order to cheat customers the short delivery was made on every five litres of petroleum products by the petitioner. 31. Several contentions have been raised by learned counsel for petitioner that on account of professional rivalry since the petitioner is carrying on the business with unblemished and spotless career for last 15 years, her business contemporary anyhow managed to install two extra button switches in DUs and it was also submitted by petitioner while replying the show cause notice given to it and therefore the averments made in the pleadings and grounds raised in the memorandum of petition which are based on reply of show cause notice as well as argument put-forth by learned counsel appears to be correct that in absence of any knowledge of the petitioner, these two switches were installed in DUs. I would like to mention here that despite there are serious allegations against respondents 4 and 5 in this regard that a day before the inspection, they had worked for hours together on the machines of DUs and on the very next day inspection was made and inspection note was prepared, but, no return has been filed on their behalf nor any appearance has been put on their behalf to refute the averments. The Supreme Court in ABL International (supra) has held in para 16, 19, 27 and 51 that writ petition involving serious disputed question of facts which requires consideration of evidence which is on record will not normally be entertained by the Court in exercise of jurisdiction under Article 226 of the Constitution but there is no absolute proof that in all the cases involving disputed question of fact, the party should be relegated to a civil suit. The Supreme Court hence held that in appropriate case the writ Court has jurisdiction to entertain writ petition involving disputed question of fact as there is no absolute bar for entertaining a writ petition. 32. At this juncture, I would like to go through averments made in para 5.11 to 5.14 of the memorandum of writ petition and in reply to these averments, the respondents 1 to 3 have pleaded only this much that the switch has been installed by L & T Service Engineers is unsubstantiated and is not acceptable. It is pertinent to mention here that on 11-11-2009 the L&T Service Engineers have made preventive service report which was signed by petitioner's representative and not by the petitioner that repair work has been done in presence of representative and they confirmed that machines are working OK in that service report. There is no averment of respondents 1 to 3 that any extra switches were found by Engineers of L&T and therefore for this reason also the averments made by the petitioner in para 5.11 to 5.14 appears to be correct particularly when respondents 4 and 5 who are impleaded personally as party and allegations are made against them have not filed any return and have not refuted the averments. 33. I have already held hereinabove that bulk was not found excessive despite the display was showing short delivery at the time of inspection and therefore action of the respondents terminating the dealership is arbitrary in nature. The term 'arbitrarily' has been magnified in Corpus Juris Secundum Volume 6 page 144-145, which reads thus, Arbitrarily. Capriciously, in an arbitrary manner; without any reasonable cause; without cause based upon the law; without fair, solid, and substantial cause... 34. Similarly, what is the meaning of "Arbitrariness" it has been explained on page 145 in the same Volume, which is as under : Arbitrariness. Capriciously, in an arbitrary manner; without any reasonable cause; without cause based upon the law; without fair, solid, and substantial cause... 34. Similarly, what is the meaning of "Arbitrariness" it has been explained on page 145 in the same Volume, which is as under : Arbitrariness. Conduct or acts based alone upon one's will, and not upon any course of reasoning and exercise of judgment. 35. The term "Arbitrarily" has also been magnified in Advanced Law Lexicon by P. Ramanatha Aiyar Foreword Edition by Hon'ble Mr. Justice Y. V. Chandrachud, Former Chief Justice of Supreme Court of India Vol. 1 re-print edition 2007 Page 323, which I am quoting as under : Arbitrarily. In an arbitrary manner; according to one's pleasure or caprice; capriciously; without fair, solid and substantial cause and without reason given judicial discretion ought not to be used arbitrarily. In an unreasonable manner, as fixed or done capriciously or at pleasure, without adequate determining, principle; not founded in the nature of things, non-rational; not done or acting according to reason or judgment; depending on the will alone; absolutely an power, capriciously; tyrannical, despotio. 36. Similarly word "Arbitrariness" has also been explained in the following manner: Arbitrariness. The meaning and true import of arbitrariness is more easily visualized that precisely stated or defined. The question, whether an impugned act is arbitrary or not is ultimately to be answered on the facts and in the circumstances of a given case. An obvious test to apply is to see whether there is any discernible principle emerging from the impugned act and if so, does it satisfy the test of reasonableness? 37. In similar manner, the meaning of word "Arbitrary" has been highlighted which reads thus Arbitrary. Depending on will or pleasure, based on mere opinion or preference, hence capricious. 38. The Supreme Court in its latest pronouncement Mohd. Yunus Khan vs. State of Uttar Pradesh and others, (2010) 10 SCC 539 in para 21 has held that statutory authority is not permitted to act whimsically/arbitrarily. Its action should be guided by the principles of reasonableness and fairness and the authority cannot be permitted to abuse the law or to use it unfairly. For better understanding entire para 21 is reproduced : 21. Thus, the requirement of morale, discipline and justice have to be reconciled. Its action should be guided by the principles of reasonableness and fairness and the authority cannot be permitted to abuse the law or to use it unfairly. For better understanding entire para 21 is reproduced : 21. Thus, the requirement of morale, discipline and justice have to be reconciled. There is no scarcity of examples in history, and we see it in day-to-day life also, that even in disciplined forces, forced morale and discipline without assured justice breeds defiance and belligerency. Our Constitution protects not only the life and liberty but also the dignity of every person. Life convicts and hardcore criminals deprived of personal liberty are also not wholly denuded of their constitutional rights. Arbitrariness is an anathema to the principles of reasonableness and fairness enshrined in our constitutional provisions. The rule of law prohibits the exercise of power in an arbitrary manner and/or in a manner that travels beyond the boundaries of reasonableness. Thus, a statutory authority is not permitted to act whimsically/arbitrarily. Its action should be guided by the principles of reasonableness and fairness and the authority cannot be permitted to abuse the law or to use it unfairly. (emphasis supplied). 39. The Supreme Court in Harbanslal Sahnia (supra) has taken note of Arbitration Clause in similar type of situation as the case was between the Indian Oil Corporation and Harbanslal (appellant therein) that despite there is an arbitration clause available to appellants, the High Court still can exercise its jurisdiction in at-least three contingencies (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where there is failure of principles of natural justice; or (iii) where the orders or proceedings are wholly without jurisdiction or vires of Act is challenged. Since the action of Oil Corporation terminating the dealership of retail outlet is found to be arbitrary, according to me, the fundamental right of petitioner enshrined under Articles 19(1)(g) and 21 as well as Article 14 are jeopardised, this writ petition is maintainable and relief can be granted and the Supreme Court by allowing the appeal of the Proprietor of Retail Outlet Dealer, set aside the judgment of High Court and quashed the order of Indian Oil Corporation terminating dealership of appellant. According to me, this decision governs the field of this case also. 40. According to me, this decision governs the field of this case also. 40. In another decision the Supreme Court in Mahabir Auto Stores (supra) has held that action of the State or its instrumentality entering in commercial field should not be arbitrary. 41. The decisions relied upon by learned counsel for respondents 1 to 3 that looking to the Arbitration Clause, the Supreme Court has categorised the law that due weightage should be given to that clause. But since I have found the action to be arbitrary in nature and apart from this the recent decision of Supreme Court in Empire Jute Company Limited (supra) in which it has been held in para 21 by relying its earlier decision Sanjana M. Wig vs. Hindustan Petroleum Corpn. Ltd., (2005) 8 SCC 242 in which it was held that a writ petition, however, will be entertained when it involves a public law character or involves a question arising out of public law functions on the part of respondents, therefore according to me since there is no absolute bar and arbitrariness is apparent the petitioner is entitled for the relief of quashment of impugned order dated 15-1-2010 (Annexure-P/8). 42. For the reasons stated hereinabove, this petition succeeds and is hereby allowed. The impugned order dated 15-1-2010 (Annexure-P/8) terminating the dealership of retail outlet of petitioner is quashed. No costs.