GAJRAULA FILLING STATION v. INDIAN OIL CORPORATION LIMITED
2015-08-17
BRIJESH KUMAR SRIVASTAVA II, SUDHIR AGARWAL
body2015
DigiLaw.ai
JUDGMENT By the Court.—Heard Sri J.J. Munir, learned counsel for the appellant and Sri Prakash Padia, Advocate for respondents. 2. This appeal has arisen against the judgment and order dated 22.1.2008 passed by Sri Nand Lal Agarwal, District Judge, J.P. Nagar, rejecting appellant’s application filed under Section 34 of Arbitration and Conciliation Act, 1996 (hereinafter referred to as the “Act, 1996”), for setting aside award dated 14.9.2006. 3. Sri J.J. Munir, learned counsel for the appellant, sought to argue only one aspect that, termination order is founded on certain facts which are not part of show-cause notice and this aspect having been noticed by Arbitrator, still he has ignored the same and, therefore, has committed misconduct; and, the Court below by not appreciating the same has committed manifest error of law. 4. Having gone through the record and after hearing learned counsel for the parties, we find no force in the above submission. 5. The inspection was made at premises of appellant on 7.6.2004 when it was found that, (i) salesmen were not in uniform, (ii) barrel containing off of spec product was found in D.G. Room and (iii) density register was not produced at the time of inspection. Deputy Manager, Moradabad sought explanation of appellant vide letter dated 7.6.2004 and thereafter show-cause notice dated 19.6.2004 was issued to appellant stating that it has breached Clauses 29 and 44 of dealership agreement and, therefore, why it’s dealership be not terminated. 6. Clauses 29 and 44 of the agreement, read as under: “29. The Dealer shall not purchase from any person firm or company other than the Corporation any petroleum or allied products used, stocked or sold at the said premises. 44. The Dealer undertakes faithfully and promptly to carry out, observe and perform all directions or rules given or made from time to time by the Corporation for the proper carrying on of the dealership of the Corporation. The Dealer shall scrupulously observe and comply with all laws, rules, regulations of the Central/State Government and of all authorities appointed by them or either of them including in particular the Chief Inspector of Explosive Government of India and/or any other local authority with regard to the storage and sale of such petroleum products.” 7. The appellant submitted reply in which factum of all the three allegations were not denied but it tried to explain the same in its own way.
The appellant submitted reply in which factum of all the three allegations were not denied but it tried to explain the same in its own way. The Competent Authority thereafter passed order dated 22.7.2004 terminating dealership of appellant under Clause 58(m) of the agreement. 8. Initially the appellant came to this Court in Writ Petition No. 31858 of 2004, which was dismissed on the ground of remedy of arbitration and thereafter the matter was referred for arbitration. The Arbitrator has given award against appellant on 14.9.2006. For setting aside award the appellant moved application under Section 34 of Act, 1996 before District Judge, Moradabad but the same has been rejected by means of impugned order dated 22.1.2008. 9. The only argument advanced is that the termination of agreement is founded on certain allegations which were not part of show-cause notice. 10. The submission is thoroughly misconceived. In the first part of order of termination the Competent Authority has held that reply of appellant was not satisfactory and he has committed breach/violation of Clauses 29 and 44 of the agreement. Thereafter to ascertain the circumstances as to whether termination would be justified or not, the Competent Authority has also noticed that in the past also conduct of appellant has been found blameworthy and he has committed breach of agreement. It is in these circumstances, finding that appellant is in practice of committing breach of agreement consistently, the agreement was terminated. 11. It thus cannot be said that the impugned order of termination is founded on the ground which are not mentioned in show-cause notice. All these aspects have been considered by the Court below and we do not find any manifest error in the findings recorded by Court below warranting interference. 12. The appeal lacks merit. Dismissed. 13. Interim order, if any, stands vacated. ———————