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2015 DIGILAW 43 (ORI)

Umakanta Nayak v. Indian Oil Corporation Ltd.

2015-01-21

A.K.RATH, AMITAVA ROY

body2015
JUDGMENT : Amitava Roy, J. The petitioner, a transport contractor, with the Indian Oil Corporation Limited (for short, hereinafter referred to as “the IOCL”) seeks to impeach its decision to blacklist his tank truck (for short, “TT”) detailed for the work entrusted to him and to realize an amount of Rs.3,06,730/- towards the cost of pilfered petroleum product for the period from 22.1.2014 to 8.7.2014. 2. We have heard Mr. G. K. Mohanty, learned counsel for the petitioner and Mr. S. Mohanty, learned counsel for the opp. parties. 3. A brief outline of the pleaded assertions would provide the factual background. The petitioner has claimed himself to be the owner of three TTs bearing registration Nos.OR-02-BS-4778, OR-02-BJ-4778 and OR-05-P-3362. He submitted his bid in response to a process initiated by the IOCL for transport of bulk petroleum products with effect from 01.05.2012 for a period of two years by road from its oil storage and handling location at Bhubaneswar depot at Chhanaghar, Jatni to different destinations within and outside the State of Odisha. He, in addition to the above TTs, did also offer two more trucks bearing registration Nos.OR-05-AA-5117 and OR-02-Z-4800. The petitioner having been found to be suitable was entrusted with the work following which an agreement was executed between the parties. He also furnished the security deposit and completed other formalities. The operations admittedly were to be regulated by the Industry Transport Discipline Guidelines (for short, hereinafter referred to as “the Guidelines”) to ensure flawless and timely transportation of the petroleum products. Clause 8 of the Guidelines spells out the consequences of penalties for malpractice/irregularities detected in course of the operations. Whereas Clause 8.2.1 defines malpractices/irregularities, Clause 8.2.2 prescribes the penalties on the detection thereof. These two provisions being of foundational relevance are extracted herein below for ready reference: “8.2 Penalties for malpractices/irregularities 8.2.1 Malpractices/irregularities will cover any of the following: a. Unauthorized deviation from specified route/unauthorized delay/unauthorized en-route stoppage/not reaching destination/over speeding/en-route switching off VMU/ unauthorized removal of VMU/use of VMU on other vehicles. b. TT crew found in intoxicated state while on duty. c. For not wearing seat belt while driving on road or driving vehicle without cleaner/helper. d. For non functioning of TT Fire Extinguisher. e. Polluting environment due to product spillage from tilting or leaky vehicles on road, in case of accident/unsafe driving. b. TT crew found in intoxicated state while on duty. c. For not wearing seat belt while driving on road or driving vehicle without cleaner/helper. d. For non functioning of TT Fire Extinguisher. e. Polluting environment due to product spillage from tilting or leaky vehicles on road, in case of accident/unsafe driving. f. Accident involving injury or damages to the facilities at the work place. g. Fatal accident at the work place. h. Tampering with standard fittings of TT including the sealing, security locks, security locking system, calibration, Vehicle Mounted Unit or its fittings/fixtures. i. Unauthorized use of TT for products other than the petroleum products for which it has been engaged. j. Entering into contract based on forged documents/false information. k. Entering into an agreement for the same TT with other oil companies. l. Irregularities under W & M Act. m. Not lodging FIR with the Police in case of accident, not informing/submitting accident report to the Oil Company about the accident. n. Pilferage/short delivery of product. o. Any act of the carrier/carrier’s representative that may be harmful to the good name/image of the Oil Company, its products or its services. 8.2.2 Penalties upon detection of malpractice/irregularities: The carrier shall attract penalties for the malpractice/irregularities as given below and the TT mentioned in the following instances shall be suspended /blacklisted along with TT crew. However, an investigation shall be conducted and if the malpractice/irregularity is established then penal actions stipulated as under shall be taken. SR. NO. TYPE OF MALPRACTICE/ IRREGULARITY NUMBER OF MALPRACTICE/IRREGULARITY First Second Third Fourth 8.2.2.5 Pilferage of product, TT not reaching destination, Fatal accident resulting in death at the work place, Irregularities under W & M Act, Tampering with standard fittings of TT including the sealing, security locks, security locking system, calibration, VMU or its fittings/ fixtures, Unauthorized removal of VMU, Use of VMU on other vehicles, Unauthorized use of TT for products other than the petroleum products, Entering into contract based on forged documents/ false information, Entering into an agreement for the same TT with other oil companies, Not lodging FIR with the Police in case of accident, not informing/ submitting accident report to the Oil Company about the accident. Be blacklisted on industry basis. Be blacklisted on industry basis. However, if the complicity of the carrier is detected in case of occurrence of any of above malpractice/irregularity or incident of malpractice/irregularity stipulating into blacklisting of second TT of the carrier (during the tenure of the contract), the whole contract comprising of all the TTs belonging to the concerned carrier shall be terminated and the concerned carrier & their all TTs shall be back listed on industry basis.” 4. The petitioner has averred that in course of the contract, his TT bearing registration No. OR-02-BS-4778 was loaded with petroleum and diesel on 7.7.2014 at 7 PM at the Bhubaneswar Depot of the IOCL and his driver was asked to effect delivery thereof to OM Sai Karuna KSK under work order No.OSO/POL/BULK/PT-02/2012-15/72/66 vide challan no. 671664993. It has been stated that when the said petroleum product was unloaded at the filling station, the proprietor thereof raised doubt following which the contents were measured in presence of the petitioner and 23 liters of petroleum product was found short in the TT. In view of this disclosure, the Senior Depot Manager IOCL (MD), Bhubaneswar Depot, Chhanaghar, Dist. Khurda, issued a notice to the petitioner alleging that an arrangement had been made in the third compartment of the TT involved controlled by a wire to conceal the product in the chamber after decantation. It was alleged that by the said arrangement, 23 liters of the petroleum product was concealed in the third chamber of the TT resulting in short delivery thereof to the customer concerned thus tarnishing the image of the IOCL. The petitioner was thereby advised to explain as to why action would not be taken as per Clause 8.2.2.5 of the Guidelines for tampering with the standard fittings and having spurious fittings inside the third chamber of the TT. 5. According to the petitioner, he submitted a reply dated 22.7.2014 categorically stating that he was ignorant of the misdeed of his driver and the helper of the TT for which irregularities detected had occurred. He stated further that on being confronted, the driver and the helper had confessed their guilt even before the authorities of the IOCL. He asserted in clear terms that he had no complicity in the incident. He stated further that on being confronted, the driver and the helper had confessed their guilt even before the authorities of the IOCL. He asserted in clear terms that he had no complicity in the incident. By the impugned decision contained in the letter dated 4.9.2014 under Annexure-6 to the writ petition, the IOCL while rejecting the explanation furnished, penalized the petitioner as hereunder: “1. Black listing of the TT No. OR-02-BS-4778 along with the TT crew (Driver-Sh Bhajamana Nayak and Helper Sh Sudhir Patra) permanently. 2. Black listing of other four TTs (OR02BJ-4778, OR05P3362, OR05AA5117 & OR02Z4800) for two years w.e.f.27.08.2014. 3. Recovery of Rs.306730/-towards the cost of product shoten during every load starting from 22.01.2014 till 08.07.2014.” 6. By a subsequent letter dated 19.9.2014, the IOCL after adjusting the amount of Rs.1,72,460/-payable to the petitioner on its transportation bills, required of him to pay the balance amount of Rs.13,4,270/-. He seeks judicial intervention in this factual premise. 7. The IOCL in its counter affirmed by the Deputy General Manager (Operations) while admitting that the transaction between the parties was subject to the terms and conditions contained in the Bulk Petroleum Products Road Transport Agreement dated 29.5.2012 as well as the Guidelines has asserted that on the detection of the irregularities/malpractice vis-à-vis the petitioner’s TT bearing registration No. OR-02-BS-4778 and the receipt of the complaint from M/s. Om Sai Karuna KSK at Mahana, Japakuda, Salepur, Dist. Cuttack, an investigation was carried out by the officials of the IOCL and on the basis of the findings a notice dated 16.7.2014 was issued to the petitioner seeking explanation as to why action would not be taken as per Clause 8.2.2.5 of the Guidelines. According to the answering opp. party, after the petitioner had submitted his reply on 22.7.2014 inter alia attributing the malpractice/irregularities detected solely to the driver of the TT and contending that he had no knowledge of the tampering of the standard fittings and that he had no complicity in the episode, he was given a personal hearing on 26.7.2014. The answering opp. party, after the petitioner had submitted his reply on 22.7.2014 inter alia attributing the malpractice/irregularities detected solely to the driver of the TT and contending that he had no knowledge of the tampering of the standard fittings and that he had no complicity in the episode, he was given a personal hearing on 26.7.2014. The answering opp. party has maintained that the explanation of the petitioner and his version in course of personal hearing were not found to be convincing and it was concluded that the irregularities/malpractice as detected could not have been possible without his complicity and consequently it was decided to blacklist him in accordance with Clause 8.2.2.5 of the Guidelines and to recover the price of pilfered product ascertained to be Rs.3,06,734/-. Accordingly, the decision to that effect was communicated to him. That the contract between the parties being non-statutory in nature is not amenable to writ jurisdiction has also been underlined. 8. No rejoinder has been filed by the petitioner. 9. Mr. G.K. Mohanty, learned counsel for the petitioner has assiduously urged that even assuming that Clause 8.2.2 of the Guidelines was invocable, in the facts and circumstances of the case, the TT involved only could have been blacklisted and thus the blacklisting of the petitioner’s other TTs was grossly illegal and sans any authority of law. Referring to the provision contemplating the eventualities in which the whole contract was permissible to be terminated by blacklisting carrier and all its TTs on industry basis, the learned counsel has argued that such a consequence in terms thereof would ensue only in the event of the complicity of the carrier in two malpractices/irregularities involving its TTs being proved and not otherwise. As admittedly, in the facts of the present case, there is no instance of double involvement of the TTs of the petitioner, the impugned decision of blacklisting all his TTs and directing recovery towards the cost of stolen petroleum product is patently unsustainable in law and on facts, he maintained. 10. Per contra, Mr. J. Mohanty, learned counsel for the opp. parties, has insisted that as the involvement of the petitioner’s TT bearing registration No.OR-02-BS-4778 in the malpractice/irregularities contemplated in Clause 8.2.2.5 stood proved, the impugned decision is valid and does not merit any interference by this Court. 11. 10. Per contra, Mr. J. Mohanty, learned counsel for the opp. parties, has insisted that as the involvement of the petitioner’s TT bearing registration No.OR-02-BS-4778 in the malpractice/irregularities contemplated in Clause 8.2.2.5 stood proved, the impugned decision is valid and does not merit any interference by this Court. 11. The learned counsel has maintained that to attract the consequence of blacklisting of the carrier and all its TTs along with termination of the contract on industry basis, complicity of the carrier in any one instance of malpractice/irregularities is sufficient and thus the decision taken is in consonance with Clause 8.2.2 of the Guidelines. 12. We have analyzed the pleaded facts and documents on record and have consciously weighed the rival arguments. That the transaction apart from being governed by the stipulations in the agreement executed by/and between the parties is also regulated by the Guidelines is a matter of record. The pleaded averments in the writ petition do attest the acceptance of the petitioner about the involvement of his TT bearing registration No.OR-02-BS-4778 in the malpractice/irregularity as contemplated in sub-clause (h) of Clause 8.2.2.5, i.e., tampering with standard fittings of the TT etc. entailing the penalty of blacklisting of the said TT on industry basis. 13. A plain reading of the letter dated 16.7.2014 also highlights the offending arrangement in deviation of the standard fittings of the said TT with the motive of effecting short delivery of the petroleum product to the consumer. Thereby the petitioner was asked to explain as to why action would not be taken as per Clause 8.2.2.5 of the Guidelines for tampering with the standard fittings and having spurious fittings inside the chamber of the said TT. 14. In his reply, the petitioner did not deny the detection of the unauthorized arrangement in the third chamber of the TT bearing registration No.OR-02-BS-4778. He, however, stressed that he was not involved in the incident and that the driver was solely responsible therefor. He clarified that the driver had confessed to have committed the mischief. The petitioner thus specifically denied his complicity in the incident. 15. The text of the letter dated 4.9.2014 carrying the impugned decision is extracted herein below: “WO Ref: OSZO/POL/BULK/PT-2/2012-15/72/66 DT: 06.06.2012 was placed on you for transportation of POL Product Ex-Bhubaneswar Depot as per the terms and conditions of Public tender ref:OSO/POL/BULK/PT-02/2012-15. The petitioner thus specifically denied his complicity in the incident. 15. The text of the letter dated 4.9.2014 carrying the impugned decision is extracted herein below: “WO Ref: OSZO/POL/BULK/PT-2/2012-15/72/66 DT: 06.06.2012 was placed on you for transportation of POL Product Ex-Bhubaneswar Depot as per the terms and conditions of Public tender ref:OSO/POL/BULK/PT-02/2012-15. Vide show cause notice Ref: BBSR/S&D/02 dated 17.07.2014 it was brought to your notice that (1) abnormal shortage observed during decantation of product at dealer’s premises on 08.07.2014 (2) Arrangements were made inside the third compartment to conceal the product after decantation and removing the same by pulling a wire. Physical inspection of the TT was carried out at Depot by officers in your presence on 16.07.2014 and it was found that a container of 50 liter capacity was fitted in the third compartment to steal the product. Joint inspection report was prepared and the same was signed by you. You have appeared for personal hearing at 1300 hrs on 26.07.2014 and offered you views and comments. The minutes of the meetings were prepared and signed by you along with IOC officials. Competent authority has approved the following as your reply to show cause notice and views expressed by you during personal hearing are not convincing, hence not acceptable: 1. Black listing of the TT No. OR-02-BS-4778 along with the TT crew (Driver-Sh Bhajamana Nayak and Helper Sh Sudhir Patra) permanently. 2. Black listing of other four TTs (OR02BJ4778, OR05P3362, OR05AA5117 & OR02Z4800) for two years w.e.f.27.08.2014. 3. Recovery of Rs.306730/- towards the cost of product stolen during every load starting from 22.01.2014 till 08.07.2014. 16. Reading between the lines, it is not discernible that any finding had been reached by the IOCL in clear terms about the complicity of the petitioner either in the alleged act of tampering with the standard fittings of the TT involved or in planting spurious fittings in the third chamber thereof. The petitioner was, however, visited with the penal consequences, as adverted to herein above, on the ground that the explanation offered and his version in course of the personal hearing was unconvincing. The petitioner was, however, visited with the penal consequences, as adverted to herein above, on the ground that the explanation offered and his version in course of the personal hearing was unconvincing. The report of the Inspection Team of the IOCL (Annexure-B to the counter), which investigated into the incident on 9.7.2014 as well as the report of the Committee following an elaborate inquest of the TT though had detected the tampering with the standard fittings and incorporation of spurious fittings in the third chamber of the TT involved, however, noticeably did not even suggest that these violations were caused with the complicity of the petitioner in any manner. Neither the counter filed by the IOCL nor any document appended thereto discloses any basis for the conclusion that he indeed had the complicity and/or any kind of collaboration in the act of tampering with the standard fittings of the TT or installation of spurious fittings. There is no unimpeachable evidence as well that such deviations had been either within his knowledge or approval or consent. The conclusion with regard to his complicity forming the basis of the impugned action of blacklisting of all his TTs thus, when judged on the basis of the materials on record, is thus wholly inferential. Having regard to the serious detrimental consequences that had ensued, in our opinion, in absence of any irrefutable proof of his complicity, the IOCL could not have proceeded on mere assumptions or surmises 17. Vis-à-vis the competing interpretations accorded to the provision permitting the termination of the whole contract and blacklisting of the carrier and all its TTs on industry basis, we are of the view that such a consequence would ensue, if the complicity of the carrier is detected qua any of the malpractices/irregularities set out in Clause 8.2.2 of the Guidelines or in the event of involvement of the second TT of the carrier in such incident of malpractice/irregularities during the tenure of the contract. In other words, in the latter eventuality, if during the execution of the contract the TTs of the carrier are found involved in more than one malpractice/ irregularities, the whole contract comprising of all the TTs of the carrier would be terminated and the concerned carrier and all his TTs would stand blacklisted on industry basis. In other words, in the latter eventuality, if during the execution of the contract the TTs of the carrier are found involved in more than one malpractice/ irregularities, the whole contract comprising of all the TTs of the carrier would be terminated and the concerned carrier and all his TTs would stand blacklisted on industry basis. As, in the instant case, no second incident involving any other TT of the petitioner has been alleged or proved, his complicity in the detected incident of malpractice/irregularities would be an essential pre-requisite for blacklisting his other TTs. Any other interpretation would be unintelligible, incongruent and illogical. The plea of the petitioner that in order to terminate the whole contract comprising of all the TTs of a carrier and to blacklist it with all the TTs industry basis, the complicity of the carrier in the malpractice/irregularities in both the episodes ought to be a precondition however does not commend for acceptance. Such an exposition would, in our view, render the stipulation of complicity of the carrier in any of the malpractice/irregularities de hors the number of incidents in which its TTs are involved wholly redundant or a surplusage, a result incomprehension by the primary principles of interpretation. 18. Maxwell, in his celebrated work The Interpretation of Statutes (Twelfth Edition), had enunciated at page 76 as hereunder: “The words of a statute, when there is doubt about their meaning, are to be understood in the sense in which they best harmonise with the subject of the enactment. Their meaning is found not so much in a strictly grammatical or etymological propriety of language, nor even in its popular use, as in the subject, or in the occasion on which they are used, and the object to be attained. Their meaning is found not so much in a strictly grammatical or etymological propriety of language, nor even in its popular use, as in the subject, or in the occasion on which they are used, and the object to be attained. Grammatically, words may cover a case; but whenever a statute or document is to be construed it must be construed not according to the mere ordinary general meaning of the words, but according to the ordinary meaning of the words as applied to the subject matter with regard to which they are used, unless there is something which renders it necessary to read them in a sense which is not their ordinary sense in the English language as so applied.” In Union of India and others v. Brigadier P.S. Gill, (2012) 4 SCC 463 , the Hon’ble Apex Court had underlined that one of the salutary rules of interpretation is that the legislature does not waste words that each word used in the enactment must be allowed to play its role however significant or insignificant the same may be in achieving the legislative intent and promoting legislative object. That an interpretation to advance the avowed objective of a statute is always to be accepted than the one which dilutes it was underscored by the Hon’ble Apex Court in Regional Provident Fund Commissioner v. Hooghly Mills Company Limited and others, (2012) 2 SCC 489 . 19. Judged on the above expounded principles on interpretation, we are of the comprehension that the complicity of the carrier in any one instance of malpractice or irregularity would act as a vitiating factor to attract the consequence of termination of the whole contract and the blacklisting thereof (carrier) along with all TTs on industry basis. Understandably, this is gravely detrimental and the penal consequence can be justified on proved culpable state of mind of the carrier qua the assignment entrusted to it. 20. On a close consideration of the above aspects, we are thus of the opinion that the impugned decision to blacklist TTs bearing registration Nos.OR02BJ-4778, OR05P3362, OR05AA5117 & OR02Z4800 of the petitioner for two years with effect from 27.08.2014 is unsustainable in law. However, in view of the proved facts vis-à-vis the involvement of the TT bearing registration No.OR-02-BS-4778 in the malpractice/irregularities of tampering with the standard fittings etc. However, in view of the proved facts vis-à-vis the involvement of the TT bearing registration No.OR-02-BS-4778 in the malpractice/irregularities of tampering with the standard fittings etc. contemplated in Clause 8.2.2.5 of the Guidelines, the decision to blacklist it with its crew, i.e. the driver and the helper as per letter dated 04.09.2014 and to recover Rs.3,06,730/-is upheld. The petition is thus partly allowed.