Research › Search › Judgment

Gujarat High Court · body

2024 DIGILAW 1794 (GUJ)

JENAMBEN FIROZ JHOKIYA v. BHARAT PETROLEUM CORPORATION LIMITED

2024-09-02

PRANAV TRIVEDI, SUNITA AGARWAL

body2024
JUDGMENT : PRANAV TRIVEDI, J. 1. The present Letters Patent Appeal under Clause 15 of the Letters Patent is preferred by the appellant-original petitioner assailing the correctness and validity of the order dated 15.02.2024 passed by the learned Single Judge in Special Civil Application No. 15934 of 2023. 2. The prayers made by the appellant-original petitioner in the writ petition before the learned Single Judge was to issue an appropriate writ, order or direction to quash and set aside the order dated 28.08.2023 passed by the Executive Director (Retail), Bharat Petroleum Corporation-respondent No. 3. 3. The learned Single Judge, after considering the arguments of both the parties was pleased to observe that the writ court is not supposed to sit in appeal over the findings recorded by the competent Appellant Authority and/or to re-appreciate the evidence for itself. When the evidence is based on satisfactory or sufficient fact, then no interference would be required to exercise extraordinary jurisdiction under Article 226 of the Constitution of India. In the wake of such observations, the writ petition preferred by the appellant-original petitioner was dismissed. 4. The factual matrix leading to filing of the writ petition is that, sometime in the year 2012, respondent No. 1 issued notice for allotment of the petroleum outlet at Rajula, Gujarat. It is the case of the petitioner that he submitted necessary forms. Pursuant to the application, a selection process took place and petitioner was selected as first choice. After going through the entire procedure, an agreement was executed between petitioner and respondent No. 1 on 28.08.2012, which was addressed as Dispensing Pump and Selling License (hereinafter referred to as “the DPSL”). Subsequent to the agreement between the parties, Marketing Discipline Guidelines (hereinafter referred to as “the MDG”) were brought into force on 08.01.2013. The MDG was issued by the Government of India for Public Undertakings of Oil Marketing Companies. The agreement between petitioner and respondent continued for 10 years during which there was no dispute between the parties. 4.1 It is the case of the petitioner that an inspection was carried out at the outlet premises of the petitioner on 27.01.2022, wherein certain deficiencies were reported. As per one of the inspection report, the Multi Product Dispenser (hereinafter referred to as “the MPD)/Automatic Tank Gauge (hereinafter referred to as “the ATG”) were switched to offline/manual mode without authorization from the respondent. As per one of the inspection report, the Multi Product Dispenser (hereinafter referred to as “the MPD)/Automatic Tank Gauge (hereinafter referred to as “the ATG”) were switched to offline/manual mode without authorization from the respondent. Pursuant to the inspection, the respondent communicated to the petitioner on 27.01.2022 explaining the breach by the petitioner, particularly of Clause 5.1.16 of the MDG. In the wake of such irregularities, the sales and supply by the Corporation to the petitioner were suspended. The communication dated 27.01.2022 was replied by the petitioner vide letter dated 02.02.2022. 4.2 Pursuant to the reply given by the petitioner, two member committee was formed by the respondent consisting of two senior members of the respondent Corporation. The committee conducted another inspection on 21.02.2022 in the presence of representative of the petitioner. The committee based on their observations, advised to seal cards of MPD bearing serial No. 12EB0346V and send it to the laboratory for testing. A joint observation report of the committee was prepared on 21.02.2022 in the presence of representative of the petitioner, and the MPD was sent for lab testing. However, while sending the MPD to lab testing, it was observed that the petitioner had sold 13,133 litres of motor spirit between the date of suspension i.e. 27.01.2022 till 22.2.2022. Subsequent to the inspection, communications were addressed by the petitioner to the respondent. 4.3 Another inspection at retail outlet was undertaken on 26.03.2022 and 19.05.2022 by the respondent in presence of the Manager of the retail outlet of the petitioner. Many irregularities were found out. It was observed that the tank unloading point seals which were put by the officers of the Corporation were found to be broken. The seals found broken were also photographed. It was also found that there were various inventories. Therefore, the petitioner had indulged into unauthorized sale/purchase of the products. Therefore, it was observed that there is unauthorized product decantation at the retail outlet and seals of the tank were found broken and was unlocked. 4.4 In view of these observations, a show-cause notice was given on 20.06.2022. The petitioner responded to the show-cause notice by way of communication dated 27.07.2022. Therefore, it was observed that there is unauthorized product decantation at the retail outlet and seals of the tank were found broken and was unlocked. 4.4 In view of these observations, a show-cause notice was given on 20.06.2022. The petitioner responded to the show-cause notice by way of communication dated 27.07.2022. Before any personal hearing could be afforded, the petitioner preferred a writ petition before this Court, which came to be numbered as Special Civil Application No. 14731 of 2022 and the said petition came to be withdrawn on 01.08.2022 by the petitioner with a view to approach the appropriate authority. The petitioner received a communication dated 19.09.2022 for personal hearing on 03.10.2022. After affording personal hearing to the petitioner when the decision of the respondent was pending another writ petition came to be preferred by the petitioner before this court, which came to be numbered as Special Civil Application No. 911 of 2023. During the pendency of the second writ petition, the dealership agreement came to be terminated on 12.01.2023. Consequently, the writ petition as well as connected application came to be disposed of by this Court on 28.08.2023, reserving liberty in favour of the petitioner to challenge the termination order in accordance with law. The petitioner also preferred a Regular Civil Suit, during the pendency of the writ petition. 4.5 However, after withdrawal of the second writ petition, an appeal came to be preferred by the petitioner before the Appellate Authority under the MDG. The Appellant Authority by way of the order dated 28.08.2023 rejected the appeal of the petitioner. As a result, the petitioner filed the third writ petition before this Court, which came to be numbered as Special Civil Application No. 15934 of 2023. The learned Single Judge, by way of an order dated 15.02.2024, rejected the said writ petition which order is now being challenged in the present Letters Patent Appeal. 5. We have heard Mr. B.M. Mangukiya, learned advocate appearing for the appellant and Mr. Ajay R. Mehta, learned advocate appearing for the respondents. 6. Mr. B.M. Mangukiya, learned advocate appearing for the appellant has submitted that the very action of the respondent is dubious. During the first inspection, which was carried out on 27.01.2022, the respondents themselves had put the dispenser on manual mode, which was impermissible. Ajay R. Mehta, learned advocate appearing for the respondents. 6. Mr. B.M. Mangukiya, learned advocate appearing for the appellant has submitted that the very action of the respondent is dubious. During the first inspection, which was carried out on 27.01.2022, the respondents themselves had put the dispenser on manual mode, which was impermissible. It is further submitted that the electronic gadgets installed at the premises of the petitioner were not working. The allegation that the petitioner changed the mode of the electronic gadgets, namely, ATG is not sustainable. Mr. Mangukiya, learned advocate further submitted that the petitioner had made a complaint on 02.12.2021 about non working of the electronic gadgets. Though, it was informed by the respondent that the complaint should be made through BROMA, but the fact that the petitioner has made complaint with regard to the issue of Automation and ATG not working was not disputed. It was also complained by the petitioner that MPD was non-functional and needed to be repaired. Therefore, according to Mr. Mangukiya, learned advocate, there was no fault on the part of the petitioner after complaints were made to the authorities. 6.1 Mr. Mangukiya, learned advocate has further submitted that all the data were available with the respondents. The respondents was well aware of the fact that the electronic gadget at the premises of the petitioner was not functioning properly. The ATG was not functioning properly and it was jumping on records. From 25.01.2021 to 27.01.2022, eight complaints were made about malfunctioning; however, no steps were taken by the respondent. Such glaring facts were available with the respondents, but they deemed it fit to terminate the license granted to the petitioner. 6.2 With regard to breaking of the seals during inspection, it was submitted by Mr. Mangukiya, learned advocate that the broken seals were the act of animals like dogs attacking the machines. The petitioner was not aware about the such incident and cannot be held responsible for the broken seals. It was further submitted that there was a cyclone on 14.05.2021 as a result of which electronic gadgets stopped working. There is, thus, no question any irregularity by the petitioner. 6.3 Mr. The petitioner was not aware about the such incident and cannot be held responsible for the broken seals. It was further submitted that there was a cyclone on 14.05.2021 as a result of which electronic gadgets stopped working. There is, thus, no question any irregularity by the petitioner. 6.3 Mr. Mangukiya, learned advocate has, thus, prayed that the order terminating the dealership agreement, which has been confirmed by the Appellant Authority as well as the learned Single Judge, is bad in law and is required to be quashed and set aside, accordingly. 7. Per contra, Mr. Ajay R. Mehta, learned advocate appearing for the respondents has submitted that the inspection took place on 27.01.2022 at the retail outlet and dispensary station of the petitioner. All supplies to the retail outlet were stopped. On 21.02.2022, a further inspection was conducted, during which one of the MPDs was removed and sent to the original equipment manufacturing laboratory for testing. However, another MPD was still at the premises of the petitioner. When another inspection was undertaken on 26.03.2022, it was observed that the retail outlet of the petitioner was operational and products were being sold without any drop in the supply of the product. When the seals were applied to the machines, and supply was suspended there was no question of further sale by the petitioner. However, if the report is perused, there was categorically observed that there was supply to the petitioner and sale had taken place. Once the sales and supply was suspended on 27.01.2022, the supply to the petitioner had to be from other sources. The only argument given by the petitioner with regard to seals is that animals had broken the seals. Such an argument is nothing but an eye wash. When there is a categorical observation of sales and supply by the petitioner after suspension of the license, the petitioner has clearly violated the guidelines. Further, during the pendency of the inspection, the petitioner has never complained that seals were broken by the animals. Further one of the MPD was still into place. Therefore, this issue and violation of guidelines itself was good enough for termination of the agreement. In the wake of such submission, Mr. Mehta, learned advocate appearing for the respondents has prayed to reject the writ petition. 8. Further one of the MPD was still into place. Therefore, this issue and violation of guidelines itself was good enough for termination of the agreement. In the wake of such submission, Mr. Mehta, learned advocate appearing for the respondents has prayed to reject the writ petition. 8. Having heard the learned advocates appearing for the respective parties and perused the material on record, we may note that certain facts are undisputed. The first allegation was pursuant to the inspection dated 27.01.2022. There is a categorical stand of the respondent authorities that sales and supplies were suspended and the meter reading of MPD bearing number 12EB0346V and the nozzles were sealed. There is a categorical finding that when subsequent inspection was conducted on 22.02.2022, there was a variation in sales and supplies in the MPD. Additionally, there is also a finding that the representative of the petitioner had acknowledged the sealing of nozzles on 27.01.2022. Therefore, there is a clear cut finding that there is no answer from the petitioner with regard to variation occurred between 27.01.2022 to 22.02.2022. The only answer given was the seals were intact, and therefore, variation was not possible. However, the variations were found out from 27.01.2022 to 22.02.2022. 9. Another issue is with regard to unloading point seals affixed by the officer on 26.03.2022. Subsequent to affixation of such seals on 26.03.2022, another inspection was conducted on 19.05.2022 in the presence of the representatives of the petitioner. The seals on tank unloading point were found to be broken and another MPD bearing serial number 12EB0345V was having variation in sales and supplies despite suspension on 27.01.2022. The only answer given by the petitioner was seals were broken/cut by the dogs or any wild animals. However, as per the contract, the petitioner was responsible for ensuring that no part of facilities was removed, changed, or altered without prior consent of respondent. If such thing happened, there is no communication by the petitioner giving explanation in the interregnum period as to why such change has occurred. It was clearly observed that as tank seals were broken, the petroleum product could have been easily decanted from outside and taken out without the use of MPD. Even during the arguments, the only answer given by the learned advocate for the appellant with regard to broken seals was that it was the act of stray dogs and animals. It was clearly observed that as tank seals were broken, the petroleum product could have been easily decanted from outside and taken out without the use of MPD. Even during the arguments, the only answer given by the learned advocate for the appellant with regard to broken seals was that it was the act of stray dogs and animals. There is a concurrent finding given by the authorities below which is categorically accepted by the learned Single Judge on this issue. 10. Another issue pertains of the ATG being put on manual mode without the consent of the respondent. It was contended by the petitioner that the ATG machines were not working properly and readings could not be relied upon. It is the contention of the appellant that the automation system was not working properly after the downfall of the Tauktae Cyclone. It was also alleged by the petitioner that complaints were made from 25.02.2021 to 27.01.2022. A finding has been given on this aspect that as per the specific complaint mechanism of the respondent, the complaints had to be submitted through portal of BROMA. Two complaints related to ATG malfunction were lodged on 09.12.2021 and 19.01.2022 and they were duly addressed and closed on 20.12.2021 and 03.02.2022 respectively. As per the appeal and service report, eights complaints were made by the petitioner which were closed and service reports were singed by the representatives of the petitioner. Further the petitioner has never alleged that the complaints remained unresolved or the issue persisted. There are clear cut fining on this issue in the termination order, as well as order passed by the Appellant Authority. All the issues raised by the petitioner are being answered by categorical findings in the termination order as well as the Appellant order. Therefore, we see no infirmity in the findings of fact given in the termination order, the appellant order and the order passed by the learned Single Judge. There is no interference required in the order passed by the learned Single Judge and therefore, the appeal is required to be dismissed. 11. Therefore, we see no infirmity in the findings of fact given in the termination order, the appellant order and the order passed by the learned Single Judge. There is no interference required in the order passed by the learned Single Judge and therefore, the appeal is required to be dismissed. 11. We may further record that within the scope of judicial review and scrutiny of the technical contracts under the writ jurisdiction, the Court may inquire that the bodies which are ‘State’ within the meaning of Article 12 of the Constitution of India are bound to act fairly and are amenable to the writ jurisdiction of the Courts. However, the discretionary power must be exercised with a great deal of restraint and caution. The judicial intervention should only occur when it is found out that the opinions and findings given by the experts are totally arbitrary or unreasonable. Even in case of two interpretations, the opinion of the technical experts has to be accepted. In the present case and having gone through the order of termination as well as the order of Appellant Authority, it can be categorically said that there is nothing on record to prove that there was any arbitrariness, irrationality, bias, mala fides or perversity on the part of the technical experts who has passed the impugned orders. Being satisfied on the above, we are of the considered view that the order passed by the learned Single Judge is just and proper and does not require any interference. 12. In view of the above-mentioned observations, the appeal being meritless is hereby dismissed with no order as to costs. 13. In view of the order passed in the main matter, connected Civil Application stands disposed of.