Telangana High Court
The Indian Oil ... vs Ranjith Filling Station,Medak ... on 19 March, 2024
THE HON'BLE THE CHIEF JUSTICE ALOK ARADHE
AND
THE HON'BLE SHRI JUSTICE ANIL KUMAR JUKANTI
WRIT APPEAL No. 169 of 2014
JUDGMENT:
(Per the Hon'ble the Chief Justice Alok Aradhe) Mr. Deepak Bhattacharjee, learned Senior Counsel for the appellant.
Mr. P. Girish Kumar, learned Senior Counsel represents Mr. Shaik Jeelani Basha, learned counsel for the respondents.
2. This intra court appeal arises from an order dated 11.12.2013 passed by the learned Single Judge by which W.P.No.28062 of 2013 preferred by the respondents has been allowed.
3. Facts giving rise to filing of this appeal briefly stated are that sometime in April, 2011, the appellant appointed respondent No.1 firm (hereinafter referred to as "the firm") as dealer in Petrol (Motor Spirit) and High Speed Diesel Oil (Retail Outlet). Thereafter, an agreement was executed between the firm and the appellant - The Indian Oil ::2::
Corporation Limited (hereinafter referred to as "the Corporation") and the firm has been operating the retail outlet under the aforesaid agreement. Admittedly, the firm is bound by the Marketing Discipline Guidelines.
4. An inspection was conducted on 05.02.2013 by the Anti Adulteration Cell of the Corporation. During inspection one additional unauthorized electronic fitting in Midco MMSH 1112 ASPI 07ECO591V in dispensing unit was found. The samples were collected and thereafter by an order dated 06.02.2013, the firm was advised not to dispense fuel from the dispensing unit.
5. The firm was required to submit an explanation, pursuant to which a detailed explanation was submitted. The firm expressed ignorance about the alleged additional unauthorized fitting in the dispensing unit. It was further stated that as per the samples taken prior to opening of the dispensing unit and thereafter, it was found that delivery was accurate and there was no variation in the delivery. The firm was also afforded an opportunity of personal hearing. However, the Corporation by an order dated 16.09.2013 ::3::
inter alia held that the firm is guilty of violation of the dealership agreement as well as Clause 5.4.1 of the Marketing Discipline Guidelines and accordingly, terminated the dealership of the firm.
6. The aforesaid order was challenged by the firm in W.P.No.28062 of 2013. The learned Single Judge by an order dated 11.12.2013 has inter alia held that there is no material on record to indicate as to at what point of time the unauthorized unit was inserted into the dispensing unit and how the firm is manipulating the distribution of fuel. It was further held that no material was brought on record to disclose the unauthorized access to the equipment by the firm. It was further found that it is not the allegation of the Corporation that the firm has tampered with the seals. It was further held that the officials of the Weights and Measures Department have inspected the retail outlet periodically and found the seals to be intact. The learned Single Judge therefore set aside the order dated 16.09.2013 and has allowed the writ petition. In the aforesaid factual background, this intra court appeal has been filed.
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7. Learned Senior Counsel for the appellant has submitted that the order passed by the learned Single Judge is contrary to law and facts of the case. It is further submitted that on termination of the contract of dealership, the appropriate remedy for the firm was to invoke the arbitration clause, as provided under the arbitration agreement.
8. On the other hand, learned Senior Counsel for the respondents has supported the order passed by the learned Single Judge.
9. We have considered the rival submissions made on both sides and have perused the record.
10. The competent authority in its order has recorded the finding, which has been referred to by the learned Single Judge in paragraph 20 of the impugned order. The same is extracted below for the facility of reference:
"(i) "They found everything to be normal and within the permissible limits. The explanation offered by you in this regard is factually correct and acceptable" (para 5 in page 6 of the order).
(ii) "Therefore it can be safely concluded that there is no impact of the said additional fitting for delivery of the ::5::
product. Apart from the alleged unauthorized fitting found in the Midco Dispensing unit everything was in permissible limits. The explanation offered by you is factually correct and convincing". (para 6 of page 6)
(iii) "Your explanation that the no variation in so far as delivery of fuel is concerned is acceptable". (first para of page 7)
(iv) "It is true that as per our records you have been carrying on the business as per the terms and conditions of the Dealership agreement until the above referred irregularities were detected by Anti Adulteration Cell -
Southern Region on 05.02.2013"."
11. The explanation put-forth by the firm has been rejected on the ground that it was not possible to insert an unauthorized unit without the consent of the firm. The learned Single Judge, however, has recorded a finding in paragraph 22 of the impugned order that there is no finding in the order passed by the competent authority as to when the unauthorized unit was inserted in the dispensing unit and how the firm is manipulating the distribution of fuel. It was further held that there is no material on record to hold that the firm in any manner has tampered with the seals. The learned Single Judge also took note of the fact that the seals were found to be intact on the periodical inspection of ::6::
the officials of the Weights and Measures Department. It was also held that by the insertion of the aforesaid unauthorized unit, the firm has indulged in short delivery of fuel. It was also found that delivery of fuel was accurate prior to checking of the unit and even after checking. Therefore, the learned Single Judge recorded a finding that the possibility that the supplier himself has supplied that particular cable in the dispensing unit cannot be ruled out. It was also held that no effort was made to ascertain from the supplier whether there was some significance in insertion of such unit and it was inserted for proper functioning of the unit. For the aforementioned reasons, the learned Single Judge has found that the order of termination of dealership of the firm is based on surmises and conjectures that the firm has indulged in short delivery of fuel. There is no material on record to draw such an inference and accordingly, the writ petition has been allowed.
12. The learned Single Judge has meticulously appreciated the material available on record and recorded a finding that the firm did not indulge in short supply of fuel. In view of the ::7::
fact that the seals in the dispensing unit were found to be intact during the time of inspection and there is no finding that the firm indulged in short supply of fuel even at the time of inspection, the supply of fuel was found to be proper. No effort has been made by the Corporation to enquire from the supplier about the installation of additional unauthorized electronic fitting in dispensing unit. The findings recorded by the learned Single Judge cannot be either said to be perverse or based on no material.
13. For the aforementioned reasons, we do not find any ground to differ with the view taken by the learned Single Judge.
14. In the result, the writ appeal is dismissed.
Miscellaneous petitions, pending if any, stand closed. No order as to costs.
__________________ ALOK ARADHE, CJ ________________________ ANIL KUMAR JUKANTI, J Date: 19.03.2024 ES