Tarun Kumar Halder vs Bharat Petroleum Corporation ...
2023 Latest Caselaw 3404 Cal

                     IN THE HIGH COURT AT CALCUTTA
                      Constitutional Writ Jurisdiction
                                  Appellate Side



Present:

The Hon'ble Justice Jay Sengupta



                            WPA 25853 of 2022
                           Tarun Kumar Halder
                                    Versus
              Bharat Petroleum Corporation Limited & Ors.



For the petitioner            :       Mr. Amlan Jyoti Sengupta
                                      Mr. Manabendra Thakur
                                      Mr. Soumen Mandal
                                                            .....Advocates
For the Respondent nos. 1, 2:         Mr. S.K. Mal

Mr. B. Das Mr. S. Das .....Advocates

Heard lastly on : 16.02.2023

Judgment on : 16.05.2023

Jay Sengupta, J.:

1. The writ petitioner has challenged the order dated 28.10.2022 passed

by the Appellate Committee which was constituted by the respondent

authority in terms of the solemn order passed by a Division Bench of this

Court in MAT No. 1188 of 2013. A review application was also purportedly

filed by the writ petitioner/appellant before the Appellate Committee, but

the same was not disposed of.

2. Learned counsel appearing on behalf of the petition submitted as

follows. On 02.11.1998 an agreement was executed by and between Bharat

Petroleum Co. Ltd. (BPCL for short) and Sankar Filling Centre (an

unregistered firm) represented by its partners for running a petrol pump at

73D, Narkeldanga, Main Road, Kolkata - 700 054. There was no allegation

about adulteration of petrol or diesel of the said petrol pump till 03.12.2007.

Since before independence, the petitioner's father was running a petrol

pump under the then Burma Shell at Jessore, now in Bangladesh. After

independence, the petitioner's father, since deceased, was running petrol

pump at the present site. As such, there is a reputation in their business.

On 03.12.2007 a person of the SGS India Pvt. Ltd. claiming to be an

authorized agent of the BPCL collected and tested by way of 'Marker' test

and told that HSD was found adulterated, without giving sample of the

drawn sample of HSD from the petrol pump to the petitioner. The sales and

supply to the petitioner's pump was suspended. The petitioner had

suspicion from the very beginning. Subsequently, market test was allegedly

conducted in the laboratory of the BPCL. Thereafter, the BPCL issued show

cause notice to the petitioner's firm. A reply was given by the petitioner. On

07.12.2007 the petitioner made a representation for clinical test, because

there is a provision for clinical test in the Marketing Discipline Guidelines of

the Oil Company, 2005. Market Test was introduced in the year 2007 and

the same was withdrawn on 01.01.2009 by all the oil companies. The

petitioner preferred the first writ petition before this Court challenging the

authority of the SGS. The said writ petition was dismissed on contest. The

petitioner preferred an appeal challenging the said dismissal order before

this Court. The said appeal was dismissed. On 05.12.2009 the BPCL took

physical possession of the petrol pump without raising any objection.

However, a complaint case bearing No. C/24950 of 2009 under Section

156(3) of Cr. P.C. was initiated by the petitioner before the Chief

Metropolitan Magistrate, Kolkata and against one Kanyalal Pandit of the

SGS Ltd. The C.M.M was inclined to direct the concerned police to

investigate into the matter and to file a report. The police during the course

of presence of investigation drew the sample from the HSD tank of

petitioner's petrol pump of oil company and sample was sent to the National

Laboratory for clinical test. Clinical test was done and the police after

collecting report, submitted the same before the Court. There it was reported

that the sample met the requirements of IS:1460 - 2005 specification for

Automotive Diesel Fuel in Bharat Stage - II Grade only. The HSD was kept

in an iron tank, which was kept underground and by natural course, the

quality of the HSD would be decayed. As such, clinical report said that

"Specification for Automotive Diesel Fuel in Bharat Stage-II Grade only"

which was as per Marketing Discipline Guide Line for RO/SKO dealership of

public sector oil marketing companies. On 5th December 2009 by a letter the

BPCL unilaterally terminated the agreement dated 24th November, 1998. On

2nd May, 2011 the petitioner made a representation before the BPCL for

reconsideration of their decision. Subsequently, the petitioner called at the

office of the BPCL and enquired about the fact of his representation and

came to know that the BPCL was going to create third party interest. The

petitioner preferred a writ petition being WP No. 8155 (W) of 2011

challenging the said termination letter and also the advertisement dated

July 26th 2010. This Court was pleased to pass an ad-interim order with a

direction on the BPCL not to create any third party interest. The BPCL

preferred an appeal and this Court was pleased to dispose of the appeal with

a direction to the BPCL to run the petrol pump without creating any third

party interest till decision of the trial Court. The writ petition being WP No.

8155 (W) of 2011 was disposed of by an order to the BPCL to consider the

petitioner's representation dated May 2, 2011 in accordance with law and to

pass a reasoned order. On January 3, 2012 representation was heard and

subsequently, a written note of argument was filed by the petitioner on

09.01.2012. After expiry of time as directed by the Hon'ble Court, the BPCL

issued a purported Memo dated 10th February, 2012. Being aggrieved, the

petitioner preferred a writ petition bearing WP No. 4329 (W) of 2012 this

Court and the said writ petition came up for hearing before this Court on

05.07.2013 and this Court was pleased to dispose of the said writ petition

with a direction to the BPCL to constitute an Appellate Committee consisting

of three members. Being aggrieved, the BPCL preferred an appeal bearing

MAT 1188 of 2013 along with CAN 8 of 2013. On 07.04.2015, a Division

Bench was pleased to direct the BPCL/Appellant to prepare adequate

number paper books within a period of 10 days and the BPCL was further

directed to maintain status quo as directed by the Trial Court. The said

appeal finally came up for hearing before this Court on 16.06.2022 and after

hearing submissions their Lordships were pleased to dispose of these said

appeal with a direction to the BPCL to constitute a Committee, consisting of

three members and the respondent/writ petitioner was directed to file

appeal before the Appellate Committee and the Appellate Committee would

dispose of the said appeal after giving reasonable opportunity of hearing to

the petitioner. The writ petitioner accordingly filed the appeal before the

Appellate Committee within time as directed. The Appellate Committee

passed the impugned order on 28th October, 2022, whereby it rejected the

appeal on the ground that the petitioner/appellant could not formulate any

new ground and holding that the "valve of the HSD tank was in loose

condition". The petitioner filed a review application before the Appellate

Committee on 08.11.2022 with one of the prayers not to create third party

interest till the disposal of the said review application. But, the said review

application was not disposed of and the BPCL intentionally and arbitrarily

issued LOI to a third party during pendency of the review petition. The

petitioner filed this writ petition challenging the impugned order dated

28.10.2022 passed by the Appellate Committee. The respondent Oil

Company filed their opposition avoiding to deal all the grounds made by the

writ petitioner in his writ petition only banking on the report of "Market

Test", but not relying the 'Clinical Test'. The concerned Police Station during

investigation took sample of HSD from the HSD tank in presence of

representative of the BPCL. The said sample was sent to National Lab for

conducting clinical test. After clinical test the experts opined that "in respect

of test carried out the sample meets the requirements of IS: 1460-2009

Specification for Automotive Diesel Fuel in Bharat Stage II Grade only"

which was as per Marketing Discipline Guidelines for RO/SKO dealership of

public sector oil marketing companies. When the sales and supply of

petroleum products to the petitioners petrol pump was suspended i.e. on

03.12.2007, valves of all the tanks were sealed. When the respondent

company found that the seal of the valve was in alleged loose condition

above, they did not lodge any complaint before the police authority. The

petitioner had been discriminated by the respondent authority in not

allowing to resume sales and supply of petroleum products to the

petitioner's petrol pump, when in the similar circumstances other petrol

pumps situated in other States had been given permission. The writ

petitioner was relying an unreported judgment dated 19.11.2009 passed by

this Court in WP No. 9100 (W) of 2009 (Ashutosh Chakraborty and Anr.

Versus Union of India & Ors.). The High Court can intervene under Article

226 of the State or its instrumentality acted in an arbitrary manner even in

a matter of contract, the High Court could intervene with any order passed

by State or its instrumentality by way of judicial review. The petitioner relied

on a decision reported in (2004) 3 SCC 572 (ABL International Ltd. & Anr.

Versus Export Credit Guarantee Corporation of India Ltd. & Ors.).

3. Learned counsel representing the respondent nos. 1 and 2 submitted

as follows. M/s Sankar Filling Centre was initially an old retail outlet (RO)

commissioned by respondent no. 1 in 1980. By way of Dispensing Pump and

Selling License (DPSL) Agreement dated 2nd November 1998, the dealership

was operating through a partnership firm. The said DPSL agreement was

initially valid for a period of 15 years from 26.06.1998. Public Sector Oil

Marketing Companies (OMC's) had consistently taken steps to check and

control adulteration of petroleum products. One such step was the

introduction of the three tier sampling system which, inter alia, included

collecting samples and testing the same in order to establish whether any

malpractice had taken place at the supply location or during transportation

or at the retail outlet. The elaborate procedure and guidelines for the sample

collection and testing were contained in the Marketing Discipline Guidelines

(MDG) as amended and updated from time to time. The Ministry of

Petroleum and Natural Gas (MOPNG) had decided to adopt the marker test

with the objective of preventing diversion of PDS kerosene for adulteration of

Motor Spirit (MS) and High Speed Diesel (HSD). The marker, being a

chemical substance, was mixed/blended in trace amount at the

depot/installation level in PDS kerosene and thereafter if the marker test

was carried out, pink band would appear showing that the sample was

positive for marker. Contract for supply of marker was awarded by OMC's to

the SGS India Pvt. Ltd. The SGS was duly authorised by the OMC's to carry

out tests and collect samples at various points including retail outlets. On

3rd December 2007, a marker test of all the products was carried out at the

RO by officers of the SGS India Pvt. Ltd. wherein the HSD sample was found

failing (turned pink). Further sample of HSD was obtained in presence of

dealer's representative and sealed by SGS officer. As per usual procedure

the TT retention sample was also handed over to the SGS officer who

submitted the same along with RO sample and field reports to the BPCL

sales officer. As per Guidelines, the sales and supplies of all products of the

dealership were suspended immediately. Thereafter tests of both the TT

retention sample as well as the RO sample were conducted at the BPCL

Budge Budge laboratory on 06.12.2007 in the presence of the petitioner and

the SGS representative after prior intimation. On testing the RO HSD

sample for marker at the laboratory, it was observed that the sample

indicated "P"(Pink) colour and hence, failed the analytical result.

Subsequently, the tank lorry HSD sample was tested for marker and it was

observed that the sample indicated "N"(Not Pink) hence passing the

analytical result. Thus a SCN (Show Cause Notice) dated 07.12.2007 was

issued by BPCL to the partners seeking their explanation for failure of the

HSD sample. In due compliance with the Court directions, a letter was

issued by the respondent no. 2 to the writ petitioner on 14th July 2022

informing that the appellate body had been constituted and to accordingly

file his appeal. Thereafter, the writ petitioner filed his appeal dated

10.08.2022 and opportunity for personal hearing before the appellate body

was granted on 29th August 2022. Consequently, the hearing took place on

29th August 2022 wherein the writ petitioner along with his advocate made

submissions and subsequently filed written submissions on 06.09.2022.

Consequent to such hearing which took place on 29th August 2022, a

speaking order dated 28.10.2022 was passed by the Appellate Committee

rejecting the appeal filed by the writ petitioner. This was communicated to

him by letter of the respondent no. 2 dated 03.11.2022. The writ petition

was not maintainable in view of the fact that the dealership was allotted in

favour of a partnership firm having three partners. However, the instant writ

petition was filed by only one of the partners allegedly on behalf of the firm.

Hence, this writ petition was not maintainable in law in view of the specific

provisions of the Partnership Act, 1932. The learned Single Judge while

disposing of W.P. No. 4329 of 2012 by order dated 5th July 2013 had

recorded that the dispute involved highly technical issues and required

proper forum to adjudicate the dispute. It was categorically submitted that

after passing of the order dated 28th October 2022 in compliance of the

Court directions, there was no scope of filing the instant writ petition re-

agitating the issues. That consequent to the rejection of the appeal by the

Appellate Committee vide speaking order dated 28th October 2022 the

answering respondent had issued Letter of Intent (LOI) to Mr. Sandip Kumar

Saha for running the dealership in respect of the particular RO. The steps

that were taken by the SGS Private Ltd. were in accordance with the existing

Marketing Discipline Guidelines (MDG) as also in consonance of the

January 2007 amendment carried out in the Motor Spirit and High Speed

Diesel (Regulation of Supply, Distribution and Prevention of Malpractices)

Order, 2005 incorporating the marker test for control of adulteration in

petroleum products being sold to the public. All action taken by the BPCL

and the SGS was as per the policy and guidelines and had been upheld by

this Hon'ble Court in the previous rounds of litigation. It was settled law in

Indian Oil Corporation Ltd. Versus Amritsar Gas Service & Ors. (1991) 1

SCC 533 that once a determinable agreement had been terminated by a

party, the only relief available to the aggrieved party was to claim damages.

The contract could not be specifically enforced as per Section 14 of the

Specific Relief Act. The respondent nos. 1 and 2 have also relied on the

following judgments in support of their case - (i) W.P. No. 16930 of 2009

(Kishore Auto Sales Versus BPCL) (Unreported judgment of Hon'ble

Allahabad High Court, Division Bench); (ii) 2009 (2) CHN 689; (iii) F.M.A No.

609 of 2009; (iv) 2012 (3) CHN 37; and (v) WP No. 9100(W) of 2009.

4. I heard the learned counsels and perused the writ petition, the

affidavits and the written notes of submission.

5. First, on the question of maintainability of this writ petition vis-a-vis

the respondent's contention about only one of the partners in the firm

approaching this Court for a relief, it is held that an individual partner of a

partnership firm can fairly vent his grievances before a Court of law in

respect of infringement of his rights even if the same pertains to his

engagement with the partnership firm, especially when it involves violation

of the petitioner's fundamental rights.

6. In an ideal situation, the time tested reputation of an entity is quite

indubitably relevant in public discourse. However, it is unfortunate that in

the present times all these had to make way for the accumulation of money

power and influence as a surer "marker" of acceptability. Of course, the flip

side of an argument about reputation is that even a single exception of

indiscretion can tarnish the hard work of years.

7. Be that as it may, it seems more pertinent to deal more directly with

the impugned order in question. For doing so it is indeed necessary to refer

to the scope that was chalked out by the Division Bench of this Court for

passing such order. The relevant portion of the order dated 14th June, 2002

passed in MAT 1188 of 2013 is quoted as under -

"The learned Single Judge did not set aside the adjudication dated

February 10, 2012. It was however felt that in view of such conflicting

report, an expert body might be formed for the purpose of deciding whether

proper procedure was adopted at the time of taking sample for conducting

test and the manner, method and procedure of testing applied in

ascertaining the quality of the diesel supplied to the writ petitioner conform

to establish norms. The writ petitioner, having lost his business as a result

of a finding of adulteration, may expect an impartial report with an

opportunity to raise all points with regard to the report filed by the National

Test House.

In view thereof, we do not find any reason to interfere with the order

dated July 5, 2013 passed by the learned Single Judge. The time to

constitute the appellate body is extended by eight weeks from date and the

time to file the appeal before the appellate body by the writ petitioner is

extended by thirty days from the date of constitution of the appellate body.

The appellate body is directed to dispose of the appeal to be filed by the writ

petitioner after giving reasonable opportunity of hearing to the parties within

a period of two months from the date of first hearing.

With the aforesaid observations, the appeal is disposed of."

8. In the connected criminal proceeding, the police did collect a sample

and had it tested. Here, there was a specific direction by a Division Bench of

this Court to go to the root of the matter and deal with the apparent

discrepancy between the result found by the police and the result obtained

by the private agent being the SGS or at the laboratory of the oil company

on a sample forwarded by the said SGS. Yet, the impugned order failed to

attach adequate importance to the issue and deal with the matter by way of

a plain denial. The reasoning was far from adequate.

9. It is true that the authority of the SGS has been vindicated in several

decisions. But, no one can vouch for the infallibility by the personnel

engaged by the SGS in respect of collection and testing of samples. When an

apparent discrepancy was detected, it was incumbent upon the concerned

authority to have properly dealt with the same. In a way, the Appellate

Committee constituted for such purpose only paid lip service to the

directions passed by this Court.

10. What is more perturbing is the fact that even before the petitioner

could approach this Court for an appropriate relief, a third party interest

was created in respect of the petrol pump in question. This is clearly against

the spirit of the consistent directions passed by this Court from time to time.

Earlier, a clear direction had been passed not to create third party interest

pending adjudication. This was continued for quite sometime. Merely

because the respondents could technically find a gap during which such

interim direction was not there, it was not proper for them to have rather

hastily created a third party interest. This Court deprecates such action.

11. It is no less surprising that the Appellate Committee found the

absence of presentation of any new facts or evidence as one of the grounds

to dismiss the petitioner's appeal. At least, this Court, while setting the

course to be charted by the Committee in deciding the appeal, did not ask to

look for new evidence or grounds.

12. In view of the above discussions, the impugned order dated

28.10.2022 passed by the Appellate Committee of the respondent

authorities cannot be sustained.

13. Accordingly, the impugned order is set aside and the matter is

remanded back to the Appellate Committee for fresh consideration. The

committee shall decide the matter afresh within two months from the date of

communication of this order and within a fortnight thereafter, communicate

the result to the petitioner.

14. With these observations, the writ petition is disposed of.

15. Urgent photostat certified copies of this judgment may be delivered to

the learned Advocates for the parties, if applied for, upon compliance of all

formalities.

(Jay Sengupta, J.)

S.M