Sarabjit Singh Anand & Ors. vs Bharat Petroleum Corporation ...
2011 Latest Caselaw 748 Del

             IN THE HIGH COURT OF DELHI AT NEW DELHI

                                   W.P.(C) 10671-80/2006

                                              Reserved on: January 24, 2011
                                              Decision on : February 08, 2011

        SARABJIT SINGH ANAND & ORS                   ..... Petitioners
                          Through: Mr. Subhash Chand, Advocate
                          with Petitioner No. 1 in person.

                          versus

        BHARAT PETROLEUM CORPORATION LTD. ....Respondent
                        Through: Mr. A.D.N. Rao with
                        Ms. Neelam Jain, Advocate

        CORAM: JUSTICE S. MURALIDHAR

        1. Whether reporters of the local newspapers
            be allowed to see the judgment?                             No
        2. To be referred to the Reporter or not?                       No
        3. Whether the judgment should be reported in the Digest? No


                                       JUDGMENT

08.02.2011

1. This is the second round of litigation concerning the petrol pump

dealership which was originally granted in the name of the partnership

firm in the name and style of M/s S.K.S. Gurmukh Singh at Lothian

Road, Kashmere Gate, Delhi.

2. The Petitioner states that in 1939 late Sardar Kahan Singh Anand was

granted a dealership by M/s Burmah Shell, i.e., the predecessor-in-

interest of Respondent Bharat Petroleum Corporation Ltd. (`BPCL‟).

Upon the death of Sardar Kahan Singh, his sons became the partners and

a fresh dealership agreement was entered into in 1953. After BPCL took

over Burmah Shell, an agreement of dealership was entered into on 11th

November 1974 with effect from 1st January 1970.

3. Clause 10(s) of the Agreement dated 11th November 1974 reads as

under:

"10. The Licensees hereby covenant and agree with the Company as follows:

.......

(s) Not to change the constitution of the licensees‟ firm nor to dissolve the partnership nor admit new member as partner nor allow any partner to withdraw from the partnership without obtaining the previous consent in writing of the Company."

4. It is stated that one of the partners Shri Gurmukh Singh settled down

in the United States of America in 1974 and subsequently acquired the

citizenship of USA. Shri Gurmukh Singh returned to India in 1992. He

filed Suit No. 2619 of 1992 for dissolution of partnership. A preliminary

decree was passed in the said suit on 17th October 1995 whereby the

partnership firm was dissolved. One of the other partners late Sardar

Sucha Singh filed an appeal against the said preliminary decree. The

Division Bench referred the matter to arbitration. However, the

arbitration proceedings could not proceed on account of the non-

cooperation of the parties, who failed to appear before the Arbitrator on

several dates. Ultimately, the suit came to be dismissed on 21st August

2008 reserving the rights and contentions of the LRs of the defendants in

the said suit vis-à-vis the Writ Petition (C) No. 10671-80 of 2006 (the

present petition) filed by them challenging the cancellation of the

dealership.

5. The Petitioner states that on 14th November 1995 a notice was sent to

the BPCL on behalf of S. Gurmukh Singh Anand stating that the

partnership firm of M/s S.K.S Gurmukh Singh had been dissolved by the

preliminary decree dated 17th October 1995 and that consequently the

business of selling petrol and its other bye-products cannot be carried on

at the premises of the dealership by any of the parties. Consequently, the

BPCL was requested to stop the delivery of petrol at the petrol pump

forthwith.

6. On 14th May 1996, the BPCL sent a show cause notice to late Sucha

Singh Anand (one of the partners) as to why the dealership should not be

terminated. Thereafter by a letter dated 29th December 1996 the BPCL

terminated the dealership. It is stated that the requests made on 14th

January 1997 of the firm for its reconstitution was not accepted by the

BPCL. In the circumstances, Writ Petition (C) No. 5453 of 1997 was

filed by late Sucha Singh Anand (as Petitioner No. 1) and M/s S.K.S.

Gurmukh Singh (firm - as Petitioner No. 2). The Respondents in the said

writ petition were the BPCL (Respondent No. 1) and Shri Gurmukh

Singh Anand (Respondent No. 2).

7. It is stated that during the pendency of the said writ petition Sucha

Singh Anand expired on 6th March 2000. The present petitioners were

brought on record in place of Shri Sucha Singh Anand as Petitioners in

W.P.(C) 5453 of 1997 by an order dated 29th January 2001.

8. While the said writ petition was pending, the Petitioners made a

representation on 8th November 2002 to BPCL seeking permission to

reconstitute the firm in the name of Shri Sarabjit Singh Anand

(Petitioner No.1 herein). By a letter dated 6th March 2003, the BPCL

refused to grant such permission.

9. W.P.(C) 5453 of 1997 was disposed of by the learned Single Judge on

22nd July 2003. It was held that since the dissolution was brought about

by the preliminary decree dated 17th October 1995 of this Court in a suit

filed by Shri Gurmukh Singh, there was no occasion for late Sucha

Singh to take prior written consent of BPCL for such dissolution. The

second ground for rejection of the representation was that the petrol

pump was no longer a commissioned site and BPCL had arranged for an

alternative site which had already been commissioned. The learned

Single Judge held that the non-commissioning of the plot where the

petrol pump was running, was not on account of any act of commission

or omission of Petitioner No. 1. It was observed that at the same time,

the BPCL also could not be faulted inasmuch as it had to also ensure that

if one petrol pump is not running, another should be commissioned so

that the public does not suffer. In the facts and circumstances of the case,

the writ petition was disposed of with the following directions:

"i) The Petitioner may make a fresh representation and Application before the Respondent No. 1;

ii) The Respondent No. 1 will consider the question of giving consent under clause 10(s) afresh;

iii) In case the Respondent No. 1 does grant the consent, the licence for the petrol pump be restored in the name of Petitioner No. 1."

10. A review petition was filed by the Petitioners seeking recall of the

aforementioned order dated 22nd July 2003. The BPCL also filed a

review petition seeking recall of the directions contained in para 6 (iii)

of the said order. By an order dated 13th August 2004, both review

petitions were dismissed by the learned Single Judge. As regards the

review petition filed by the Petitioners, it was observed that they were

entitled to take all grounds in the fresh representation to be made to the

BPCL and BPCL was bound to consider the grounds raised with regard

to the question of giving consent under Clause 10(s) afresh.

11. The BPCL then filed Writ Appeal No. (LPA) 1076 of 2004 which

came to be dismissed as withdrawn on 22nd September 2005.

12. On 14th September 2004, a fresh representation was made by

Petitioner No. 1 for grant of permission under Clause 10(s) of the license

agreement dated 11th November 1974. A reminder was sent on 13th

December 2004. Thereafter the impugned order dated 28 th December

2004 was passed by the BPCL rejecting the representation.

13. It was pointed out in the said order that a request for reconstitution of

the dealership was denied as BPCL was not legally permitted to

reconstitute the terminated dealership for any reason. The partnership

stood dissolved on 17th October 1995. Prior to termination of the

dealership, neither of the partners had made any application for

reconstitution of the partnership. Moreover, the request for

decommissioning of the site was made with the consent of the erstwhile

dealer and decommissioning had started as early as in 1988. The letter

dated 28th December 2004 summarized the reasons for rejection of the

representation as under:

"We are therefore unable to consider your claim for granting permission under Clause 10(s) of the dealership agreement dated 11-11-1974 because:-

= the said dealership agreement stands terminated for almost 8 years now, and as per the provisions of Section 14(1)(c) of the Specific Relief Act 1963 we are unable to consider your request for restoring licence;

= you have no dealership Agreement with Bharat Petroleum Corporation and are not entitled to evoke any Clause of the said Agreement including Clause 10(s) of the dealership agreement. For these reasons stated herein above, we are unable to consider your representations dated 14-9-2004 and 13-12-2004."

14. The basic point to be considered is whether the BPCL can be faulted

for not granting permission in terms of the Clause 10(s) of the

Agreement dated 11th November 1974 to the change in the constitution

of the firm or dissolution of the firm.

15. The facts show that the firm stood dissolved by the preliminary

decree dated 17th October 1995 passed by this Court. That preliminary

decree became final, as is evident from the order dated 21st August 1998

passed by this Court in Suit No. 2619 of 1992. An intimation to that

effect was also sent on behalf of the partners to the BPCL on 14 th

November 1995. There is also no denial of the fact that the

decommissioning started in 1988 itself. Neither of the partners of M/s

S.K.S Gurmukh Singh wrote to the BPCL for its previous consent in

terms of Clause 10(s) of the Agreement dated 11th November 1974. The

fact remains that the dissolution of the firm had already taken place even

before Clause 10(s) could be invoked. The BPCL was in no position to

grant its „previous consent‟ to the „reconstitution‟ of the partnership

firm. The fact remains that the dealership was granted in the name of the

firm which stood dissolved on 17th October 1995. In the eye of law,

there was no reconstitution of the firm at all after its dissolution.

Admittedly, the dealership had to necessarily come to an end with the

dissolution of the firm.

16. In the additional written submissions filed by the Petitioner on 27 th

January 2011, it is contended that the petrol pump in question is situated

on a land which is owned by the dealer, where the dispensing machines,

underground tanks etc. are supplied and owned by the BPCL. It is

submitted that unless a dispensing pump selling licence („DPSL‟) is

issued in the name of the Petitioner No. 1, it would not be possible to run

the petrol pump. It is further contended that "if the licence is granted

then there can be a firm created to run the Petrol Pump." This Court

cannot accept the above submission. The entire case stems from the

termination of a dealership granted in the name of the firm M/s S.K.S

Gurmukh Singh. The claim of the Petitioner throughout has been that

there has been a reconstitution of the firm which should be recognised

by the BPCL and the dealership should be permitted to continue in the

name of the firm. If the case now is that the erstwhile dealership which

was granted in the name of the firm should now be granted in the name

of the individual, then clearly such individual is not claiming a right to

the dealership through the firm but merely as an individual. The BPCL

cannot be directed by a mandamus to „restore‟ the „dealership‟ granted

in the name of a firm to an individual who happens to be one of the legal

heirs of one of the partners of the firm.

17. The writ petition is dismissed.

S. MURALIDHAR, J.

FEBRUARY 08, 2011 akg