M/S Anantji Gas Service vs Indian Oil Corporation
2014 Latest Caselaw 3260 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
+      FAO(OS) 136/2014
                                                    Reserved on: 02.05.2014
%                                                Pronounced on: 22.07.2014

       M/S ANANTJI GAS SERVICE                  ..... Appellant
                     Through: Mr. M. C. Dhingra, Adv. with
                     Mr.Rajesh Sachdeva, Advs.

                    Versus

       INDIAN OIL CORPORATION                    ..... Respondent
                     Through: Mr. M.M. Kalra, Adv. with Mr.Kunal
                     Kalra, Adv.

       CORAM:
       HON'BLE THE CHIEF JUSTICE
       HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW


                             JUDGMENT

: Ms.G.ROHINI, CHIEF JUSTICE

1. This appeal is preferred under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 (for short 'the Act') aggrieved by the order of the learned Single Judge dated 29.01.2014 in OMP No.115/2014.

2. The said OMP No.115 of 2014 was filed by the appellant herein under Section 9 of the Act seeking stay of operation of the orders dated 23.09.2013 and 11.01.2012 passed by the respondent herein. By the order under appeal, the learned Single Judge dismissed OMP 115/2014 holding that the petitioner/appellant herein failed to make out a prima facie case for grant of any order by way of an interim measure.

3. The petitioner/appellant herein is a distributor of the respondent- Indian Oil Corporation Ltd. (hereinafter referred to as 'IOC') for supply of the Liquefied Petroleum Gas (LPG) and is carrying on the business in the name and style of M/s Anantji Gas Service.

4. By letter dated 11.01.2012, the IOC/respondent directed the appellant to deposit a sum of Rs.22,73,697/- towards penalty within 7 days alleging several irregularities in making the supplies to the customers and deliberate manipulation of the record. The appellant was also directed to suspend the supplies to the consumers immediately except 198 which were physically verified. Subsequently, by letter dated 23.09.2013, the penalty imposed earlier was revised and the appellant was directed to deposit Rs.93,08,989/-.

5. Thereupon, the appellant sought appointment of an arbitrator for resolution of the dispute in terms of the arbitration clause contained in the agreement entered into between the appellant and IOC.

6. Simultaneously, the appellant preferred OMP No.115/2014 under Section 9 of the Arbitration and Conciliation Act seeking stay of operation of the above-said orders dated 23.09.2013 and 11.01.2012 issued by IOC. The said petition was dismissed by the learned Single Judge by the order under appeal. Hence, the present appeal under Section 37(1)(a) of the Act.

7. Mr. M.C. Dhingra, learned counsel appearing for the appellant vehemently contended that the order under appeal is erroneous and that the learned Single Judge in the facts and circumstances of the case ought not to have declined to grant the relief as prayed for in exercise of the power conferred under Section 9 of the Act. It is also contended that the irregularities alleged against the appellant in making the supplies to the customers as well as the allegation of manipulation of records are false and

without any basis.

8. A perusal of the order under appeal shows that the learned Single Judge had taken into consideration all the submissions made on behalf of the appellant and on appreciation of the same a specific finding was recorded that the imposition of the penalty by IOC was founded on relevant and cogent material and that no prima facie case was made out for grant of any relief under Section 9 of the Act. It was also observed that the conduct of IOC in transferring the customers of the appellant to other distributors was reasonable in the facts and circumstances of the case and the same did not call for interdiction.

9. Such a finding of fact recorded by the learned Single Judge assigning cogent reasons, therefore, warrants no interference by us on any ground whatsoever.

10. The law is well settled that the power granted to the Civil Court under Section 9 of the Act is akin to Order 39 Rules 1 & 2 of CPC, 1908 and therefore the court has to satisfy itself that the petitioner has established the three cardinal principles of prima facie case, balance of convenience and irreparable loss in case no protection is extended by way of interim measure under Section 9 of the Act. Vide Adhunik Steels Ltd. Vs. Orissa Mangenese and Minerals Pvt. Ltd., (2007) 7 SCC 125 and Arvind Constructions Co. (P) Ltd. Vs. Kalinga Mining Corporation and Others, (2007) 6 SCC 798.

11. As noticed above, the learned Single Judge recorded a specific finding that the appellant failed to make out a prima facie case. We do not find any justifiable reason to hold that the said finding of fact suffered from any error of fact or law. We are also unable to hold that the appellant would suffer

irretrievable injury unless a protective order is passed under Section 9 of the Act. Therefore, the learned Single Judge was justified in declining to grant the relief in exercise of the power conferred under Section 9 of the Act.

12. The two decisions cited by the learned counsel for the appellant, namely, State of Karnataka Vs. Shree Rameshwara Rice Mills, Thirthahalli, (1987) 2 SCC 160 and J.G. Engineers Pvt. Ltd. Vs. Union of India & Anr., (2011) 5 SCC 758 in our considered opinion are clearly distinguishable on facts and are of no assistance to take a view different from the one taken by the learned Single Judge.

13. The appeal is without any merits and the same is accordingly dismissed. No order as to costs.

CHIEF JUSTICE

RAJIV SAHAI ENDLAW, J JULY 22, 2014 'anb'