Delhi High Court
Haryana City Gas Distribution ... vs The Petroleum And Natural Gas ... on 16 September, 2016
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 16.09.2016
+ W.P.(C) 11690/2015
HARYANA CITY GAS DISTRIBUTION LTD. ...... Petitioner
Through Mr.Prag P.Tripathi, Sr.Advocate with
Ms.Neelima Tripathi, Advocate
versus
THE PETROLEUM AND NATURAL GAS REGULATORY
BOARD AND ANR. ..... Respondents
Through Mr.Saurav Aggarwal & Ms.Astha
Gaur, Advocates for R-1/PNGRB.
Mr.Manish Mohan, CGSC with
Mr.R.M.Tripathi, Advocate for the
UOI
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE JAYANT NATH
JAYANT NATH , J. (ORAL)
CM No.24102/2016
1. The petitioner has filed the present application for directions to the
respondent Board to forthwith comply with the order dated 24.05.2016
passed by this court and to direct the respondent Board to recall the letter
dated 05.07.2016 sent to the petitioner requiring the petitioner to appear for
hearing before the respondent Board.
2. The present petition was filed seeking various reliefs including an
order to quash the order dated 13.08.2015 passed by respondent No.1-The
Petroleum & Natural Gas Regulatory Board (in short 'Board'); a writ
CM No.24102.2016 in WP(C) 11690.2015 Page 1
declaring the petitioner to be a "Deemed Authorised" Entity under Section
16 of the PNGRB Act; an appropriate writ declaring the
PNGRB(Authorising Entities to lay, Build, Operate or Expand City or Local
Natural Gas Distribution Networks) Regulations, 2008 to be null and void or
in the alternative as being in force w.e.f. 15.07.2010; and a writ of certiorari
to quash/set aside the Regulation 18 of the PNGRB Regulations, 2008.
3. This court on 24.05.2016 disposed of the petition noting the grounds
on which the application of the petitioner has been rejected by Respondent
no.1 as follows:
"3. The PNGRB had rejected the petitioner's application under
Regulation 18 by the impugned order concluding as follows:
".........a) Physical progress and financial commitment
achieved by M/s Haryana City Gas Distribution Limited
(HCGDL) before the Appointed Day in the GA of
Bhiwadi does not meet the proviso 18(2)(d) of the
Petroleum and Natural Gas Regulatory Board
(Authorising Entities to Lay, Build, Operate or Expand
City or Local Natural Gas Distribution Networks)
Regulations, 2008.
b) M/s HCGDL does not meet the proviso 18(2)(e) of the
Petroleum and Natural Gas Regulatory Board
(Authorising Entities to Lay, Build, Operate or Expand
City or Local Natural Gas Distribution Networks)
Regulations, 2008 owing to legality of land lease
document."
4. This court also noted the recommendations of the committee which
has been appointed by the respondent Board as follows:
"5. The impugned order dated 13.08.2015 also records as
follows:
"The Committee, in its report, had referred to this
contention of HCGDL that lease is said to have been
CM No.24102.2016 in WP(C) 11690.2015 Page 2
executed for a period of 30 years against the
consideration of Rs.1.4 crores and if this transaction is
considered, then the target of HCGDL can be assumed to
have been archived."
5. This court held that a fresh lease deed has been registered and in view
of the impugned order itself recording that the petitioner would meet the
target of Regulation 18 if the lease deed is taken into consideration, the
order of the Board was set aside and the Board was directed to take the said
registered lease deed into consideration and pass orders as per law to grant
of authorization in terms of Regulation 18 of the 2008 Regulations to the
petitioner.
6. On 05.08.2016, the learned counsel appearing for the respondent
Board has placed before this court in a sealed cover a decision of the Board
in its meeting dated 03.08.2016 regarding grant of authorisation. It was
stated that the order has not yet been released.
7. The learned senior counsel for the petitioner has vehemently argued
that the said proposed order which has been placed before this court in the
sealed cover is palpably contrary to the order of this Bench dated 24.05.2016
and that appropriate directions need to be passed by this court. It is
submitted that by the order dated 24.05.2016 this court had noted that in
case lease deed between the petitioner and M/s Luthra Metals (P) Ltd. was
taken into account, the Board itself had concluded that the petitioner would
be eligible under Regulation 18. Now the registered lease deed has been
executed and which as per order of this court dated 24.05.2016 was to be
taken into account, the Board is now not justified to again reject the
authorisation of the petitioner.
CM No.24102.2016 in WP(C) 11690.2015 Page 3
8. Regulation 18(1) and (2) issued by the PNGRB reads as follows:
"18. Entity not authorised by the Central government for
laying, building, operating or expanding CGD network
before the appointed day.
(1) An entity laying, building, operating or expanding a
CGD network at any time before the appointed day but not duly
authorised to do so by the Central Govenment shall apply
immediately for obtaining an authorisation in the form as at
Schedule I.
(2) The Board may take into consideration the following
criteria while considering the application for grant of
authorisation, namely."
...........
"(d) in respect of the actual physical progress made and the
financial commitment thereof referred to in clause (c), a
physical progress of at least twenty five percent and a
financial commitment of at least twenty five percent of the
capital expenditure identified for the CGD project as per the
DFR immediately before the appointed day may be
considered as adequate;
(e) the entity should have arranged, by way of acquisition or
lease, land for CGS and procured the necessary equipment
for erecting the CGS before the appointed day."
9. This court in its order dated 24.05.2016 had noted as follows:
"5. The impugned order dated 13.08.2015 also records as
follows:
"The Committee, in its report, had referred to this
contention of HCGDL that lease is said to have been
executed for a period of 30 years against the
consideration of Rs.1.4 crores and if this transaction is
considered, then the target of HCGDL can be assumed to
have been archived."
6. Thus, as per the impugned order, if the lease deed was taken
CM No.24102.2016 in WP(C) 11690.2015 Page 4
into account, the petitioner would have achieved the target and
was entitled to authorization as per Regulation 18."
10. This court further ordered that since a fresh lease deed is now
registered and in view of the fact that the impugned order of the Board dated
13.08.2015 itself recorded that the petitioner would meet the target of
Regulation 18 if the lease deed is taken into consideration, the Board was
directed to take the registered lease deed into consideration and pass orders
as per law granting authorisation in terms of the Regulation 18 of the
Regulations. Order dated 13.08.2015 was set aside. Admittedly the said
order dated 24.05.2016 has not been challenged and is now binding on the
respondent Board.
11. A perusal of the proposed order which is now placed by the Board
before this court in purported compliance of the order dated 24.05.2016
again rejects the application of the petitioner.
12. A perusal of the original order passed by the Board dated 13.08.2015
shows that the Board had requested the petitioner to be present for hearing
with regard to their application for grant of authorisation on the following
observations:
"(a) Lease of land was not registered.
(b) 4,000 square meter of land in Dharuhera was not actually
in the possession of HCGDL on the "Appointed Day".
(c) Permission of RIICO was after the "Appointed Day".
(d) Against the claim of LOI/PO issued to M/s Surya Roshini
Limited and M/s Kimplas Piping Systems Limited for
Rs.3.47 crore and Rs.1.23 crore respectively, material
worth Rs.1.23 crore and Rs.0.33 crore respectively only
was procured by HCGDL."
13. Based on the hearings given to the petitioner, the Board in its said
CM No.24102.2016 in WP(C) 11690.2015 Page 5
order dated 13.08.2015 concluded that in view of provision of Section 17 of
the Indian Registration Act, the lease deed relied upon by the petitioner
would have to be compulsorily registered and the unregistered lease deed
filed by the petitioner does not confer any power on the lessee in respect of
the leased property. It further noted that as follows:
"The Committee, in its report, had referred to this contention of
the HCGDL that lease is said to have been executed for a period
of 30 years against the consideration of Rs.1.4 crores and if this
transaction is considered, then the target of HCGDL can be
assumed to have been achieved. But as said hereinabove, no
advantage can be given to HCGDL of such a lease deed, which
was executed in utter violation of the mandatory statutory
provisions."
Hence, the order rejected the application of the petitioner stating that
the petitioner does not meet proviso 18(2)(d) and 18(2)(e) of the said
Regulations.
14. A perusal of the proposed order now shows that it again rambles
about alleged irregularities done by the petitioner. It notes that while passing
the earlier order dated 13.08.2015 the contents of the lease deed or its
genuineness were not verified as the document as a whole was considered as
inadmissible. Now as the question of admissibility does not remain, it is
necessary for the Board to look into its other aspects. It concludes that the
possession of the land was received after "Appointed Day". It further
concludes that the boundary of the leased property has not been shown in the
registered lease deed. It further notes that the petitioner has failed to show
that the registered lease deed dated 13.05.2016 pertains to the same land
which was the subject matter of the lease deed dated 20.06.2007. Thereafter,
CM No.24102.2016 in WP(C) 11690.2015 Page 6
it concludes as follows:
"However, even on taking into account the consideration
money alone of Rs.1.4 crores, we find that the applicant would
meet the requirement as laid down in Regulation 18(2)(d) of the
Authorisation Regulations but still there is non-compliance of
the provision of Regulation 18(2)(a) of these Regulations as the
approval of PESO and the permission of RIICO were granted
on 13.05.2008 and 28.02.2008 respectively i.e. after the
"appointed day".
15. Hence, it is clear from the order dated 13.08.2015 that all the
contentions which are now repeated herein above were noted when the
order dated 13.8.2015 was passed and it was concluded that the petitioner
does not meet proviso 18(2)(d) and 18(2)(e) only. Now a new criteria is
sought to be introduced, namely Regulation 18(2)(a) of the Regulations
based on the same contentions as noted in order dated 13.8.2015. This new
ground has now been added on the same facts which are already available
with the respondent when it passed order dated 03.08.2016.
16. The respondents have not challenged the earlier order of this court
dated 24.05.2016 and are bound to comply with the same. The proposed
order dated 03.08.2016 shows that taking into account the registered lease
deed the requirements of Regulation 18(2)(d) of the Regulations stand
complied with. But now the order seeks to disallow the application on the
ground of non-compliance of proviso of Regulation 18(2)(a) of the
Regulations on the same facts which were known to the respondent when it
passed its earlier order dated 13.08.2015.
17. In our opinion, the proposed order dated 03.08.2016 is only an
attempt to overreach the order of this court dated 24.05.2016. We have
CM No.24102.2016 in WP(C) 11690.2015 Page 7
reached this conclusion as the Board in the facts of this case has concluded
that if the land, subject matter of the lease is taken into account as directed
by this Court, the petitioner meets the criteria under proviso to Regulation
18(2) (d). But on the same facts it now seeks to introduce a new
disqualification. We accordingly direct the respondents to take appropriate
steps as directed by our order dated 24.05.2016.
18. The application stands disposed of.
JAYANT NATH, J.
CHIEF JUSTICE
SEPTEMBER 16, 2016/v
CM No.24102.2016 in WP(C) 11690.2015 Page 8
