Bharat Petroleum Corporation Ltd vs Girish Mahendraprasad Pathak
2021 Latest Caselaw 1338 Guj

          C/SA/295/2019                                        JUDGMENT




           IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                      R/SECOND APPEAL NO. 295 of 2019


FOR APPROVAL AND SIGNATURE:


HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

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1    Whether Reporters of Local Papers may be allowed
     to see the judgment ?

2    To be referred to the Reporter or not ?

3    Whether their Lordships wish to see the fair copy
     of the judgment ?

4    Whether this case involves a substantial question
     of law as to the interpretation of the Constitution
     of India or any order made thereunder ?

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                 BHARAT PETROLEUM CORPORATION LTD
                               Versus
                   GIRISH MAHENDRAPRASAD PATHAK
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Appearance:
MR AJAY R MEHTA(453) for the Appellant(s) No. 1,2
MR CS UPADHYAY(952) for the Respondent(s) No. 1,2
MS.YOGINI H UPADHYAY(6695) for the Respondent(s) No. 1,2
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 CORAM: HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

                                  Date : 29/01/2021

                                  ORAL JUDGMENT

1. At the joint request of the learned advocates for the respective parties the present appeal is taken up for final disposal at this stage.

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2.     Admit.          Ms.       Yogini       H.    Upadhyay,           learned

advocate for the respondents waives service of admission of appeal.

3.The appellant has filed present second appeal under Section 100 of the Civil Procedure Code challenging the judgment and decree dated 19.11.2018 passed by the learned Additional District Judge Chhota Udaipur in Regular Civil Appeal No.87 of 2017 confirming the judgment dated 10.2.2015 passed by the learned Principal Senior Civil Judge, Chota Udaipur at Sabarkantha in Regular Civil Suit No.109 of 2009.

4. Brief facts leading to the filing of the second appeal are as under :­

4.1 The appellant ­ original defendant (Bharat Petroleum Corporation Ltd.,). The defendant is an oil marketing company involved in the sale and distribution of high speed diesel motor spirit and oils, being a successor of Burmah Shell, The defendant entered into dealership agreement with the plaintiff on the running of fuel dispensing station. On 02.12.2009, a surprise check was carried at the plaintiff's dispensing station and it was noticed that the motor spirit

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(petrol dispensing unit) was found dispensing 130 mi less on two occasions and 150 mi less on the third occasion for every five liters of patrol dispensed. Thus, it was noticed that there was deliberate short delivery of fuel by the plaintiff. A report was prepared by the representative of the defendant duly signed by the representative of the plaintiff.

4.2 On 07.02.2009, without waiting for any initiation of proceedings, the plaintiff instituted the suit for declaration that the dispensation of sale of diesel pump was not in accordance with law and was in violation of the Weights and Measures Act and the guidelines framed thereunder and that the plaintiff had not tampered with the dispensing unit whereby short delivery could be effected and that the dispensation of delivery was not justified and untenable.

4.3 The respondent - original plaintiff prayed for the following reliefs in Regular Civil Suit No.109 of 2009 :­ "(1) To declare that the defendants are not entitled to take any action by virtue of the dealership agreement executed between the plaintiff and

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defendant as the officers of the defendant have inspected the place of the business of the plaintiff against the provisions and rules of the law and the said inspection was illegal.

 (2)                To    declare            the     order         of       the
 defendant          suspending              the    sale      of      diesel

pump of the plaintiff as illegal and void as the officers of the defendant have inspected the place of the business of the plaintiff against the provisions and rules of the law and the said inspection was illegal.

(3) To direct the defendants not to take any action under the said dealership agreement even for petrol unit without giving an opportunity of the hearing after informing the plaintiff about the result whatsoever comes in the analysis of the control card the defendant has taken for inspection from the petrol pump unit in question from the place of business of the plaintiff.

(4) To direct the defendants to provide supply of diesel and not to prevent the plaintiff selling diesel as no malpractice is found in diesel pump at the place of business of the plaintiff.

(5)                 Any other and further relief in




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 the interest of justice."

4.4 The suit was resisted by the appellant inter alia contending that the plaintiff had breached the agreement and there was a prima facie proof that the electronic card was tampered and that there was a short delivery as alleged. It was also contended by the defendant that a show cause notice was issued but in view of institution of the suit, nothing further could be done and no action was taken and suspension of supply was justified. The trial court decreed the suit and held that the action of the defendant in suspending the supply was unjustified and illegal and there was no proof that there was short delivery. The trial court passed the following decree in Civil Suit No. 109 of 2009 :­

"(i) Partly allowed the Regular Civil Suit No.109 of 2009 of the plaintiff.

(ii) The permanent injunction is granted directing the present appellants - original defendants that without following due process of law the plaintiff be not restrained from selling the diesel and petrol. It is further directed that the defendants are restrained from stopping

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supply of diesel and petrol without following due process of law and no action be taken pursuant to the dealership agreement.

(iii) The defendants have to bear the cost of suit of the plaintiffs and their own cost."

5. Being aggrieved by the aforesaid decree, the defendant preferred an appeal being Regular Civil Appeal No. 87 of 2017 before the District Court, Chhota Udaipur. The said appeal was also dismissed. The Appellate court passed the following decree in Civil Appeal No. 87 of 2017 :­

"(i) Appeal of the appellants is rejected and order of the trial Court is confirmed.

(ii) Decree to be drawn accordingly.

(iii) Parties have to bear their own costs.

(iv) Record and proceedings are sent back to the trial Court."

6. Heard Mr. Ajay R. Mehta, learned advocate for the appellants and Ms. Yogini H. Upadhyay, learned advocate for the respondents.

7.         From       the     facts       narrated         above           and       the





       C/SA/295/2019                                                 JUDGMENT

findings arrived at between the parties, it is established that on 02.12.2009, the representative of the appellant company had noticed that the plaintiff indulged into malpractice and was dispensing fuel less than what was shown to have been delivered. There was short delivery of supply. Authentic report was also prepared duly signed by the representatives of the plaintiff and the defendant.

8. The suit was thereafter instituted on 07.12.2009 by the present respondents. Except the issuance of notice, the defendant company could not hold any inquiry. The defendant company had no opportunity to hold any inquiry as required and the suit proceeded.

9. Several contentions have been raised by the appellants as well as respondents (original plaintiffs). It is not necessary to go into each of them. The trial Court could not have gone into the contents of the report as defendant Company was yet to hold inquiry but could not do so in view of the pending suit.

10. The trial Court as well as appellate Court

were not right in law in considering the veracity of the report and holding that the plaintiff has not committed any error. The

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inquiry is to be conducted by the Company after seeking explanation and giving opportunity to the plaintiff and take appropriate decision in accordance with law.

11. In view of above, the appellant defendant is right that the trial court could not have given any finding as regards prima facie conclusion arrived at from the report at Ex.38. The inquiry was yet to be held by the company. The findings of both the Courts below are required to be quashed to the aforesaid extent. It is obvious that the company was required to hold an inquiry before taking any action against the appellant. Suspension of supply of fuel was only a stopgap measure. This appeal is required to be partly allowed.

12. In view of the broad consensus arrived at between the learned advocates for the respective parties the decree passed by both the Courts below is modified to the following extent :­

13. The decree of both the courts below is modified to the extent that the appellant - defendant company can proceed with an inquiry in accordance with law pursuant to the report. Inquiry, if any, is directed to be

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completed within a period of six months from the date of initiation of inquiry. The appellant Company is restrained from terminating the dealership agreement dated 7.4.2001 without affording opportunity of hearing to the respondents and without following due process of law.

14. With the above observations the second appeal is partly allowed.

(VAIBHAVI D. NANAVATI,J) K.K. SAIYED