Madhya Pradesh High Court
M/S Shahpur Filling Station ... vs Bharat Petroleum Corporation ... on 23 June, 2023
Author: Vivek Agarwal
1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VIVEK AGARWAL
ON THE 23 rd OF JUNE, 2023
WRIT PETITION No. 20697 of 2013
BETWEEN:-
M/S SHAHPUR FILLING STATION SHAHPUR,
DISTRICT BURHANPUR THROUGH ITS
PROPRIETOR KASHINATH DAYARAM MAHAJAN
S/O DAYARAM MAHAJAN, AGED ABOUT 61
YEARS, R/O WARD NO.12, VILLAGE SHAHPUR,
DISTRICT BURHANPUR (MADHYA PRADESH)
.....PETITIONER
(BY SHRI MANIKANT SHARMA - ADVOCATE)
AND
1. BHARAT PETROLEUM CORPORATION LTD.,
BHARAT BHAVAN, 4 AND 6 CURRIMBHOY ROAD,
BALLARD ESTATE, P.B. NO.688, MUMBAI - 400 001
2. TERRITORY MANAGER [RETAIL], BHARAT
PETROLEUM CORPORATION LTD., INDORE
RETAIL TERRITORY, A.B. ROAD, MANGALIYA,
INDORE (MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI KAPIL JAIN - ADVOCATE)
T h is petition coming on for orders this day, t h e cou rt passed the
following:
ORDER
This writ petition is filed by the dealer of respondents No.1 and 2, who
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was authorized to dispense with products which are allowed to be marketed
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through respondents No.1 and 2. A dealership was awarded in favour of the
Date: 2023.06.27 19:37:47 IST
petitioner under the Ex-Servicemen quota. An inspection was carried out on
22.08.2012. Copy of inspection report of retail outlet is available on record as
Annexure P-1.
2. Petitioner's contention is that at the time of the inspection, petitioner was
not present. Six months earlier, petitioner had lost his young son, who was
looking after the affairs of the petitioner's petrol pump. It is also submitted that
in June, 2012, some inspection was carried out by the officials of the
respondents and in that inspection, some parts were found to be weird out for
which requisition was sent for replacement but before any replacement could
take place, second inspection was carried out and, thereafter, a show cause
notice was issued to the petitioner on 01.11.2012 (Annexure P-2).
3. Petitioner had filed its detailed reply on 10.11.2012 (Annexure P-3) and
thereafter, he had filed a writ petition bearing No.14852/2013 which came to be
decided vide order dated 20.09.2013. The coordinate Bench of this High Court
vide order dated 20.09.2013 held that the petition was premature and it was filed
only against the show cause notice. In the aforesaid background, the coordinate
Bench of this Court disposed of the petition with a direction to the authorities
of the respondents No.1 and 2 to decide the entire proceedings in which the
impugned show cause notice dated 01.11.2012 was given to the petitioner by
speaking order under intimation to the petitoner within 45 days from the date of
the order.
4. In pursuance to the said order of the High Court, authorities passed
order dated 02.11.2013 (Annexure P-7) whereby intimating termination of
Dispensing Pump and Selling Licence (DPSL) agreement dated 01.01.2004,
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which was issued in favour of the petitioner.
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5. Learned counsel for the petitioner submits that firstly there was no
tampering. Secondly, no consent of the authorities of the Weights and
Measures Department was obtained and thirdly, as per clause 5.1.4 of the
Marketing Discipline Guidelines dated 08th January, 2013, as contained in
Annexure P-10, the Additional/Unauthorized Fittings/Gears found in Dispensing
Units/Tampering with Dispensing Unit, was required to be sent to the original
equipment manufacturer for his independent opinion but said opinion was not
obtained and, therefore, the whole action of the respondents is vitiated.
6. Learned counsel for the petitioner further submits that under similar facts
and circumstances in case of M/s V.M. Modi & Sons, Sendhwa, dispensing
unit was removed, it was sent for inspection and, thereafter, action was taken.
These documents have been filed by the petitioner along with I.A. No.
9277/2023 filed on 23.06.2023.
7. Shri Kapil Jain, learned counsel for the respondents, in his turn, submits
that firstly the documents which have been filed by the petitioner on 23.06.2023
are privileged communication between the company and the dealer. It is
surprising that how petitioner could lay his hands to such communication.
8. It is further submitted that since no additional/unauthorized fittings/gears
found in dispensing units, therefore, there was no need to refer the matter for
independent opinion of the original equipment manufacturer. It is submitted that
present is the case of manipulation of the electronic chip. It is pointed out that
from the inspection report itself that in the remark column, third remark clearly
shows that ''Electronic tampering is noticed in HSD DU 4D063 delivering short
by 140 ml/130 ml, which can be activated on 4th cycle 3rd flash mode''. It is
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Date: 2023.06.27 19:37:47 IST 9. Shri Kapil Jain submits that the meaning of words ''activated on 4th cycle
rd
3 flash'' means that in the first go when dispensing unit was activated then it
delivered correct measurement of the product. Thereafter, on the second
operation also the delivery of the product was appropriate but in the third round
of operation, there was short delivery of 140 ml and this cycle was repeated as
can be seen from the inspection report which was carried out in presence of
petitioner Shri Kashinath Mahajan as well as his representative Shri Prakash
Mahajan. Thus, reading from the report and pointing out that there are
signatures of Shri Kashinath Mahajan, dealer and his representative Shri Prakash
Mahajan on the inspection report, the submission made by Shri Manikant
Sharma that inspection was carried out behind their back, is not made out.
10. It is further submitted that at this distance of time, no good purpose is
going to be served by either relegating the petitioner to the Civil Court or to the
arbitration, inasmuch as, after 2015 with the change in the Arbitration and
Conciliation Act, 1996, now even company cannot give consent for arbitration
in absence of any clause for arbitration in the Dispensing Pump and Selling
Licence (DPSL).
11. Shri Kapil Jain further submits that a detailed note has been enclosed
along with the impugned order dated 02.11.2013 (Annexure P-7), wherein
various clauses of DPSL have been quoted and how they have been violated by
the petitioner is demonstrated.
12. It is submitted that the petitioner is not entitled to operate the licence
for infinity in breach of terms and conditions of the DPSL. Once factum of
short delivery was discovered then there is no error in the action of the
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authorities in terminating the licence in terms of the DPSL.
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13. Reliance is placed on the judgment of the coordinate Bench of this
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Court in case of M/s Prasanna Kumar Kharya and another Vs. Bharat
Petroleum Corporation Ltd. and another (W.P. No.17763/2016, decided on
01.05.2020), order of Hon'ble Division Bench of this Court in case of M/s
Prasanna Kumar Kharya and another Vs. Bharat Petroleum
Corporation Ltd. and another (Writ Appeal No.565/2020, decided on
24.06.2020) and decision of another coordinate Bench of this Court in case of
M/s Verma Service Station Vs. Bharat Petroleum Corporation Ltd. and
another (Writ Petition No.11261/2014, decided on 12.12.2017).
14. Reliance is also placed on the judgment of the Hon'ble Supreme Court
in case of A.S. Motors Private Limited Vs. Union of India and others,
(2013) 10 SCC 114, wherein placing reliance on para 20, it is submitted that
the Hon'ble Supreme Court in contractual matters has held as under:-
''20. There is, in our opinion, no error of law, nor is there
any perversity in the appreciation of the material available
before the respondents. The report submitted by the agency
employed by the respondent Authority was damning for the
appellant and clearly showed that the appellant was indulging
in malpractices like charging excess fee from the owners/drivers
of the vehicles using the stretch of road covered by the contract.
Nothing in particular has been pointed out to us to persuade us
to take a contrary view. If the report submitted by the agency
against whom the appellant has no allegation of malice or other
extraneous considerations to make are accepted, we see no
reason why the same could not furnish a safe basis for the
respondent to take action especially when the appellant was
abusing its position as a contractor, putting the public at large to
unnecessary harassment and exaction of money not legally
recoverable from them. The material collected could and was
rightly made a basis for the termination of contract by the
competent authority.''
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15. Shri Kapil Jain also submits that petitioner has since not filed copy of
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DPSL which was mandatory, inasmuch as, in case a Government employee is
terminated then he is first required to show the order of appointment then on the
same analogy, petitioner was required to produce copy of his licence and
DPSL, an argument which deserves to be rejected at the outset because that
argument is devoid of merit and appears to have been made to add gravity to
the matter, whereas it has failed to make any impact, inasmuch as, once
respondents admitted that the petitioner was their licencee, they entered the
premises in terms of the provisions contained in DPSL and, thereafter,
conducted inspection, found certain shortcomings, sealed the licensed premises
and, thereafter, took action in terms of the DPSL then there was no need for the
petitioner to have demonstrated his licence or the DPSL agreement separately.
Thus, this last limb of argument put forth by Shri Kapil Jain is hereby rejected.
16. After hearing learned counsel for the parties and going through the
record, few things need to be put in a straitjacket manner. One, that the
inspection was carried out as contained in the report (Annexure P-1) on
22.08.2012. This inspection report clearly bears signatures of not only the
inspecting officers but also that of the proprietor of the petitioner firm Shri
Kashinath Mahajan and that of his official representative Shri Prakash Mahajan.
Thus, alibi of being a senior citizen is not available to the petitioner. Nor the fact
that he lost his son would generate any sympathy because in such matters where
essential commodities are dispensed with for the benefit of the public at large,
such sympathy will be not only misplaced but will also displace the true facts
which are required to be examined in terms of the conditions stipulated in the
contract.
17. Thirdly, petitioner's submission that as per the Marketing Discipline
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Guidelines, there was violation of the guidelines. It is carefully noted though not
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Date: 2023.06.27 19:37:47 IST
argued by any of the parties that the guidelines which have been produced by
the petitioner as Annexure P-10 along with the rejoinder are effective from 8 th
January, 2013. Inspection was admittedly carried out on 12.08.2012, therefore,
he was required to produce set of those guidelines which were in operation and
holding the field on the date of the inspection and subsequent guidelines cannot
be applied to. Therefore, a submission that once the Weights and Measures
Department's seals were intact then in terms of clause 5.1.4, matter was required
to be referred to the original equipment manufacturer for independent opinion,
is not made out, firstly because said guidelines are not applicable to the case of
the petitioner as they are subsequent to the date of the inspection and secondly,
petitioner has failed to make out a case that there was any unauthorized fitting.
Case of the respondents is that the electronic chip was being remotely
manipulated so to deliver the petroleum product in short to the extent of 140
ml/130 ml per five liters.
18. A careful of perusal of Annexure P-7, which is the impugned order
reveals that the relevant clauses of DPSL which have been reproduced in the
order, may be reproduced herein for the purpose of clarity and to avoid any
ambiguity. Therefore, relevant clauses of DPSL are reproduced hereunder:-
''1. The Company expressly reserves itself the right to take back
the whole or any part of the outfit or alter the same at any time
during the continuance of this licence at its sole discretion.
4. The said premises and the said facilities shall at all times
during the continuance of this License remain the absolute
property and in sole possession of the Company and no part of
the said facilities shall be removed by the Licensees nor shall the
position of any constituent part thereof or of the said premises be
changed or altered without the previous written consent of the
Company.
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5. The premises and said facilities hereby licensed to the
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Licensees shall only be used for stocking and selling / dispensing
the Petroleum product of the Company and shall not be used for
any other purpose except as may be permitted in writing by the
Company.
7(a) The licensees shall be responsible to see that full and
proper measure is delivered from the pumps installed by the
company on the said premises and shall have no recourse
against the company for any loss, damages, cost, charge or
expenses which the Licensees may at any time suffer by reason of
the pumps delivering wrong measure or by reason of the Motor
Spirit or HSD becoming contaminated in any way. If at any time
the pumps shall be delivering wrong measure or shall develop
any other defect the Licensees shall forthwith report such defect
in writing to the Company and subject to sub-clause (b)
hereunder shall not operate the defective pump or pumps further
until the defect shall have been remedied.
7(b) If and so long the pump is delivering per liter measure a
quantity which is within the tolerance limits of excess or
deficiency hereinafter mentioned the pump shall not by reason
merely of the fact that it is delivering per liter measure an
amount in excess or deficient of one liter be deemed to be not in
good repair or to be delivering wrong measure and the Licensees
or to be delivering wrong measures and the Licensees shall not
by reason merely of such fact have any claim against the
Company or be liable to report such fact to the Company or to
cease operating the pump. The tolerances hereinbefore referred
to are those permissible under the law relating to weights and
measures for the time being in force in the locality where the
pump is situated.
7(c) The licensees shall in their own interest and as often as
may be required by the Company check the accuracy of the
pump and shall also provide facilities for the Company's staff for
doing so whenever required.
9. Neither the licensees nor the licensee's servants or agents
shall interfere in any way with the working parts of the pumps or
other equipment provided by the Company.
10. The Licensees hereby covenant and agree with Company
as follows:
(i) To be responsible for all Motor Spirit or H.S.D. or
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other Petroleum products delivered by the Company to the
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Licensees from the time of the delivery thereof into the
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storage tanks of the pumps upon the said premises or
otherwise and to pay for all supplies ordered by them prior
to the delivery thereof unless otherwise agreed;
(j) Not to do or permit to be done on the said premises
any act or thing which may (i) endanger the grant or
continuance of the Government License under the authority
of which Motor Spirit or H.S.D. may be stored, or sold,
upon the said premises, or (ii) be contrary to the terms and
conditions on which the said premises are held by the
Company.
(k) To abide by the Petroleum Act, 1934 and the Rules
framed thereunder for the time being in force as also any
other laws, rules or regulations either of the Government or
of any local body as may be in force.
(l) Not to sell the petroleum products supplied by the
company at prices exceeding the prices fixed by the
company from time to time. Nothing herein contained shall
prevent the licensees from selling the petroleum products at
prices lower than the prices fixed by the company, but any
reduction made by the licensees shall be to their own
account and shall not be recoverable from the company.
11. The Company hereby covenants and agrees with the
Licensees as follows:
(c) Provided the licensees faithfully observe and perform
all stipulations in the agreement required of them hereunder
the company will do its best at all the times to supply the
licensee with their requirement of the Motor Spirit or HSD
and other petroleum products. The Company, however,
shall be under no liability if prevented from supplying
Motor Spirit or HSD or any other petroleum products by
any cause beyond its control or for stoppage of supplies
under the terms thereof.
13(a). Notwithstanding anything to the contrary herein
contained the Company shall be at liberty to terminate this
agreement forthwith upon or at any time on the happening of
any of the event following:
(vii) If the licensees shall be guilty of a breach of any of
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the covenants and stipulations on their part contained in
this agreement. (viii) If the licensees shall commit or suffer
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Date: 2023.06.27 19:37:47 IST to be committed any act which in the opinion of the
Marketing Director of the Company for the time being in
Bombay or any other person nominated for this purpose by
the Company is prejudicial to the interest or good name of
the company or its products. The decision of such officer or
person shall be final and binding on the licensees. (d)
That if the licensees commit breach of any covenant and/or
stipulation in this licence, the company shall not be bound
to observe and perform its obligations hereunder.
20. All notices required to be served by either party hereto
upon the other shall be deemed properly served if delivered in the
case of the Company, at its office aforesaid or sent by registered
post to its said office, and in the case of the licensees, if sent by
post or delivered by hand at his place of business hereinabove
mentioned. All notices required to be given by the licensees shall
be deemed to have been sufficiently given if signed in case the
licensee is a firm by any partner thereof, where the licensee is a
company by any director, Secretary or other Principal Officer
thereof and where the Licensees is a Co-operative Society or
Trust by any officer bearer of the Executive, Managing or
Governing Committee thereof.''
19. When these clauses are examined then it is evident from clause 7(a)
that the licensee i.e. the petitioner was under obligation to see that full and
proper measure is delivered from the pumps installed by the company on the
said premises and shall have no recourse against the company for any loss,
damages, cost, charge or expenses, which the licensees may at any time suffer
by reason of the pumps delivering wrong measure or by reason of a Motor
Spirit or HSD becoming contaminated in any way.
20. It is further mentioned in the aforesaid clause that if at any time the
pumps shall be delivering wrong measure or shall develop any other defect the
Licensees shall forthwith report such defect in writing to the company and
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subject to sub-clause (b) hereunder shall not operate the defective pump or
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pumps further until the defect shall have been remedied. In the present case, no
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such defect was admittedly brought to the notice of the respondents.
21. Therefore, when there was violation of the contractual liability and the
petitioner could not demonstrate that how earlier inspection will give them a
sense of immunity from further tampering because licensees were obliged to
maintain the sanctity of measurement throughout and merely the previous
inspection was carried out in June, 2012, is not sufficient circumstance to
extend immunity to the petitioner to treat that the functioning of the petrol pump
which was found to be proper at the time of earlier inspection will deemed to be
continued even at the time of second inspection and when there is no material
on record to dispute the inspection report (Annexure P-1), the action of the
respondents cannot be faulted with especially in the light of the law laid down
by the Hon'ble Supreme Court in case of A.S. Motors Private Ltd. (supra).
22. As far as case of other retail outlets is concerned, facts of their case
are not before this court and merely filing certain documents at the nick of the
time and expecting the Court to take cognizance of them when they are actually
not brought before the Court and have been filed today itself, no cognizance of
such documents can be taken especially when Shri Kapil Jain submits that it is a
privileged communication between the company and the said dealer and the
petitioner cannot take advantage or shelter of said documents because neither
they lay down any ratio of law nor can be treated as a precedent. Thus, petition
deserves to fail and is hereby dismissed.
23. Parties to bear their own cost.
24. Interim order, if any, shall stand vacated.
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(VIVEK AGARWAL)
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Date: 2023.06.27 19:37:47 IST JUDGE
pp
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Digitally signed by PUSHPENDRA PATEL
Date: 2023.06.27 19:37:47 IST
