Madras High Court
The Executive Director (Tn&P) vs H.Thiagaraj on 11 August, 2021
O.S.A.(CAD) No.48 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 11.08.2021
CORAM :
THE HON'BLE MR.SANJIB BANERJEE, CHIEF JUSTICE
AND
THE HON'BLE MR.JUSTICE P.D.AUDIKESAVALU
O.S.A.(CAD) No.48 of 2021
The Executive Director (TN&P)
Indian Oil Corporation Limited,
Marketing Division, Southern Region,
Indian Oil Bhavan, 139, Mahathma Gandhi
Road, Nungambakkam High Road,
Chennai 600 034. ... Appellant
Vs
H.Thiagaraj
Managing Partner,
M/s.Shanthi Super Service,
Kothagiri 643 217. ... Respondent
Appeal filed against the Judgment and Decree dated 17.12.2020
passed in O.P.No.402 of 2016 on the file of original side of this Court.
For Appellant : Mr.Abdul Hameed
for M/s.AAV Partners
*****
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O.S.A.(CAD) No.48 of 2021
JUDGMENT
(Delivered by the Hon'ble Chief Justice)
The appeal is of limited scope and is confined to the award of a
sum of Rs.7.5 lakh, together with interest, on account of employees
engaged by the respondent in course of its dealership and the running
of an outlet for the appellant herein.
2. The grievance raised by the appellant is that despite the
arbitral tribunal negating the dealer's contention that the dealership
had been unlawfully terminated and disallowing a claim for damages
on such count that had been fashioned by the dealer, the tribunal
proceeded to consider a claim on account of 11 employees engaged at
the outlet. The appellant refers to paragraph 52 of the arbitral award
dated March 26, 2016. The tribunal refers to a letter dated September
4, 2008 which was marked as Ex.C-18 in course of the reference.
3. The claim on the basis of such document was that several
employees had been engaged by the dealer and the severance of the
employment of such persons entailed due compensation to be paid to
them.
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O.S.A.(CAD) No.48 of 2021
4. While it is, ordinarily, accepted that a dealership agreement
may not be specifically enforced by the dealer against the principal and
the termination thereof may not result in the dealership being revived,
the consequence of the termination is a different matter altogether. It
is possible that a dealership agreement is terminated midway through
the tenure, when a claim for damages may be maintained, despite a
claim for continuation of the dealership agreement for the remainder
of the tenure not being permissible.
5. In the present case, the termination of the dealership was
found to be in order. As a consequence, the claim for damages carried
by the dealer was repelled. However, despite the dealership
agreement coming to an end and the principal not being found to be at
fault, if the termination results in the loss of engagement or
employment and visits the immediate employer with certain
consequences, a claim on such count may be made by the dealer
against the principal. In effect, despite the entirety of the claim in
damages being disallowed, the matter has to be seen from the
perspective of a particular head of claim being allowed to the extent
that the arbitral tribunal found that it was a consequence of the
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O.S.A.(CAD) No.48 of 2021
termination of the dealership. The award on the relevant head
appears, thus, to be sufficiently justified.
6. The next limb of the appellant's objection pertains to the
quantification of the amount. Paragraph 52 of the award, quite
candidly, refers to a “rough and ready” estimate being made by the
tribunal in arriving at the figure. Not every claim, particularly in
damages, is capable of assessment to any degree of arithmetical
precision. In this case, 11 employees were found to have lost their
engagement upon the termination of the dealership. Considering the
nature of the activity that was involved, the tribunal found it
appropriate to award damages to the extent of Rs.7,50,000/- in
principal to the dealer for payment of compensation to the concerned
employees, together with interest thereon.
7. It is elementary that the arbitral tribunal is the best judge of
the quality and the quantity of the evidence before it on the basis of
which it allows a head of claim. The arbitral tribunal may not have
been satisfied with the material that was produced, but reckoned that
"rough and ready figure" would be appropriate for 11 employees.
Apart from the fact that the matter was within the exclusive domain of
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O.S.A.(CAD) No.48 of 2021
the arbitral tribunal and cannot be regarded as an error of jurisdiction,
the award of the quantum does not shock the conscience of the court
nor does it appear to be opposed to any public policy or patently
absurd.
8. The challenge on such count received the due attention of the
court of the first instance as the judgment and order impugned refers
to the Hodgkinson's principle and the acceptance thereof, inter alia, in
the judgment of Associate Builders, [(2015) 3 SCC 49].
9. For the reasons aforesaid, the judgment and order dated
December 17, 2020 passed under Section 34 of the Arbitration and
Conciliation Act, 1996 do not call for any interference and the arbitral
award dated March 26, 2016 is left undisturbed.
O.S.A. (CAD) No.48 of 2021 is dismissed. Consequently,
C.M.P.Nos.12281 and 12282 of 2021 are closed. There will be no
order as to costs.
(S.B., CJ.) (P.D.A., J.)
11.08.2021
Index : yes/no
sra
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O.S.A.(CAD) No.48 of 2021
THE HON'BLE CHIEF JUSTICE
AND
P.D.AUDIKESAVALU, J.
(sra)
O.S.A.(CAD) No.48 of 2021
11.08.2021
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