Madras High Court
M/S.K.T.S.Nagamanickam ... vs The Indian Oil Corporation Ltd on 27 June, 2022
W.P.No.29930 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 27.06.2022
CORAM:
THE HONOURABLE MR.JUSTICE R.SUBRAMANIAN
W.P.No.29930 of 2019
and
W.M.P.No.29842 of 2019
M/s.K.T.S.Nagamanickam Chettiar,
Indian Oil Dealer,
Rep. By its working Partner,
Mr.N.Sudhakaran,
No.209, (Old No.345), Attur Main Road,
Namagiripettai – 637 406.
Namakkal District. ..Petitioner
Vs.
1.The Indian Oil Corporation Ltd.,
Rep. By its Chief Divisional Retail Sales Manager,
Indian Oil Corporation Ltd., Marketing Division,
Salem Divisional Office,
No.234, 1st Floor, NH-7,
Salem - Bangalore Bypas Road,
Kondalampatty, Salem – 636 010.
2.G.Amudhavalli ..Respondents
Prayer: Writ Pet ition filed under Article 226 of the Constitution of India
seeking issuance of Writ of Mandamus, forbearing the 1st respondent and
their subordinates from in any manner disturbing or stopping supply of
petroleum products or interfering the business carrying by the petitioner in
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W.P.No.29930 of 2019
the name of M/s.K.T.S.Nagamanickam Chettiar, Petroleum Oil Dealer,
situated at No.209 (New No.345), Attur Main Road, Namagiripettai,
Namakkal – 637406 in pursuant to the letter of the 1st respondent dated
01.10.2019.
For Petitioner : Mr.M.R.Jothimanian
For Respondents : Mr.R.Ravi for R1
Mr.M.Deivanandam for R2
ORDER
The petitioner prays for a Writ of Mandamus, forbearing the 1st
respondent from disturbing, stopping supply of petroleum products or
interfering with the business carried on by the petitioner in the name of
M/s.K.T.S.Nagamanickam Chettiar, Petroleum Oil Dealer situated at
No.209, Attur Main Road, Namagiripettai, Namakkal pursuant to the letter
of the 1st respondent dated 01.10.2019 wherein, the 1st respondent had
forwarded a letter received by it from the 2nd respondent seeking an
explanation from the petitioner.
2.The facts that led to filing of the Writ Petition are as follows:-
One Mr.K.T.S.Nagamanickam Chettiar was appointed as dealer by
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W.P.No.29930 of 2019
the 1st respondent / Oil Corporation in the year 1970 to carry on business in
retail outlet of petroleum products at Namagiripettai in Salem District (Now
Namakkal District). The said Nagamanickam Chettiar died in 1982. In a
partition suit between the family members, the business in petroleum
products was allotted to two of his sons namely, one Sudhakaran and
Viswanathan. They were running the business in partnership till
Viswanathan died in the year 2002.
2.1.After the death of Viswanathan, his only daughter, the 2nd
respondent herein was inducted as a partner on 01.04.2004. Pursuant to
such induction, a dealership agreement was also entered into between the
newly constituted partnership firm and the Indian Oil Corporation on
11.12.2006. On 04.02.2019, a memorandum of understanding was entered
into between the partners and one S.Srinath, son of Sudhakaran, one of the
partners, in and by which, the 2nd respondent agreed to retire from the
business on receipt of certain compensation and the said Srinath was to be
inducted as a partner in the business. Consequent upon this, on 04.02.2019,
the 2nd respondent wrote to the Senior Divisional Manager, Indian Oil
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W.P.No.29930 of 2019
Corporation, expressing her no objection for reconstitution of the
partnership in the Petrol Bunk business.
2.2.On 07.02.2019, an application for reconstitution was also
made wherein, the petitioner, one of the partners, Sudhakaran and the 2nd
respondent had signed. An application for reconstitution of the dealership
signed by all the parties was also submitted to the Corporation on
06.02.2019. An undertaking, confirming the details furnished in the
application was also submitted on 06.02.2019. The Indian Oil Corporation
however, without acting upon the said application and the undertaking,
required the partners to appear in person to affirm the said undertaking.
2.3.It is at that time, the 2nd respondent went back on the
undertaking given by her and raised a dispute. Therefore, the reconstitution
was not carried out. Thereafter, the 2nd respondent wrote a letter to the
Indian Oil Corporation, requesting the Oil Corporation to stop supply of
petrol and diesel to the Petrol Bunk. She had also gone on to state that she
is cancelling the licence for her 50% share. This letter was forwarded to the
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W.P.No.29930 of 2019
petitioner requiring the petitioner's explanation. There upon, the petitioner
has come up with this Writ Petition.
3.The 2nd respondent has filed a counter wherein, she had claimed
that her share in the profits was not paid for over a period and therefore,
though she had given her consent, she has now withdrawn the same. The
Oil Company has filed a memo stating that it does not intend stopping
supply. The written instructions received by the counsel is also placed
before this Court wherein, it is stated that the reconstitution could not be put
in place because of the objections made by one of the partners, who had
earlier consented to the reconstituion.
4.The law on the subject of reconstitution of licencees of Oil
Companies is no longer res-integra. It is governed by the judgment of the
Hon'ble Supreme Court in Bharat Petroleum Corporation Limited Vs.
B.M.Motors and Others reported in (2014) 16 SCC 749 wherein, the
Hon'ble Supreme Court has held that the agreement between the parties to
retire is to be treated as no objection, as far as reconstitution is concerned.
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W.P.No.29930 of 2019
The Hon'ble Supreme Court has also pointed out that the partners cannot go
back on it and raise a dispute regarding the no objection subsequently. The
practice of the Oil Companies in calling upon the parties to appear in person
before them to affirm such no objection has created this kind of anamolous
situation, where one of the partners after having consented for reconstitution
goes back on it and attempts to hold the other person at ransom.
5.It is also stated that the reconstitution application is presented
physically in the presence of all partners to the Official concerned.
Therefore, I do not see any justification in the action of the Oil Company in
requiring the parties to affirm the reconstitution once again three months
after submission of an application for reconstitution. This practice by itself
gives scope for parties to derail the process by withdrawing the consent
already given.
6.As pointed out by the Hon'ble Supreme Court, by entering into
an agreement for reconstitution, the 2nd respondent has virtually retired from
the partnership firm and she had agreed to take a quantified sum of money.
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W.P.No.29930 of 2019
If she is to dispute the same, her remedy is elsewhere and not by objecting
to the reconstitution. It is well open to the 2nd respondent to make her claim
before the appropriate Civil Court for whatever she is entitled to. She
cannot derail the reconstitution process after having agreed to the same.
7.I am therefore, of the opinion that the Writ Petition deserves to
be allowed and the same is allowed. There will be a direction to the Oil
Corporation not to stop supply and proceed with the reconstituion based on
the no objection given by the 2nd respondent earlier in point of time. The
rights of the 2nd respondent to claim a share in the profits or whatever are
preserved. It is open to her to approach a Civil Court seeking such share.
8.This Writ Petition is allowed with the above observations. No
costs. Consequently, connected miscellaneous petition is closed.
27.06.2022
kkn
Index:No
Internet:Yes
Speaking
https://www.mhc.tn.gov.in/judis
W.P.No.29930 of 2019
R.SUBRAMANIAN, J.
KKN
To:-
1.The Chief Divisional Retail Sales Manager,
Indian Oil Corporation Ltd., Marketing Division,
Salem Divisional Office,
No.234, 1st Floor, NH-7,
Salem - Bangalore Bypas Road,
Kondalampatty, Salem – 636 010.
W.P.No.29930 of 2019
and
W.M.P.No.29842 of 2019
27.06.2022
https://www.mhc.tn.gov.in/judis
