Madras High Court

R.Arun vs The Territory Manager (Retail) on 18 February, 2025

Author: D.Bharatha Chakravarthy

Bench: D.Bharatha Chakravarthy

    2025:MHC:499




                                                                                 W.P.No.28198 of 2024

                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                               DATED: 18.02.2025

                                                     CORAM :

                        THE HON'BLE MR.JUSTICE D.BHARATHA CHAKRAVARTHY


                                               W.P.No.28198 of 2024
                                            and W.M.P.No.30741 of 2024

                 R.Arun                                                          ..      Petitioner
                                                         Vs.

                 1.The Territory Manager (Retail)
                 Bharat Petroleum Corporation Limited
                 Trichy Retail Territory, 1st Floor, Raj Towers
                 Near Kalaignar Arivalayam
                 Karur Bye Pass Road
                 Tiruchirappalli – 620 002.

                 2.M.Muthazhagi
                 3.M.Cibi Mathialagan
                 4.Chandra
                 5.M.Dhivyaa
                 6.M.Paary                                                  ..        Respondents

                 Prayer: Writ Petition filed under Article 226 of the Constitution of India
                 seeking a Writ of Certiorarified Mandamus, to call for the records of the Order
                 Ref.No.TRT. Aruna Enterprises.Speaking Order dated 11.09.2024 passed by the
                 1st respondent to allow the petitioner to continue to operate the existing petrol


                 Page 1 of 18


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                                                                                   W.P.No.28198 of 2024

                 pump at Trichy – Chennai Main Road, Padalur, Perambalur District, Tamilnadu
                 – 621 109 as the dealer until the 1st respondent ascertains and assesses the
                 readiness and suitability of the legal heirs of the erstwhile partner, Mr.(Late)
                 S.Mathialagan, to join the existing business as active partners with the petitioner
                 and execute a reconstituted/fresh partnership agreement in the prescribed format
                 and to pass such further order.


                                  For the Petitioner       : Mr.V.B.R.Menon

                                  For the Respondents      : Mr.Rajkumar Jabakh for R1
                                                             Mr.R.Jagadeesan for RR2 & 3
                                                             Ms.Kavitha Renjini.C.P
                                                             for RR4 to 6


                                                        ORDER

This Writ Petition challenges the order of the 1st respondent dated

11.09.2024, seeking to quash the order and to consequently direct the

respondents to allow the petitioner to continue operating the existing petrol

bunk on Trichy – Chennai Main Road, Padalur, Perambalur District, Tamilnadu

– 621 109 as the dealer. This is until the 1st respondent ascertains and assesses

the readiness and suitability of the legal heirs of the late Mr. Mathialagan, the

erstwhile partner, to join the existing business as active partners in the petitioner

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and execute a fresh partnership agreement in the prescribed format.

2. The petitioner asserts that the partnership firm M/s Aruna Enterprises

was appointed as a dealer for the outlet by following due process, effective from

1982. It was reconstituted in 2018, with the petitioner becoming a partner

alongside S. Mathialagan. The petitioner held a 49% share, while Mathialagan

held 51%. There was no dispute until the demise of partner Mathialagan on

09.10.2023. Following this, the petitioner was appointed as an interim dealer on

21.10.2023. A communication dated 23.01.2024 confirmed the execution of the

interim dealership agreement. An enquiry was then conducted on 05.04.2024,

during which it was recorded that the former partner had died and the petitioner

was requested to provide the reconstitution of the partnership agreement.

Furthermore, on 11.04.2024, the petitioner submitted a letter requesting an

extension of the temporary dealership. An Arbitration OP in O.P.No.46 of 2024

was also filed for the appointment of an arbitrator regarding the disputes as per

the partnership agreement.

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3. At that time, on 11.09.2024, the 1st respondent – Corporation, by the

impugned order, decided that the interim dealership is extended only until

15.10.2024, as a final chance, and no further extension will be granted to the

petitioner. The petitioner was also given the option to apply under the holiday

scheme to operate the petrol bunk until the competent authority resolves the

partnership issue. The petitioner challenges the said order.

4. The respondents resist the Writ Petition by filing individual counter-

affidavits.

5. Heard, Mr. V.B.R. Menon, the learned counsel for the petitioner; Mr.

Rajkumar Jabakh, the learned counsel for the fir respondent; Mr. R. st

Jagadeesan, the learned counsel for respondents 2 and 3; and Ms. Kavitha

Renjini, the learned counsel for respondents 4 to 6.

6. The learned counsel representing the petitioner submits that in the

name of the holiday scheme or on an ad hoc basis, the petitioner, as the

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surviving partner with 49% of the shares in the business, cannot be unjustly

removed from the business without any fault of his own. The other partner,

Mathialagan, has passed away. Mathialagan was married twice, leading to

disputes among the legal heirs. One set of legal heirs initially granted him no

objection to operate the petrol bunk. However, they have not come forward to

execute the re-constitution agreement. In this scenario, the 1st respondent should

have adhered to their own rules, considering that the legal heirs of the deceased

partner are neither coming forward nor showing interest. Without addressing

this, the impugned order was issued, which contradicts the scheme. The learned

counsel highlights the policy guidelines governing this matter, directing

attention to the heading “Process of Re-Constitution of Commissioned

Dealership’ and would rely upon the various guidelines which are thereunder.

7. Therefore, he submits that the entire exercise of power is erroneous in

law and that appropriate directions should be given to continue the dealership.

He states that during the course of the hearing, when the matter was at the

partially heard stage, the 1st respondent suddenly attempted to dispossess him on

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15.02.2025. However, the petitioner resisted this attempt and sent an email,

which was also replied to.

8. Mr. Rajkumar Jabakh, the learned counsel representing the Bharat

Petroleum Corporation, would submit that, as rightly pointed out by the learned

counsel for the petitioner, if the partnership firm is the dealer and one of the

partners dies, the Corporation is bound by the policy guidelines. First, regarding

the deceased partner, either a succession certificate or a legal heirship certificate

must be obtained. In this case, that process has not been initiated by the legal

heirs of the deceased partner. In this scenario, no further action can be taken,

which is why the respondent – Corporation rightly offered the petitioner the

holiday scheme, under which a third-party ad hoc dealer will be appointed. Once

the civil dispute among the legal heirs is resolved, the reconstitution can take

place, and thereafter, when they re-approach the Corporation, the Corporation

will terminate the ad-hoc dealership and grant them the regular dealership,

provided that the reconstitution agreement is completed according to the rules.

9. As a matter of fact, after the impugned order was passed, since no

further interim order was issued in this Writ Petition, the dealership came to an

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end on 15.10.2024. Subsequently, no supplies were made. The last extension of

the dealership was also upto 15.10.2024. After that, they conducted an interview

for an ad hoc dealership on 05.02.2025, and the ad hoc dealer was appointed on

12.02.2025. Therefore, according to the learned counsel, the ad hoc dealer is

already in place, and thus, the relief requested as of today cannot be granted.

The petitioner must await the final result of the disputes between the legal heirs

of the deceased partner before the appropriate Civil Court, after which the 1st

respondent will consider the petitioner's case.

10. The learned counsel appearing on behalf of the 2nd and 3rd respondents

submits that the 2nd respondent is the legally wedded wife of Mathialagan. The

3rd respondent is Mathialagan's only son. A suit for partition has already been

filed in O.S. No. 24 of 2013, and a legal heirship suit was also filed in O.S. No.

6 of 2014. Both matters were addressed together and disposed of by a common

judgment from the District Court, Perambalur. By a decree dated 23.04.2018, it

was declared that the 2nd respondent, Muthazhagi, is the legally wedded wife,

and the 3rd respondent, being a legitimate son, was entitled to half share in all

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coparcenary properties. At the time of this decision, Mathialagan was still alive.

After Mathialagan's death, the question of legal heirship remains undecided.

Therefore, if the respondents—Muthazhagi and Cibi Mathialagan—are

recognized as the only legal heirs, they are willing to join as partners, execute a

reconstitution of the partnership agreement, and run the business. Otherwise, as

the matter is pending in the First Appeal, further proceedings should await the

judgment in the First Appeal.

11. As rightly pointed out by the learned counsel for the 1st respondent

Corporation, if the other legal heirs or the petitioner do not accept the above

proposal, the holiday scheme can be resorted to by allowing third parties to run

the bunk. Only after the decision of the Civil Court can the partnership firm be

reconstituted as per the decision of the Civil Court.

12. The learned counsel representing respondents 4 to 6 submits that the

subject matter of the appeal suit pertains solely to the validity of the marriage

between Chandra and Mathialagan and whether it should be considered the first

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marriage, or if the marriage between Muthzhagi and Mathialagan is the first

marriage. Regarding the children, Dhivya and Paari, they will be the legal heirs

in any event. The matter does not involve any coparcenary property but relates

to the partnership business; therefore, it is clear that the sole dispute is whether

Chandra or Muthazhagi is the legally wedded wife. As for Cibi, Dhivya, and

Paary, they are undoubtedly the legal heirs. She further notes that in the appeal

suit, only the passing of the final decree is stayed.

13. I have considered the rival submissions made and examined the

material records of the case.

14. There is no dispute that the petitioner – R.Arun and Mathialagan were

the partners in M/s Aruna Enterprises and they were given the regular dealership

by the 1st respondent. There is no dispute that the said Mathialagan died on

09.10.2023. The said Mathialagan had two families. The 3rd respondent –

Muthazhagi was married to the said Mathialagan and through her, one son viz.,

Cibi Mathialagan was born. The 4th respondent – Chandra was also married to

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the said Mathialagan and through her two children viz., M.Dhivyaa and M.Paari,

the 5th and 6th respondents were born. Even during the lifetime of Mathialagan,

disputes arose between the parties and two suits were filed. After taking up the

partition suit and the maintenance suit together, the CivilCourt specifically

framed the issues concerning the fact that who is the legally wedded wife of

Mathialagan. The Civil Court after appreciating the oral and documentary

evidence on record held that Mathialagan initially married Muthazhagi and

through the said lawful wedlock, Cibi Mathialagan was born. Therefore,

Chandra was refused to be given the status of the wife of Mathialagan, because,

it was held that the marriage with Chandra was second marriage and therefore,

she cannot claim the legal status of the wife of Mathialagan.

15. After holding so, since the properties listed in the partition suit were

coparcenary, the Court granted half a share to the 3rd respondent – Cibi

Mathialagan, while the other half share was held to belong to Mathialagan

because he was alive on the date of the said suit. Even before this Court, the

relationship is not denied. The dispute is whether Mathialagan initially married

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Chandra or Muthazhagi. Furthermore, it is not disputed that Dhivyaa and Paary

were also born to Mathialagan. When the Civil Court had thus decided the issue

between the parties, the contention of the 1st respondent that the issue of legal

heirship will have to be recorded by filing a legal heirship certificate or by

obtaining a succession certificate cannot be upheld. While it may be correct that

the rules framed by the 1st respondent state this, at a higher level, when the Civil

Court itself has addressed the issue and declared that Muthazhagi is the wife of

Mathialagan, and that Cibi Mathialagan is born to Muthazhagi, it is noted that

Chandra, although married to Mathialagan, was not his legally wedded wife, and

that Dhivyaa and Paary were born to her, the issue has thus been decided by the

Civil Court itself, and the 1st respondent can certainly act according to the Civil

Court decree.

16. As rightly contended by the learned counsel for respondents 4 to 6, it

can be observed that in the appeal suit, only issue regarding the marriage of

Chandra and whether it constitutes the first marriage of Mathialagan needs to be

decided. In any event, as of now, there is no stay on the decree granted by the

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Civil Court; only the final decree proceedings are stayed. Given this situation,

the 1st respondent need not further insist on obtaining any succession certificate

or legal heirship certificate between the parties. It suffices to mention that

Muthazhagi, Cibi Mathialagan, Dhivyaa, and Paary are the legal heirs as of

today. Secondly, if that situation is considered, the policy guidelines for the

reconstitution of the retail outlet read as follows:-

“7. In cases where Nominee(s) / Legal Heir(s) not responding: In cases where one or more of the Nominee(s) / Legal heir(s) of deceased proprietor / partner(s) have not given their consent within specified period of 30 days, another time period of 30 days (as reminder) shall be given to the nominee(s)/legal heir(s) for expressing their willingness to join the dealership failing which, it will be treated that they {non responding nominee(s)/legal heir(s) of deceased proprietor/partner(s)} are unwilling to be inducted in the Dealership and the OMC can approve reconstitution of the Dealership with the willing nominee(s)/legal heir(s). However, the surviving / incoming proprietor/partner(s) of the reconstituted Dealership will have to indemnify the OMC against (Annexure-12) any claims or demands which may be made in future.

8. In cases where there is dispute in share out: In case of dispute on share out between legal heir(s) of deceased proprietor / partner(s), the share of the deceased proprietor/partner(s) will be equally divided between all the willing incoming legal heirs.

However, in this case the willing legal heirs proposed to be inducted in the dealership will have to indemnify the OMC against any claims or demands, which may be made in future.

9. In cases where there is no NOCs from Nominee(s) / Legal Heir(s) who are not eligible to become Dealer: In case of death, where one or more Nominee(s) / Legal heir(s) are not willing to give relinquishment or NOC in favour of

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incoming/surviving Proprietor/Partner (s) despite the fact that these Nominee(s) / Legal heir(s) may not be eligible to become dealer as per Disqualification norm of Dealer Selection guidelines, in such cases obtaining NOC/Relinquishment from such Nominee(s)/Legal heir(s) will not be mandatory. However, the onus would be on the surviving/incoming Proprietor/Partner

(s) of the dealership to provide conclusive documentary evidence with regard to disqualification of such Nominee(s)/Legal heir(s) and OMC would also independently verify the authenticity of the same. In such cases, OMCs may issue a communication to the concerned Nominee(s) / Legal heir(s) to submit documentary proof with regard to their eligibility within 30 days from the date of the letter. In case no response is received, the OMC can approve reconstitution of the dealership excluding such Nominee(s) / Legal heir(s). However, the surviving/incoming Proprietor/Partner (s) of the dealership will have to indemnify the OMC against (Annexure-J2) any claims or demands which may be made in future.”

17. A review of Clause 7 reveals that the procedure regarding situations

where one or more legal heirs of the deceased partner are unresponsive is

detailed. As of today, among the legal heirs recognized by the Civil Court,

respondents 5 and 6 have expressed their willingness to become partners before

this Court. Regarding respondents 2 and 3, although they claim to be willing,

their willingness is conditioned on they being exclusively recognised as the

legal heirs of Mathialagan. But there is no legal justification of excluding

respondents 5 and 6. They are also legal heirs. The judgment of the Civil Court

is binding between the parties. It is not the case of the respondents three and

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four that respondents 5 and 6 are not the children of deceased Mathialagan.

18. In view thereof, it would also be open for respondents 2 and 3 to

express their willingness and join the petitioner, along with respondents 5 and 6,

in executing the reconstituted partnership agreement. If they are willing, they

must send communication in writing within 10 days of receipt of the web copy

of this order, without waiting for the certified copy. In that case, all five shall

come together to execute a reconstitution agreement and then approach the 1st

respondent. If respondents 2 and 3 are not willing, the petitioner may

reconstitute the partnership firm with respondents 5 and 6. Of course, this

arrangement will be subject to the ultimate result of the First Appeal that is

currently pending.

19. However, it is stated that from the year 2023, only temporary

extensions were given to the petitioner. The last extension expired on

15.10.2024. Subsequently, the first respondent proceeded to conduct an

interview to select an ad hoc dealer on 05.02.2025, and it is stated that they

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appointed an ad hoc dealer on 12.02.2025.

20. In this regard, it is clear that the present matter was heard in detail by

this Court on 12.02.2025. At the part heard stage, the matter was adjourned

solely for the learned counsel for respondents 2 and 3 to produce a copy of the

Judgment, as only the decree copy had been presented earlier.

21. Therefore, when the matter is part-heard, propriety demands that the

1st respondent could have awaited the issuance of the letter of appointment as an

ad hoc dealer on the very same day, i.e., 12.02.2025. In any event, from the

emails exchanged by the parties, it is apparent that the third party has not come

into the picture or started operating the outlet. Moreover, it is only the ad hoc

dealership until the issue is resolved. Therefore, this Writ Petition is disposed of

with the following directions:-

(i) Within 10 days of receiving the web copy of the order, respondents 2

and 3 may express their willingness to join the partnership firm by sending a

written letter to the petitioner. If they are willing, then within 10 days of

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receiving their indication of willingness, the petitioner and respondents 2, 3, 5,

and 6 shall enter into a reconstitution of the partnership agreement;

(ii) It is clear that the 51% share of Mathialagan will be equally

distributed among these four individuals as of today, subject to the final outcome

of the First Appeal.

(iii) Keeping those shares in mind, they shall enter into a reconstitution

agreement, and in conjunction with the reconstitution agreement in the

prescribed format, they shall file a representation/application before the 1st

respondent;

(iv) The 1st respondent shall convene a meeting and subsequently

determine the issue of continuing the dealership, in accordance with the rules,

by obtaining the necessary indemnity bonds and ensuring other compliance

requirements are met;

(v) Since the above exercise is scheduled to occur within a very short time

frame, and even though it is brought to the attention of this Court that the first

respondent cannot be put to prejudice as the outlet has had no sales for the past

four months, I believe they can wait for another 20 days, and the ad hoc dealer

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need not be permitted to operate.

(vi) Further decisions can be made contingent upon the parties submitting

the reconstitution agreement, and further orders may be issued accordingly;

(vii) The 1st respondent may also choose to begin operating the outlet

solely with the petitioner, or they can opt to wait for the reconstitution

agreement, which will depend on their commercial decision.