1. Public interest writ petition challenging the arbitrary exercise of discretion in the allotment of petroleum product, LPG, and SKO dealerships due to lack of guidelines. (Para 1 )
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1995 Supreme(SC) 382
SUPREME COURT OF INDIA
Centre for Public Interest Litigation
Versus
Union of India
Decided on : March 31, 1995
Important Points
The Court held that discretionary allotments of petroleum product dealerships must be governed by settled norms and guidelines to prevent arbitrariness and ensure conformity with the rule of law. It established specific criteria for compassionate allotments and capped the total number of such discretionary allotments.
Subject
Administrative Law - Discretionary Allotments
Act Referred
Headnote
Civil Laws – Allotment of retail outlets – In this writ petition which has been brought in public interest, the exercise of discretion in allotment of retail outlets for petroleum products, LPG Dealership and SKO Dealership by the central government is challenged. – It is urged that there are no guidelines to regulate the exercise of discretion in the matter of such allotments which results in exercise of the discretion arbitrarily. – Held, To ensure the exercise of discretion in making such allotments in conformity with the rule of law by excluding the likelihood of arbitrariness and minimising the area of discretion by regulating its exercise in accordance with settled norms and guidelines, we indicate herein these norms which would govern all future allotments. – The norms/guidelines required to be followed hereafter in making all such allotments are as under: guidelines for Discretionary Allotments of Petroleum Products Agencies. – THE following are the guidelines which are to be the guiding factors in discretionary allotments of dealership/distributorship on compassionate grounds: (1 Dependent of a person who has made supreme sacrifice for the nation, but has not been properly rehabilitated so far. (2 Member of a family which has been a victim of unforeseen circumstances, like terrorist attack, earthquake, floods etc. (3 Physically handicapped person. (4 Defence/paramilitary/police personnel/other Central/state government employees, who are permanently disabled on duty. (5 Immediate next of kin, namely, widow, parents, children of those who lost their lives in abnormal circumstances. (6 Eminent professionals like outstanding sportsmen, musicians, litterateurs etc. and women, of high achievements, in distress. (7 Individual cases of extreme hardship, which in the opinion of government are extremely compassionate and deserve sympathetic consideration in view of the special circumstances of the case at the given time. (8 The number of discretionary allotments should not ordinarily exceed 10% of the average annual marketing plan of which 384 allotments of retail outlets for petroleum products should not normally exceed 5%. GENERAL CONDITIONS (1 He/she should be a citizen of India. (2 He/she or any of his/her following close relatives (including step relatives) should not already hold a dealership of petroleum products of any oil company: (I) spouse (II) father/mother (III) brother (IV) son/daughter-in-law. – Court hereby direct that the above-quoted norms/guidelines etc. shall be followed by the central government in making all such discretionary allotments of retail outlets for petroleum products, LPG Dealership and SKO Dealership, hereafter. – Writ Petition Disposed Of
Legal Category Hierarchy
Table of Contents
2. The petitioner contended that the absence of guidelines to regulate the central government's discretion in dealership allotments leads to arbitrary exercise of power. (Para 1 )
3. The court observed that to prevent arbitrariness and ensure the rule of law, discretionary allotments must be governed by settled norms and guidelines. (Para 3 )
4. Governmental discretionary power must be exercised according to established norms and guidelines to minimize arbitrariness and maintain conformity with the rule of law. (Para 3 )
5. The court established specific guidelines and general conditions for discretionary petroleum dealership allotments and directed the central government to follow them. (Para 4 )
6. How should discretionary power in government allotments be exercised to avoid arbitrariness?
Discretionary power must be regulated by settled norms and guidelines to minimize the area of discretion and ensure the exercise of power conforms to the rule of law. (Para 3 )
7. What are the criteria for discretionary allotment of petroleum dealerships on compassionate grounds?
Allotments may be made to dependents of national martyrs, victims of unforeseen disasters, physically handicapped persons, disabled government employees, next of kin of those lost in abnormal circumstances, and eminent professionals in distress. (Para 3 )
8. What are the general eligibility conditions for applicants seeking discretionary petroleum dealerships?
Applicants must be Indian citizens and must not have close relatives—including spouses, parents, siblings, or children-in-law—who already hold a dealership from any oil company. (Para 3 )
9. Is there a limit on the number of discretionary allotments allowed for petroleum products?
Discretionary allotments should ordinarily not exceed 10% of the average annual marketing plan, with retail outlets for petroleum products normally capped at 5%. (Para 3 )
Judgment
( 1 ) ). In this writ petition which has been brought in public interest, the exercise of discretion in allotment of retail outlets for petroleum products, LPG Dealership and SKO Dealership by the central government is challenged. It is urged that there are no guidelines to regulate the exercise of discretion in the matter of such allotments which results in exercise of the discretion arbitrarily.
( 2 ) ). After hearing the learned counsel for the parties, we requested the learned Attorney general to submit a draft of the proposed guidelines to regulate exercise of the discretionary power in the matter of such allotments in the light of the suggestions made on behalf of the petitioner at the hearing. The learned Attorney General submitted a draft of the proposed guidelines together with the general conditions on which the applicants may be chosen for making the allotments. In addition, the learned Attorney General also indicated certain details for being inserted in the brochure of guidelines for selection of dealers available with all the oil companies.
( 3 ) ). To ensure the exercise of discretion in making such allotments in conformity with the rule of law by excluding the likelihood of arbitrariness and minimising the area of discretion by regulating its exercise in accordance with settled norms and guidelines, we indicate herein these norms which would govern all future allotments. The norms/guidelines required to be followed hereafter in making all such allotments are as under:guidelines for Discretionary Allotments of Petroleum Products Agencies. THE following are the guidelines which are to be the guiding factors in discretionary allotments of dealership/distributorship on compassionate grounds: (1 Dependent of a person who has made supreme sacrifice for the nation, but has not been properly rehabilitated so far. (2 Member of a family which has been a victim of unforeseen circumstances, like terrorist attack, earthquake, floods etc. (3 Physically handicapped person. (4 Defence/paramilitary/police personnel/other Central/state government employees, who are permanently disabled on duty. (5 Immediate next of kin, namely, widow, parents, children of those who lost their lives in abnormal circumstances. (6 Eminent professionals like outstanding sportsmen, musicians, litterateurs etc. and women, of high achievements, in distress. (7 Individual cases of extreme hardship, which in the opinion of government are extremely compassionate and deserve sympathetic consideration in view of the special circumstances of the case at the given time. (8 The number of discretionary allotments should not ordinarily exceed 10% of the average annual marketing plan of which 384 allotments of retail outlets for petroleum products should not normally exceed 5%. GENERAL CONDITIONS (1 He/she should be a citizen of India. (2 He/she or any of his/her following close relatives (including step relatives) should not already hold a dealership of petroleum products of any oil company: (I) spouse (II) father/mother (III) brother (IV) son/daughter-in-law.
( 4 ) ). We hereby direct that the above-quoted norms/guidelines etc. shall be followed by the central government in making all such discretionary allotments of retail outlets for petroleum products, LPG Dealership and SKO Dealership, hereafter. A copy of this order be provided to every oil company by the central government for general information.
( 5 ) ). The writ petition stands disposed of in the above terms.
