IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
B. KRISHNA MOHAN, J.
Rayapati Sujini – Appellant
Versus
The Union Of India and Others - Respondent
Writ Petition Nos.12071 and 17458 of 2023
Decided on : 18-06-2024.
Reconstitution - LPG Distributorship - The court examined the guidelines for reconstitution of LPG distributorship, emphasizing the need for consent from legal heirs and the implications of mental capacity in the context of distributorship rights, ultimately ruling in favor of the petitioner.
Fact of the Case:
The petitioner challenged the reconstitution of an LPG distributorship originally awarded to her late father-in-law, claiming her exclusion as a legal heir and guardian of her husband, who was deemed mentally incapacitated. The case involved disputes over the legitimacy of wills and the authority to manage the distributorship.
Finding of the Court:
The court found that the reconstitution of the distributorship was conducted without the necessary consent from the petitioner and her husband, and that the Oil Corporation failed to follow proper procedures as outlined in their guidelines.
Issues: Whether the reconstitution of the LPG distributorship was valid without the consent of the petitioner and her husband, and whether the actions of the unofficial respondents were lawful.
Ratio Decidendi: The court held that the reconstitution of the distributorship was invalid due to lack of consent from the legal heirs and failure to adhere to the guidelines set forth by the Oil Corporation regarding reconstitution procedures.
Result: The court ordered the reconstitution of the LPG distributorship in favor of the petitioner with a 51% share.
ORDER :
Heard the learned Senior counsel for the petitioner, the learned Standing counsel for the respondent-oil corporation, the learned counsel appearing for the respondent –bank and the learned counsel appearing for the unofficial respondents.
2. The W.P.No. 12071 of 2023 was filed questioning the action of the respondent-Oil Corporation in re-constituting the LPG Distribution Agency Code No. 661837, M/s. Venkataramana Enterprises in its present form without including the petitioner as the sole owner in the re-constitution of the said agency and non payment of arrears also due to the petitioner.
3. The W.P.No. 17458 of 2023 was filed questioning the action of the respondent-bank for processing the application(s) made by the 4th respondent to open the savings bank account No.415714845 in the name of the petitioner’s husband and the Savings Bank Account No.7097764009 in the name of the petitioner in the capacity of the guardian and Administrator of the petitioner’s husband by allowing the respondent Nos. 4 to 6 to operate and maintain the said account numbers for the purpose of depositing and withdrawal of the amounts.
4. The learned Senior Counsel for the petitioner in both the cases submits that initially one Mr. Rayapati Veeraiah was awarded the LPG Distributorship under compassionate grounds for taking care of his Physically Handicapped sons Mr.R.Srinivas and Mr.R.Prasad by the Ministry of Petroleum and Natural Gas vide reference No.P-19015/04/92-IOC dated 21.01.1992. Then the distributorship was commissioned in the name and style of M/s.Venkataramana Enterprises, Guntur with Mr.Rayapati Veeraiah as the sole proprietor on 27.05.1992. After a lapse of about five (5) years of doing the business, at the request of the said Mr.Rayapati Veeraiah, the above said distributorship was reconstituted by inducting his daughter Smt.G.Rajyalakshmi/the 5th respondent herein dated 15.04.1997 and 21.05.1997. While so, the said Mr.Rayapati Veeraiah passed away on 06.02.2002 leaving behind his two sons Mr.R.Sinivas/husband of the petitioner and Mr.R.Prasad and his daughter Smt.G.Rajyalakshmi who was already inducted in the distributorship as stated above. In view of the death of Mr.Rayapati Veeraiah, his two sons viz., Mr.R.Srinivas and Mr.R.Prasad made representation dated 15.02.2002 to the respondent-Oil Corporation for reconstitution of the Distributorship in their favour as it was their only source of income which was granted to their father initially on compassionate grounds to take care of them only. Whereas Smt.G.Rajyalakshmi/the 5th respondent herein sent a proposal for reconstitution dated 25.03.2003 with a request to induct her son Mr.G.Raghuram/the 6th respondent herein as one of the partners stating that her two brothers are mentally/physically unsound and enclosed the false medical certificate. Then the respondent-Oil Corporation asked Mr.R.Srinivas and Mr.R.Prasad to appear before the Medical Board on 16.06.2003 and 30.06.2003. Then Mr.R.Prasad appeared before the Medical Board and Mr.R.Srinivas did not appear for examination before the Medical Board. Then the 5th respondent/Smt.G.Rajyalakshmi submitted a partnership deed dated 06.03.2004 to the respondent-Oil Corporation to reconstitute the Distributorship in favour of her son Mr.G.Raghuram/the 6th respondent herein and herself by undertaking to pay a paltry amount of Rs.7,500/- per month to each of her brothers. The above said proposal and the partnership deed were accepted by the respondent-Oil Corporation by reconstituting the above said distributorship dated 06.03.2004 without the consent and knowledge of the petitioner, petitioner’s husband and his brother.
5. Aggrieved by the fabrication of the will of late R.Veeraiah created by Smt.G.Rajyalakshmi/the 5th respondent and her husband, disputing the same, the petitioner and her husband Mr.R.Srinivas initiated action on 26.03.2004 in P.O.P.No.160 of 2004 which was numbered subsequently as O.S.No.744 of 2012 on the file of senior
AI
The court established that consent from legal heirs is essential for the reconstitution of a distributorship, particularly when mental capacity is in question.
Legal heirs of a deceased sole proprietor are entitled to reconstitute a distributorship without excluding other legal heirs.
Withdrawal of a writ petition without permission is deemed abandonment of the cause of action, affecting the maintainability of subsequent petitions.
The rejection of a partnership reconstitution application based on penalty demands is arbitrary and contrary to the Indian Partnership Act and applicable guidelines.
The nominee of a convicted distributor has the right to seek reconstitution of the distributorship as per the guidelines, even after the termination of the distributorship.
There is no rule in the Corporation which allows renewal of terminated Distributorship on sympathetic grounds, especially in cases where Distributorship has been terminated on account of malpractices....
The court established that termination of a distributorship must adhere to due process and contractual obligations, emphasizing the need for prior consent in partnership arrangements.
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