Bharat Petroleum Corporation Ltd. & another vs Municipal Corporation of Greater Bombay & another

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1984 Supreme(Bom) 89

IN THE HIGH COURT OF BOMBAY
M.L. Pendse, J.
Bharat Petroleum Corporation Limited another... Petitioners.
Versus
Municipal Corporation of Greater Bombay another... Respondents.
Writ Petition No. 521 of 1982, decided on 15-3-1984.
Advocates appeared :
F.D. Damania with S.H. Kapadia, for petitioners.
R.L. Dalal with R.T. Hemrajani and F.N.P. D’mello, for respondents.

Headnote:Section 394-Petroleum Act, 1934, Section 31-Two provisions overlaping and conflicting-Cannot co-exist-It would not be correct to say that licences for storage of petrol and High Speed Diesel be obtained both under Petroleum Act and Bombay Municipal Corporation Act-Hence Notification issued under Section 31 of Petroleum Act has overriding effect over Section 394, Bombay Municipal Corporation Act, 1888.
       Section 31 of the Petroleum Act, 1934 read with notification of 4th May, 1950 does not cover the entire area of storage and transport of all kinds of petroleum products. It governs only certain kinds of petroleum products and certain quantities of such products. But in respect of the products and qualities which are so covered the power of the Bombay Municipal Corporation under Section 394 is clearly restricted by reason of the notification. This was not the case before the Division Bench. In the present case the two provisions are overlapping and conflicting. They cannot therefore, co-exist. It would not therefore, be correct to say that licences for storage of petrol and High Speed Diesel should be contained both under the Petroleum Act and the Bombay Municipal Corporation Act.
       In the present case the Petroleum Act has restricted the power of the local authority to regulate transportation and storage of certain kinds of petroleum products and certain quantities of such products as set out earlier. There is therefore, a direct abridgement of the powers of the local authority by the notification. Hence the notification issued under Section 31 of the Petroleum Act has an overriding effect.
       PETROLEUM ACT, 1934
       Section 31
       See Bombay Municipal Corporation Act, 1880, Section 394.

Judgement Key Points

Key Points: - The Petroleum Act, 1934 Section 31 with the 4 May 1950 notification can override Section 394 of the Bombay Municipal Corporation Act, 1888 where overlapping and conflicting provisions exist. (!) - The notification under Section 31 of the Petroleum Act restricts the power of local authorities to regulate transportation and storage of certain petroleum products, leading to an overriding effect on local authority powers in the present case. (!) - The Petroleum Act’s scope is not intended to cover the entire area of storage and transport for all petroleum products; it governs only certain products and quantities, impacting the applicability of municipal regulation. (!) - The underground petrol tanks, though within the regular line of the street, are not considered "buildings" under Section 3(s) of the Bombay Municipal Corporation Act, and therefore do not fall within the exclusion from Section 299(1). (!) (!) - A tank is not necessarily a "building" and cannot be treated as part of a building for the purposes of Section 299(1)’s exclusion; the tanks are independent structures. (!) (!) - The court held that prior sanction of the State Government is not required given the corporation’s status and the facts presented; the petition challenging possession was dismissed. (!) (!) - The Commissioner's exercise of Section 299 powers to recover possession is upheld in the public interest for road widening, and compensation principles remain unaffected by the mode of possession (299 vs 296). (!) (!) - The petition is dismissed with costs. (!)

How to determine which statute overrides in overlapping and conflicting provisions between the Petroleum Act, 1934 and the Bombay Municipal Corporation Act, 1888?

What is the scope of Section 31 of the Petroleum Act, 1934 read with the 1950 notification in relation to storage and transport of petroleum products within municipal boundaries?

What are the conditions under which the Bombay Municipal Corporation Act, 1888 can or cannot exercise possession powers under Section 299 versus Section 296 in the context of underground petroleum tanks within the regular line of a street?

JUDGMENT - M.L. PENDSE, J.:---The petitioner No. 1-Bharat Petroleum Corporation Limited is a Government of India Company and by a lease deed dated September 10, 1964 from Mirchandanis a lessee in favour of the predecessor in title of petitioner No.1 i.e. Burmah Shell Oil Storage and Distribution Company of India Limited was obtained in respect of a piece of land admeasuring 630 Sq. Yards at Worli. The land includes a Petrol Service Station and other erections and structures standing thereon. The right, title and interest of the lessee now vests in the petitioner Company. The Petitioner No. 2. was appointed as a dealer in August 1978 for the purpose of running the Petrol Pump. The petitioners claim that the Petrol Pump is run on the leased property for last several years and has annual turnover of Rs. 31,52,000/-. The petitioner No.1 holds the required licence issued by the authorities under the Petroleum Act, 1934 and the rules framed under the said Act.

2. The Deputy Municipal Commissioner for Greater Bombay, Zone I, served notice dated March 20, 1979 on the petitioners under section 299 of the Bombay Municipal Corporation Act (hereinafter referred to as the "Act"). The notice recites that certain land not occupied by building and forming part of Plot No.1 situated at Worli lies within the regular line of the public street as prescribed by the Municipal Commissioner under section 297 of the Act. The Deputy Municipal Commissioner informed the petitioners that after the expiration of 7 clear days from the service of the notice the possession of the land together with its enclosing wall, hedge or fence, if any, will be taken possession. The plan of the land was kept for inspection in the Office of the Ward Officer. The petitioners have annexed the sketch to the petition marked as Ex. B and that sets out the area which the Corporation proposes to take possession of. The petitioners claim that the effect of recovery of possession would be the closure of the Petrol Pump. The petitioners complained that the three underground Petrol tanks of the Petrol Pump fall within the land proposed to be recovered by the Corporation and it will be impossible for the petitioners to relocate the underground Petrol tanks. The petitioners claim that the underground tanks are the 'buildings', as understood by the expression under the Act and, therefore, the Corporation cannot exercise powers under section 299 of the Act to recover possession. The petitioners also complained that the possession cannot be recovered by the Corporation without the prior sanction of the State Government as prescribed under sub-section (2) of section 299 of the Act. The petitioners have approached this Court by filing the present petition under Article 226 of the Constitution of India on March 15, 1982 and the relief sought is quashing of the impugned notice threatening to recover possession of the land underneath which the underground tanks are located.

3. To appreciate the submissions urged by Shri Damania, learned Counsel appearing for the petitioners, it is necessary to make reference to certain relevant provisions of the Act. Section 297 forms part of Chapter XI of the Act dealing with regulation of streets. Section 297 of the Act confers power upon the Commissioner to prescribe a line on each side of any public street and such line is to be called "the regular line of the street". The section sets out the procedure which must be followed by the Commissioner must give a public notice in the local newspaper as well as in the Official Gazette inviting objections. The Commissioner is required to consider the objection and forward the same to the Municipal Secretary for placing before the Corporation. The prescription of the regular line prohibits construction of any building within the line of the street except with the written permission of the Commissioner.

4. Section 299 of the Act deals with acquisition of open land or of land occupied by platforms, etc., within the re

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