Termination of distributorship upheld as no violation of natural justice occurred; allegations were clearly stated, and double jeopardy claim rejected due to serious defalcations.

JUDGMENT :

K. Vinod Chandran, CJ.

The appellant is aggrieved with the termination of a Liquefied Petroleum Gas (LPG) Distributorship (Domestic and Commercial) granted to her by agreement dated 15.03.2013. The contentions raised before the learned Single Judge were two fold. One, that there was violation of principles of natural justice insofar as the inspection reports relied on having not been supplied. The next contention was that the respondent-Corporation by imposing a penalty and directing compensation as also payment of the outstanding dues and not terminating the distributorship, as threatened in the first two show-cause notices, could not have then proceeded for such termination by the 3rd show-cause notice. The contention urged was that the respondent-Corporation had waived the right to visit the appellant with the consequence of termination of distributorship.

2. The learned Single Judge found on facts that there was no violation of principles of natural justice, since even if the inspection reports were not supplied, the allegations in the said reports were verbatim reproduced in the show-cause notices. It was also found that the appellant had never sought for supply of the inspection reports and not even made an averment to that effect in the writ petition; which non-supply even if established, there was no prejudice caused to the appellant. Insofar as the contention of waiver, it was found from the penalty order issued that the other consequences and the right to proceed further were reserved specifically in the order of penalty. The learned Single Judge dismissed the writ petition leaving liberty to approach the remedy of arbitration; which the agreement provided, in which event the contentions were left open.

3. Learned Counsel for the appellant Sri Sanjeev Ranjan vehemently pointed out that the allegations arose from the implementation of a scheme brought out by the Central Government termed as Pradhan Mantri Ujjawala Yojna (for brevity, PMUY) for supply of LPG connections to the marginalized sections, especially the BPL families, who suffer from at least one deprivation under the Socio-Economic and Caste Census of 2011 (Rural data base). The distributors had only the responsibility to furnish the applications to the Oil Marketing Companies (for brevity, OMCs) who have to carry out the verification and the de-duplication exercise; for due diligence in providing a new LPG connection. Allegations were raised on the implementation of the scheme and the supply of LPG connections to undeserving persons; which deserts were not supposed to be verified by the distributors. For the failure of the OMC to properly verify the credentials of the applicants, the appellant was witch-hunted.

4. Proceedings were taken by two separate show-cause notices based on two separate inspections, one carried out by a team of officers from the Ministry of Petroleum and Natural Gases and another by a Ujwalla Coordinator and the Sales Officer of the OMC. The reports of such inspections were never supplied to the appellant. The appellant replied to the show-cause notices, but without considering the objections raised, was imposed with a penalty. Later to that, a 3rd show-cause notice was issued threatening termination; which amounts to double jeopardy as argued by the learned counsel. It is pointed out that at the earlier point itself the show-cause notices threatened termination but did not impose such a penalty. Having once considered the objections and decided not to terminate the distributorship, a further proceeding could not have been taken. It is also vehemently argued that the non-supply of the inspection reports prejudiced the appellant. The finding of the learned Single Judge that the principle of waiver would not apply to the respondent-Corporation cannot be sustained. The appellant seeks setting aside of the order of termination.

5. Learned Counsel appearing for the respondent-Corporation, Sri Siddharth Prasad, sought to uphold the ord