IN THE HIGH COURT AT CALCUTTA
TAPABRATA CHAKRABORTY, RAJA BASU CHOWDHURY, JJ.
M/s. Hazra Filling Station - Appellant
Versus
The Indian Oil Corporation Ltd. & Ors. – Respondents
FMA 4819 of 2015 with IA No. CAN 1 of 2021
Decided On : 08-12-2022
Dealership Agreement - Appointed as a dealer of petrol (MS)/ High Speed Diesel Oil - Criminal Case - Show cause notice for termination - Whether the said order issued by the Senior Retail Sales Manager, Haldia Divisional Office, Indian Oil Corporation Limited (in short, IOCL) suffers from a jurisdictional error - Held, Even a slight distinction in fact or an additional fact may make a lot of difference in decision making process- Judgment is a precedent for issue of law that is raised and decided and not observations made in facts of any particular case - Court are of considered opinion that there is nothing wrong with approach and decision of learned Single Judge. No arbitrariness, malafides, irrationality or perversity could not be established by appellant warranting the Constitutional Court to interfere with decision making process or decision - Court find no infirmity in the judgment impugned warranting interference in present appeal - Appeal dismissed
JUDGMENT :
(Tapabrata Chakraborty, J.)
1. A legal tussle has spiraled up to this Court seeking a quietus to the primary issues as to whether the order of termination of the appellant’s dealership dated 16th December, 2011 is perverse, whether the said order issued by the Senior Retail Sales Manager, Haldia Divisional Office, Indian Oil Corporation Limited (in short, IOCL) suffers from a jurisdictional error, whether at the show cause stage the authority arrived at a finding of guilt against the appellant and as to whether non-communication of the result of test conducted in the MIDCO laboratory at Mumbai maligns the termination proceedings.
2. Shorn of unnecessary details, the facts are that the appellant/writ petitioner was appointed as a dealer of petrol (MS)/ High Speed Diesel Oil outlet in the year 2005 by IOCL. The dealership agreement between the writ petitioner and IOCL was executed on 27th March, 2005. On 24th September, 2010, the Anti Adulteration Cell (AAC), a team consisting of two officers of IOCL on a routine checkup, reached the retail outlet for inspection and started delivery check with 5 litre calibrated measure of the retail outlet and from the first nozzle it was allegedly ascertained that there was a shortage of 90 ml of oil in 5 litres. As the experts of Weights and Measures Department did not turn up on the said date, the AAC sealed the dispensing unit and prepared an inspection report. The AAC again visited the outlet on 27th September, 2010 but in the midst thereof, two delivery units were totally damaged by an unknown vehicle in the intervening night between 25th September, 2010 and the 26th September, 2010. A complaint to that effect was immediately lodged before the Officer-in-Charge, Jagacha police station and the same was registered as FIR No.399/2010 dated 26.09.2010 under Sections 279/427 of the Indian Penal Code (in short, IPC). During pendency of the criminal case, a show cause notice for termination was issued on 28th March, 2011 by the respondent no. 6 to which a reply was submitted by the appellant on 14th April, 2011. Thereafter a notice dated 29th June, 2011 was issued to the appellant by the Senior Manager (Retail Sales) asking the appellant to furnish additional document, evidence, statement, if any in connection with the show cause notice. The appellant submitted a reply to the same on 21st July, 2011. Thereafter by a memo dated 16th December, 2011 issued by the respondent no.6, the appellant’s dealership was terminated. Challenging the said order of termination, the appellant preferred the writ petition which was dismissed on 17th August, 2015 by the judgment impugned in the present appeal.
3. Drawing the attention of this Court to the contents of the show cause notice dated 28th March, 2011, Mr. Dutta, learned advocate appearing for the appellant submits that the respondent no.6 at the show cause stage arrived at a conclusive finding that ‘the sealed DU had been fiddled with rendering the electronic components of DU capable of being managed, improved and corrected. Thus the whole exercise of keeping the DU sealed for expert’s checking was frustrated’. The said notice demonstrates totally closed mind at the show cause stage. The learned Single Judge had glossed over and has not returned a finding on the said issue and such infirmity on the face of the records warrants interference in appeal. In support of such contention reliance has been placed upon the judgment delivered in the case of Oryx Fisheries Private Limited –vs- Union of India and Others, reported in (2010) 13 SCC 427.
4. Mr. Dutta argues that the result of the test conducted in the MIDCO laboratory at Mumbai was never communicated to the appellant though the same was an important piece of evidence and the appellant was deprived of the opportunity to deal with the same. The learned failed to appreciate that appellant was thus severely prejudiced. There is nothing in the agreement which excludes the operation of the principles of
Oryx Fisheries Private Limited –vs- Union of India and Others
State of Orissa Vs. Dr. (Miss) Binapani Dei and others
Termination of dealership without adhering to procedural guidelines and principles of natural justice is unlawful.
The court upheld the legality of dealership termination based on confirmed tampering evidence, affirming procedural fairness and adherence to natural justice principles, invalidating the petitioner's....
The principle of adherence to the principles of natural justice and the justification of termination based on the dealer's involvement in malpractices.
The termination of a dealership agreement must be fair and in accordance with the principles of natural justice. The burden of proving unauthorized purchase lies on the party alleging it.
The court upheld the termination of the dealership agreement based on the critical irregularities as per the Marketing Discipline Guidelines.
Termination of dealership - Action of termination against critical irregularities has to be approved by Regional Head/State Head/Zonal Head of the Oil Company (General Manager and above) and in respe....
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.