The central legal point established in the judgment is the importance of adherence to natural justice principles and standard norms in commercial matters, and the preference for resolving disputes through arbitration as mutually agreed between the parties.

SANJIV KHANNA, J.

CM No. 47072/2016

This is an application for deletion of ground (J) and question No. (ii) from the substantial questions of law mentioned in the grounds of appeal.

Counsel for the respondent does not oppose the application.

The application is allowed. Necessary corrections have been carried out by the counsel for the petitioner and initialled in today’s date.

LPA 603/2015

Indian Oil Corporation (Appellant Corporation, for short) has filed the present intra court appeal impugning judgment dated 21st August, 2015 passed by the learned single Judge in Writ Petition (C) No. 5983 of 2012 whereby letter of termination of dealership dated 14th September 2012 issued to M/s Bhatia Service Station (Respondent, for short) has been quashed and set aside. Direction has been issued to the appellant corporation to remove seals from the delivery units in order to enable the respondent to resume operations within one week.

2. By order dated 7th September, 2015 in this appeal, a Division Bench, while issuing notice, had stayed operation of the impugned judgment till further orders.

3. Respondent was operating a retail outlet for petrol and diesel from property bearing No. 4 Factory Road, Ring Road, Near Trauma Centre, Safdarjung Hospital, New Delhi under dealership agreement with the appellant corporation, dated 11th November, 2009. The respondent states that the dealership could be traced to the year 1960.

4. On 27th October, 2011, a team from the Anti Adulteration Cell, Northern Region had inspected the retail outlet and had recorded abnormal short delivery of 660 ML, 290 ML and 230 ML in every 05 ltrs in three dispensing units. Outlet inspection report was prepared recording short delivery. The report also records observations of the inspection team on electronic manipulation in the dispensing unit components i.e. control Card/pulse unit etc. Components of the three dispensing unit were taken out in the presence of dealer representatives and handed over to the Deputy General Manager (Engineering). Marketing division was asked to arrange for testing of mentioned components at the original equipment manufacturer laboratory.

5. By letter dated 21st April, 2012 appellant corporation terminated dealership of the respondent.

6. Aggrieved, the respondent had filed W.P.(C). No. 2406 of 2012, in which by order dated 24th April, 2012 notice was issued and direction for maintenance of status quo was passed. W.P.(C) No. 2406/2012 was disposed of, vide order dated 5th July, 2012. This order refers to the contentions raised, albeit did not decide the lis finally as with the consent of the parties the matter was remitted to the appellant corporation for re-examination after issue of supplementary show-cause notice. Relevant portion of the order dated 5th July, 2012 reads as under:-

“Mr. Nigam has assailed the document dated 21.04.2012 on various grounds. Principally, his contention is that the order dated 21.04.2012 reviewed the earlier order dated 05.01.2012. According to Mr. Nigam, since the function performed by the concerned officer on 05.01.2012 was a quasi judicial in nature, without being conferred the power of review, the said order could not have been reviewed on 21.04.2012 and that too by an officer who was junior in rank to the GM.

On the other hand, Mr. Sethi Contends, firstly, that the document generated on 05.01.2012 is not an order, in the sense that, it adjudicates upon the show cause notice which was issued to the petitioner. Secondly, Mr. Sethi submits that the exercise carried out, which culminated in the generation of the order dated 21.04.2012 was, a case of exercise of administrative power and not a quasi judicial power as contended by Mr. Nigam.

Having heard the learned counsels for parties, I have put to both sides, as to whether the respondent corporation could consider reexamination of the case of the petitioner in the light of material which is presently available with the respondent corporation. Mr. Sethi says deho