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2017 Supreme(Guj) 942

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Rajesh H. Shukla, J.
Indian Oil Corporation Ltd. - Appellants
Vs.
Surendra Filing Station and Ors. - Respondent
First Appeal No. 3216 of 2012 and Special Civil Application No. 10252 of 2013
Decided On : 04-05-2017

Advocates Appeared:
For the Appellant : Akshay A. Vakil
For the Respondents: Harnish V. Darji

Headnote:

Arbitration & Conciliation Act, 1996 - Section 37 - Civil Procedure Code - Section 96 – Appeal is filed by appellant-original applicant aggrieved and dissatisfied with impugned judgment and order in Civil Application passed by Auxiliary Chamber Judge City Sessions Court rounds stated in memo of appeal - It is contended that impugned judgment and order is not a reasoned order and no reasons are assigned for not setting aside order of Arbitrator - It is contended that it is reproduction of arbitration award - Further it has been contended that Court below has not appreciated that rod was inserted in dispensing unit and opponent in its reply has not disputed was upon opponent to prove that said rod was not inserted for manipulating delivery of product or dispensing unit - It is contended that Court below has completely overlooked representatives had confirmed that meter unit of all dispensing units were having additional spring additional gear system nuts etc and report was signed by opponent without any protest - It is therefore contended that findings and conclusion are contrary to statutory provision and material and evidence on record – Held, Court termination order came to be passed - It also records that delivery was found correct without inserting wire rod and shortage of ml petrol per ltrs was found - It is in this background judgment and award which has been made Rule of Court requires a closer scrutiny - In impugned judgment passed in Civil Application by Auxiliary Chamber Judge City Sessions Court observations have been made in referring natural justice and violation of guidelines without addressing issue with regard to breach of condition of dealership agreement which in turn would enable appellant to exercise option of termination of dealership agreement - Similarly issue about finding of foreign object or wire rod/gear with effect on functioning of dispensing unit has not been considered at all and it has been observed - Appeal Dimissed(Para 19)

JUDGMENT :

Rajesh H. Shukla, J.

1. First Appeal No. 3216 of 201 2 is filed by the appellant-original applicant-IOC under Section 96 of the Civil Procedure Code as well as under Section 37 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as "the Arbitration Act") being aggrieved and dissatisfied with the impugned judgment and order in Misc. Civil Application No. 957 of 2010 passed by the Auxiliary Chamber Judge, City Sessions Court, Ahmedabad dated 31st March, 2012 on the grounds stated in the memo of appeal. It is contended inter alia that the impugned judgment and order is not a reasoned order and no reasons are assigned for not setting aside the order of the Arbitrator. It is contended that it is reproduction of the arbitration award. Further it has been contended that the Court below has not appreciated that the rod was inserted in dispensing unit and the opponent in its reply has not disputed the said fact and the onus was upon the opponent to prove that the said rod was not inserted for manipulating the delivery of the product or the dispensing unit. It is contended that the Court below has completely overlooked the fact that OILCO representatives had confirmed that the meter unit of all dispensing units were having additional spring, additional gear system, nuts etc. and the report was signed by the opponent without any protest. It is therefore contended that the findings and conclusion are contrary to the statutory provision and material and evidence on record. It is also contended that the Court below has failed to appreciate that the Arbitrator had no jurisdiction to give certain directions. It is also contended that the compensation could not have been awarded as the agreement specifically provides otherwise and, therefore, the present Appeal may be allowed.

2. Special Civil Application No. 10252 of 2013 has been filed by the petitioner herein - M/s. Surendra Filling Station, A proprietary Firm under Articles 14, 19(1)(g) and 226 of the Constitution of India praying inter alia for issuance of the writ of mandamus or any other appropriate writ, order or direction directing the respondent-authority to hear and decide Appeal dated 19.08.2010 filed by the petitioner on the grounds stated in the memo of petition.

3. Heard learned advocate, Shri Akshay Vakil appearing for the Indian Oil Corporation Ltd. and learned advocate, Shri Harnish Darji appearing for M/s. Surendra Filling Station in both matters.

4. Learned advocate, Shri Akshay Vakil appearing for the appellant-Company has referred to the background of the facts as well as record and the proceedings and also the dealership agreement. He referred to Clauses 16, 36, 43 and 56 of the agreement clause and submitted that Clause - 16 provides that "no repairing shall be made" and Clause - 43 provides that "dealer undertakes to observe all directions, rules and regulations of the corporation as well as other authorities". He pointedly referred to Clause - 56, which reserves liberty to the Corporation to terminate the agreement on happening of any of the events as specified in detail. For that purpose, he referred to Clause 56(1), which provides,

"56(i) If the Dealer shall deliberately contaminate or tamper with the quality or any of the Corporation's product."

5. Learned advocate, Shri Vakil submitted that therefore the dealership was suspended and the notice was given on 21.11.2006. He submitted that reply was also filed by the respondent-dealer on 29.11.2006. Learned advocate, Shri Vakil submitted that in reply also, the respondent-dealer has not disputed about the presence of the rod. He pointedly referred to Paragraph Nos. 6 and 7 of the reply and submitted that such a rod was found inside the dispensing unit, which itself would suggest about the tampering and manipulation.

6. Learned advocate, Shri Vakil submitted that Marketing Discipline Guidelines, 2005 also provides for termination of the dealership. He again referred to the guidelines produced on rec













































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