IN THE HIGH COURT AT CALCUTTA
SMITA DAS DE, J.
M/s. Begampur Indane Gramin Vitrak & Ors. – Petitioner
Versus
Indian Oil Corporation Limited & Ors. – Respondent
WPA 4012 of 2026
Decided On : 11-05-2026
| Table of Content |
|---|
| 1. background and factual history of lpg distributorship reconstitution. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13) |
| 2. parties' arguments regarding contract execution and procedural validity. (Para 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29) |
| 3. scope of judicial review and administrative discretion regarding policy. (Para 30 , 31 , 32 , 33 , 34) |
| 4. final order and disposal of the writ petition. (Para 35 , 36) |
Judgment :
Smita Das De, J.
1. The petitioners seek a writ of certiorari to quash the speaking order dated 21.01.2026 passed by the competent authority being the respondent no. 4 herein. The impugned order confirms the revocation of approval for the reconstitution of the partnership firm in respect of the petitioners’ distributorship, primarily on the ground of failure to execute the formal distributorship agreement.
2. The petitioners in the instant case prays inter alia, for the following reliefs:
“a) Declaration declaring Clause 3.17.12 of Guideline of May 202 of Indian Oil corporation Limited, being contrary to and dehors the 1932 Act, be declared null and void;
b) A writ of and/or in the nature of Mandamus Commanding the respondents IOCL to withdraw and/or rescind and/or cancel the impugned memo dated 22nd January 2026, forthwith;
c) A Writ of and/or in the nature of Certiorari calling upon the respondents IOCL and each of them to certify and transmit the records of the case culminating in impugned memo dated 22nd January 2026, so that upon perusal thereof, conscionable justice may be rendered to the petitioners by quashing the same:
d) A Writ of and/or in the nature of Prohibition, prohibiting the IOCL authority from giving any effect and/or further effect to the impugned memo dated 22nd January 2026, in any manner whatsoever;
e) Direction directing the IOCL to conclude the reconstitution process in terms of approval order dated 21st February 2024, forthwith;
f) Rule N I S I in terms of prayer (a), (b), (c), (d) and (e) above and to make the Rule absolute if no cause or insufficient cause is shown;
g) An interim order of injunction restraining the respondent authorities from giving any effect and/or further effect to the impugned memo dated 22nd January 2026, in any manner whatsoever;
h) Stay of operation of the impugned memo dated 22nd January 2026;
i) Ad interim order in terms of prayers (g) and (h) above;
j) costs and incidental arising out of the instant petition;
k) Such other or further order or orders as to Your Lordships may deem fit and proper.”
3. Apropos the facts of the case, it is stated that the respondent no. 6 herein is the sole proprietor of a firm under the name and style of M/s. Begumpur Indane Gramin Vitrak.
4. The licence has been granted by Indian Oil Corporation Ltd., being the respondent No. 1 herein by executing an agreement on 06.07.2020 for running the LPG distributorship business. However, upon facing several problems in operating the same, mainly due to financial constraints, respondent No. 6 submitted a representation to respondent No. 1 on 06.10.2023 seeking reconstitution of the said business from a proprietorship to a partnership by inducting petitioner Nos. 2 to 4 as partners in the said LPG distributorship business.
5. Thereafter, the representation of the respondent No. 6 has been considered by the respondent No. 1 at a meeting held on 17.01.2024 wherein the respondent No. 6 expressed her willingness to continue running the said LPG business and requested the officials of the respondent No. 1 to induct the petitioner Nos. 2 and 4 as partners for the smooth running of the business.
6. Accordingly, a proposed partnership deed has been executed amongst the petitioner Nos. 2 to 4 and the respondent No. 6 along with an affidavit.
7. The respondent No. 6 also executed an affidavit stating her willingness to induct the petitioner Nos. 2 to 4 as partners, declaring inter alia, that she has no objection to respondent No. 1 permitting of the sai
AI
The rejection of a partnership reconstitution application based on penalty demands is arbitrary and contrary to the Indian Partnership Act and applicable guidelines.
The court established that termination of a distributorship must adhere to due process and contractual obligations, emphasizing the need for prior consent in partnership arrangements.
The court emphasized that termination of business agreements requires adherence to principles of natural justice, including the right to a personal hearing, and that mere allegations without substant....
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