BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 18.09.2025 CORAM THE HONOURABLE MR.JUSTICE G.R.SWAMINATHAN and W.M.P(MD)Nos.16351 & 16584 of 2025 M/s.Mugavai Indane Gas Agency, Represented by its Proprietor, K.Gurumoorthi Kamaraj, No.30/1, Moolakothalam Bungala Street, Ramanathapuram, Ramanathapuram District. ... Petitioner Vs.

1.The Executive Director and State Head, Tamil Nadu State Office, Indian Oil Corporation Limited, No.139, Uthamar Gandhi Salai, Nungambakkam High Road, Chennai – 600 034.

2.The General Manager (LPG-s), Indian Oil Corporation Limited, Indane Area Office, No.2, Race Course Road, Chokkikulam, Madurai, Madurai District. ... Respondents Prayer : Writ Petition filed under Article 226 of the Constitution of India, praying this Court to issue a Writ of Certiorari, to call for the records relating to the impugned order passed by the first respondent vide proceedings in Ref.TNSO/LPG/MDU AO/MUGAVAI dated 29.07.2025 and quash the same as illegal.

For Petitioner : Mr.Ajmal Khan Senior Counsel for M/s.Ajmal Associates For Respondents : Mr.K.Muraleedharan

ORDER

Heard both sides.

2.The writ petitioner was selected for LPG distributorship by the respondent Corporation. The allotment was made under “Scheduled Caste” category. Distributorship agreement dated 15.03.2019 was entered into. Vide order dated 29.07.2025, the dealership was terminated.

Challenging the same, this writ petition came to be filed.

3.The learned Senior Counsel appearing for the writ petitioner reiterated all the contentions set out in the affidavit filed in support of the writ petition and called upon this Court to set aside the impugned order and grant relief as prayed for.

4.An interim order was granted by this Court on 31.07.2025 and to vacate the same, the Corporation has filed W.M.P(MD)No.16584 of 2025. The learned Standing Counsel for the Indian Oil Corporation took me through the affidavit filed by them and also the materials enclosed in the typed set of papers. His core contention is that clause 37(a) of the agreement between the parties provides for an arbitral remedy and that therefore, the writ petition itself is not maintainable. He relied on the decision of this Court reported in 2000 (IV) CTC 711 (Union of India Vs Sri Gayathri Agencies). He contended that the writ petitioner had acted against Clauses 21, 23(c), 27(m) and 27(n) of the distribution agreement by entering into a partnership agreement with third parties. He justified the order of termination on the ground that such an act committed by the writ petitioner was squarely contrary to the terms of allotment. He called upon this Court to dismiss the writ petition and relegate the petitioner to avail the arbitral remedy.

5.I carefully considered the rival contentions and went through the materials on record.

6.It is true that the existence of an arbitral remedy in normal circumstances would come in the way of maintaining a writ petition. When the maintainability of the writ petition was assailed on the ground of availability of arbitral remedy, the Hon'ble Supreme Court in the decision reported in (2003) 2 SCC 107 (Harbanslal Sahnia v. Indian Oil Corpn. Ltd.,) held as follows:

“7. So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the appellants was liable to be dismissed is concerned, suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case, in spite of availability of the alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies: (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where there is failure of principles of natural justice; or (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged.”

Thus, where