Dismissed

Indian Oil Corporation Ltd. v. Balaji Fuels

Kerala HC21 Jan 2021WA/165/2021

Case brief

AI extract

What is this about?

Appellants (Indian Oil Corporation) appealed against a single judge order quashing notices to refund incentives paid to retail dealers. The Division Bench held that the single judge's decision to allow the refund, partly based on admitted policy lapses and lack of proof regarding awareness of policy changes, could not be interfered with. The appeals were dismissed.

What did the court decide?

The writ appeals were dismissed, thereby upholding the order quashing the refund notices.

Indian Oil Corporation Ltd. Vs Balaji Fuels — Company and Corporate | Kerala HC (2021)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR

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THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

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THURSDAY, THE 21ST DAY OF JANUARY 2021 / 1ST MAGHA, 1942

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WA.No.163 OF 2021

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AGAINST THE JUDGMENT IN WP(C) 9883/2014(I) OF HIGH COURT OF KERALA

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APPELLANTS/RESPONDENTS:

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1 INDIAN OIL CORPORATION LTD.

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KERALA STATE OFFICE, PANAMPILLY NAGAR P.O, KOCHI 682 036,

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REPRESENTED BY ITS DEPUTY GENERAL MANAGER

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2 THE CHIEF DIVISIONAL RETAIL SALES MANAGER, INDIAN OIL CORPORATION LTD., COCHIN DIVISIONAL OFFICE, PANAMPILLY NAGAR P.O, KOCHI - 682 036

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BY ADVS.

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DR.THUSHARA JAMES SRI.M.S.AMAL DHARSAN

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RESPONDENTS/PETITIONERS:

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1 UNITED FUELS DEALERS

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I.O.C DEALER, EDAPPALLY, COCHIN -24, REPRESENTED BY ITS PARTNER.

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2 FORTUNE SERVICE STATION, IOC DEALER, UDAYAMPEROOR, NADAKKAVU P.O, ERNAKULAM REPRESENTED BY ITS MANAGING PARTNER

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3 SREENARAYANA SALES AND SERVICES, IOC DEALER, EDAPPALLY, COCHIN - 24, REPRESENTED BY ITS PARTNER

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4 CHERIA PATHROSE AND COMPANY, IOC DEALER, KOLDENCHERY, ERNAKULAM - 682 311 REPRESENTED BY ITS MANAGING PARTNER

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5 A M A FUELS, IOC DELAER, M.C ROAD, MUVATTUPUZHA - 682 673 REPRESENTED BY ITS MANAGING PARTNER

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WA.Nos.163 & 165 OF 2021

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6 KOTHAMANGALAM AUTO FUELS, IOC DEALER, KOTHAMANGALAM, ERNAKULAM DISTRICT, REPRESENTED BY ITS MANAGING PARTNER.

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7 AVARAN PETROLEUM IOC DEALER, KATTOOR ROAD, IRINJALAKUDA, THRISSUR - 680 121, REPRESENTED BY ITS PROPRIETOR

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8 ANIDYA PETRO CAFE, IOC DEALER, OLLUKKARA P.O, KALATHODE, THRISSUR - 680 121, REPRESENTED BY ITS PROPRIETOR

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9 STAR AGENCY IOC DEALER, THRIPRAYAR, NATTIKA P.O, THRISSUR DISTRICT, REPRESENTED BY ITS PROPRIETOR

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10 DURGA FUELS, IOC DEALER, PEERAMANGALAM, THRISSUR DISTRICT, REPRESENTED BY ITS PROPRIETOR

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11 KHAYAM PETROMEUM,

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IOC DEALER, PERUMPILAVU JUNCTION, THRISSUR - 680 519, REPRESENTED BY ITS PROPRIETOR

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12 SREE SASTHA FUELS, IOC DEALER, KAVUVATTOM, PATTAMBI ROAD, CHERPLASSERY, PALAKKAD DISTRICT, REPRESENTED BY ITS PARTNER

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13 GURUDEV PETROPARK, IOC DEALER, N.H 47, PUDUKKAD, P.O NANDIKKARA, THRISSUR - 680 301, REPRESENTED BY ITS PROPRIETOR.

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14 JYOTHI AGENCIES IOC DEALDER,TUDA PLOT/TUDA ROAD,THRISSUR DISTRICT REPRESENTED BY ITS PROPRIETOR.

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15 I.R BAHULEYAN AND SONS IOC DEALER,PALLURUTHY,COCHIN 682 006,REPRESENTED BY ITS MANAGING PARTNER.

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SMT. M.U.VIJAYALAKSHMI FOR RESPONDENTS

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 21.01.2021, ALONG WITH WA.165/2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WA.Nos.163 & 165 OF 2021

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR

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THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

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THURSDAY, THE 21ST DAY OF JANUARY 2021 / 1ST MAGHA, 1942

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WA.No.165 OF 2021

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AGAINST THE JUDGMENT IN WP(C) 10562/2014(U) OF HIGH COURT OF KERALA

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APPELLANTS/RESPONDENTS:

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1 INDIAN OIL CORPORATION LTD.

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KERALA STATE OFFICE, PANAMPILLY NAGAR P.O, KOCHI 682 036, REPRESENTED BY ITS DEPUTY GENERAL MANAGER.

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2 THE CHIEF DIVISIONAL RETAIL SALES MANAGER, INDIAN OIL CORPORATION LIMITED, COCHIN DIVISIONAL OFFICE, PANAMPILLY NAGAR P.O., KOCHI - 682 036.

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BY ADVS.

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DR.THUSHARA JAMES SRI.M.S.AMAL DHARSAN

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RESPONDENT/PETITIONER:

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BALAJI FUELS

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I.O.C. DEALER, CHANDRA NAGAR, PALAKKAD 678 007, REPRESENTER BY ITS MANAGING PARTNER.

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MT. M.U.VIJAYALAKSHMI FOR RESPONDENT

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 21.01.2021, ALONG WITH WA.163/2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WA.Nos.163 & 165 OF 2021

JUDGMENT

SHAJI P.CHALY,J

These appeals are directed against the common judgment of the learned Single Judge dated 12.5.2020 in W.P.(C) Nos.9883/2014 and 10562/2014, by the respondents. Having been aggrieved by the following directions issued by the learned Single Judge in the judgment, these writ appeals are filed:

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“4. I have considered the contentions advanced. Though the petitioners have raised contentions seeking payment of incentives in terms of Ext.P1, the essential question which arises for consideration before this Court at the present time is only with regard to the refund of the amounts already paid to the petitioners. I am therefore called upon to consider only the question of legality of the notices issued to the petitioners requiring them to refund the amounts already drawn by them on the basis of the XTRACARE scheme incentives in force. The petitioners have raised a specific contention that they were not made aware of any change in the policy and that the amounts had been released to them till the first quarter of 2013. Though the respondents have placed counter affidavit on record pointing out that there were modifications to the policy and specifically pleading that the circular dated 2.5.2012 provides that incentives will not be granted in case of the dealers registering a negative growth, there is no pleading to the effect that the dealers were put on notice at any point of time that they would not be entitled to the incentives unless they register positive growth. On the contrary, the pleading in the counter affidavit itself is to the effect that the amount of incentives eligible as per Ext.P1 had been granted to the petitioners till the first quarter of 2013 but such payment was by mistake. The contention raised by the respondents is to the effect that several

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WA.Nos.163 & 165 OF 2021

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dealers have refunded the amounts and that the petitioners alone cannot contend that they are not liable to refund the same. In view of the fact that the respondents themselves had paid the amounts to the petitioners, apparently, without noticing the change in policy brought about by Ext.R2(4) and since it is not disputed that the petitioners have provided the extra facilities required for claiming the incentives as per Ext.P1 and the modifications brought about thereto, I am of the opinion that the communications issued to the petitioners requiring them to refund the amounts already paid by the respondents is completely untenable and unsustainable. Even if it is the case of the respondents that the amounts were not liable to be paid pursuant to Ext.R2(4), I am of the opinion that since the amounts had already been disbursed to the petitioners and since the incentives were paid against the maintenance of extra facilities by the dealers, the contention of the respondents cannot be accepted.

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The petitioners had approached this Court immediately after the issuance of the notices and had obtained interim orders against recovery of incentives paid pursuant to the notices. The fact that other dealers had not challenged the notices and had paid the amounts cannot be a reason for rejecting the claim raised by the petitioners. This is more so in view of the fact that the specific case of the petitioners that they were not made aware of the requirement in the amended policy has not been specifically controverted by the respondents.

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In the above view of the matter, I am of the opinion that the prayers sought for in these writ petitions are liable to be allowed. The impugned notices are quashed. However, the prayer for payment of further amounts on the basis of Ext.P1 cannot be allowed since it is an admitted fact that the policy has undergone a change and that incentives can be granted only in terms of the policy as amended.

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These writ petitions are ordered accordingly. ”

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The subject issue relates to unilateral stoppage of incentives given

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WA.Nos.163 & 165 OF 2021

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to retail dealers of the Indian Oil Corporation Limited and also the claims for refund of the incentives provided. According to the writ petitioners, the order in question issued by the Indian Oil Corporation are in fragrant violation of the provisions of fairness, equity and natural justice. It was also pointed out that writ petitioners were providing additional facilities and services in their outlets

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in accordance with the directions issued by the Indian Oil Corporation to the retail dealers individually. It was also submitted that incentives towards the compensation was certified and cleared from 2008 onwards based on the inspection and verification carried out. Other legal contentions were also raised to substantiate the contention that the action of the Corporation stopping the incentives and re-calling the incentives already provided to the writ petitioners are bad and illegal.

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The learned Single Judge after taking into account the attendant facts and circumstances projected by the writ petitioners and the contentions raised in the counter affidavit filed by the Indian Oil Corporation, has arrived at the finding that the Corporation itself paid the amounts without noticing the change in policy brought about by the Corporation and also that it is not disputed that the writ petitioners have provided the extra facilities required for claiming the incentives as per Ext.P1 directions of the Corporation and the modifications brought about thereto and therefore, the refund sought for was held to be bad. It was also found that the contention advanced by the writ petitioners that they were not made aware of the requirement in the amended policy

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WA.Nos.163 & 165 OF 2021

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has not been specifically controverted by the respondents. Anyhow, the further prayer sought for by the writ petitioners for payment of further amounts on the basis of the offer extended by the Indian Oil Corporation cannot be allowed since it was found that the policy had undergone a change and that incentives can be granted only on the basis of amended policy. Appellants relied upon Ext.R2(4) change of policy and submitted that the writ petitioners were aware of the change of policy on and w.e.f. 2^nd May, 2012 and therefore, the appellants were justified in re-calling the incentives on the basis of change of policy. It was also pointed out that meetings of the dealers were frequently called for and further that the subsequent change of policy was implemented by the retail dealers and therefore, the retail dealers cannot be said to be ignorant of the policy dated 2^nd May, 2012.

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We have heard learned counsel for appellants Sri.Thushara James (Dr.), learned counsel for writ petitioners Sri.Brijesh Mohan and perused the pleadings and materials on record.

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The sole question to be considered is whether any manner of interference is required in the judgment of the learned Single Judge ? In our considered view, except from the contentions raised in the counter affidavit filed by the appellants before the writ court that the retail dealers were aware of Ext.R2(4) circular issued by the appellant Corporation in regard to the change of policy, no documents were produced before the writ court to

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WA.Nos.163 & 165 OF 2021

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substantiate the said contention. Mere submission made before the writ court that periodical meetings of the retail dealers were conducted and therefore, the dealers can be presumed to be aware of the change in policy is not a legally sustainable contention. It was taking into account the said legal aspects and factual circumstances available on record only, the learned Single Judge has allowed the writ petition partly and declined the continuance of the incentive facilities overlooking the amended policy.

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On appreciation of the facts and law raised by the appellants, we do not think, the appellants have made out a case of any illegality or unfairness in exercise of the discretion by the learned Single Judge justifiable to be interfered exercising the power of appeal conferred under section 5 of the Kerala High Court Act, 1958.

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Needless to say, writ appeals fail, accordingly they are dismissed.

Sd/-

S.MANIKUMAR

CHIEF JUSTICE

Sd/-

SHAJI P.CHALY

JUDGE

smv

Indian Oil Corporation Ltd. v. Balaji Fuels

Case brief

What is this about?

What did the court decide?

Indian Oil Corporation Ltd. v. Balaji Fuels

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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