Partly allowed

Leashar v. Bharat Petroleum Corporation Limited

Kerala HC2 Aug 2021WA/526/2021

Case brief

AI extract

What is this about?

The Division Bench quashed the Single Judge's order in a petition concerning LPG distributorship reconstitution. The lower court erroneously applied retail outlet guidelines. The Benched corrected this, noting applicable distributorship guidelines fail to mandate third-party consent if public employment disqualifies them, and remitted the matter to BPCL.

What did the court decide?

Impugned W.P. (C) No. 15053/2014 and its judgment dismissed by Single Judge are quashed; matter remitted to BPCL for decision on reconstitution within two months.

Leashar Vs Bharat Petroleum Corporation… — Contract and Commercial Disputes | Kerala HC (2021)

¶1

IN THE HIGH COURT OF KERALA AT ERNAKULAM

¶2

PRESENT

¶3

THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR

¶4

¶5

THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

¶6

MONDAY, THE 2^ND DAY OF AUGUST 2021 / 11TH SRAVANA, 1943

¶7

WA NO. 526 OF 2021

¶8

AGAINST THE JUDGMENT IN WP(C) 15053/2014 OF HIGH COURT OF KERALA

¶9

APPELLANTS/PETITIONERS IN THE WPC:

¶10

1 LEASHAR AGED 53 YEARS, S/O. NARAYANAN, VRINDAVANAM, CHEPPAD, KANNIMAL, CHEPPAD P.O., ALAPPUZHA DISTRICT - 690 507.

¶11

2 SANGEETHA RANI, W/O. SURENDRAN R., PANACKAL PADEETTATHIL, RAMAPURAM, KURIKKAD P.O., ALAPPUZHA.

¶12

BY ADVS.

¶13

GEORGE VARGHESE(PERUMPALLIKUTTIYIL) SRI.A.R.DILEEP SRI.P.J.JOE PAUL SRI.MANU SRINATH

¶14

RESPONDENTS/RESPONDENTS IN THE WPC:

¶15

1 BHARAT PETROLEUM CORPORATION LIMITED, TRIVANDRUM LPG TERRITORY OFFICE, REPRESENTED BY TERRITORY MANAGER, LPG BOTTLING PLANT, POST BOX NO.6, KAZHAKOOTTAM P.O, THIRUVANANTHAPURAM - 695 522.

¶16

2 TERRITORY MANAGER

¶17

BHARAT PETROLEUM CORPORATION LIMITED, TRIVANDRUM LPG TERRITORY OFFICE, LPG BOTTLING PLANT, POST BOX NO.6, KAZHAKOOTTAM P.O, THIRUVANANTHAPURAM - 695 522.

¶18

W.A.No.526 of 2021

¶19

¶20

3 SHIBUKUMAR VRINDAVANAM, CHEPPAD KIZHAKKUM MURI, CHEPPAD P.O., ALAPPUZHA DISTRICT – 690 507.

¶21

BY ADVS. SRI.M.GOPIKRISHNAN NAMBIAR SRI.T.KABIL CHANDRAN SRI.G.MANU KRISHNAN SRI.K.JOHN MATHAI SRI.JOSON MANAVALAN SRI.KURYAN THOMAS SRI.PAULOSE C. ABRAHAM SRI.E.K.NANDAKUMAR (SR.)

¶22

THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 02.08.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

¶23

W.A.No.526 of 2021

¶24

¶25

JUDGMENT

¶26

Dated this the 2^nd day of August, 2021

¶27

S.Manikumar, C.J.

¶28

Instant writ appeal is directed against the judgment in W.P. (C)No.15053 of 2014. Short facts leading to the filing of the appeal are as hereunder:

¶29

The appellants are the legal heirs of Late Smt. Lekshmi, who was assigned an LPG Distributorship by the Bharat Petroleum Corporation Limited, 1^st respondent. After the death of Mrs. Lekshmi, the appellants approached the 1^st respondent, BPCL, for reconstitution of the distributorship. The appellants had sought Mr.Shibukumar, the 3^rd respondent, to be included in the distributorship, but the 3^rd respondent had declined the same. In such circumstances, the appellants, after forming a partnership, requested the 1^st respondent, BPCL, for reconstituting the distributorship in their name. As the 1^st respondent, BPCL, failed to take a decision on the appellants' request, writ petition was filed seeking necessary reliefs and the said writ petition was dismissed by the learned single Judge. Hence the appeal.

¶30

W.A.No.526 of 2021

¶31

¶32

The impugned judgment is assailed, inter alia, on the following

¶33

grounds:

¶34

A. It is submitted that it is a settled law that the legal heir-ship and succession operate automatically and instantaneous upon the death of the subject. Thus in matters affecting the devolution of property and assets of the deceased, the law or norms that govern the field at the time of death alone can be considered and acted upon. Thus the applicable set of norms governing the reconstitution of the distributorship is the one which is in effect on the date of the death of the sole proprietor. The Learned Single Judge grossly erred in deciding issues raised in the writ petition in accordance with Policy Guidelines for Reconstitution of Retail Outlet/SKO-LDO Dealerships dated 04.07.2018. The sole proprietor had died on 20.02.2014 and the applicable guidelines governing the reconstitution of the distributorship were the Ext.P2 guidelines which were in force with effect from 01.12.2008. Without any basis, the learned single Judge has relied upon the Policy Guidelines dated 04.07.2018 for dismissing the contentions taken by the Appellants. Thus the impugned judgment needs to be revisited by this Division Bench.

¶35

B. The impugned judgment failed to appreciate that a conjoint reading of Clauses 3.4 and 3.5 of Ext.P2 guidelines would entitle the appellants to carry on the distributorship as the 3^rd respondent has expressed his unwillingness co join the partnership. Since the 3^rd respondent had expressed his unwillingness to join the appellants as partners on both the meetings held on 25.04.2014 and 13.05.2014, respondents 1 and 2 ought to have reconstituted the gas agency

¶36

W.A.No.526 of 2021

¶37

¶38

with the appellants as partners.

¶39

C. The impugned judgment fails to take note of the fact that the distributorship has been awarded in the instant case to the family of Late Radhakumar, a martyr of the Kargil War. Termination of agency on the sole ground of reluctance of the 3^rd respondent to join partnership of the appellants would cause irreparable injury and hardship to the appellants. The said gas agency was allotted to honour the valiant services rendered by Late Radhakumar as a soldier in the Indian Army. The family of Late Radhakumar was considered for such allotment and Smt.Lekshmi was nominated for allotment by other family members comprising the appellants and the 3^rd respondent. It was upon their written consent that the allotment happened to be in the name of Smt. Lekshmi. Hence, it is the entitlement of the family unit as such and no family member can claim exclusive rights over the same. Hence, the 1^st respondent, being an instrumentality of the State, ought to act fairly and reasonably and ought to continue the distributorship with the partnership of the appellants, instead of attempting to terminate it on the ground that 3^rd respondent is not co-operating and consenting. Ext.P2 guidelines do not recognise the right to veto of a family member in the process of reconstitution of the distribution.

¶40

D. The 3^rd respondent, a beneficiary of public employment under the Compassionate Employment Scheme of the Government of Kerala and an employee of the Agricultural Development Bank, Mavelikkara, is disqualified from seeking reconstitution of the distributorship as per Ext.P2 guidelines and thus his consent is irrelevant and immaterial for the 1^st and 2^nd respondents to process the appellants'

¶41

W.A.No.526 of 2021

¶42

¶43

application for reconstitution of the distributorship. The appellants' objection before the 1^st and 2^nd respondents regarding the disqualification is pending before the respondents since long and the learned single judge ought to have issued a writ of mandamus in this regard, requiring the 1^st and 2^nd respondents to fulfill its obligations under the Ext.P2 guidelines.

¶44

E. An Ext. P2 norm enables all legal heirs at law to join in partnership for the reconstitution of an existing LPG Distributorship. It also enables a legal heir from opting out, leaving the others the freedom to join as partners. However, a heir at law cannot regulate the entitlement of another legal heir in the matter of reconstitution of the Distributorship. Therefore the learned single judge ought to have treated Ext. P7 as a document evidencing the intention of the 3^rd respondent to opt out of the partnership and thereby disentitled in the reconstitution of the Distributorship. Finding to the contrary is erroneous in law and cannot be legally sustained.

¶45

F. Respondents 1 & 2 must be held to be bound by the rigours of Ext.P2 guidelines and they must not be permitted to evade from their duty to reconstitute the distributorship in strict adherence to Ext.P2 guidelines which they had framed. The Hon'ble Supreme Court in R.D. Shetty v. International Airport Authority, [1979] 3 SCC 489: 1979 AIR 1628 held that once the norms and standards are laid down by any executive authority, it cannot go back from the standards established. It is the very essence of the rule of administrative law which was taken from the enunciation of Mr. Justice Frankfurter in Vitarelli v. Seaton, 359 U.S. 535 (1959) where the learned judge held that “an executive agency must be rigorously

¶46

W.A.No.526 of 2021

¶47

¶48

held to the standards by which it professes its action to be judged”. Thus the respondents 1 & 2 must be directed to strictly adhere to Ext.P2 guidelines and to permit the appellants to reconstitute the distributorship without requiring the 3rd Respondent's consent for the same, as per the Clauses 3.4 and 3.5 of the Ext.P2 guidelines.

¶49

G. It is further submitted that the Annex.1 letter further prolongs the appellants' agony. The Annex.1 is also illegal as it coerces the appellants to seek and obtain the consent of the 3^rd respondent as a pre-requisite for reconstituting the distributorship, in defiance of the Ext.P2 guidelines. This Hon'ble Court may be pleased to stay the operation of the said letter during the pendency of this writ appeal.

¶50

Mr.George Varghese (Perumpallikuttiyil), learned counsel for the appellants, made submissions on the above grounds and referring to the policy guidelines for reconstitution of retail outlets, relied on by the writ court, submitted that they are not applicable to the case on hand, and in particular clause 9, which reads thus:

¶51

“In case where there is no NOCs from Nominee(s)/Legal Heir(s) who are not eligible to become Dealer. In case of death, where one or more Nominee(s)/Legal Heir(s) are not willing to give relinquishment or NOC in favour of incoming/surviving Proprietor/Partner(s) despite the fact that these Nominee(s)/Legal heir(s) may not be eligible to become dealer as per Disqualification norm of Dealer Selection guidelines, in such cases obtaining NOC/Relinquishment from such Nominee(s)/Legal heir(s) will not be mandatory. However, the

¶52

W.A.No.526 of 2021

¶53

¶54

onus would be on the surviving/incoming Proprietor/Partner(s) of the dealership to provide conclusive documentary evidence with regard to disqualification of such Nominee(s)/Legal heirs(s) and OMC would also independently verity the authenticity of the same. In such cases, OMCs may issue a communication to the concerned Nominee(s)/Legal heir(s) to submit documentary proof with regard to their eligibility within 30 days from the date of the letter. In case no response is received, the OMC can approve reconstitution of the dealership excluding such Nominee(s)/Legal heir(s). However the surviving/incoming Proprietor/Partner(s) of the dealership will have to indemnify the OMC against (Annexure-J2) any claims or demands which may be made in future.

¶55

For cases where letters written to such nominee(s)/Legal heir(s) gets returned undelivered. Such cases to be treated as “Nominees(s)/Legal Heir(s)/Partner(s) is/are not traceable” and further action is to be taken in accordance with the same.”

¶56

Mr.George Varghese (Perumpallikuttiyil), learned counsel for the appellants further submitted that what is applicable to the case on hand is Exhibit P2.

¶57

Referring to clause 3.4 of the said revised policy guidelines, for reconstitution of the RO dealerships/LPG distributorships/SKO-LDO dealerships, learned counsel for the appellants submitted that Bharat Petroleum Corporation Limited (BPCL), respondent No.1, is bound to continue the LPG dealership, accepting the partnership of the appellants,

¶58

W.A.No.526 of 2021

¶59

¶60

who succeed to the estate of the deceased dealer, namely Lekshmi K. (mother).

¶61

He further submitted that the Will sought to be relied on by respondent No.3, brother of the appellants, who is also a legal heir of the deceased Lekshmi, was found to be not valid by a competent civil court and in such circumstances, appellants are entitled to the award of LPG dealership on the demise of their mother.

¶62

Ms.Ramola Nayanpally, learned counsel appearing for BPCL, fairly admitted that the policy guidelines applied to the case on hand is only Exhibit P2 and not the one, relied on by the writ court. According to her, the clause in the policy guidelines, referred to by the writ court applies to retail outlets and not reconstitution of RO dealerships/LPG distributorships/SKO-LDO dealerships. She further submitted that Exhibit P2 was the only document filed at the time of filing of the writ petition.

¶63

However, after hearing, it appears that the policy guidelines applicable to retail outlets have been produced and thus, reliance by the writ court was erroneous. Submission of the learned counsel for the Corporation is not disputed by either the appellants or the third respondent, who have sought for award or assignment of LPG dealership on the demise of their mother.

¶64

W.A.No.526 of 2021

¶65

¶66

Mr.George Varghese (Perumpallikuttiyil), learned counsel for the appellants, contented that in terms of clause 3.4 of the revised policy guidelines applicable to the case on hand, that is, LPG distributorship, BPCL is mandated to consider only clause 3.4 of the said guidelines. Said clause reads thus:

¶67

“3.4. In cases of death of the sole dealer/distributor reconstitution may be made in favour of the legal heir. However, if there is no legal heir(s) or legal heirs(s) has expressed unwillingness, the dealership/ distributorship shall be terminated.”

¶68

As the appellants have relied on clause 3.5 of the revised

¶69

policy guidelines, the same is extracted hereunder:

¶70

“3.5. In cases of death of one of the partner(s), the partnership shall be reconstituted with the legal heir(s) of the deceased partner(s) and surviving partner(s). However, if there is no legal heir(s) or the legal heir(s) has expressed unwillingness, the dealership/ distributorship shall be reconstituted with the surviving partner(s).”

¶71

The abovesaid clause is not applicable to the case on hand, as the dealership awarded to the mother of the claimants, is not the one of a partnership firm, but it was sole proprietorship.

¶72

Though, inviting the attention of this court to Exhibit P6 dated

¶73

10.5.2014, a letter addressed by the appellants to BPCL, learned counsel

¶74

W.A.No.526 of 2021

¶75

¶76

for the appellants submitted that when one of the legal heirs, Mr.Shibukumar, did not want to join as a partner, BPCL is bound to issue the allotment of gas agency to the other legal heirs, we are not inclined to issue any such directions for the reason that the BPCL is bound to consider only clause 3.4 of the revised policy guidelines.

¶77

In the case on hand, there are three legal heirs.

¶78

Though Mr.Shibukumar, the third respondent, has made an independent claim, on the basis of the Will said to have been executed by the mother/sole dealer, civil court of competent jurisdiction has declared the Will as invalid. Therefore, all the legal heirs are entitled to seek for allotment or assignment. It is for the BPCL to decide as to whether allotment or assignment, be continued or not, by exercising their discretion in terms of clause 3.4 of the revised guidelines.

¶79

Though Mr.Manu G.Krishnan, learned counsel for the 3^rd respondent, submitted that talks of settlement are going on between the parties and therefore, the instant writ petition may be referred to mediation, we are not inclined to do so, for the reason that material on record discloses that the fight between the legal heirs has been started in the year 2014, after the demise of the sole dealer, mother. There was litigation regarding the validity of the Will alleged to have been executed

¶80

W.A.No.526 of 2021

¶81

¶82

by the mother, the sole dealer. Six years have elapsed, since the demise of the sole dealer. Reading of the impugned judgment also indicates that even during the pendency of the writ petition, parties have resorted to mediation and that they could not arrive at a settlement. Therefore, we are of the view that no useful purpose would be served, in once again sending the matter for mediation for amicable settlement. Pending disposal of the litigation, BPCL has made a temporary arrangement for running the LPG distributorship.

¶83

It is time that the appellants and third respondent should come to some sort of an arrangement to retain the LPG distributorship.

¶84

At this juncture, learned counsel for the BPCL submitted that the Corporation has already fixed 22.8.2021, as the day for reporting the matter before them.

¶85

In view of the specific admission by all the parties concerned, decision and directions of the writ court, by placing reliance on the policy guidelines applicable to LPG retail outlets, have to be set aside and accordingly we set aside the same. In terms of clause 3.4 of the revised policy guidelines, applicable to LPG dealership, BPCL is directed to take a decision, within two months from the date of receipt of a copy of this judgment. We make it clear to the contesting parties and hope that the

¶86

W.A.No.526 of 2021

¶87

¶88

concession given should be utilised, barring differences, if any. Parties to

¶89

bear in mind that, “Blood is thicker than water”. Let there be a wise decision before the Corporation acts.

¶90

Writ appeal is disposed of as above.

¶91

Pending interlocutory applications, if any, shall stand closed.

¶92

Sd/-

¶93

S.Manikumar Chief Justice

¶94

Sd/-

¶95

Shaji P.Chaly Judge

¶96

vpv

¶97

/TRUE COPY/

¶98

P.A. TO JUDGE

Leashar v. Bharat Petroleum Corporation Limited

Case brief

What is this about?

What did the court decide?

Leashar v. Bharat Petroleum Corporation Limited

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Parties & counsel

Coram

Case details

Similar cases

V. Varghese Vs the Union of India

V. Varghese Vs the Union of India

Musaliar College of Engineering Vs State of Kerala

Aswin Manmathan, Vs A.P.J Abdul Kalam Technological University

State of Kerala Vs Rahul S Krishnan

Central Board of Secondary Education Vs Mohammed Saiban M. (Minor)