Allowed

Sri Vinkateswara Service v. Bharath Petroleum Corporation

Madras HC4 Apr 2014CRP/1325/2014

Case brief

AI extract

What is this about?

The High Court allowed a civil revision petition filed by a service station dealer against the dismissal of his suit as infructuous. The Court held that though the dealership was initiall

What did the court decide?

Order of trial court set aside; suit decreed for permanent injunction restraining cancellation of dealership, and mandatory injunctions for supply and permission to sell until proceedings conclude.

Sri Vinkateswara Service Vs Bharath Petroleum Corporation — Specific Performance | Madras HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED : 04.04.2014

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CORAM :

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THE HONOURABLE MR. JUSTICE N.KIRUBAKARAN

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CRP NPD No.1325 of 2014 and M.P.Nos.1 to 3 of 2014

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Sri Venkateswara Service Station, A Registered Firm by its Managing Partner K.G.Loganathan No.265/1, CP Manali Express Highway Road, Sathangadu, Manali, Chennai – 600 068.

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.. Petitioner / Plaintiff

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vs.

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1.Bharat Petroleum Corporation Ltd., Rep.by its Territory Manager (Retail) 35, Vaidyanathan Mudali Street, Tondiarpet, Chennai – 600 081.

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2.Bharat Petroleum Corporation Ltd., Rep.by its Chief Divisional Manager, 1, Ranganathan Gardens, Anna Nagar, Chennai – 600 040.

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.. Respondents / Defendants

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Prayer:- Civil Revision Petition filed under Article 227 of the Constitution of India against the order dated 13.12.2013 made in I.A.No.7006 of 2011 in O.S.No.719 of 2011 on the file of III Additional Judge, City Civil Court, Chennai.

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For Petitioner : Mr.V.Lakshmi Narayanan for Ms.Vadudha Thiagarajan For Respondents : Mr.O.R.Santhana Krishnan

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ORDER

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This Civil Revision Petition has been filed against the order dated 13.12.2013 made in I.A.No.7006 of 2011 in O.S.No.719 of 2011 on the file of III Additional Judge, City Civil Court, Chennai.

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If an issue comes before the Civil Court, the citizens are under the impression that it goes to the cold storage. This is a classic case which should have been decided within a year, however is hanging for more than a decade and this court does not want to find fault with anybody for that.

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The petitioner was appointed by the respondent as adhoc dealer by virtue of the letter dated 01.11.1995 to run the HSD retailer outlet at Sathangadu, Manali. The period of dealership was upto 01.05.1996. Even after expiry of the said period, the petitioner was not disturbed. The petitioner has allowed to act as a dealer and the supply was continuing. The problem arose only in the year 2000 when the officials of the respondent took samples from the petitioner's run outlet on 01.11.2000 and the samples were sent for analysis report. Meanwhile, for violation of certain norms, the petitioner's dealership was suspended for a period of 45 days by virtue of communication dated 01.11.2000 which enabled the petitioner to approach the original side of this court and to file

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C.S.No.880 of 2000 seeking for a decree (a) declaring that the notice dated 01.11.2000 issued by the defendants suspending sale is illegal, (b) for a mandatory injunction directing the respondent/defendants to effect the supply of petroleum products in accordance with the adhoc dealership appointment order dated 01.11.1995, (c) for a mandatory injunction directing the defendants to permit the petitioner/plaintiff to effect sale and supply of the products through the outlet and (d) for permanent injunction restraining the respondents/defendants from cancelling the adhoc dealership awarded by the petitioner/plaintiff at Sathangadu dated 01.11.1995 except in accordance with law.

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Though the suit was moved, only notice was issued and respondents appeared. Only after expiry of 45 days, injunction was granted and it was made absolute till the disposal of the suit as the issue has to be gone into. Aggrieved over that, the respondents filed OSA No.67 of 2991 and this court, while disposing of the OSA alongwith other OSA No.68 of 2001 filed in respect of Tiruvottiyur outlet run by the petitioner and W.A.No.2002 & 2005 of 2003 filed by the respondents noted the taking over of the Tiruvottiyur outlet run by the petitioner after cancelling the dealership and left open the issue in respect of the subject suit whether it has become infructuous or not to be determined by the trial court. In view of that, the suit continued.

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When things stood so, due to change in the pecuniary jurisdiction, the above suit got transferred to the City Civil Court and re-numbered as O.S.No.719 of 2011. When the matter was posted for trial, the respondents taken out an application under Section 151 of CPC contending that the suit has become infructuous and it should be dismissed. The said application was allowed and thereby the suit has been dismissed. Aggrieved over that only, the plaintiff before the trial court has approached this court by way of this revision.

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Mr.V.Lakshmi Narayanan who is appearing on behalf of Ms.Vasudha Thiagarajan, learned counsel for the petitioner would contend that the suit cannot be dismissed as infructuous as the suit has to be tried whether the suspension of dealership is correct or not and whether the petitioner is entitled to mandatory injunction to continue the business, as the petitioner, even after expiry of the period was allowed to continue the business. Secondly, he would submit that even though it is contended by the respondents/defendants that the dealership came to an end by an efflux of time, the dealership was never terminated in accordance with law and still it continues. Thirdly, the analysis report which forms the basis for further action has to be tried as an issue before the trial court and therefore the suit cannot become infructuous.

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On the other hand, Mr.O.R.Santhana Krishnan, the learned counsel appearing for the respondents/defendants would submit that the dealership itself is for a limited period and after expiry of that period, the petitioner cannot expect continuance of the dealership. Secondly, he would submit that following procedure only, suspension order was passed and there cannot be any illegality. Thirdly, appeal alone is maintainable against the order of the allowing application and dismissing the suit. He relied upon a judgment of this court in Anantha

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Agencies v. Bharat Petroleum Corporation Ltd., & another reported in

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2006 (3) CTC 643 which declared the order passed in an application which sought the suit to be dismissed as infructuous is the decree as per Section 2(2) of CPC and only appeal under Section 96 of the CPC would lie and no revision is maintainable.

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In reply, Mr.V.Lakshmi Narayanan, learned counsel appearing for the petitioner would contradict the contention of the respondents in relying upon the judgment reported in 2006 (3) CTC 343 and relied upon a judgment of the Hon'ble Supreme Court in Shipping Corporation of India Ltd. vs. Machado Brothers & Others reported in 2004 (11) SCC 168 wherein the Hon'ble Supreme Court has categorically held that the revision alone is maintainable against the application filed seeking to dismiss the suit as infructuous and appeal is not maintainable.

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Heard the parties and perused the records.

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The facts are not disputed upto 01.11.2000. Even on 01.11.2000, admittedly there was an inspection by the officials of the respondents. Samples were taken and for certain violations, the dealership was suspended. Only challenging the said suspension and seeking other reliefs, the petitioner has approached this court filing C.S.No.880 of 2000. The following is the prayer in Para 21 of the plaint which is usefully extracted as follows -

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“21. The plaintiff therefore prays for a judgment and decree as against the defendants herein as follows -

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a) for a declaration that the notice of suspension issued by the defendants dated 01.11.2000 in respect of the plaintiff's retail outlet at No.265/1, Manali Express Highway, Sathangadu, Chennai 600 068 is illegal, arbitrary and void abinitio and not binding on the plaintiff firm.

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b) for a mandatory injunction directing the defendants herein to resume supply of the petroleum products to the plaintiff's firm retail outlet at No.265/1, Manali Express Highway, Sathangadu, Chennai 600 068 strictly in accordance with the Adhoc Dealership order dated 01.11.1995;

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c) for a mandatory injunction directing the defendants to permit the plaintiff to effect sales of the petroleum products at their retail outlet at No.265/1, CP Manali Express Highway, Sathangadu, Chennai 600 068;

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d) for a permanent injunction restraining the defendants or

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their agents, sub-ordinates, or anyone acting on their behalf from cancelling the Adhoc dealership letter dated 01.11.1995 issued in favour of the plaintiff by the defendants in respect of the outlet at No.265/1, Manali Express Highway, Sathangadu, Chennai – 600 068, except in accordance with law ;

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e) grant such further or other reliefs ”.

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Though the suspension was only for a period of 45 days, this court did not grant injunction till the 45^th day and injunction was granted from 46^th day. Therefore the suspension has undergone by the petitioner. After expiry of 45 days period, the suit should have been disposed at that stage itself granting order of injunction restraining the respondents not to cancel, except by following due process of law. If the prayer (d) is granted, the suit would not have lasted for more than 13 years. Even today, though the learned counsel argued at length, only to simplify the issue, the suit itself requires to be disposed of by this order.

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First of all, the dealership called as adhoc dealership was issued on 01.11.1995. Clause 22 of the order would speak about the period of the agency upto 1^st May, 1996. After expiry of the period, by efflux of time, on 01.05.1996, if the respondents wished, they could have terminated the said dealership by issuing appropriate termination order which they failed to do so. On the other hand, they allowed the dealership to continue till 2000. By their act, the dealership has been continued. If the respondents wanted to terminate it, they

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should have followed the law by issuing appropriate notice to the petitioner. That is one course always open to the respondents. Irrespective of that, there was an inspection made by the officials on 01.11.2000 and a notice was served upon the petitioner stating that a joint inspection was carried at the petitioner's outlet on 01.11.2000 and it was found that following two discrepancies were found -

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“ 1. MS and HSD Stock variation beyond limits

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Lub invoices not available @ R.O. ”

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In the aforesaid background only, the petitioner approached the court for

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the reliefs which have been already referred above and the proceedings are kept pending and thereafter it was transferred to the City Civil Court.

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In the Civil Court only, an application has been taken out by the respondents contending that the suit has become infructuous by efflux of time. It is also further averred by the respondents that continuance of the suit is an abuse process of law and therefore the suit has to be dismissed as infructuous. In the said application, the petitioner contended that many prayers were sought; that the relief claimed is based on suspension order and the matter requires to be disposed after trial as many issues are involved in the suit. Contending that the suit requires appropriate trial and thereafter only it can be disposed of, the petitioner opposed the said application. The trial court, after hearing both the

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parties and relying upon a similar case, came to a conclusion that the original grant of dealership was adhoc one which was terminated by letter dated 29.03.2003 and therefore the petitioner cannot pursue the suit and therefore the suit has become infructuous.

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Though Mr.V.Lakshmi Narayanan would submit that based on the earlier orders passed by this court, the trial court simply followed those judgment and dismissed the suit, this court is not inclined to go into that issue. The campus of the suit itself is very narrow. The first prayer (a) whether the declaration that the notice dated 01.11.2000 issued by the respondents suspending the sale and supply of petroleum products to the petitioner is illegal, invalid and void abinitio and not binding on the petitioner/plaintiff was virtually became infructuous on expiry of 45 days as the suspension order itself was for 45 days. The only prayer requires to be considered is (d), i.e. for permanent injunction restraining the respondents/defendants from cancelling the adhoc dealership awarded to the petitioner/plaintiff at Sathangadu dated 01.11.1995 except in accordance with law and (b) and © prayer for mandatory injunctions are consequential, in the sense if the dealership is continuing, naturally the respondents have to continue the supply and the plaintiff should be continued to effect the sale.

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What has to be seen is whether the petitioner is entitled to the prayer

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(d) ? Admittedly, the adhoc dealership commenced on 01.11.1995 and as per the clause 22 of the adhoc dealership agreement, it ought to have come to an end on 01.05.1996. Though by efflux of time, the agency came to an end, the respondents have not chosen to terminate and allowed the petitioner to carry on the business. If he is allowed to carry on the business, the clause 22 was not acted upon. If it was not acted upon, what is the course open to the respondents ? It is always open to the respondents to terminate the agency as per law. In this case, the respondents are always at liberty to terminate agency in case of adulteration or any other misconduct which violates the conditions of

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the agency given to the petitioner. Admittedly, in this case, there was an inspection on 01.11.2000 and samples were taken and thereafter suspension order was given. After taking the samples, the same was sent for analysis to the lab. As per the procedure, alongwith the analysis report, a show cause notice is required to be given to the petitioner and after getting reply, the respondents, if they are satisfied with the reply should have dropped the proceedings or otherwise to continue the proceedings and to take it for logical end. In this case, upto taking the samples and sending the same to lab was already done and what is required to be done is to conclude the already initiated proceedings. Therefore, interest of justice requires that the petitioner should be allowed to

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continue the business as long as the proceedings initiated, as stated above is concluded. Therefore, the order of the trial court is set aside and the suit is decreed in respect of prayer (d) and consequently, (b) & (c) are also granted. It is open to the respondents to continue with the proceedings which they have already initiated by issuance of suspension order dated 01.11.2000 and thereafter pass appropriate orders.

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If the suit is not disposed in the above manner, again it will take another decade. Therefore, the above order is passed carefully.

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In the result, the Civil Revision Petition is disposed of. No costs. Consequently, connected Miscellaneous Petitions are closed. The trial court is directed to draft the decree and issue the decree within two (2) weeks from the date of receipt of a copy of this order.

04.04.2014

rgr

Internet : Yes

The III Additional Judge, City Civil Court, Chennai.

N.KIRUBAKARAN,J.

Rgr

CRP NPD No.1325 of 2014

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04.04.2014

Sri Vinkateswara Service v. Bharath Petroleum Corporation

Case brief

What is this about?

What did the court decide?

Sri Vinkateswara Service v. Bharath Petroleum Corporation

Case brief

What is this about?

What did the court decide?

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