Dismissed

M/S Shree Rajendra Agro Service Centre v. Indian Oil Corporation Ltd.

Rajasthan HC26 May 2023SAW/456/2023

Case brief

AI extract

What is this about?

The High Court of Rajasthan dismissed a special appeal filed by a petrol pump dealer against the termination of their dealership by Indian Oil Corporation Ltd. The Court upheld the termination, holding that disconnecting the original E-Card connector constituted tampering under the relevant guidelines and confirmed that the show-cause notice was timely issued.

What did the court decide?

The Special Appeal and the termination order were dismissed; the dealership termination was upheld.

M/S Shree Rajendra Agro Service Centre Vs… — Contract and Commercial Disputes | Rajasthan HC (2023)

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[2023/RJJD/017611]

[SAW-456/2023]

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

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D.B. Spl. Appl. Writ No. 456/2023

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M/s Shree Rajendra Agro Service Centre, Through Its Proprietor Shri Mahendra Kumar Mewara S/o Shri Sukha Ram Mewara, Aged About 39 Years, Resident Of Ramdevra Gali, At Post Sindru, Sumerpur, Pali (Raj.).

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----Appellant

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Versus

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Indian Oil Corporation Ltd., Through Its Chief Manager, Jodhpur Divisional Officer, Sector 12, Chopasani Housing Board, Jodhpur-342008.

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Divisional Retail Sales Head, Divisional Office Indian Oil Bhawan, Plot No.1162-63, Sector No.11, Hiran Magri, Udaipur - 313002.

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M/s Gilbarco Veedeer Root India Pvt Ltd., Through Its Head /director Art Guild House, B Wing, 1St Floor Pheonix Market City, L.b.s. Road, Kurla West, Mumbai - 400 070.

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----Respondents

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For Appellant(s) : Mr. Lakshaya Singh Udawat For Respondent(s) : Mr. Nishant Bora

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HON'BLE MR. JUSTICE VIJAY BISHNOI HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT

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Judgment / Order

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26/05/2023

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This Special Appeal has been filed on behalf of the appellant being aggrieved with the impugned order dated 09.05.2023 passed by the learned Single Judge in S.B. Civil Writ Petition No.4160/2023, whereby the writ petition filed by the petitioner has been dismissed.

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Brief facts of the case are that the appellant-firm was operating a Retail Outlet/Petrol Pump Dealership (RO) at Village

[2023/RJJD/017611]

[SAW-456/2023]

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Sanderao, District Pali, Rajasthan. On account of facing some difficulties on 15.12.2020, in operating one of the Dispensing Unit, the petitioner-firm contacted the officials of the respondent-IOCL and ultimately, the officials of the respondent-IOCL alongwith a team has inspected the troubled Dispensing Unit of the appellantfirm on 30.12.2020 and submitted its report.

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Later-on, on 08.09.2021, a show cause notice was issued to the petitioner-firm alleging that some manipulation was done in the said Dispensing Unit by the dealer or its employees. The appellant-firm has replied the aforesaid show cause notice, however, the respondent-IOCL, has ultimately terminated the dealership of the petitioner-firm vide order dated 10.02.2023.

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Being aggrieved with the said termination, the appellant-firm has preferred S.B. Civil Writ Petition No.4160/2023, however, the learned Single Judge, after hearing counsel for the parties and particularly taking into consideration the report prepared by the manufactures of the Dispensing Unit has dismissed the writ petition.

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In the said report dated 23.08.2021, it is clearly mentioned that the Dispensing Unit was manipulated by disconnecting original E-Card connector with the spurious external device.

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Learned counsel for the appellant has submitted that in the said report, prepared on 30.12.2020, the inspecting team has not found any error in the Dispensing Unit, which may lead to the only conclusion that there is no manipulation on the part of the petitioner-firm in the said Dispensing Unit.

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Learned counsel for the appellant has further submitted that the report dated 23.08.2021 is misleading. It is argued that in the final report, it is clearly mentioned that in all the parts/hardware i.e. Controller Card, Keypad Card, E-Cal Card, Pulsar Unit, Display Card, SMPS Card and Relay Card, no modification or damage was observed. Learned counsel has, therefore, argued that in view of the said analysis and observations, it can very well be concluded that there was no manipulation on the part of the petitioner-firm in the Dispensing Unit.

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Learned counsel for the appellant has further submitted that the respondent-IOCL has terminated the dealership of the petitioner-firm by invoking Clause 5.1.4 of the Marketing Discipline Guidelines, 2012 (for short ‘the Guidelines of 2012’). It is argued that from a bare perusal of said Clause, it is clear that there is no provision, which suggests that disconnecting a connector with the Dispensing Unit comes within the definition of malpractice.

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Learned counsel has further argued that as per Clause 8.5.6 of the Guidelines of 2012, if there is any malpractice, a show cause notice is required to be given to the dealer within 30 days from the date of inspection. However, in the present case, the first inspection of the Dispensing Unit was carried by the respondentIOCL on 30.12.2020, whereas the first show cause notice was issued to the dealer on 08.09.2021 i.e. almost after 9 months of the inspection and on account of this only, the impugned order passed by the respondent-IOCL may be quashed and set aside.

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Learned counsel, therefore, prayed that the impugned order passed by the learned Single Judge may be quashed and set aside and the termination order passed by the respondent-IOCL may also be quashed and set aside.

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Per contra, learned counsel appearing for the respondent- IOCL has vehemently opposed the present appeal and argued that as per the final analysis report received from the Manufacturer, it can only be concluded that error in the Dispensing Unit occurred because the dealer of the petitioner-firm or his employees had disconnected the original E-Cal connector of the Dispensing Unit to manipulate delivery of the fuel.

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Learned counsel has also submitted that the analysis report prepared by the Manufacturer cannot be read as piecemeal and the learned Single Judge has rightly discarded the initial inspection report as the same was prepared without any technical assistance. Learned counsel has also argued that the analysis report clearly suggests that there was manipulation in the Dispensing Unit and, in such circumstances, the respondent-IOCL was left with no option but to terminate the dealership of the retail outlet run by the petitioner-firm.

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Learned counsel for the respondents has also submitted the respondent-IOCL has not committed any illegality in invoking provision 5.1.4 of the Guidelines of 2012, which specifically provides that manipulation of any part of the Dispensing Unit including any mechanism, gear, microprocessor chip/electronic parts/OEM software will be deemed as tampering of the Dispensing Unit, which clearly covers the case of the petitionerfirm.

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[SAW-456/2023]

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Mr. Bora has further submitted so far as the argument of learned counsel for the appellant that the show cause notice was issued to the petitioner-firm after expiry of 30 days of the inspection is concerned, the same has no basis. It is submitted that the final analysis report of the Dispensing Unit, prepared by the Manufacturer was received by respondent-IOCL on 23.08.2021 and thereafter on 08.09.2021, the first show cause notice was issued to the appellant-firm, which is well within 30 days.

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Learned counsel has also argued that the learned Single Judge has rightly observed that in view of the analysis report prepared by the Original Equipment Manufacture, the respondent-IOCL has not committed any illegality in passing the termination order.

¶45

Heard learned counsel for the parties and perused the material available on record.

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It is true that on 30.12.2020, when the first inspection report was prepared by the officials of the respondent-IOCL, it was clearly observed that no manipulation in the Dispensing Unit was found but the learned Single Judge has rightly observed that the said inspection report was prepared without any technical assistance and therefore, the same cannot be treated as final analysis of the Dispensing Unit.

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Having regard to Clause 5.1.4 of the Guidelines of 2012, this Court is of the opinion that the term mentioned in the aforesaid Clause i.e. manipulation in the tempering Dispensing Unit is wide enough and action on the part of the dealer of disconnecting the original E-Cal connector of the Dispensing Unit

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very well comes within the definition of tempering with the Dispensing Unit.

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So far as the contention of learned counsel for the appellant that the show cause notice was given to the petitionerfirm in respect of the alleged mall functioning after 30 days of the inspection is concerned, the same has also no merit because the final analysis report was received by the appellant-firm only on 23.08.2021 and within 30 days of it, the first show cause notice was issued to the appellant-firm on 08.09.2021.

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In view of the above discussions, the Special Appeal being bereft of force is hereby dismissed.

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(YOGENDRA KUMAR PUROHIT),J

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(VIJAY BISHNOI),J

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21-Hanuman/-

M/S Shree Rajendra Agro Service Centre v. Indian Oil Corporation Ltd.

Case brief

What is this about?

What did the court decide?

M/S Shree Rajendra Agro Service Centre v. Indian Oil Corporation Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

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