Allowed

Arundathi Gangi Reddy, v. Kanala Obula Reddy

Telangana HC10 Oct 2012WA/1238/2012

Case brief

AI extract

What is this about?

The Acting Chief Justice disposed of a writ appeal challenging the quashing of the disqualification of an LPG dealer. The court held that the High Court erred in disregarding material facts regarding false declarations and the reliance of the next eligible candidate, Thus allowing the appeal and setting aside the impugned order.

What did the court decide?

Impugned order set aside; writ appeal allowed.

Arundathi Gangi Reddy, Vs Kanala Obula Reddy — Telangana HC (2012) — LawSathi Research

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HON’BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE AND THE HONOURABLE SRI JUSTICE VILAS V.AFZULPURKAR

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WRIT APPEAL No.1238 OF 2012

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Dt: 10.10.2012.

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Between: Arundathi Gangi Reddy .. APPELLANT AND

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Kanala Obula Reddy and others.

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.. RESPONDENTS

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HON’BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE AND THE HONOURABLE SRI JUSTICE VILAS V.AFZULPURKAR

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WRIT APPEAL No.1238 OF 2012

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JUDGMENT: (Per THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE)

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This writ appeal has been filed against the order passed by the Hon’ble single Judge dated 27.8.2012 in W.P.No.25971 of 2010, which was filed by the writ petitioner praying to issue a Writ of Mandamus declaring the action of the Senior Regional Manager, Hindustan Petroleum Corporation Limited (for short “the HPCL”), LPG Regional Office, Anantapur District, the 2^nd respondent therein in issuing the proceedings dated 6.5.2010 disqualifying the writ petitioner as LPG dealer/distributor of Duvvur Village and Mandal, YSR Kadapa District, as illegal and arbitrary.

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The facts of the case briefly are as follows:

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On 1^st October, 2007 an advertisement was published by the HPCL in daily newspaper (Eenadu) inviting applications for appointment of LPG dealership/distributorship of Duvvur Village and Mandal under open category. Pursuant to the said advertisement, the petitioner and others, including the appellant/respondent No.5 in the writ petition applied for allotment of such LPG dealership. The Selection Committee, after taking into account the application filed by the writ petitioner and others empanelled the candidates for appointment of dealership/distributorship. In the order of merit, petitioner stood at Sl.No.1, whereas respondent No.5 stood at Sl.No.2 amongst the other empanelled. It appears that the verification committee found certain variations with regard to the financial declaration, which has been given by the writ petitioner in his application and the said

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Committee submitted its report to the authorities. The HPCL, on the basis of the said verification report, issued a show cause notice dated 22.3.2010 to the writ petitioner calling upon him to submit the documents as to the proof of balance of Rs.3,00,000/- in his Savings Bank account as on the date of the application i.e., 30.10.2007. On filing such explanation by the writ petitioner, the HPCL found that the explanation is not satisfactory, hence proceeded and disqualified the writ petitioner for allotment of such distributorship, which was duly informed to the writ petitioner by a letter dated 6.5.2010. In these circumstances, the 2^nd person, being the appellant/respondent No.5 was issued the Letter of Intent dated 9.8.2010 by the 2^nd respondent-HPCL. It appears that challenging the action on the part of the respondents the writ petition was filed.

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Counter was filed by the appellant herein/respondent No.5 and reply was also filed by the writ petitioner before the Hon’ble single Judge. The matter was heard out by His Lordship and after hearing the parties, his Lordship found that the only ground on which the writ petitioner was declared to be disqualified is that on the date of filing of the application, there was no credit of Rs.3,00,000/- in his Savings Bank account. His Lordship, after considering the said fact, opined that what is relevant is the date of submitting the application and not the date on which the writ petitioner signed the application and hence held that the reason assigned by the HPCL for disqualifying the writ petitioner for allotment of LPG dealership/distributorship cannot be sustained.

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Per contra, it was argued by the learned counsel appearing on behalf of the respondent No.5/appellant herein that it is a matter of record that respondent No.5 spent huge amounts in the matter of dealership, after being accepted by the HPCL, and after issuing the said Letter of Intent of 9.8.2010 spent money in order to carry on the business as such of dealership/distributorship and injected capital for such purpose. Further, it was stated that the bank statement, which was filed by the writ petitioner, would also show that as on the date of the application, the writ petitioner cannot have the amount as stated to be maintained by the applicant in the

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account. Further more, it has been stated that the point number, which was given by the HPCL without considering the fact that the amount was not lying in the said account, the writ petitioner got 97.5 allotted in his favour, whereas respondent No.5 got 95 points. But, after considering that aspect of the matter, the writ petitioner did not give a true picture as it was required to be given by him. At that point of time, he cannot have the said number at his credit and thereby respondent No.5/appellant ought to have topped the said merit list of the candidates in appointing such dealership by the HPCL and hence the HPCL rightly allotted the distributorship in favour of the appellant herein.

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The HPCL also filed their counter affidavit and it has been specifically stated that the writ petitioner tried to mislead the Corporation by giving false information and the Corporation has issued the letter on 6.5.2010 informing the writ petitioner that he is disqualified for his selection and in pursuance of such disqualification, the next eligible candidate, being respondent No.5, the appellant herein, was issued Letter of Intent on 9.8.2010 after conducting field verification and also after finding that she is the eligible candidate. Therefore, it is submitted that the Corporation has strictly followed the procedure contemplated under the dealership guidelines and had taken all necessary steps keeping in view the provisions of the Petroleum Act. It is further stated that as per Clause 14.2, the amount in the said Savings Bank account in the name of self and the member of the “Family Unit” should be mentioned as on the date of application, which in this case is 30.10.2007. Further, as per the field verification conducted by the officials on behalf of the Corporation, the statement of account showed a transaction of Rs.3,00,000/- on 31.10.2007 in the account of the writ petitioner and not on 30.10.2007, as ought to have been mentioned in accordance with clause 14.2. It is further pointed out by them that the balance mentioned in the application was not maintained as it would be evident from the statement of account of the said Savings Bank account and an amount of Rs.82,000/- was withdrawn on 2.1.2008. According to the HPCL, the writ petitioner tried to mislead the Corporation by giving false information resulting in issuance of the letter-dated 6.5.2010

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disqualifying the writ petitioner for such selection. It is further submitted that the market in the rural segment are of prime importance to supply LPG and the distributorship needs to be commissioned without any delay. It is also stated by the HPCL that godown and show room were completed by respondent No.5/appellant herein and further obtained the final trade licence from the District authorities on 7.1.2011 and letter of appointment was issued on 10.1.2011 and the distributorship was commissioned by respondent No.5/appellant herein. Therefore, it is submitted that in the order so passed by the Hon’ble single Judge, his Lordship did not consider this aspect of the matter in question and that the writ petitioner tried to mislead the HPCL and thereby giving of false information would certainly stand in the way to get the dealership of the said Corporation.

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It appears that the Hon’ble single Judge, after taking into account the said submissions, came to the conclusion that the action on the part of the Corporation should be quashed, including the proceedings held by them by a letter dated 6.5.2010. The Letter of Intent dated 9.8.2010 issued in favour of respondent No.5/appellant herein was also directed to be quashed.

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Being aggrieved and dissatisfied with the said order dated 27.8.2012 in W.P.No.25971 of 2010, this writ appeal has been filed before us on the ground that the Hon’ble single Judge has misconstrued the facts, which are placed before His Lordship, and further more has failed to consider clause 14.2, which specifically states that the account should be maintained and must have the balance of Rs.3,00,000/- as on the date of the application so to be made by the candidates.

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Heard the learned counsel appearing for the parties.

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Sri.D.V.Seetharama Murthy, learned Senior Counsel appearing on behalf of the appellant has drew our attention to a decision of the Supreme Court in SENIOR LAW MANAGER, INDIAN OIL CORPORATION LTD. v. GURU SHAKTI SINGH^[1] where the Supreme Court, after considering the facts therein, came to the conclusion as follows:

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“ 8. …………The High Court appears to have proceeded on the basis that even though the selection process was illegal, as the complainant (Sardar Mahinder Singh), who had alleged the

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irregularities had died, the irregularities were no longer relevant and would no longer exist and the merit panel should be accepted. Unfortunately, the High Court failed to deal with the larger issue as to whether the Selection Committee had acted fairly and properly in awarding the marks and preparing the merit panel. If the finding was that the marks were wrongly assigned to the complainant and consequently, first respondent had benefitted, it does not follow that when the complainant dies, the irregularity in assigning marks could be brushed aside or ignored. In such selections, any irregularity or material irregularity in assigning marks in regard to any person with the intention of favouring some one or excluding some one, vitiates the entire selection process. Such a selection process cannot be saved by holding that the person in regard to whom lesser marks were given had died or failed to pursue his remedy. Once the appellants took cognizance of the illegality in the selection process, the withdrawal of writ petition on death of the aggrieved complainant lost significance. The issue, as already noticed, is whether the selection process was fair and proper and whether the appellant acted arbitrarily or unreasonably in taking a decision to scrap the selection process and re-interview the candidates.”

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9. Assigning of lesser marks to Sardar Mahinder Singh not only denied him the first place in the panel, but also unjustly and undeservedly gave the first respondent, the first place in the panel. The manner of assigning marks showed a clear intention to favour the first respondent at the cost of the other applicants. It is this finding that persuaded the General Manager of IOC to scrap the selection. The High Court having recorded a finding that the appellant was satisfied about the illegality committed by the selection committee, ought to have rejected the writ petition, as the decision of the appellants to scrap the selection was reasonable and not arbitrary.”

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It also appears to us that after going through the field verification report of the said Committee, which was placed before the Selection Committee, the same should have been considered by the Hon’ble single Judge that the statements made by the writ petitioner on the date of application for obtaining such distributorship varies from the statement so shown at that point of time and, in fact, it is nothing but giving a false declaration to that effect and that part also should have been considered by the Court at the time of deciding the matter in question. We have also been able to find out that the finding of the said Selection Committee, as it appears to us, persuaded them to reconsider the list and thereby allowed the second person to have the

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distributorship and accordingly issued the Letter of Intent in his favour. It cannot be kept aside from the mind that the appellant has considerably spent money and further commenced such distributorship after obtaining all the relevant licences from different authorities. Accordingly, it appears to us that such relevant facts also should have been considered by His Lordship at the time of deciding the matter in question. In not doing so, in our opinion, the equity, which is created in favour of the appellant, was tried to be disturbed in such a fashion, which ought not to have been done by the said order.

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Accordingly, we do find that the order so passed by His Lordship is not sustainable in the eye of law.

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On the above analysis, the impugned order is set aside and the writ appeal is allowed. No order as to costs.

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( PINAKI CHANDRA GHOSE, ACJ )

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(VILAS V.AFZULPURKAR, J )

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Dt: 10.10.2012. Tnb/Msr

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HON’BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE AND THE HONOURABLE SRI JUSTICE VILAS V.AFZULPURKAR

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WRIT APPEAL No.1238 OF 2012 (Per THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE)

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Dt: 10.10.2012. (Msr)

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[1] AIR 2011 SC 1207

Arundathi Gangi Reddy, v. Kanala Obula Reddy

Case brief

What is this about?

What did the court decide?

Arundathi Gangi Reddy, v. Kanala Obula Reddy

Case brief

What is this about?

What did the court decide?

What the court decided

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