W.P.(C) No.2011/2015 Page 1 of 44

* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Date of decision: 7th

July, 2016.

+ W.P.(C) No.2011/2015 & CM No.31914/2015 (of the petitioner for

setting aside of the order dated 14th

December, 2015)

M/S. MASAURHI SERVICE STATION ..... Petitioner

Through: Mr. Amit Sibal, Sr. Adv. with Mr.

Sanat Kumar and Mr. Vivek Raja,

Advs.

Versus

BHARAT PETROLEUM CORPORATION LTD.

& ANR. ..... Respondents Through: Mr. Sudhir Chandra Aggarwal, Sr.

Adv. with Mr. Anil K. Batra and Mr.

Paramjit Sinha, Advs. for R-1.

Mr. Sanjay Jain, ASG with Mr.

Vikram Jetly, CGSC, Ms. Pallavi

Shali and Mr. Akash Nagar, Advs. for

UOI.

CORAM:

HON’BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1. The petition (i) impugns the letter dated 24th February, 2015 of the

respondent No.1 Bharat Petroleum Corporation Ltd. (BPCL) resiting the

petitioner, a Retail Outlet (RO) dealer of the respondent No.1 BPCL from

Shanti Path to Azadpur, Delhi; (ii) seeks to restrain the respondent No.1

BPCL from taking over physical possession of the petitioner‟s petrol pump

at Shanti Path, Moti Bagh, New Delhi; and, (iii) seeks direction to the

W.P.(C) No.2011/2015 Page 2 of 44

respondent No.1 BPCL to resume sales and supplies and not to obstruct or

interfere in the operation by the petitioner of the Shanti Path RO.

2. It is the case in the petition:

(i) that the respondent No.1 BPCL is a Public Sector Undertaking

(PSU) and respondent No.2 Union of India through Ministry of

Petroleum & Natural Gas (MoPNG) is the parent Ministry of the

respondent No.1 BPCL;

(ii) that the petitioner was originally operating a RO dealership in

Bihar;

(iii) that in the year 1999, the petitioner was resited from Bihar to

Azadpur, Delhi and operated the RO at Azadpur from 1999 to 2010-

2011;

(iv) that the petitioner‟s RO was one of the best performing RO in

the northern region contributing considerably to the respondent No.1

BPCL‟s market share in Delhi;

(v) that due to various infrastructure developments undertaken in

and around Delhi, specially around the RO of the petitioner at

Azadpur, the traffic flow got reduced, thereby making the RO at

W.P.(C) No.2011/2015 Page 3 of 44

Azadpur almost non-functional and economically unviable;

(vi) that consequently in April, 2007, a decision was taken to resite

the petitioner‟s RO from Azadpur to railway land at Shakurbasti,

Delhi; however, due to withdrawal of the offer of land by the railways,

the resitement to Shakurbasti did not materialise;

(vii) that finally by letter dated 16th

April, 2010, the petitioner was

resited from Azadpur to Shanti Path, Moti Bagh, New Delhi;

(viii) that complaints with respect to irregularity in resitement of the

petitioner from Azadpur to Shanti Path were examined by the Board

of Directors of the respondent No.1 BPCL which on 10th

February,

2012 noted that the resitement of the petitioner was in the commercial

interests as well as in accordance with the broad guidelines issued by

the respondent No.2 MoPNG and contained in the Company Owned

Company Operated (COCO) Policy dated 6th

September, 2006 and the

letter dated 17th

November, 2005 containing the resitement policy;

(ix) that the RO at Shanti Path was earlier operated by another

dealer whose dealership was cancelled in the year 2001 and upon

taking over thereof by the respondent No.1 BPCL, the same was

classified as COCO and has since the year 2001 been so operated;

W.P.(C) No.2011/2015 Page 4 of 44

(x) that in the year 2005, the labour contract for operating the

Shanti Path RO, under the direct supervision of the designated officer

of the respondent No.1 BPCL, was given to one Ms. Rajni Goyal,

whose contract was ultimately terminated / came to an end on 16th

April, 2010;

(xi) that on 25th

March, 2010, classification of the said RO was

again changed from that of a permanent COCO to a temporary COCO;

(xii) that since there was no pending Letter of Intent (LOI) holder

under the social objective category in Delhi, the RO at Shanti Path

was handed over to the petitioner which was an existing regular dealer

of respondent No.1 BPCL, by way of resitement;

(xiii) that the aforesaid Ms. Rajni Goyal had filed a suit against the

respondent No.1 BPCL and on account of pendency thereof, the RO at

Shanti Path could not be advertised for dealership and the allotment

thereof in favour of the petitioner was subject to the outcome of the

Court case;

(xiv) that the respondent No.1 BPCL vide its letter dated 25th

November, 2014 to the respondent No.2 MoPNG confirmed that the

resitement of the petitioner from Azadpur to Shanti Path was in

W.P.(C) No.2011/2015 Page 5 of 44

accordance with the guidelines;

(xv) that however suddenly on 24th February, 2015, without any

notice, the respondent No.1 BPCL attempted to forcibly take

possession of the Shanti Path RO from the petitioner and upon being

unsuccessful therein stopped supplies of petroleum products to the RO

of the petitioner at Shanti Path.

3. The petition came up first before this Court on 2nd

March, 2015 when

notice thereof was issued.

4. The respondent No.1 BPCL filed a counter affidavit pleading:

(a) that the Licence Agreement dated 17th April, 2010 between the

petitioner and the respondent No.1 BPCL contains an arbitration

clause and the writ petition is not maintainable;

(b) that under the licence agreement, the respondent No.1 BPCL

has reserved into itself the right to take back the whole or any portion

of the RO and / or the RO or to alter the same at any time during the

continuance of the licence and at its sole discretion and that the RO

shall always continue to be the property and in sole possession of the

respondent No.1 BPCL;

W.P.(C) No.2011/2015 Page 6 of 44

(c) that the claim of the petitioner, a mere licensee, of possession of

the property during the pendency of the licence is not maintainable;

reliance in this regard is placed on Gesture Hotels and Food Pvt.

Limited Vs. The New Delhi Municipal Council 210 (2014) DLT 359

and The Corporation of Calicut Vs. K. Srinivasan AIR 2002 SC

2051;

(d) that the petitioner thus does not have any enforceable right and

the right of the petitioner to enter the RO at Shanti Path had come to

an end on 24th

February, 2015;

(e) that vide letter dated 10th March, 2015, the Dealership

Agreement dated 17th

April, 2010 of the petitioner had also been

revoked;

(f) that it was the petitioner who was obstructing the operation of

the said RO by the respondent No.1 BPCL;

(g) that the respondent No.1 BPCL resited the petitioner from

Azadpur to Shanti Path on a perception that the same was permissible

under the policy; however such a perception of respondent No.1

BPCL was not found correct by the Chief Vigilance Officer (CVO) of

the respondent No.1 BPCL who submitted a report to the respondent

W.P.(C) No.2011/2015 Page 7 of 44

No.2 MoPNG with the observation that the petitioner, under the

policy, could not have been resited at Shanti Path;

(h) that the respondent No.2 MoPNG had vide its letter dated 25th

February, 2015 to the respondent No.1 BPCL directed the cancellation

of the resitement of the petitioner to Shanti Path;

(i) that the site at Azadpur is ready and operations can be carried

out therefrom by the petitioner;

(j) that since it was a case of recall / revocation of decision of

resitement not in conformity with the policy / guidelines of the

respondent No.2 MoPNG with the permissibility to the petitioner to

commence operations at Azadpur, from where the petitioner had been

operating prior to resitement at Shanti Path, there was no requirement

to give any show cause notice or hearing, as the business relationship

between the petitioner and the respondent No.1 BPCL continued;

(k) that the resitement of the petitioner from Masaurih, Bihar to

Azadpur, Delhi was effected in the year 2004 and not in the year 1999;

(l) that resitement of the petitioner from Azadpur to Shanti Path

could not have been granted as the policy did not permit so;

W.P.(C) No.2011/2015 Page 8 of 44

(m) that as per the Guidelines dated 6th

September, 2006 of the

respondent No.2 MoPNG, the COCO RO at Shanti Path could be

divested to pending LOI holders belonging to the categories of

Operation Vijay-Kargil or Discretionary Quota Scheme or Corpus

Fund Scheme (SC / ST category of dealerships, widows and women

above 40 years of age without earning parents) or other categories as

prescribed in the marketing plans and if none was available in any of

the aforesaid categories, by advertising under normal process;

(n) that since the petitioner had been resited at Shanti Path in

contravention of the policy / guidelines, it was essential to correct the

said mistake;

(o) that the reliance by the petitioner in the petition on the letter

dated 9th August, 2010 of the respondent No.2 MoPNG is

misconceived as, as per the said letter itself the final decision was still

to be taken.

5. The respondent No.2 MoPNG in its counter affidavit pleaded:

(i) that the supply and sale of petroleum products to the general

public across the country is done by the Public Sector Oil Marketing

Companies viz. Indian Oil Corporation Limited, BPCL and Hindustan

W.P.(C) No.2011/2015 Page 9 of 44

Petroleum Corporation Limited through their duly appointed dealers

and distributors; though the MoPNG does not interfere in the day-to-

day affairs of the Oil Marketing Companies but has framed guidelines

governing selection, resitement, reconstitution of the dealers and / or

distributors so as to ensure transparency, uniformity and

accountability and in case of any discrepancy or irregularity or

violation in the implementation of the broad guidelines, directions are

issued for taking corrective action;

(ii) that on examination of the complaints received and on the basis

of the report of the CVO of the respondent No.1 BPCL, it was found

that resitement of the petitioner by the respondent No.1 BPCL from

Azadpur to Shanti Path was in blatant and gross violation of the extant

policy / guidelines; it is believed that certain officials of the

respondent No.1 BPCL flouted the guidelines so as to give undue

favour to the petitioner on account of certain extraneous

considerations;

(iii) that accordingly, the respondent No.2 MoPNG vide letter dated

25th February, 2015 read with corrigendum dated 25

th February, 2015

directed the respondent No.1 BPCL to cancel the resitement of the

W.P.(C) No.2011/2015 Page 10 of 44

petitioner from Azadpur to Shanti Path with immediate effect;

(iv) that in fact the resitement of the petitioner from Masaurih in

Bihar to Azadpur in Delhi was also found to be in violation of extant

guidelines;

(v) that the RO at Shanti Path was originally allotted to M/s Rajnath

Motors whose dealership was terminated in the year 2001; M/s

Rajnath Motors initiated litigation which is still pending adjudication;

(vi) that pursuant to the termination, the said RO was operated by

the respondent No.1 BPCL as a temporary COCO which was managed

by Ms. Rajni Goyal on labour contract basis and was managed by all

women and which labour contract was terminated just before the

resitement of the petitioner from Azadpur to Shanti Path;

(vii) that as per the Guidelines dated 6th September, 2006, temporary

COCOs were required to be phased out by handing over to pending

LOI holders in the order of priority mentioned therein and in case of

no LOI holder under the specific category was available, the said ROs

were to be advertised for selection of dealer in normal process;

(viii) that the respondent No.1 BPCL misinterpreted and violated the

said guidelines in resitement of the petitioner at Shanti Path;

W.P.(C) No.2011/2015 Page 11 of 44

(ix) that the Board of Directors of the respondent No.1 BPCL in the

meeting held on 24th

September, 2010 was informed that the petitioner

was being resited in accordance with the respondent No.2 MoPNG

guidelines; however the respondent No.2 MoPNG vide its letters dated

29th December, 2010, 9

th February, 2011, 14

th March, 2011, 3

rd May,

2011, 27th May, 2011, 9

th August, 2011, 14

th September, 2011, 25

th

November, 2011 and 6th

March, 2012 asked the Board of respondent

No.1 BPCL to reconsider but was not reconsidered;

(x) that in the meanwhile, the respondent No.2 MoPNG received

complaint dated 25th May, 2011 from one Member of Parliament

wherein it was alleged that some of the officials of the respondent

No.1 BPCL had permitted resitement of the petitioner at Shanti Path in

violation of the guidelines and on receipt of which complaint, a

vigilance investigation was commenced; the CVO of the respondent

No.1 BPCL concluded vide his report dated 17th October, 2012 that

divesting COCO at RO Shanti Path by the officers tantamounts inter

alia to violation of the guidelines and breach of rules and violation of

laid down procedures and was null and void;

W.P.(C) No.2011/2015 Page 12 of 44

(xi) that the respondent No.2 MoPNG on examination of the report

of the CVO vide its letter dated 25th February, 2015 directed the

respondent No.1 BPCL to cancel the resitement of the petitioner;

(xii) that further suitable action as may be deemed fit shall be taken.

6. When the petition came up before this Court on 27th May, 2015, both

the petitioner as well as the respondent No.1 BPCL claimed to be in

possession of the RO at Shanti Path. In this view of the matter, both parties

were directed to maintain status quo as it was obtained on that date, till the

next date of hearing.

7. The petitioner applied for amendment of the petition to also impugn

the letter dated 10th March, 2015 of cancellation of dealership of the

petitioner. The said application came up before this Court on 17th

September, 2015 when it was allowed un-opposed and the amended petition

taken on record. The respondent No.1 BPCL and the respondent No.2

MoPNG have filed counter affidavits thereto.

8. On 14th

December, 2015, the following order was passed:

“1. An adjournment is sought on the ground of unavailability

of the counsel for the petitioner. It is stated that the counsel for

the petitioner is unwell.

W.P.(C) No.2011/2015 Page 13 of 44

2. The senior counsel for the respondent No.1 vehemently

opposes. It is reminded to the Court that on 6th

October, 2015

also when the matter could not be taken up, the respondent no.1

Bharat Petroleum Corporation Ltd. (BPCL) had expressed

urgency and thus the counsel for the petitioner was aware that

the matter would be taken up today. It is yet further contended

that in fact the counsel whose illness is pleaded as a ground for

adjournment has not been arguing and on arguing dates a

senior counsel has been engaged and could have been engaged

today also.

3. The counsel for the petitioner states that the senior

counsel who was to be engaged is also out of station today.

4. The senior counsel for the respondent no.1 BPCL further

states that the petitioner after obtaining an interim order from

this Court has been delaying the matter, sometimes by seeking

adjournments and sometimes by making frivolous applications

including for amendment of the petition and which amendments

have no relevance to the controversy. It is further contended

that the petitioner at best was a mere licensee of the respondent

no.1 with respect to the subject petrol pump and which licence

also had been obtained in violation of the Rules/Guidelines

therefor, in collusion with some officials of the respondents no.1

BPCL and in a vigilance inquiry, action has been taken against

as many as five officials of the respondent no.1. It is stated that

action against two others could not be taken as they had retired.

It is also informed that the respondent no.1 BPCL has stopped

supplies to the subject petrol pump and now the petitioner is

illegally squatting thereon under protection of the interim order

of status quo of this Court and the respondent no.1 BPCL is

also suffering a loss from being not able to sell its petroleum

products therefrom. It is also pointed out that the petitioner has

also been given an option to go back to the original Azadpur

site from which he was shifted / re-shifted to the subject site.

5. Having considered all the aforesaid facts and factors, I

am of the view that the ad interim injunction obtained by the

petitioner is to be vacated not only for the reason of the

petitioner having chosen not to after notice / after completion of

W.P.(C) No.2011/2015 Page 14 of 44

pleadings argued but also in the larger public interest.

6. Not only is the respondent no.1 BPCL being deprived of

the revenues from the subject petrol pump but the public must

also be suffering owing to non availability of petroleum

products at the said site.

7. Accordingly, the interim order dated 27th

May, 2015

directing the parties to maintain status quo is vacated.

8. The application for interim relief is dismissed.”

9. CM No.31914/2015 was filed by the petitioner for setting aside of the

order dated 14th December, 2015. The same came up before this Court on

22nd

December, 2015 when notice thereof was issued and while adjourning

the matter to 6th

January, 2016, the counsels were asked to come prepared to

argue the writ petition also on the said date. The senior counsels for the

petitioner was heard on 6th January, 2016, 8

th January, 2016 and 25

th January,

2016. The learned ASG appearing for the respondent No.2 MoPNG was

heard on 28th January, 2016. On 8

th February, 2016, the following order was

passed:

“1. The senior counsel for the respondent no.1 Bharat

Petroleum Corporation Ltd. (BPCL) has been heard to an

extent.

2. It is inter alia the contention of the respondent no.1

BPCL that the re-sitement of the petitioner from Azadpur to

Shantipath COCO site was violative of the Guidelines therefor

as filed at pages 33 to 35 of the paper book. During the

hearing, the Re-sitement Guidelines w.e.f. 17th November, 2005

at pages 36-41 have also been perused and on a prima facie

W.P.(C) No.2011/2015 Page 15 of 44

reading thereof it appears that the re-sitement of the petitioner

from Masaurhi, Bihar to Azadpur, Delhi also was contrary

thereto. The counsel for the petitioner states that the said re-

sitement was as far back as in 2004 and is not under challenge.

The senior counsel for the respondent no.1 BPCL states that the

Guidelines applicable in 2004 will be produced on the next date

of hearing.

3. The respondent no.1 BPCL to also produce the file

containing the decision making process for re-sitement of the

petitioner from Bihar to Azadpur, Delhi and from Azadpur,

Delhi to Shantipath, New Delhi.

4. The senior counsel for the respondent no.1 BPCL to on

the next date also address on whether the Policies regarding

Retail Outlets have been examined vis-a-vis the judgment of the

Supreme Court in Natural Resources Allocation, In Re,

Special Reference No.1 of 2012 (2012) 10 SCC 1. It appears

that BPCL and other Oil Marketing Companies cannot be

permitted to create rights in perpetuity in retail outlets and

there should be allotment of retail outlets except for categories

reservation for whom may be deemed necessary, through

competitive bidding process.

5. I have already in Bharat Petroleum Corporation Ltd.

Vs. Union of India MANU/DE/4431/2015 made certain

observations in this regard. The obliviance of the officers of

BPCL present in Court thereto shows the scant

regard/consideration by BPCL of Courts orders.

6. List on 25th February, 2016.”

The senior counsel for the respondent No.1 BPCL concluded his

arguments on 25th February, 2016. The senior counsel for the petitioner was

heard in rejoinder on 14th March, 2016 and 5

th April, 2016 when judgment

was reserved.

W.P.(C) No.2011/2015 Page 16 of 44

10. The senior counsel for the petitioner in addition to the factual matrix

recorded hereinabove, argued:

(a) that the petitioner operated the RO at Shanti Path till 23rd

February, 2015 as an all women served RO and won several awards

therefor;

(b) that the revocation by the respondent No.1 BPCL of the

allotment of the RO at Shanti Path to the petitioner vide notice dated

24th February, 2015 was without giving any reason and without any

show cause notice and liable to be set aside on this ground alone;

(c) that reliance in this regard was placed on paras 58 and 59 of

M/s. Allied Motors Ltd. Vs. M/s. Bharat Petroleum Corpn. Ltd. AIR

2012 SC 709 and on paras 1, 9 to 11 and 16 of Ashish Gupta Vs. IBP

Co. Ltd. 125 (2005) DLT 298;

(d) that no arbitration is possible because the respondent No.2

MoPNG on whose direction the respondent No.1 BPCL has acted is

not a party to the arbitration agreement; even otherwise, there can be

no arbitration qua rights under Article 14 of the Constitution of India;

(e) that the termination of the dealership agreement of the petitioner

is also without any notice; as per the licence agreement, termination

W.P.(C) No.2011/2015 Page 17 of 44

could be effected after 90 days notice, if without any cause and after

30 days notice, if for any breach; reliance was placed on paras 14, 16

and 18 to 21 of Bharat Filling Station Vs. Indian Oil Corporation

Ltd. 104 (2003) DLT 601 and it was argued that no urgency has also

been disclosed so as to be dispensed with the notice; attention was

invited to the letter dated 29th

December, 2010 of the respondent No.2

MoPNG to the respondent No.1 BPCL with respect to the operations

of the RO at Shanti Path advising the respondent No.1 BPCL to

examine the matter, keeping in view the Guidelines dated 6th

September, 2006 and “considering the commercial interest of the

company”;

(f) attention was invited to the extract of the meeting of the Board

of Directors held on 24th

September, 2010 recording that Shri

Shailender Kumar of the petitioner was not a relative of the Chairman

& Managing Director of the respondent No.1 BPCL and that there is

no mala fide wrong-doing by any officer of respondent No.1 BPCL in

resitement of the petitioner at Shanti Path and that the resitement was

carried out in the best interest of the respondent No.1 BPCL;

W.P.(C) No.2011/2015 Page 18 of 44

(g) attention was also invited to the agenda item for the Board

meeting of 3rd

February, 2012 also containing the reasons for

resitement of the petitioner;

(h) it was informed that the Court case with respect to the RO at

Shanti Path is still pending;

(i) that from all the aforesaid documents it is evident that there was

no mala fide or errors in the resitement of the petitioner at Shanti Path;

attention was also invited to the letter dated 25th

November, 2014 of

the respondent No.1 BPCL to the respondent No.2 MoPNG reiterating

that the resitement of the petitioner from Azadpur to Shanti Path was

in accordance with the guidelines and in the best interest of the

respondent No.1 BPCL and there was no hanky-panky therein and it is

argued that when the respondent No.1 BPCL had taken such a stand

till three months before 24th February, 2015, could not, merely

because of the directive dated 25th February, 2015 of the respondent

No.2 MoPNG, change its stand;

(j) that the petitioner, at the time of filing of the petition was not

even aware of the reasons for which action divesting it of the RO at

Shanti Path was taken and thus could not challenge the same and the

W.P.(C) No.2011/2015 Page 19 of 44

decision for the said action had emerged only from the counter

affidavit of the respondent No.2 MoPNG and without there being any

inkling of it earlier;

(k) that the same also demonstrates the need for a show cause

notice; had an opportunity been given to the petitioner, the petitioner

would have had a chance to explain that there was no violation of the

policy or mala fide on the part of the respondent No.1 BPCL on

resitement of the petitioner at Shanti Path;

(l) that even from the counter affidavit of the respondent No.2

MoPNG and the documents filed therewith, no finding of any mala

fides on the part of anyone in the respondent No.1 BPCL in resitement

of the petitioner emerges and the decision to resite the petitioner was

on hearsay / impressions;

(m) that no report of the CVO has been placed on record and in any

case the said report itself is stated to be three years old, of 17th

October, 2012;

(n) that the CVO of the respondent No.1 BPCL also did not conduct

any inquiry from the petitioner and the report of the CVO also is thus

in violation of natural justice and arbitrary;

W.P.(C) No.2011/2015 Page 20 of 44

(o) that the report of the CVO in any case is advisory in nature;

(p) that till date no prosecution has been launched nor any

disciplinary proceedings initiated against anyone for the illegality, if

any in such resitement of the petitioner;

(q) that the dicta of this Court in Bharat Filling Station supra

where it was held that no such action could be taken on the basis of

First Information Report (FIR) alone squarely applies and rather in the

present case there is no FIR also;

(r) that once the Board of Directors of the respondent No.1 BPCL

had considered the matter and were satisfied, the petitioner without

any notice could not have been so divested of its RO allotted to it;

(s) that the respondent No.1 BPCL is not to act at the behest of the

respondent No.2 MoPNG, specially when the Board of Directors of

the respondent No.1 BPCL had decided otherwise;

(t) that the respondent No.1 BPCL even in its counter affidavit to

this petition does not say that the resitement of the petitioner was not

in consonance with the policy or that there was any wrongdoing;

W.P.(C) No.2011/2015 Page 21 of 44

(u) that there are no findings of any extraneous consideration for

resitement of the petitioner;

(v) that the letter dated 25th

February, 2015 of the respondent No.2

MoPNG to the respondent No.1 BPCL also does not contain any

reason and the respondent No.1 BPCL could not have blindly acted

thereon, when its Board had earlier concluded that the resitement of

the petitioner was in accordance with the extant policy;

(w) that thus the divestment of the petitioner of the allotted site

challenged in this petition is without any reasons whatsoever and

without application of mind; reliance in this regard is placed on para

47 of Kranti Associates Private Limited Vs. Masood Ahmed Khan

(2010) 9 SCC 496 and on para 46 of Ravi Yashwant Bhoir Vs.

District Collector, Raigad (2012) 4 SCC 407 (DB);

(x) that in any case reasons for the action could not have been given

in the counter affidavit and there is nothing to show that any such

reasons existed at the time when action was taken; reliance is placed

on para 8 of Mohinder Singh Gill Vs. The Chief Election

Commissioner, New Delhi (1978) 1 SCC 405; attention was drawn to

the policy for resitement of a commissioned dealership /

W.P.(C) No.2011/2015 Page 22 of 44

distributorship enclosed to the letter dated 17th November, 2005 of the

respondent No.2 MoPNG providing for road widening, diversion of

road, re-alignment of existing road by a new one, as a ground for

resitement and it was argued that no error has been pointed out in

violation thereof;

(y) that a note dated 25th March, 2010 was prepared by a

Committee of Chief Manager (Highway Retailing), General Manager

(Retail) Headquarter, General Manager, Headquarter (Brand & ARB)

and General Manager (Highway Retailing) with regard to COCOs was

handed over and on the basis thereof, it was argued that all the COCOs

which were not meeting the desired standard were agreed to be

divested and it was argued that the decision for resitement of the

petitioner was thus felt to be the in the best commercial interest of the

respondent No.1 BPCL;

(z) that the CVO did not know the reasons for the respondent No.1

BPCL choosing not to advertise for Shanti Path RO i.e. the pendency

of suit filed by the earlier dealer;

W.P.(C) No.2011/2015 Page 23 of 44

(aa) that in equity there was nothing wrong in resitement of the

petitioner;

(bb) in response to my query it was informed that Mohinder Singh

Gill supra has not been diluted and has been followed in Rashmi

Metaliks Limited Vs. Kolkata Metropolitan Development Authority

(2013) 10 SCC 95;

(cc) that the respondent No.1 BPCL as a statutory authority and a

writ petition is maintainable against it; reliance in this regard was

placed on Bharat Petroleum Corporation Ltd. Vs. Maddula

Ratnavalli (2007) 6 SCC 81;

(dd) that the respondent No.2 MoPNG at the relevant time having

left the matter of allotment of the Shanti Path RO to the decision of the

respondent No.1 BPCL could not have subsequently issued a direction

to the respondent No.1 BPCL to revoke the said resitement. A lot of

emphasis was made on the respondent No.1 BPCL having rewarded

the petitioner for its performance;

(ee) had there been any involvement of any of the officers of the

respondent No.1 BPCL in such resitement of the petitioner,

disciplinary action would have followed;

W.P.(C) No.2011/2015 Page 24 of 44

(ff) that no undue favour was shown to the petitioner;

(gg) that notwithstanding an arbitration clause writ remedy is

available; reliance was placed on Harbanslal Sahnia Vs. Indian Oil

Corpn. Ltd. (2003) 2 SCC 107;

(hh) that the respondent No.1 BPCL ought not to have taken such

mid-night action against its best dealer;

(ii) that photographs of the Azadpur RO site were shown to contend

that the same is still not viable. Reliance was placed on M/s. Dadri

Cement Co. Vs. M/s. Bird and Co. Pvt. Ltd. AIR 1974 Delhi 223 to

contend that the petitioner could not have been reverted to Azadpur

RO, the agreement with respect whereto stood novated;

(jj) that the respondents have, in the garb of termination of

resitement, in fact terminated the licence of the petitioner;

(kk) that the landlord of the Azadpur RO has instituted a suit for

possession and which is pending adjudication;

(ll) that the mid-night action of the respondent No.1 BPCL against

the petitioner was also contrary to public interest. Reliance was also

placed on M/s R.K. Associates & Hoteliers Pvt. Ltd. Vs. Indian

W.P.(C) No.2011/2015 Page 25 of 44

Railways Catering & Tourism Corporation (IRCTC) 2015 SCC

OnLine Del 9528 to contend that existence of arbitration clause in the

licence agreement is not a bar to the maintainability of the writ

petition;

(mm) that the mere fact that the respondents have taken over Shanti

Path site would not make the writ petition infructuous, inasmuch as if

the petitioner succeeds, it is entitled to restoration of possession of the

Shanti Path site.

11. The learned ASG appearing for the respondent No.2 MoPNG

contended:

(I) that the petitioner has travelled a long distance from Masaurih

in Bihar to Shanti Path, New Delhi and the decision of the respondent

No.1 BPCL to permit the same was flawed and contrary to policy;

(II) that the dealership is a state largesse;

(III) that the petitioner was operating the RO from 2004 when

according to the petitioner also the proposal for its resitement from

Azadpur was first mooted, till the year 2010 when the petitioner was

ultimately resited;

W.P.(C) No.2011/2015 Page 26 of 44

(IV) that the permanent COCOs were converted to temporary COCO

to be ultimately phased out;

(V) that the policy of the year 2005 of allotment of temporary

COCOs did not provide for resitement thereof of the existing dealers;

(VI) that the resitement policy annexed to the letter dated 17th

November, 2005 on which reliance is placed by the petitioner is not

with respect to the temporary COCOs and there could be no

resitement at temporary COCO thereunder;

(VII) that even as per the policy enclosed to the letter dated 17th

November, 2005, there could be no resitement on the ground of loss of

revenue;

(VIII) that though the respondent No.1 BPCL had terminated the

dealership of the petitioner but the petitioner can go back to Azadpur;

(IX) that the COCO Phasing Out Policy dated 6th

September, 2006

was the applicable policy and under which the petitioner could not

have been resited at Shanti Path;

(X) that the petitioner was / is deemed to be fully in the know of all

the policies of the respondent No.1 BPCL and had no bona fides in

W.P.(C) No.2011/2015 Page 27 of 44

claiming or in retaining resitement at Shanti Path;

(XI) that the conduct of the petitioner disentitles it from any relief;

reliance was placed on M/s. Dharampal Satyapal Ltd. Vs. Deputy

Commissioner of Central Excise, Gauhati 2015 (6) SCALE 612

where it was held that when certain benefits were accorded contrary to

policy and were thus refundable, issuance of notice would be an empty

formality and useless formality theory was invoked;

(XII) reliance was placed on paras 69, 70.4 and 70.5 of Joshi

Technologies International Inc. Vs. Union of India (2015) 7 SCC

728 to contend that a writ petition is not maintainable where an

arbitration clause exists and in contractual matters; reliance in this

regard was also placed on State of U.P. Vs. Bridge & Roof Company

(India) Ltd. (1996) 6 SCC 22;

(XIII) that reference was made to K.D. Sharma Vs. Steel Authority of

India Limited (2008) 12 SCC 481 holding that a petitioner whose

conduct is not found to be bona fide, his petition has to be rejected on

this ground only;

(XIV) that the petitioner has not suffered from any act of the State and

the petition is not maintainable for this reason also. The petitioner in

W.P.(C) No.2011/2015 Page 28 of 44

any case had no right to remain a licensee of the Shanti Path RO.

12. The senior counsel for the respondent No.1 BPCL argued:

(A) that the petition does not disclose any vested right of the

petitioner which can be said to have been violated;

(B) that the petitioner has invested neither in land nor in equipment

nor in supplies of the petroleum products retailed from the RO, all of

which were provided by the respondent No.1 BPCL;

(C) that the claim of the petitioner of being in possession and to

possession, when as per the terms of the licence, the possession is of

the respondent No.1 BPCL, also disentitles the petitioner from any

relief in the writ petition;

(D) attention was invited to Clauses 15, 18, 19(a) & (b) of the

licence to contend that the arbitration is contemplated therein is also

empowered to restore possession;

(E) that a supplementary affidavit was handed over to the effect that

Azadpur RO is accessible from three directions and likely to have

sales of more than 500 KL per month, which is much above the

threshold volume of 150 KL required for setting up of a new RO in

W.P.(C) No.2011/2015 Page 29 of 44

Delhi;

(F) that the petitioner having got Shanti Path RO through unfair

means had to be necessarily divested thereof in public interest;

(G) that the policy prevalent at the time of resitement of the

petitioner from Masaurih in Bihar to Azadpur Delhi was handed over

to show that such resitemetn of the petitioner was also contrary thereto

and did not even have the approval in accordance with the policy;

(H) that the petitioner in terms of Clauses 1, 4, 15, 18 & 21 of the

licence agreement had no vested right with respect to any RO;

(I) that since the resitement of the petitioner at Shanti Path was

through the backdoor, there is no injustice in reverting the petitioner to

Azadpur and no notice was required to be issued;

(J) that the writ remedy is to be invoked to meet the ends of justice;

here there is no injustice;

(K) that reference was made to Rajasthan State Industrial

Development and Investment Corporation Vs. Diamond & Gem

Development Corporation Limited (2013) 5 SCC 470 to contend that

the Court should not exercise its writ jurisdiction to enforce

W.P.(C) No.2011/2015 Page 30 of 44

contractual obligations;

(L) attention was invited to para 98 of Ramesh Chandra Sankla

Vs. Vikram Cement (2008) 14 SCC 58 laying down that the

discretionary and inequitable powers under Article 226 of the

Constitution are required to be exercised in the larger interest of

justice, balancing the interests and equities and relief can be denied in

public interest;

(M) reliance was placed on Dharampal Satyapal Limited Vs.

Deputy Commissioner of Central Excise, Gauhati (2015) 8 SCC 519

laying down that a breach of procedure cannot give rise to a remedy in

the Courts, unless behind it there is something of substance which has

been lost by the failure;

(N) that now when this Court has heard the petitioner, if this Court

were to be of the view that the removal of the petitioner from the RO

of Shanti Path is justified, even if this Court to be of the view that the

petitioner should have been granted a hearing, the petitioner ought not

to be restored to the RO at Shanti Path for the said reason;

W.P.(C) No.2011/2015 Page 31 of 44

(O) that this is not a fit case for exercise of extraordinary power of

prerogative writ.

13. The senior counsel for the petitioner in rejoinder, besides

recapitulating his opening arguments, contended:

(i) that the resitement policy enclosed to the letter dated 17th

November, 2005 and the COCO policy dated 6th

September, 2006

have to be read harmoniously;

(ii) that as per the 17th November, 2005 policy, the petitioner had to

be resited on account of road re-alignment;

(iii) that there is no bar in the 6th September, 2006 policy to

resitement at the COCO RO;

(iv) that at the relevant time, owing to the road realignment at

Azadpur, the petitioner had to be resited and had the COCO RO at

Shanti Path not been allotted to it, the right of the petitioner of

resitement would have been violated;

(v) that the petitioner was employing women at the RO of Shanti

Path and all of whom had been rendered unemployed;

W.P.(C) No.2011/2015 Page 32 of 44

(vi) that the tearing hurry shown by the respondent No.1 BPCL in

vacating the petitioner from the RO of Shanti Path shows the mala

fides of the respondent No.1 BPCL;

(vii) that the petitioner in accordance with the policy of the

respondent No.1 BPCL was also operating an „In and Out‟ store from

the Shanti Path RO and has been vacated therefrom also;

(viii) that Azadpur RO is still not functional;

(ix) distinguished the judgments cited by the counsels for the

respondents.

14. I have considered the rival contentions.

15. Though at one time, the respondent BPCL had terminated the

dealership of the petitioner but is now not insisting on such termination and

the question to which this writ petition is confined is whether the action of

the respondent BPCL of reverting the RO of the petitioner from Shanti Path

to Azadpur is illegal.

16. The first illegality argued by the senior counsel for the petitioner is, of

the said reversion being without notice and without hearing to the petitioner.

In this regard, the reason for which such action has been taken becomes

W.P.(C) No.2011/2015 Page 33 of 44

important. It is the case of BPCL and MoPNG that the resitement of the

petitioner from Azadpur to Shanti Path was illegal and the action of undoing

what was illegal does not require any notice or hearing to be given. I,

however, do not deem it necessary to adjudicate the said question at this

stage, when the petition is pending before this Court for the last nearly 1 ½

years and when the petitioner, though had sought, did not get any interim

relief of restoration of supply of petroleum products which had been stopped

since 24th

February, 2015 and managed to get interim relief only of

maintenance of status quo qua possession and appears to have been satisfied

therewith. The reason thereof is obvious. The petitioner, besides a retailing

petroleum products from the RO at Shanti Path, was also operating an “In

and Out” store from the said outlet and the business of an “In and Out” store

appears to have been more lucrative and more rewarding than the business of

operating the RO. The petitioner felt the pinch only after was divested of the

“In and Out” store pursuant to vacation on 14th December, 2015 as of the

interim order earlier granted of „status quo‟. I am of the view now that all

the issues have been thrashed out before this Court in the lengthy and

elaborate hearing, in the facts of the present case, even if I were to find that

the petitioner before the impugned action was required to be given a notice

W.P.(C) No.2011/2015 Page 34 of 44

and an opportunity of being heard, disposal of the petition simply with that

direction without returning any findings on the other arguments urged would

be a wastage of judicial time.

17. Moreover, no prejudice is found to have been caused to the petitioner

from being deprived of notice and hearing, even if were to be given.

Petitions, one of the ground of challenge to the impugned action wherein is

of non-grant of hearing/notice, depending upon their peculiar facts can be

either disposed of at the initial stage with a direction for hearing to be given

and if remain pending and are heard finally, can be disposed of with such a

direction only if the petitioner is found to be suffering from any prejudice by

being deprived of the notice and/or hearing. In most cases, including the

present one, disposal of the petition with the direction for hearing to be given

would only delay, keeping the rights of the respective parties at sea and

thereby preventing both parties from beneficial use and enjoyment o the

property concerned. Considering the nature of the property concerned in the

present case i.e. a RO, keeping the rights at sea any longer would be against

public interest.

18. There is another reason for which I say that keeping the issue at sea is

contrary to public interest. According to the respondents, the petitioner was

W.P.(C) No.2011/2015 Page 35 of 44

resited from the RO at Azadpur to the RO at Shanti Path to the detriment of

others who, as per the policy of MoPNG were required to be allotted the

same. If that is found to be true, then no illegality can be seen in undoing

thereof at the earliest so as to enable the RO at Shanti Path to be allotted to

its rightful claimants.

19. Supreme Court recently in Dharampal Satyapal Ltd. supra, after

holding that there was a requirement of issuance of a show cause notice

before taking the action impugned therein, proceeded to hold that the

principles of natural justice are very flexible principles and cannot be applied

in any straight jacket formula. It was held that it may not be necessary for the

Court to strike down the action and refer back the matter to the authorities

concerned to take a fresh decision after complying with the procedural

requirements in those cases where non grant of hearing has not caused any

prejudice to the person. It was further held that rules of natural justice are to

be followed for doing substantial justice and are not ritualistic.

20. As far as the objections of the respondents as to the maintainability of

the petition for the reason of existence of an arbitration clause in the

dealership agreement is concerned, the principle of non-maintainability of a

writ petition if an alternative suitable remedy is available is also a principle

W.P.(C) No.2011/2015 Page 36 of 44

of discretion and not an absolute principle. I am again of the view that once

the writ petition remains pending and arguments have been fully heard

thereon and if the question involved can be adjudicated conveniently in writ

jurisdiction, the Court should ordinarily attempt to dispose of the question in

writ jurisdiction even if the alternative remedy is available, so that judicial

time is not wasted.

21. That brings me to the illegality if any on merits in the action of the

respondents, of reverting the petitioner from Shanti Path to Azadpur.

Though to the petitioner, as a dealer of BPCL, it should matter not whether it

deals in the BPCL products from Shanti Path or from Azadpur, but obviously

the petitioner has reason to feel aggrieved therefrom. The reasons which

have come forward are two-fold. First, commercial and second being the

fear of losing the dealership at Azadpur also in the eventuality of BPCL

being evicted from the said site by the owner/landlord thereof. As aforesaid,

the petitioner till was not divested of “In and Out” store being operated by it

at the RO at Shanti Path was satisfied with the interim order of status quo

qua possession even without being able to operate/retail petroleum products

therefrom and of which additional source of revenue there appears to be no

possibility from the RO at Azadpur. However, the same, in my view will not

W.P.(C) No.2011/2015 Page 37 of 44

qualify as reasons for which the petitioner can legally be said to feel

aggrieved. The petitioner has not been assured any minimum revenues while

becoming a dealer of BPCL. In any case it has come on record that the sales

from the RO at Azadpur have also always been above the minimum „off

take‟ which is required of a dealer of BPCL.

22. Before proceeding to discuss the question further I may record that

several cases have come before this Court where as a result of development

of civil infrastructure in the city resulting in realignment of the roads, or for

other varied reason, RO‟s of oil companies have had to shut down or close

and dealers whereof have been left without any RO to operate. The

consistent stand of the oil companies in those cases has been that resitement

is subject to policy and availability and not as a matter of right and those

petitions have been disposed of with directions to the oil companies to

accommodate such dealers subject to availability. Reference can be made to

Khandelwal Oil Company Vs. Indian Oil Corporation 2012 SCC OnLine

Del 1400 (DB) and to Bharat Petroleum Corporation Ltd. Vs. Union of

India MANU/DE/4431/2015.

23. On the contrary, here is a case where the petitioner by acquiring the

dealership of BPCL with respect to a RO in a remote corner of Bihar has

W.P.(C) No.2011/2015 Page 38 of 44

used the same to successively shift to more lucrative RO‟s of BPCL. Indeed

a special treatment appears to have been given by BPCL to the petitioner.

24. The petitioner, along with the petition, in support of its plea of

resitement from Azadpur to Shanti Path being in accordance with law, filed

the letters dated 17th November, 2005 and 6

th September, 2006. The letter

dated 17th November 2005 of MoPNG to the oil companies annexing thereto

the marketing guidelines including with respect to resitement of dealerships

and distributorships. It inter alia provides that resitement of a commissioned

dealership / distributorship “may be considered” inter alia on the ground of

re-alignment of existing road and subject inter alia to (i) being within the

same district/area/State and class of markets; (ii) the

dealership/distributorship at the old location being decommissioned. The

letter dated 6th September, 2006 is with respect to operation of RO‟s on

COCO basis and directing phasing out of temporary COCOs by offering and

handing over of the same subject to suitability to the pending letter of intent

holders under the following categories:-

“(a) Special Scheme (Operation Vijay-Kargil), the Kargil

allottees

(b) Discretionary quota scheme

(c) Corpus Fund Scheme (SC/ST category of dealerships,

widows and women above 40 years of age without

W.P.(C) No.2011/2015 Page 39 of 44

earning parents).

(d) Other categories as prescribed in the marketing plans.

(e) The industry may pool their available temporary

COCO ROs for offering to the categories under (a) &

(b) above. In case no LOI-holder under these

categories are available, then these dealerships should

be advertised for selection of dealers under normal

process.”

25. It would thus be seen that while the letter dated 17th November, 2015

supra enables resitement but does not provide where the dealer/ distributor

can be resited; the letter dated 6th September, 2006, though not concerning

resitement of a commissioned dealer / distributor, provides for phasing out

of ROs being operated on temporary COCO basis. It is not in dispute that the

Shanti Path RO was being operated on temporary COCO basis and was to be

dealt with in accordance with letter dated 6th September, 2006. The question

for consideration is, whether under the policy contained in the letter dated 6th

September, 2006, it could have been allotted to the petitioner by way of

resitement from Azadpur.

26. According to the petitioner, at the time of phasing out of Shanti Path

RO from the category of temporary COCO, no LOI holder belonging to

either of the categories of, Operation Vijay-Kargil or Discretionary Quota

Scheme of any of the Oil Companies or of other categories prescribed in the

W.P.(C) No.2011/2015 Page 40 of 44

marketing plans of the respondent BPCL was available. Though the same

does not inspire confidence as it is unbelievable that no LOI holder of any of

the Oil Companies from the Operation Vijay-Kargil or Discretionary Quota

Scheme was available but even if that be so, according to the letter dated 6th

September, 2006, the Shanti Path RO then had to be advertised for selection

of dealers under the normal process. The same was admittedly not done and

instead the petitioner was resited thereat. The other reason given by the

petitioner for the RO being not advertised because of pending Court case is

also not only without any basis but also not tenable in law. There admittedly

was no stay from the Court against advertisement. Just like the petitioner,

notwithstanding the Court case was willing to be resited, so could have

others been willing. In any case, even if it were to be believed that the

petitioner was willing to be resited there as a temporary measure, the

petitioner cannot now claim any permanency with respect thereto. Also,

there is no absolute right of resitement as aforesaid. The right is only to be

considered for resitement and subject to availability.

27. Such resitement of the petitioner at Shanti Path RO which was till then

being operated on temporary COCO basis is clearly in violation of the policy

contained in letter dated 6th September, 2006. The petitioner was certainly

W.P.(C) No.2011/2015 Page 41 of 44

given something by respondent BPCL, to what he was not entitled to, not

only in violation of policy with which the respondent BPCL was bound but

also at the cost of dependents of martyrs of Operation Vijay - Kargil or those

in Discretionary Quota Scheme, of any of the Oil Companies and/or at the

cost of selection of dealer / distributor thereof through advertisement,

offering equal opportunity to all. The fact that none of the officials of the

respondent BPCL responsible for this violation have been proceeded against

or punished therefor will not convert what was given to the petitioner in

violation of the policy, in accordance with the policy and will not diminish

the need to undo the illegality committed. Similarly, the decision of the

Board of Directors of the respondent BPCL, of the resitement of the

petitioner being in accordance with the extant policy, did not take away the

right of MoPNG to, upon finding the same to be against the policy, direct the

respondent BPCL to undo the illegality.

28. It was in this context that I had vide my order dated 8th February 2016

supra drawn the attention of the counsels to the directions issued by me in

Bharat Petroleum Corporation Ltd. Vs. Union of India,

MANU/DE/4431/2015 and to which no heed appears to have been shown by

the BPCL till now. I had therein wondered, as I had now also, as to what is

W.P.(C) No.2011/2015 Page 42 of 44

the right of a person who once becomes the dealer of an Oil Company to the

dealership in perpetuity. Ordinarily no contracts of the Governments are in

perpetuity, the intention being to give opportunity to all desirous of availing

thereof. If dealerships are given a perpetual status, considering the fact that

there is hardly any scope for any new dealership in the city, it would amount

to those who have succeeded in acquiring the same, enjoying it like

ownership rights in immovable property and to the detriment of others when

a dealership is but a largesse. There can possibly be no justification for

allowing a dealership once obtained, say under the operation (Vijay-Kargil

Scheme) to help out martyrs, to continue in the family of such martyrs and

resulting in none being available subsequently for another who may have

similarly suffered.

29. I have in this context also enquired of the commission which the

dealers of oil companies get from sale of the petroleum products and had yet

further inquired why should the dealership not be auctioned to a person who

tenders the minimum commission. The only answer forthcoming was that

introducing competition in commission may introduce an element of

adulteration of petroleum products. However, in my understanding, payment

of a high fixed commission does not insure that adulteration will not be

W.P.(C) No.2011/2015 Page 43 of 44

indulged in.

30. Be that as it may, these issues are for the respondent BPCL to consider

in pursuance to my directions in the judgment aforesaid.

31. The only response of the petitioner to my repeated query, that without

the letter dated 6th

September, 2006 supra (laying down modus of phasing

out of temporary COCOs) providing for resitement therein of existing

dealers, how could the petitioner be resited therein, was that since the

guidelines circulated under cover of letter dated 17th

November 2005

provided for resitement and there was no bar in the letter dated 6th

November, 2006 to such resitement at the temporary COCO being phased

out, there was no illegality in the petitioner being resited there.

32. I am unable to agree. Once the policy of phasing out of temporary

COCOs was clear and the residuary clause therein provided for dealers to be

invited by advertisement, if there were no existing LoI holder of the

specified categories and since there was no provision therein for resitement

of an existing dealer, such resitement is excluded therefrom. Significantly,

the policy contained in the letter dated 6th September, 2006 is not under

challenge.

W.P.(C) No.2011/2015 Page 44 of 44

33. The illegality in resitement of the petitioner at Shanti Path is thus writ

large. In fact it has also come on record that the Azadpur RO has not been

decommissioned and which is one of the requirements of resitement under

the letter dated 17th November, 2005. It being so, there can be no illegality

in undoing the illegality taking benefit whereof the petitioner in the first

place came to Shanti Path.

34. No merit is thus found in the petition. Dismissed.

35. The petitioner having availed of the interim order having taking

benefit thereof also continued to earn from the “In and Out” store and to the

deprivation of the respondent of earnings from the said RO is also burdened

with costs of Rs.1 lakh of this petition to be payable to BPCL within four

weeks hereon.

RAJIV SAHAI ENDLAW, J.

JULY 07, 2016

„bs‟/gm