SUPREME COURT OF INDIA
Hindustan Petroleum Corporation and Another
Vs
Chander Bhan and Another
Appeal (Civil) 3936 of 2006 (Arising Out of Slp(C) No. 4444 of 2006)
(Arijit Pasayat and L. S. Panta, JJ)
05.09.2006
ARIJIT PASAYAT, J.
Leave granted.
Appellants call in question legality of the judgment rendered by a Division
Bench of the Punjab and Haryana High Court allowing the writ petition of the
respondent No.1 who had filed the writ application before the High Court
seeking a declaration that the advertisement issued by the appellants on
13.7.2005 for allotment of retail outlet dealership of the appellant No.1
(hereinafter referred to as the 'Corporation') at Sector 53, Gurgaon was
illegal. Further prayer was for a direction to the Corporation to allot the
said retail outlet to the respondent No.1 purportedly on the basis of a letter
of intent dated 24.6.2003. The High Court held that the writ application
deserved to be allowed and quashed the advertisement so far as it related to appointment
of dealer for retail outlet at the site in question i.e. Sector 53, Gurgaon.
Further direction was given to allot the said outlet dealership to the
respondent No.1.
Background facts as projected by the appellant in a nutshell are as follows:
On 19.8.2000 an advertisement was issued by the Corporation inviting
application for appointment as dealer in respect of allocations at several
places including a site at Gurgaon. The present dispute relates to the Sr. No.3
i.e. allocation for Delhi Jaipur Road Town Area, Gurgaon Revenue District,
Gurgaon and it was for the open category. The nature of dealership was company
owned. The first paragraph of the advertisement indicated that the appointment
of dealers was of the various categories for company owned retail outlets on
site owned by the Corporation/leased to the Corporation/dealer owned outlet on
site/super structure to be leased to the Corporation by the dealers selected.
In the advertisement it was indicated at paragraph 2 that for dealership advertised
for locations other than those reserved for scheduled castes category the
applicant was required to furnish, along with the application, details of land
which he/she would make available for the retail outlet. In the process for
assessment of the evaluation of suitability, 35 marks were allotted out of 100
for capability to provide infrastructure and facilities (land, godown, showroom
etc.). Undisputedly the respondent No.1 applied in the open category. On
24.6.2003 a letter of intent was issued to the respondent No.1 whereby approval
was given to run a retail outlet dealership at district, Gurgaon. In the
application filed by the respondent No.1, he had stated that the land was
readily available and attached rough sketch details. Because he answered in
affirmative to the question as to whether he had suitable site readily
available he was allotted 35 marks. In respondent No.1's letter dated
27.8.2003, he had given the details of the description of the land as follows:
"Location - Gurgaon-Jhajjar Road-at Village Chandu, Distt. Gurgaon - on
State Highway. Area - 150 x 198 sq-ft."
The position was reiterated even in a writ petition which was filed earlier
before the High Court i.e. CWP No. 7960 of 2004 wherein specific reference was
made to the situation of the land at villages Siwana Moja, Gurgaon-Jhajjar Road
(site at Chandu Budeda). While the matter stood thus, Haryana Urban Development
Authority (in short 'HUDA') issued an advertisement offering land to
Nationalized Oil Companies, Government Departments and State Government
Undertakings. One of the Sectors which was allotted to the Corporation was
Sector 53, Gurgaon and the size of the site was 30.30 mtrs. There was no letter
of intent issued by the Corporation in respect of said land to the respondent
No.1, as the letter of intent related to another site and not one at Sector 53.
Taking advantage of mention about issuance of letter of intent to respondent
No.1, in one communication, he staked a claim that he was entitled to be
allotted the outlet in terms of the letter of intent. The allotment letter was
not in favour of respondent No.1, but was in favour of the Corporation. It is,
therefore, submitted that the High Court clearly missed these relevant factors
and came to an abrupt conclusion that respondent No.1 was entitled to allotment
pursuant to the letter of intent dated 24.6.2003. It is pointed out that the
outlet at Sector 53, Gurgaon was a Company Owned Company Operated (in short the
'COCO') outlet and it was reserved for the scheduled castes/scheduled tribe
category. A policy decision was taken by the Government of India, Ministry of
Petroleum and Natural Gas in this regard. Though initially the Corporation had
advertised indicating the outlet to be of open category, subsequently in view
of the changed policy decision a corrigendum was issued and the outlet is
earmarked for the Scheduled Castes/Scheduled Tribes category. It is pointed out
that the High Court proceeded on the basis as if the writ petitioner-respondent
No.1 had applied for allotment of the land which was allotted to him. On the
contrary HUDA's advertisement clearly indicated that the same was meant for the
Nationalized Oil Companies. The High Court erroneously proceeded on the basis
as if it was conceded by the Corporation that the application was made by the
respondent No.1 and allotment was made to it. In essence it is submitted that
the High Court had lost sight of the relevant factors and, therefore, the
impugned judgment deserves to be set aside.
In response, learned counsel for the respondent No.1 submitted that at all
stages Corporation accepted that a letter of intent was issued for a retail
outlet at Gurgaon. Though the respondent No.1 offered the land as is accepted
by the Corporation, No Objection Certificate (in short the 'NOC') was applied
in the name of the Corporation as ultimately the land was to be leased out by
the respondent No.1 to the Corporation. While Corporation's request for NOC was
pending, HUDA came out with the advertisement. Corporation led the respondent No.1
to believe that the Corporation was making the application on behalf of the
respondent No.1. It is clearly indicated in the letter of allotment by HUDA
that if the letter of intent is not converted to regular dealership, the
allotment will be cancelled. It is submitted that the reference to letter of
intent was in respect of respondent No.1 as no other letter of intent had been
issued. The intention was all along to allot the outlet to the respondent No.1.
After allotment of land by HUDA, in between some powerful persons started
manipulating and the retail outlet is now presently being run allegedly on
contract basis by one Smt. Krishna Singh who is none other than wife of the
principal Secretary of the State. She is not the holder of any letter of intent.
If the contractual arrangement was to be entered into, obviously respondent
no.1 should have been the first choice.
The factual position as detailed above goes to show that the application of the
respondent No.1 for retail outlet was in respect of a different site and not
the one allotted by HUDA. So far as the plot at Sector 53 in Gurgaon is
concerned, respondent No.1 was not in picture. The outlet was to be run on COCO
basis. As borne out from the document brought on record clearly, respondent
No.1 was not eligible for allotment of the outlet at the site in question.
Though initially it was for the open category, later on it was earmarked for
the Scheduled Castes and Scheduled Tribes reserved category. Even though
reference has been made to the letter of intent issued in favour of respondent
No.1, that cannot in any way assist the respondent No.1 because of the nature
of allotment made by HUDA and the directives of Ministry of Petroleum and Gas.
There was no agreement between the Corporation and respondent No.1 for
allotment of the site at Sector 53, Gurgaon to the respondent No.1.
Much emphasis has been laid by learned counsel for respondent No.1 on the
letter of allotment of HUDA, which refers to the letter of intent. Obviously
the letter of intent cannot mean the letter of intent issued in respect of
another plot of land. No reference is made to respondent No.1 even by
implication in HUDA's letter of allotment. Obviously it refers to a letter of
intent meant to be issued after due allotment. The High Court proceeded on
erroneous premises to hold as if there was existing agreement between
Corporation and respondent No.1, in respect of the plot in question. The High
Court's conclusion that Corporation was acting on behalf of the respondent No.1
and/or that the allotment was in favour of respondent No.1 is clearly contrary
to materials on record. The High Court's impugned judgment is clearly
indefensible and is set aside. However, it would be appropriate for the
Corporation to take immediate steps to give effect to the advertisement dated
13.7.2005 and complete the process as early as possible. If so felt necessary,
fresh advertisement can be issued at the earliest taking note of changed
factors if any taking place, after issuance of the notification. It would be in
public interest to complete the process of selection at the earliest to avoid
unnecessary criticism as is leveled in the present case. We make it clear that
we have not expressed any opinion about the acceptability of the criticism.
The appeal is allowed but in the circumstances without any orders as to costs.