V PURUSHOTHAM RAO Vs. UNION OF INDIA

JUDGEMENT

(1.) In this batch of appeals the judgment of Delhi High Court, cancelling the allotment made by the concerned minister from out of the so-called discretionary quota on petroleum dealership as well as LPG dealership is under challenge Prior to 1995, the minister of Petroleum in exercise of his discretion had been allotting retail outlets for petroleum products, LPG dealership and SKO dealership, without having any prescribed norms A public Interest Litigation had been filed in this court by Centre for Public Interest Litigation under Article 32 of the Constitution praying that guidelines to regulate the exercise of discretion in the matter of such allotment which results in exercise of the discretion arbitrarily be fixed It may be stated that initially a prayer had also been made in that application to can eel the dealership in favour of respondent No 4, but that prayer stood deleted and an amended petition was filed as the said respondent did not accept the dealership in question this Court after hearing the counsel for the petitioner, and the learned Attorney General issued a set of guidelines for discretionary allotment of petroleum products' agencies to ensure that the exercise of discretion in making such allotments are in conformity with the rule of law and by excluding the likelihood of arbitrariness and minimising the area of discretion the said decision of this Court has since been reported in the case of Centre for Public interest Litigation vs Union of India and ors , 1995 Supp (3) S C C 382 In para (4) of the aforesaid judgment, the Court had directed as under

(2.) The Common Cause had filed a petition under Article 32 on the basis of a news item which appeared in a national newspaper that the Minister of Petroleum was personally interested in making allotment of petrol pumps in favour of 15 persons, who were either the relations of his personal staff or sons of the ministers or sons/relations of the Chairman and Members of the Oil Selection Boards praying for cancellation of allotments made inter alia on the ground that the allotments had been made by the concerned minister mala fide and the decision is arbitrary and 828 motivated by extraneous considerations. The court ultimately cancelled the allotments made in favour of the 15 persons mentioned in the petition, on a conclusion that the allotments are arbitrary, discriminatory, mala fide and wholly illegal. The Court also issued certain other directions in relation to the allottees and called upon the concerned minister to show cause as to why a direction be not issued to the appropriate police authority to register a case and initiate prosecution against him for criminal breach of trust or any other offence under law and in addition, why he should not be liable to pay damages for his mala fide action in allotting petrol pumps to 15 persons mentioned therein. This judgment of the Court is reported in 1996 (6) SCC 530. While the common Cause case was pending in this court. Civil Writ Petition Nos. 4003 and 4430 of 1995 had been filed in Delhi High Court by the Centre for Public Interest Litigation, as public interest litigation, which were pending in Delhi High Court. In those two petitions, allotment of petrol pumps/gas agencies to various persons during the period 1992-93, 1993- 94, 1994-95 and 1995-96 had been challenged. A Transfer Petition had been filed in this Court, which was registered as Transfer petition No. 127/96 and this Court had issued notice in the transfer petition and stayed further proceedings before the High Court. In an affidavit filed by the Ministry of Petroleum in the aforesaid transfer petition, the then Joint secretary had stated that in 1995-96 under the discretionary power of the Government, allotment had been made to 99 persons and further orders had already been made in favour of 61 more persons, allotting petrol pumps/gas agencies. One Mr. Srinivasan, Advocate had filed an affidavit giving a long list of persons who are related to the then Prime minister/ministers and other V. I. Ps and who had been allotted petrol pumps and gas agencies. On behalf of petroleum ministry, an affidavit had been filed, stating that due inquiry had been made through the oil companies and after due inquiry, the concerned minister had made the allotment. This Court ultimately held that since the two writ petitions are pending before the High Court, wherein the allotment made to all these persons have been challenged, it would not be necessary for this Court to get the writ petitions transferred and decide the matter. The Court, therefore, vacated the stay order granted and directed the Registry of the court to send all affidavits filed by the parties in the transfer petition along with the annexures to the High Court. The Court observed: "we have no doubt that the High Court shall examine the issues involved in the writ petitions and shall also go into the validity of the allotment of petrol pumps/ gas agencies to various persons, after hearing them, in accordance with law. We request the High Court to expedite the hearing of the petitions. "

(3.) Pursuant to the directions contained in the judgment of this Court in Common Cause vs. Union of India. 1996 (6) SCC 530, show cause notice having been issued to the then minister Captain Satish Sharma, said Shri sharma had filed an affidavit in reply to the show cause notice. The Court ultimately perused the show cause notice filed and after hearing the counsel appearing for the Minister, directed the CBI to hold an investigation, after registering a case against the concerned minister in respect of the allegations dealt with and findings made by the Court earlier in the common Cause case. On the question of liability of the minister to pay exemplary or compensatory damages, the Court considered the matter and came to the conclusion that Captain satish Sharma, the then minister would be liable to pay exemplary damages and quantified the same at Rs. 50 lacs. This judgment of the Court has been reported in 1996 (6) SCC 593.