GENERAL MANAGER I B P CO LTD Vs. TMT JAYANTHI SELVARAJAN PROPRIETRIX KAVITHA AGENCIES DEALER I B P CO LTD

JUDGEMENT

(1.) THE petitioner is aggrieved by the order of staying the termination order dated 23.02.2000. THE respondent filed O.S. No. 5086 of 2000 for declaration that the termination order dated 23-02-2000 is null and void and for a mandatory injunction to restore the supply of petroleum. Pending suit two petitions were filed, I.A. No. 13036 and 13037 of 2000. THE former was for stay of the termination order and the latter was for ad-interim mandatory injunction to restore supply. THE learned VII Assistant City Civil Judge allowed both the petitions. Against I.A. No. 13037 of 2000 which is for a mandatory injunction, C.M.A. No. 193 of 2000 was filed and against I.A. No. 13036 of 2000 which is for stay C.M.A. No. 194 of 2000 was filed. THE learned IV Additional City Civil Judge disposed of both the appeals by a common judgment. He came to the conclusion that I.A. No. 13036 of 2000 which was for stay deserved to be allowed and as regards I.A. No. 13037 of 2000, the learned Judge came to the conclusion that the respondent herein was not entitled to a mandatory injunction and therefore, set aside the order of the trial Court. THE petitioner before this Court is the party aggrieved by the order of stay. THE respondent has not challenged the order dismissing the application for mandatory injunction.

(2.) MR. Vijay Narayanan, learned counsel for the petitioner submitted that the Court below erred in granting the stay. The history of the case set in proof is as follows: The petitioner is a Government of India Enterprise, which supplies petroleum products to its dealers who are appointed under and are bound by the dealership agreement between the parties. The dealership agreement lays down the period of the agreement, the rights and liabilities of the party and in particular, the various covenants which if breached, will entitle the petitioner to terminate the dealership agreement or to suspend supplies. The agreement between the petitioner and the respondent is dated 30.10.1985 and intended to come into effect from 11-03-1986 and to remain in force for 15 years thereafter i.e. 11-03-2001. In view of the widespread complaints regarding petroleum and petroleum products, the petitioner and other public sector oil marketing companies undertook widespread surprise inspections of the various retail outlets. The respondent was one such dealer operating the retail outlet at Salem Main Road. The officers of the petitioners visited the respondent's outlet on 03-12-1999 and drew samples of both motor spirit (MS) and high speed diesel (HSD). The sample of MS failed to meet the specification limit as stipulated in Motor Spirit and High Speed Diesel Control (Regulation of Supply and Distribution and Prevention of Malpractices) Order 1998, (Control Order in short). Therefore, Ex-P3, a show cause notice was issued as to why action cannot be taken against the respondent for violation of the covenants of the agreement as well as the Control Order because the Research Octane Number (RON Test in short) of MS showed that the product was off-specification. By Ex-P4, an explanation was given. This is dated 07-02-2000. Thereafter another inspection was conducted on 26-01-2000 when according to the petitioner, the respondent failed both in the Density test and RON Test and Ex-P5 show cause notice was issued and, supplies were also suspended on the same day, namely 26.1.2000. An explanation was given by Ex-P6 dated 08.02.2000. The petitioner did not find the explanations given satisfactory, and the dealership agreement was terminated on 23.02.2000 by Ex.P-7. Thereafter the respondents appears to have approached this Court by a Writ, W.P. No. 3750 of 2000. This Court granted stay of the order of termination on 03-04-2000. Against that, Writ Appeal No. 605 of 2000 (See 2000 3 M.L.J. 534) was filed by the petitioner. The Division Bench of this Court came to the conclusion that the questions which are in issue are essentially questions of fact requiring investigation and therefore, the order of stay was set aside and it was held that these questions should be appropriately decided only in a Civil Court. It is only thereafter that the suit has been filed.

(3.) THE complaint as seen from the show cause notice shows that the irregularity complained of can only fall under the category of adulteration and consequently sale of off-specification production. Adulteration is defined as follows: