SUMITRA BHARAT GAS AGENCY Vs. UNION OF INDIA

JUDGEMENT

(1.) DR. B. S. Chauhan, J. The challenge in this writ petition is the grant of a Gas Dealership in favour of respondent No. 5 by the respondent-Corporation on the ground that the same violates the agreement which restricts the said respondent Corporation from introducing a fresh dealership within a radius of 15 kilometers of the area of operation of petitioner's agency. The petitioner further contends that other agencies by some other oil companies have also been permitted to operate within the said area, which adversely affect the petitioner economically.

(2.) TO substantiate the aforesaid submissions, Shri Shashi Nandan, learned Senior Counsel appearing for the petitioner has relied upon the terms of the agreement and other documents brought on record by way of an amendment application and the rejoinder affidavit. The main thrust of argument has been that area of operation of the petitioner could not be reduced unilaterally without involving the petitioner firm.

(3.) THE agreement dated 25-2-2002 entered into between the petitioner and the respondent Corporation provides for terms and conditions for running the agency and the relevant part thereof, reads as under : "1. (a) THE Corporation hereby appoints the Distributor and the Distributor hereby accepts the appointment as Distributor of the Corporation, on principal to principal basis, initially for a period of ten years commencing from 25th day of February, 2002 and renewable every five years at the sole discretion of the Corporation, for sale of the Corporation's Liquefied Petroleum Gas (LPG) known as 'bharatgas' in cylinders only for household consumers, and commercial consumers like hotels, canteens, hospitals etc. , but not for any industrial use nor for any industrial consumer in the territory or distribution area of within 15 kms. radius of Majhauliraj, District Deoria (UP ). (b) (i ). . . . . . . . . . . . (ii) THE Corporation reserves the right, without any reference to or consent of the Distributor, to appoint one or more additional distributors in the same territory referred to in Clause 1 (a) above and such additional distributor or distributors shall be entitled to make sales of Bharatgas in the same territory without any objection from the Distributor and the Distributor shall not be entitled to claim any over- riding remuneration, commission or allowance for the purpose. (iii) Without prejudice to the above, the Corporation shall also be entitled to require the Distributor to effect minimum sales of Bharatgas in accordance with the policy that may be formulated from time to time by the Corporation and shall be further entitled at its sole discretion to reduce, restrict, modify or alter the area of the distributorship territory and the decision of the Corporation shall be final and binding on the Distributor. THE Corporation shall further be entitled to notify, without any legal obligation to do so, from time to time to the Distributor in writing the minimum number of LPG filled cylinders which the Distributor shall be required to uplift in each month. THE Corporation shall also be entitled to require the Distributor to maintain during the duration of the Agreement such minimum stock as to meet the customers' requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . 38 (a) Any dispute or difference of any nature whatsoever any claim, cross-claim, counter-claim or set off of the Corporation against the Distributor or regarding any right, liability, act, omission or account of any of the parties hereto arising out of or in relation to this agreement shall be referred to the Sole Arbitration of the Director (Marketing) of the Corporation or of some officer of the Corporation who may be nominated by the Director (Marketing ). " (Emphasis added)