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CASE NO.: Appeal (civil)  3936 of 2006

PETITIONER: Hindustan Petroleum Corpn.& Anr.

RESPONDENT: Chander Bhan & Anr.

DATE OF JUDGMENT: 05/09/2006

BENCH: ARIJIT PASAYAT & LOKESHWAR SINGH PANTA

JUDGMENT: J U D G M E N T (Arising out of SLP(C) No. 4444 of 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.).  

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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 \026 Gurgaon-Jhajjar Road-at Village  Chandu, Distt. Gurgaon \026 on State Highway. Area \026 150 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

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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.