Calcutta High Court (Appellete Side)
Satya Prakash & Anr vs M/S. Hindustan Petroleum Corporation … on 28 January, 2025
Author: Rajasekhar Mantha
Bench: Rajasekhar Mantha
28.01.2025.
Item No. 1.
Court No. 13
ap
F.M.A. No. 1239 of 2021
With
I.A. No. CAN 1 of 2021
Satya Prakash & Anr.
Versus
M/s. Hindustan Petroleum Corporation Ltd. & Ors.
Mr. Sankar Biswas,
Mr. Aniket Mitra,
Ms. Ananya Adhikary.
...For the appellant.
Mr. Soumya Majumder, ld. Sr. Advocate
Mr. Apurba Kumar Ghosh,
Mr. Rudranil Ghosh.
...For the respondents.
1. The instant intra court appeal is directed
against the judgment and order dated 6th April, 2021
passed by a learned Single Judge of this Court in
W.P.A. No. 4862 of 2008. The prayers made in the writ
petition are as follows:
“(a) Writ in the nature of Mandamus commanding
the respondents, their servants and agents to
rescind, recall, quash the impugned decision being
the communication dated 4/3/2008, as in annexure
“P15”, and any steps taken, if any, in pursuance
thereof.
(b) Writ in the nature of Mandamus for a declaration
that the petitioners are entitled to be treated as
regular dealer on regular basis or alternatively
cancel the so-called “deed of lease” executed on
26/3/2004, as in Annexure “P-10” and release the
plots of lands;
(c) Writ in nature of Mandamus for a declaration that
the so-called lease deed was nothing but a part of
2an arrangement for dealership on regular basis in
favour of the petitioners;
(d) Writ in nature of Certiorari directing the
respondents to certify and transmit the relevant
records in connection with this case so that
conscionable justice may be administered by
quashing the same;
(e) RULE NISI in terms of prayers (a), (b), (c) & (d)
above;
(f) An ad-interim order be passed restraining the
respondents, their servants, agents from
disconnecting the present system to run the outlet
(petrol pump at Kanchrapara More) and further from
taking any steps in terms of the impugned decision
as communicated vide letter dated 4/3/2008 as in
Annexure “P-15″ till the disposal of the Rule;”
2. The brief facts relevant to the instant case are
that the writ petitioner no.1 is the uncle of the
petitioner no.2. Pursuant to a Notice Inviting Tender
dated 17th October, 2002 by the HPCL, the petitioner
No.1 offered total 21 cottahs of land ad measuring
18000 sq. ft. located at Kalyani Expressway, Kapamore
on the National Highway.
3. The land was offered for setting up of a
Company Owned and Company Operated (COCO)
Retail Petroleum Product Outlet by the respondent
HPCL. Pursuant thereto, the petitioners’ bid was found
favourable by the HPCL on 15th November, 2002. The
petitioners thereafter purchased the land between 30th
May, 2003 and 11th June, 2003. The petitioners
claimed to be a Raiyat under the West Bengal Land
Reforms Act, 1955 and obtained conversion of the land
3
for commercial use. All the local permissions from the
local authorities including District Magistrate,
Prodhan of Gram Panchayat and other authorities
were also obtained by the appellants/writ petitioners.
4. On 26th March, 2004, the petitioners entered
into a registered lease agreement of the land for 30
years with the respondent no.1. The Pump was
thereafter set up sometime in the year 2006 and the
petitioner no.2 was awarded the labour contract for
supply to the Retail Petroleum Outlet on 1st December,
2006.
5. It is averred in the writ petition that the entire
submission of bid, purchase of land and the lease
agreement were based on an assurance of one N.A.
Biswas, the respondent no.4 in the instant proceeding,
who was the then Chief Regional Manager (Retail) of
the HPCL, that the petitioners would be allotted
Dealership of the Petrol Pump eventually. No
document, however, has been produced by the
appellants/petitioners either in the pleadings before
the learned Single Judge or before this Court to that
effect. There are only averments made in the writ
petition and the stay application before this Court to
that effect.
6. Sometime on 4th March, 2008, the Labour
Supply Contract with the petitioner no.2 was
terminated by the HPCL and a new person was
engaged. The writ petition was filed immediately
4
thereafter with the prayers already set out
hereinabove. At the ad interim stage when the writ
petition was moved, an order of stay of the termination
of Labour Contract was passed by a learned Single
Judge of this Court. The petitioner no.2 thereafter
continued as Labour Contractor until the impugned
order was passed dismissing the writ petition. HPCL,
in the meantime, had filed an application for vacating
the interim order.
7. In the affidavit-in-opposition to the writ
petition, HPCL contended that due to a change of
policy of the Central Government, implemented
through the Oil Companies, the COCO Retail Outlet
business would be phased out and all existing COCO
Outlet would be made available to the general public
with due emphasis for reservation to Ex-Serviceman,
Scheduled Caste, Scheduled Tribes and Other
Backward Classes and other Categories.
8. The subject COCO Outlet of HPCL was allotted
to a third party in the year 2021 after the writ petition
was dismissed.
9. The learned Single Judge found that there was
no promissory estoppel on the HPCL in the facts of the
case. The alleged assurance of the said Mr. N.A.
Biswas was not enforceable or binding on the
respondent no.1. No case of promissory estoppel,
equitable estoppel or legitimate expectation as
recognized by the Hon’ble Supreme Court of India in
5
the case of Mohd. Janal – Vs. – Union of India
reported in (2014) 1 Supreme Court Cases 201 was
found available to the petitioners in the facts of the
present case. The learned Single Judge also found that
the change of policy of the respondents could not
confer any cause of action on the petitioners. The
learned Single Judge found that the termination of the
Labour Contract was as per the terms and conditions
of the said contract dated 1st December, 2006
extended from time to time until 2008.
10. Learned Counsel, Mr. Sankar Biswas for the
appellants has argued at length before this Court
against the order of the learned Single Judge. He has
submitted that it is essentially on the promise of Mr.
N.A. Biswas that the petitioner no.1 purchased and
entered into a lease agreement with the HPCL for 30
years. Such promise was to the effect that the
petitioners would be allotted Dealership of the Petrol
Pump, eventually.
11. It is next argued that Mr. N.A. Biswas was
made a party respondent to the writ petition and in the
instant appeal and no affidavit-in-opposition has been
filed controverting such allegation. He further
submitted that the HPCL is bound by the averments
against Mr. N.A. Biswas in the writ petition. He also
submitted that the Retail Outlet could not, therefore,
have been allotted to any third person even after
change of policy of the HPCL.
6
12. It is argued that by reason of the change of
policy, the agreement of lease stood terminated
automatically. HPCL could not allot the Petrol Pump
Outlet to any third party except the petitioners. The
petitioners should, therefore, be given back possession
of their land.
13. Reliance in this regard is placed firstly on the
decisions of R.P. Kapur & Ors. – Vs. – Sardar
Pratap Singh Kairon & Ors. reported in AIR 1961
Supreme Court 1117, particularly paragraph 19
thereof and the case of Ashok Kumar – Vs. – Raj
Gupta & Ors. reported in (2022) 1 Supreme Court
Cases 20, particularly paragraph 18 thereof on the
proposition that the allotment of the Retail Outlet after
change from COCO Model to a third party would
amount to an unconscionable bargain and hence the
lease agreement should be terminated.
14. Reliance is also placed on the decision of the
Hon’ble Supreme Court of India in the case of Central
Inland Water Transport Corporation Limited &
Anr. – Vs. – Brojo Nath Ganguly & Anr. reported in
(1986) 3 Supreme Court Cases 156, particularly
paragraph 89 thereof and the case of Pioneer Urban
Land and Infrastructure Limited – Vs. – Govindan
Raghavan reported in (2019) 5 Supreme Court
Cases 725, particularly paragraph 6.7 thereof.
15. Mr. Biswas lastly relies upon a decision of the
Hon’ble Supreme Court of India in the case of State of
7
Karnataka – Vs. – State of Tamil Nadu & Ors.
reported in (2018) 4 Supreme Court Cases 1,
particularly paragraphs 119 to 124 thereof.
16. This Court has very carefully considered the
arguments of the learned Counsel for the appellants,
the decision of the learned Single Judge and the
arguments of the Counsel for the HPCL. This Court
notes with anguish that since 2008 and until the year
2021, the petitioner no.2 has been able to continue
with the Labour Contract due to an interim order
passed by this Court. The said conduct by itself
constitutes a gross illegality on the part of the
petitioners. As to why HPCL has not chosen to prefer
an appeal against the said interim order, is intriguing.
HPCL appears to have been satisfied with the
application for vacating the interim order. Even the
said application was not pursued until final hearing of
the writ petition.
17. Be that as it may, the petitioner no.2 has
unduly and unconscionably benefitted from an interim
order from this Court for a period of about 13 years. It
does not lie in the mouth of the person benefiting in
the manner indicated above to utter scriptures on the
principles of unconscionable bargains and legitimate
expectation.
18. This Court has carefully scrutinized the Labour
Contract in question. Although paragraph 6 of the
contract has mentioned as the basis for termination,
8
the power of HPCL to terminate the contract, is in
Clause 17 thereof. The petitioner no.2 had consciously
entered into the Labour Supply Contract with the
HPCL knowing fully well that the latter reserved to
itself the right to terminate the contract with one
month notice without indicating any reason therefor.
HPCL’s termination of contract in the facts and
circumstances of the present case, therefore, cannot
be faulted.
19. On the question of any right or a legitimate
expectation on the part of the petitioners for being
allotted the Retail Dealership, this Court notes that the
lease agreement between the petitioner no.1 and the
HPCL is purely a private contractual arrangement.
There is no mention of any right to the retail
distributorship in such lease.
20. If the petitioner no.1 is aggrieved by any
violation of the terms and conditions of the lease, the
termination thereof and a civil suit for eviction is the
only and appropriate remedy. This Court sees no
public element whatsoever in execution of the lease by
the petitioner no.1 with the HPCL.
21. In so far as the change of policy and
subsequent allotment of the COCO Outlet to third
party is concerned, the petitioners have not been able
to demonstrate any vested right in claiming allotment
of the said Retail Dealership. The question of any relief
under Article 226 of the Constitution of India,
9
therefore, does not and cannot arise. The invocation of
high prerogative writ in a purely private and
commercial contract is not permissible unless there is
any public element attached or violation of any public
law is demonstrated by the parties, which this Court
has not been able to decipher.
22. In so far as the decision cited by the
petitioners, this Court notes that in the case of R.P.
Kapur (supra) the Hon’ble Supreme Court of India
was considering a fact where allegation was made by
the writ petitioners therein, inter alia, against a Chief
Minister of the State of Punjab, to the effect that it is
at the instance of the Chief Minister that criminal and
civil proceedings were instituted against them. The
petitioners specifically alleged that the Chief Minister
was unhappy with the fact that the petitioners refused
to do his bidding. When the Chief Minister did not
respond to the allegations, the Hon’ble Supreme Court
of India held that the allegations against him must be
deemed to be true and correct. It was held that the
allegations could have been controverted by the Chief
Minister or any person authorized by him. It appears
that the rights under Article 21 of the Constitution of
India are involved in the said case and the allegations
were against the Chief Minister of the State. The said
case has no manner of application in the facts and
circumstances of the present case.
10
23. In so far as the decision in the case of Ashok
Kumar (supra) is concerned, the facts were that a DNA
Test was ordered by a Civil Court in respect of
paternity of the appellant. Upon refusal of the
appellant to undergo such DNA Test, adverse inference
was drawn against him. The dicta in paragraph 18 of
the said decision would have no manner of application
to the facts of the instant case.
24. In the Brojo Nath Ganguly decision (supra)
and Pioneer Urban Land and Infrastructure
Limited (supra) which cited with the approval of
paragraph 89 of the decision of Brojo Nath Ganguly
(supra), equally would have no application in the facts
of the instant case. In the Brojo Nath Ganguly’s
decision (supra), the Hon’ble Supreme Court of India
dealt with a case of a Clause in a contract which
empowered the employer to unilaterally terminate the
same. The employee therein did not have any option
than to accept the contract. It is in this backdrop that
the Supreme Court has held that a Clause of such
nature constituted an unlawful bargain between a
powerful employer and a meek employee.
25. In the Pioneer Urban Land and
Infrastructure Limited decision (supra) the Supreme
Court was considering the rights of a purchaser of a
residential flat vis-a-vis the conduct of the builder
therein. The issue was under the provisions of the
Consumer Protection Act, 1986. The buyer of the flat
11
unit was found in a weaker bargaining position and
the Supreme Court held that he could not be
compelled to deliver the flat without compensation for
the delay. The facts of the said case are
distinguishable and, therefore, the said decision
cannot come to the aid of the petitioner.
26. The last decision cited by learned counsel for
the appellant being State of Karnataka -Vs.- State
of Tamil Nadu & Ors. reported in (2018) 4 Supreme
Court Cases 1 concerned a inter-State water dispute.
It is in the peculiar facts of the said case of agreements
between the State of Karnataka and State of Tamil
Nadu that the principle of unconscionable term of
contract was addressed under paragraphs 119 to 124
of the said decision. The facts of the said case, being
wholly and completely different from the facts of the
instant case, the observation of the Supreme Court
cannot come to the aid of the petitioner.
27. In the instant case, the petitioner no.1 entered
into the lease agreement being fully aware and
conscious of the terms and conditions thereof. There is
no document, assurance or promise on the part of the
HPCL or the said N. A. Biswas or any other employee
of the HPCL produced by the petitioner to indicate any
assurance on the part of the HPCL that the petitioner
would be allotted the dealership of the retail outlet.
28. The lease agreement for setting up the Coco
unit by the HPCL was a standalone document,
12
transferring property rights to the extent indicated
therein to the HPCL. As already stated hereinabove it
is only for violation of any terms and conditions of the
lease that the petitioner can avail the benefits and
rights conferred on him under the Transfer of Property
Act i.e. the termination and eviction. Such a prayer
and relief cannot be granted by a Writ Court, more so
in a purely private and commercial contract between
two independent parties.
29. There was no compulsion whatsoever on the
petitioner no.1 to enter into any lease with the HPCL.
The petitioner did so voluntarily on the basis of some
arrangement that he claims against the said N.A.
Biswas. The petitioner may, if he so desires,
demonstrate any such assurance and compromise,
enforce the same against he said N.A. Biswas before a
civil forum.
30. In the opinion of this Court the writ petition
itself should not have been entertained in the first
place by the Single Bench. The question of passing any
interim order, therefore, did not and cannot arise. The
writ petitioner no.2, having illegally obtained an
interim order and enjoyed the same for a period of 13
years has, caused loss and inconvenience to the HPCL.
The practice of obtaining interim orders at the ad
interim stage and compromising the private
contractual rights of a respondent has been
13
deprecated by the Supreme Court on a number of
instances.
31. For the reasons stated hereinabove, FMA 1239
of 2021 fails and is hereby dismissed.
32. In view of dismissal of the appeal itself, the
connected application being CAN 1 of 2021 shall also
stand dismissed.
33. All parties are directed to act on a server copy of
this order duly downloaded from the official website of
this Court.
(Rajasekhar Mantha, J.)
(Ajay Kumar Gupta, J.)
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