KOTHARI, J. - (1.) THE petitioner - Rajasthan Petroleum Dealers Association has filed this writ petition under Article 226 of the -Constitution of India for quashing the impugned advertisements dated 4/8/2010 and 29/8/2010 issued by the respondent Oil Marketing Companies; HPCL, BPCL & IOC OMC for short) by which these OMCs sought to invite applications for allotment of retail outlets to the selected applicants for allotment of retail outlets to them.
(2.) THE case set up by the petitioner Association in the writ petition and as argued by learned counsel with all vehemence at his command is that the respondent OMCs have not only breached the conditions and guidelines issued by the Petroleum Ministry of Government of India while issuing these advertisements for allotment of petrol pumps but also by allotting so many petrol pumps, it will cause not only loss to the respondent OMCs but also to the intending dealers as their projected sale targets have been fixed at much lower levels and such dealers would not be able to achieve even the break even point much less profit, if these outlets are allowed to be allotted and constructed with the huge investments. Learned counsel for the petitioner, Mr. Sajjan Singh also canvassed before this Court that allotment of so many petrol pumps will not only congest the retail outlet market but will cause severe competition to the present dealers, who are members of the petitioner association and with the increase of competition, the income earned by way of commission by the members of the petitioner Association is bound likely to go down. Though, the last contention was feebly raised and kept in a veiled cover, this appears to be the most important reason for the petitioner Association to have invoked the extra ordinary jurisdiction of this Court for quashing these advertisements, namely; to avoid competition. Upon issuance of notice by this Court, interim relief was granted by the coordinate bench of this Court on 12/11/2010 that the opening of petrol pumps under the impugned advertisements shall remain subject to final decision of writ petition and factum of pendency of this writ petition shall be mentioned in such allotment letters, if any. Respondent OMCs have filed their respective replies and even Union of India has filed a detailed reply to the writ petition and all respondents have jointly prayed for dismissal of the present writ petition with costs.
(3.) MR. Vinit Kumar Mathur for Union of India, MR. Arun Bhansali for HPCL, MR. O.P. Mehta, for IOC & MR. Vijay Bishnoi for BPCL vehemently submitted that the writ petition has been filed for an oblique purpose and ill motive and as a matter of fact existing dealers, the members of petitioner Association, are even estopped by virtue of agreement of dealership entered into by them with the respective OMCs and once such clause 7 with the HPCL (Page 94 of the paper book) was read before this Court in which it is stipulated that," Nothing contained in this agreement shall be construed to prohibit the Corporation from making direct and/or indirect sales to any person whomsoever or from appointing other dealers for the purpose of direct or indirect sales." Learned counsels for the respondents also submitted that there is no violation of guidelines of the Ministry of Petroleum & Natural Gas and in this regard, attention of this Court was drawn towards the recent guidelines dated 6/4/2011 vide Annex. R/2/8, in which the said Ministry has stipulated that while conducting feasibility studies for opening of new retail outlets/preparation of marketing plan in future the OMCs will henceforth comply with the following conditions, namely; that OMCs should consider appropriate returns for financial viability of a new retail outlet which from the gross margin available to OMCs on MS/HSD is Rs. 354 per k1. & (ii) that OMCs should give greater emphasis on setting up of 'B' site retail outlets in preference to 'A' site retail outlets as the cost would be much lower while returns would be similar. The OMCs will have to work out a compensation mechanism for 'B' site retail outlets where the dealer is compensated adequately. Clause 4 of the said guidelines stipulates that no restriction may apply for rural retail outlets which are anyway low cost retail outlets and are giving adequate returns. Thus, learned counsels for the respondents emphasized that with the complete freedom to the OMCs for choosing the location of retail outlets, the petitioner Association has hardly any role to play in the same and has no locus standi to challenge the impugned advertisements. The Union of India in its return filed to the present writ petition has supported the OMCs that they have not breached any guidelines issued by the Ministry of Petroleum. On the other hand, in para no. 15 of the reply, they have clearly submitted that OMCs are free to establish new retail outlets at the locations of their choices, if found viable, within any distance of an existing retail outlet, however subject to no objection from the statutory/State/ Municipal/local authorities concerned in this regard, wherein, this Ministry has no role in selection/establishment of dealership by OMCs.;