M S DESAI AND CO Vs. HINDUSTAN PETROLEUM CORPORATION LIMITED

JUDGEMENT

(1.) A short question falls for determination in this appeal. It runs as under:

(2.) Factual backdrop: In order to appreciate the aforesaid question in its correct perspective the factual matrix leading to the present proceedings deserve to he noted at the outset. The appellant is a partnership film which was appointed as a dealer entrusted with the task of selling petroleum products in retail. The appellant was appointed by the respondent-Corporation which is wholly owned by the Central Government. It is a Government Company incorporated under the Indian Companies Act 1956 The respondent Corporation discharges Government functions which were being initially discharged by the Department of the Central Government viz. Petroleum Ministry. Various dealership agreements were entered into between the respondent Corporation on the one hand and the appellant firm on the other. The last of such agreements was dated 2-8-1976. During the time the appellant was working as a dealer in petroleum products supplied by the respondent Corporation a sample of petrol sold at its pump was taken on 22-7-1981. It was subjected to laboratory test. Report thereof was received on 30 and it was found that the petrol sold at the appellants petrol pump was adulterated. On 10-11-1981 explanation was called for from the appellant in this connection and further supply of petroleum products to the appellant was suspended. The appellant submitted three written explanations in this connection on 16-11-1981 28 and 20 respectively. The appellant also respected to restore supply of petroleum products. On 1-7-1982 a notice was issued to the appellant to show cause why its dealership for selling petroleum products at its petrol pump should not be terminated. The said show cause notice was issued as per clauses 26 42 44 and 45(1) of the dealership agreement. The appellant gave a reply to the show cause notice on 7-7-1982 and thereafter as the supply of petrol was not restored. the appellant filed Special Civil Application No. 3943 of 1982 in this Court. On 21-9-1982. The present appeal arises from the final order passed in that special civil application. In that special civil application by an interim order dated 2 1982 Ahmadi. J. directed the respondent to take prompt decision within four weeks from the date of the order in connection with the show cause novice issued to the appellant The respondent was directed to make a speaking order specifically stating whether this was a case of first lapse or second lapse. Thereafter the respondent passed speaking order dated 24 1982 terminating the appellants dealership. The said speaking order is at Annexure-F to the main petition It was brought on record by amending the petition. It is this order which was challenged on diverse grounds before the learned single Judge N. H. Bhatt J. before whom the said special civil application reached final hearing noted four preliminary objections raised before him by the respondent corporation in its affidavit-in-reply. Out of these four preliminary objections the first two viz. that the respondent Corporation was not a State and that relationship between the parties was that of contracting parties and therefore. the Courts jurisdiction was not attracted were considered by the learned single Judge. The contention that the respondent was not a State was negatived while the preliminary objection about maintainability of the writ petition on the ground that relationship between the parties was governed by the contract between them and that excluded the writ jurisdiction was upheld by the learned single Judge and consequently the writ petition was dismissed as not maintainable In that view of the matter the learned single Judge naturally did not go into the merits of the controversy between the parties centering round the Impugned dealership termination order.

(3.) The following two points arise for our consideration :