Written petition is not maintained when an efficient and efficient arbitration remedy is available: Calcutta High Court

In addition, the court noted that the appellant’s case does not fall in any way of three situations and there was a mandatory arbitration agreement between the parties. Thus, the written petition was not maintained, especially when the agreement provides for an efficient alternative remedy in the form of arbitration.

Short facts of the case:

The appellant, Indian Oil Corporation Limited, carried out the inspection in the respondent’s retail store and a positive variation of the stocks has been observed beyond the permissible limits. Also, the variation was above the limit allowed in the motor spirit (“MS”), and the high -speed diesel (“HSD”) was 17919 LTR, respectively 17302 LTR. Then, a committee was formed to analyze the problem and presented his report on 26.10.2022. After that issue, it was issued to the dealer and was also approved by the competent authority. The dealer did not submit any response to the notification of the issue of issue, the appellant concluded the retail dealer granted to the respondent. Agree by this, the respondent submitted a written petition in front of the unique judge to issue a Mandamus writing to rewrite/cancel the termination order, as well as the notification of the show that was issued earlier and to prohibit the appellant to give the termination order.

Then, the unique bank allowed the written petition and canceled the opinion notice and the order of termination and guided the appellant to resume the supply of MS and HSD and other petroleum products. Agree by this decision, the appellant filed an appeal in front of the Division Bank against the Order of the Unique Bank.

Sending:

The plaintiff claimed that the Writer Court applied wrong tests while the imputed order passed and made findings beyond the scope and improvement of the written petition and, therefore, the impugite order may be canceled. In addition, the appellant argued that the application of the doctrine of proportionality, about the punishment imposed on the dealer would not be applicable to the facts and circumstances of the case, also in the light of the terms and conditions of the dealership agreement read together with MDG 2012. Quantity.

The Court analyzed three issues:

• Whether Iocc precuted the issue while issuing the case’s cause notification,
• If there was a violation of the principles of natural justice,
• If the written petition was maintained when the call remedy, as well as the arbitration remedy was provided in accordance with the distribution agreement,
• Whether the marketing discipline guide would be mandatory for the written petitioner,
• Who is the task to demonstrate that there are no variations in stock,

(6) If the termination of the respondent’s dealer could be called disproportionate.

The court observation:

The court considered that the notification of the issue has no predetermined mind and it cannot be said that the appellant has currently decided. Also, the notification of the show should contain complete details, which is why the authority was obliged to disclose all the facts in the notification of the case. Thus, the opinion notice was validly issued.

In addition, the court held that there was no violation of the principle of natural justice. Then the court took care of whether the written petition was maintained or not. The Court was based on the decision in Whirlpool Corporation versus the clerk of the trademarks, Mumbai and others (1998)In which the court held that it cannot entertain the written petition if an efficient and efficient remedy is available, the High Court would normally exercise the jurisdiction in 3 contingencies, namely (i) when the written petition was submitted for the execution of fundamental rights, (ii) if there was a violation of the principle of natural justice)

Then the court noted that the appellant’s case does not fall into other contingencies that have been carved in Whirlpool Corporation. The court also mentioned that there is a compulsory arbitration agreement between the parties. Thus, the written petition was not maintained, especially when the agreement provides for an effective alternative remedy.

After that, the court noticed that the MDG is implemented on the basis of PAN India by all petroleum marketing companies in the public sector, in order to maintain the discipline in the operation of the retail network and to provide a high standard for customer services is mandatory for the written petitioner.

Then, the Court noted that if it is considered that the dealer has an excessive amount of products over the quantity provided by them, the task/ Sample is clearly on the dealer and cannot be moved to the appellant. If the dealer had a plausible explanation for such a positive variation of the stocks, then the same is required to be decided by its correctness. Thus, the court believed that the WRIT Court is not right in changing the task of the evidence on the appellant to establish the positive variation of the stocks when the task is on the respondent dealer, in light of the conditions contained in the Dealership agreement with MDG 2012, as modified.

The court considered that the termination of the dealer was due to the committing of an irregularity that was classified as a critical irregularity, apart from the violations of the other clauses. Thus, when the agreement and ODM stipulate that certain sanctions must be imposed on the type of irregularity, the issue of incorporating the theory of proportionality into punishment will not arise as the right flows under the agreement and it will be governed by the terms and conditions of the agreement.

Consequently, the Court allowed the appeal and considered that the respondent can use the arbitration remedy, because the agreement provides for arbitration, if he wants to use such a remedy.

Case title: Indian Oil Corporation Limited and others to Saazijit Roy Chowdhury

Case number: MAT no. 1735 of 2023 with Ia no. Can 1 of 2023

Advisor for appellants: Mr. Pushpendu chakrabory, adv. Mr. Amadipta sengupta, adv.

Respondent/petitioner counselor: Mr. Pingal Bhatacharyya, adv. Mr. Rajdeep Sinha, adv.

Date of Judgment: 11.03.2025

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