Writ Petition Not Maintainable Particularly When IOCL Dealership Agreement Provides For Efficacious Alternate Remedy: Calcutta High Court

The Calcutta High Court held that a Writ Petition is not maintainable particularly when the IOCL Dealership agreement provides for an efficacious alternate remedy.

The Court held thus in an Appeal preferred by the Indian Oil Corporation Limited (IOCL) against the Single Judge’s Order.

A Division Bench comprising Chief Justice T.S. Sivagnanam and Justice Hiranmay Bhattacharyya observed, “… the appellant’s case would not fall in any other contingencies which have been carved out in Whirlpool and it has to be necessarily held that the writ petition was not maintainable, more particularly when the agreement provides for efficacious alternate remedy.”

Advocate Pushpendu Chakraborty represented the Appellants while Advocate Pingal Bhatacharyya represented the Respondent.

Brief Facts

A Writ Petition was filed by the Respondent before the High Court for issuance of a Writ of Mandamus to rescind/cancel the Order of termination issued by the Appellant as well the Show Cause Notice (SCN) and to prohibit the Appellant from giving effect to the Order of termination. The Single Bench allowed the said Writ Petition and set aside the SCN and Termination Order, and directed the Appellant to resume supply of Motor Spirit (MS) and High Speed Diesel (HSD) and other petroleum products if any, to the Respondent’s retail outlet within a specific time frame. Bein aggrieved by such an Order, IOCL filed an Appeal.

Reasoning

The High Court in view of the facts and circumstances of the case, noted, “The termination of the dealership was on account of committing an irregularity which has been classified as a critical irregularity apart from violations of the other clauses as noted above.”

The Court said that when the agreement between the parties as well as the MDG provide for certain penalties to be imposed qua the type of irregularity, the question of incorporating the theory of proportionality in punishment would not arise as the right flows under the agreement and it shall be governed by the terms and conditions of the agreement.

“Therefore we are to hold the question of considering whether the punishment was proportionate or otherwise would not arise in the fact and circumstances of this case. Accordingly this issue is answered in favour of the appellant”, it added.

Taking note of the fact that the agreement between the parties provides for arbitration, the Court refused to foreclose such remedy for the Respondent if he is desirous of availing such remedy.

“Therefore, we leave it open to the respondent to avail the remedy of arbitration, if so advised, and in such an event the arbitration proceeding shall be done without being in any manner influenced by the observations / findings recorded this judgment or by the learned Single Bench. This issue is accordingly answered”, it concluded.

Accordingly, the High Court allowed the Appeal.

Cause Title- Indian Oil Corporation Limited and Others v. Saumajit Roy Chowdhury

Appearance:

Appellants: Advocates Pushpendu Chakraborty and Amadipta Sengupta.

Respondent: Advocates Pingal Bhatacharyya and Rajdeep Sinha.

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