Indian Oil Corpn. Ltd. vs Guru Shakti Singh

Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 1649 OF 2011 [Arising out of SLP(C) No.13480 of 2007]

Senior Law Manager, Indian Oil .......Appellants Corporation Ltd. And Anr.

Versus

Guru Shakti Singh and Anr. .....Respondents

O R D E R

R. V. Raveendran J.,

Leave granted. Heard.

2. The appellants (Indian Oil Corporation Ltd.), issued

an advertisement inviting applications for grant of LPG

distributorship for Sohawal, District Faizabad, Uttar

Pradesh. The Dealer Selection Committee constituted by the

appellants interviewed the eligible candidates and declared

a panel of three candidates, on 30.3.2005, in the following

order of merit : (1) Guru Shakti Singh (first

respondent); (2) Sardar Mahinder Singh; and (3) Lal Rajendra

Nath Singh. As per the said selection first respondent had

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to be granted the LPG distributorship.

2. The second candidate in the list (Sardar Mahinder

Singh) filed a complaint with the appellants, alleging

illegalities and irregularities in awarding marks by the

Selection Committee, resulting in the first respondent being

placed as the first in the merit panel. Shortly thereafter,

the said Sardar Mahinder Singh filed a writ petition

challenging the selection process and the panel of

candidates. The said writ petition filed on 4.5.2005, was

withdrawn on 18.5.2005. Sometime thereafter the said Sardar

Mahinder Singh died.

3. The appellants thereafter cancelled the entire

selection process on 27.10.2005, and took a decision for re-

interview the candidates. The first respondent filed a writ

petition for quashing the said order dated 27.10.2005 and

seeking a direction to the appellant to issue him the letter

of intent for Distributorship as he was the first in the

merit panel. The said writ petition was allowed by the

impugned order dated 6.2.2007 holding that there should be

no re-interviews and the appellant should proceed with the

selection as already conducted in accordance with law. The

effect of the order was that the first respondent should be

granted the distributorship. The said order is challenged in

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this appeal by special leave.

4. It is not disputed by the first respondent that the

mere fact of a merit panel being prepared with him in the

first place does not entitle him to be appointed as a

distributor. The case of the first respondent is that as the

second respondent who challenged the selection as per the

merit panel withdrew the writ petition and none else had

questioned the merit panel, the said merit panel continued

to be in force and was valid; and therefore, there was no

need for re-interviews and he ought to have been granted the

distributorship. But the issue is not whether there was a

challenge, but whether there was any irregularity in the

selection process, and as a consequence whether the decision

of appellants to have fresh interviews is open to challenge.

5. Sardar Mahinder Singh filed a complaint alleging

that he had been awarded lesser marks and first respondent

had been awarded more marks. His grievances in regard to

marks were as under :

(a) Though he owned a land and the respondent did not own any land on the date of interview, yet, both were given equal 18 marks. He should have been awarded full marks of

25.

(b) He had not been given proper marks in respect of the parameter "capability to arrange finance". In spite of providing requisite financial details, he was awarded only 7 out of 35.

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{c) He had been given lesser marks of 2 out of 5 under the parameter "business ability/acumen" though he was doing business for last 20 years, for which records were placed.

6. The appellant got the said complaint investigated by

a committee of senior officers. The investigation revealed

that under the evaluation parameter "capability to provide

infrastructure" Sardar Mahinder Singh had been awarded only

18 marks whereas he ought to have been awarded 25 marks as

per the company policy as he had submitted the documents in

support of ownership of land, along with his application. It

was also found that under the evaluation parameter

"capability to provide finance : Banker's/Financial

Institution's certificate for loan", Sardar Mahinder Singh

had been awarded zero marks out of 7 marks even though he

had submitted a certificate dated 20.2.2004 from Bank of

Baroda for credit-worthiness along with his application and

that he deserved marks under that head also.

7. In view of the said findings of the investigation, the

second appellant (General Manager, IOC, UP State Office)

took a decision that the selection process violated the

guidelines and was vitiated. As a consequence, he directed

that the merit panel prepared by the Selection Committee

should be cancelled and ordered a re-interview. He also

directed that disciplinary action should be taken against

the Selection Committee Members. The above factual

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background leading to the direction for re-interview was

completely overlooked by the High Court.

8. The High Court allowed the writ petition filed by the

respondents on a rather strange reasoning. We extract below

the relevant portion of the impugned order :

"As already observed, since the Indian Oil Corporation after being satisfied about the illegality committed by the Committee in awarding marks to a particular candidate (since deceased), decided to re-interview all the candidates, but before the said exercise could be started, the said person died as such no relief can now be granted to him. Rest of candidates have not raised any grievance about their failure in selection, therefore, there is no question for reconsidering their case."

The High Court appears to have proceeded on the basis that

even though the selection process was illegal, as the

complainant (Sardar Mahinder Singh), who had alleged the

irregularities had died, the irregularities were no longer

relevant and would no longer exist and the merit panel

should be accepted. Unfortunately, the High Court failed to

deal with the larger issue as to whether the Selection

Committee had acted fairly and properly in awarding the

marks and preparing the merit panel. If the finding was

that the marks were wrongly assigned to the complainant and

consequently, first respondent had benefited, it does not

follow that when the complainant dies, the irregularity in

assigning marks could be brushed aside or ignored. In such

selections, any illegality or material irregularity in

assigning marks in regard to any person with the intention

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of favouring some one or excluding some one, vitiates the

entire selection process. Such a selection process cannot be

saved by holding that the person in regard to whom lesser

marks were given had died or failed to pursue his remedy.

Once the appellants took cognizance of the illegality in the

selection process, the withdrawal of writ petition on death

of the aggrieved complainant lost significance. The issue,

as already noticed, is whether the selection process was

fair and proper and whether the appellant acted arbitrarily

or unreasonably in taking a decision to scrap the selection

process and re-interview the candidates.

9. Assigning of lesser marks to Sardar Mahinder Singh not

only denied him the first place in the panel, but also

unjustly and undeservedly gave the first respondent, the

first place in the panel. The manner of assigning marks

showed a clear intention to favour the first respondent at

the cost of the other applicants. It is this finding that

persuaded the General Manager of IOC to scrap the selection.

The High Court having recorded a finding that the appellant

was satisfied about the illegality committed by the

selection committee, ought to have rejected the writ

petition, as the decision of the appellants to scrap the

selection was reasonable and not arbitrary.

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10. As a result, the appeal is allowed, the order of the

High Court is set aside and the writ petition filed by the

first respondent is dismissed. The appellants are permitted

to deal with the LPG distributorship as per its policy. It

can either re-interview the candidates or at liberty to deal

with the matter in accordance with the existing policy.

......................J. ( R.V. RAVEENDRAN )

New Delhi; .....................J. February 14, 2011. ( A.K. PATNAIK )