M/S. Shalimar Gas & Ors vs M/S. Indian Oil Corpn. Ltd & Anr

CIVIL APPEAL NO. 10124 OF 2010 (Arising out of Special Leave Petition (Civil) No. 26153 of 2010)

M/s. Shalimar Gas & others .. Appellants

-versus-

M/s. India Oil Corpn. Ltd & another .. Respondents

JUDGMENT

MARKANDEY KATJU, J.

1. Leave granted.

2. This appeal has been filed against the impugned judgment and

order dated 6.5.2010 of Delhi High Court in LPA No. 216/2010.

3. Heard learned counsel for the parties and perused the record. 2

4. The facts of the case have been set out in the impugned judgment

and hence we are not repeating the same here except where it is

necessary.

5. Appellant No. 2 before us, Mrs. Aruna Nanda, is a widow of late

Sqn Ldr. Romesh Nanda who was killed in an air crash in 1978 in

course of his duty. She was allotted an Indane Gas distributorship as a

sole proprietor of M/s. Shalimar Gas, appellant No. 1. She continued

looking after the management till 2003 herself or with the help of her

two daughters.

6. On 26.2.2003, appellant No. 1, i.e. M/s. Shalimar Gas Service,

was converted into a partnership firm with appellant No. 2 and with her

two daughters as partners. After the marriage of her daughters,

appellant No. 2 entered into a partnership with appellant No. 2, Anil

Kumar, on 21.12.2006 with 51% and 49% shares, respectively.

7. The respondent-corporation held an enquiry and came to the

conclusion that appellant No. 2 assigned/transferred the distributorship

in violation of the terms and conditions of the distributorship agreement 3

and got the approval for reconstitution of the firm by misrepresentation

to the Corporation. Hence the appellant's distributorship was cancelled

on 9.11.2009.

8. Aggrieved, the appellant filed a writ petition before the Learned

Single Judge of the Delhi High Court which was dismissed on

23.3.2010. Thereafter the appellant filed a writ appeal before the

Learned Division Bench which was also dismissed by the impugned

judgment. Hence, this appeal.

9. In our opinion the judgment of the Learned Division Bench as

well the Learned Single Judge of the Delhi High Court cannot be

sustained.

10. Appellant No. 2, admittedly, was a war widow who was given a

source of livelihood by awarding the distributorship of Indane Gas in

1986 and now she is an old lady with several ailments. Being an old

lady and because of her ill health she could not be an active partner and

was thus not available for day to day running of the firm. However,

she continued to hold the majority shares in the firm. 4

11. The contention of the respondent-corporation was that by virtue

of the dealership agreement, appellant No. 2 could neither sell the

distributorship nor lose control over it. The High court has held that

appellant No. 2 had lost control of the partnership firm. We do not

agree.

12. It is an admitted fact that appellant No. 2 still holds 51% shares in

the firm. Merely because she is an old lady who is a widow, it is quite

natural that she could not look after the day to day functioning of the

firm. By its letter dated 15.12.2006 the respondent-corporation

accorded its approval for the reconstitution of the partnership firm, i.e.

M/s. Shalimar Gas Service. Thereafter there was a formal agreement

between appellant No. 1 with appellant Nos. 2 & 3 as partners and

respondent No. 1 on 15.2.2007. It is a fact that the gas agency is the

sole source of her livelihood, but unfortunately the respondents have

not taken a humanitarian view in the matter.

13. The law should take a more liberal view in the case of widows,

physically handicapped people etc. 5

14. In view of the above, the impugned judgment of the Learned

Single Judge as well as the Division Bench are set aside. The

impugned order dated 9.11.2009 terminating the distributorship also

stands set aside and the respondents are directed to supply gas cylinders

to the appellants regularly in terms of the Memorandum of Agreement

dated 15.2.2007.

15. The appeal is allowed. There shall be no order as to costs.

.................................J. (Markandey Katju)

.................................J. (Gyan Sudha Misra) New Delhi;

November 29, 2010