Moumita Podder vs Indian Oil Corporation Ltd.& Anr

Smt. Moumita Poddar ... Appellant

VERSUS

Indian Oil Corporation Ltd & Anr. ...Respondents

JUDGMENT

SURINDER SINGH NIJJAR, J.

1. Leave granted.

2. These appeals have been filed against the judgment and order passed

by the High Court of Assam, Nagaland, Meghalaya, Manipur,

Mizoram, Arunachal Pradesh and Tripura, Bench at Agartala in Writ

Appeal No: 53/2005 along with connected Writ Appeal No: 54/2005,

wherein the Division Bench was pleased to set aside the common

order of the Single Judge in W.P (C) No. 259/2004.

3. We may briefly notice here the facts which are necessary to decide

the legal issues raised herein:

Indian Oil Corporation, respondent No.1, published a notice

on 19.2.2004 for appointment of Retail Outlet Dealership in local

newspapers in the State of Tripura situated at Ranirbazar and Agartala.

The advertisement shows that for Ranirbazar, the type of dealership 1 offered was "Dealer owned". The advertisement further indicates that

dealership at both the locations were for women. At Ranirbazar the

dealership was only for Open Category (Women). The last date for

submission of applications was 19.03.2004. The relevant clauses for

advertisement were as under:

"NOTICE Appointment of Retail Outlet Dealer Indian Oil Corporation Limited (Marketing division) Invites applications for appointment of Dealers for Retail Outlet dealership in the State of Tripura at the following locations for dealer owned/ Company Owned Retail Outlets on site owned by Dealer/to be taken by the Company on outright sale or lease:

Sl. Location Revenue Type of D'ship Category No. Dist. Co. Owned/ Dealer owned 1. Ranirbazar West Dealer owned OP Tripura (Women) 2 Agartala West Company ST . Tripura owned (Women)

Important Note

(a) The candidate should furnish along with the application, details of land, which he/she may make available for the Retail Outlet.

(b) Considering the location of the land from the point of view of suitability from commercial angle and rates acceptable to IOCL (AOD), applicants already having land and willing to transfer the land on ownership/long lease to IOCL (AOD), would be given preference.

(c) If an applicant, after selection is unable to provide the land indicated by him/her in the application form within a period of two (2) months from the date of Letter of Intent (LOI), the Company will have the right to cancel the allotment of dealership to him/her. Suitability of land will be decided by the Company. There is no commitment from the Company for taking the offered land from the applicant."

2

"14. APPLICATION FORMS AND ENCLOSURES COMPLETE IN ALL RESPECTS MUST BE SUBMITTED IN DUPLICATE ALONG WITH NON-REFUNDABLE FEE SO AS TO REACH THE OFFICE ADDRESS MENTIONED ABOVE BEFORE THE CLOSE OF OFFICE ON 19.03.2004."

4. In response to this advertisement, the appellant submitted her

application on 12.3.2004, for appointment of Retail Outlet Dealer in

Open Category (Women) for the location at Ranirbazar. In her

application, the appellant offered to set up the dealership on land,

purchased by her mother-in-law, being C.S. Plot Nos. 2172, 2173 and

2174/4035 and another land purchased by her father-in-law, Mr. Binoy

Krishna Poddar, measuring 1.36 Acres in Dag No.1075, Hal Dag

No. 1679 of Khatian No.491 situated in Mouja Bridhya Nagar, Tehsil:

Khoyerpur, Bridhya Nagar at the periphery of Ranirbazar, the entire area

being commonly known as Ranirbazar. According to the appellant, the

aforesaid land being situated on the Assam-Agartala Road, (National

Highway-44) with the frontage of 51.5 Metres on the road, is most

suitable for the purpose of setting up the Retail Outlet. Both her mother-

in-law and father-in-law furnished an undertaking that the said land

could be used by the appellant for the aforesaid purpose. They had duly

executed documents expressing their readiness and willingness to allow

the appellant to use the aforesaid land for installation of the retail outlet

dealership and to lease out the same to respondent No.1, on long term

basis, if she was offered a letter of intent. All the relevant documents

were furnished with the application for the said dealership.

3 5. On 18.03.2004, the respondent No.2, Smt Alpana Saha submitted

her application. She indicated in the application form that she had

suitable site readily available for the dealership. Giving details of the

land, she stated that she was offering two lease deeds, being Deed

No.381/ dated 16/3/2004; and Deed No.616/ dated 25/2/2004; in

support of the land offered by her. Reference is also made to a non-

encumbrance certificate relating to proposed site at "Location No.181 IFP

200 ft.". With regard to dimension of plot, it is mentioned "Location No. II

frontage 42 metres depth 52". The lease deed dated 16.03.2004 was to

remain in full force from 16.3.2004 for a period of 49 years, It specifically

provides that respondent No.2 "shall carry on over the rented vacant

landed property for the purpose of Oil Business under I.O.C. Limited in

[Assam Oil Division] DIGBOI Assam". However Clause 4 of the lease

deed provides as under:

"4 That, in no circumstances the second party will not sub- let the leased out landed property to any person or party(s) authority."

6. Clause 5 of the lease deed gives the option to respondent No.2 to

take further period of lease by executing a fresh deed. The aforesaid lease

deed is not a registered document. It is, however, authenticated by a

notary public at Agartala. By a further deed of tenancy agreement

dated 18.3.2004, the terms and conditions contained in the lease deed

dated 16.3.2004 have been supplemented. In the supplementing lease

agreement dated 18.3.2004 it is provided as under:

4

"The second party shall have right and/or power to create sub-tenancy, or the sub-let or to create or grant lease in favour of any person, individual or body corporate of the property and/or in respect of the properties described in the scheduled attached to the tenancy agreement dated 16.3.2004 as per terms and conditions as would be determined by the second party for the tenure not exceeding the terms what has been granted in the terms and conditions as laid down in the said tenancy Agreement dated 16.3.2004."

The aforesaid Clause undoubtedly removes the negative covenant

in the Lease Deed dated 16.3.2004. However, it seems that even this

Lease Deed is not registered.

7. On 25.05.2004, the appellant received a Registered Letter from the

Respondent No.1, calling upon her to appear before the Interview Board

on 16.06.2004 at Guwahati. The appellant was asked to bring all the

original documents, details of which had been submitted by her in her

above said application. On 11.06.2004, the appellant was informed by

Depot Manager (Marketing), Kunjaban, Agartala, of the respondent No.1

over telephone that the Survey Team of the respondent No.1 would visit

the sites offered by the respective applicants on 12.06.2004 for the

purpose of inspection of the land offered by the applicants. Thereafter,

on 12.06.2004, the above Depot Manager (Marketing) informed the

appellant that the visit of the Survey Team on 12.06.2004 had now been

deferred to 14.06.2004. Subsequently, on 14.06.2004, the appellant was

informed that the proposed visit of the Survey Team of the respondent

No.1 had been cancelled and the appellant would be subsequently

5 informed of the date for the said inspection of land. However, the

appellant did not receive any such intimation nor was any inspection

ever carried out by the said Survey Team.

8. The appellant has highlighted that the proposed inspection was of

paramount significance in ascertaining the desirability of the offered site

for setting up the Retail Outlet. The policy of the respondent No.1

stipulated that the technical/commercial suitability of the land offered by

the applicants would be ascertained by a team of IOC Officers before the

Interview.

9. On 16.06.2004, the interviews were conducted by the respondent

No.1 for appointment of Retail Outlet Dealers for the abovementioned

location of Ranir Bazar. Nine persons, including the appellant and the

Respondent No.2, appeared before the Interview Board. The interview

board, upon evaluation of the inter se merits of all the nine applicants, in

terms of the policy circular dated 4.9.2003, empanelled three candidates

in order of merit. Respondent No.2 is placed at Sl.No.1 in order of merit.

The appellant was not amongst the first three candidates and was

consequently not empanelled. After the declaration of the result, the site

offered by respondent No.2 was verified by respondent No.1 on

29.6.2004. By a communication dated 8.7.2004, respondent No.2 was

informed that Letter of Intent had been issued in her favour.

6

10. The action of respondent No.1 in offering the letter of intent to

respondent No.2 was challenged by the appellant before the Guwahati

High Court, Agartala Bench by way of writ petition being

W.P.(C)No.259/2004. Smt. Payel Biswas, one of the unsuccessful

candidates, also challenged the selection/ appointment of respondent

No.2 by way of Writ Petition (C) No.256/2004. Both the writ petitions

were decided by the learned Single Judge by a common judgment and

order dated 14.9.2004.

11. It was held that the selection of respondent No.2 was contrary to

the applicable policy guidelines. The entire selection process was vitiated

on the ground of non-application of mind and arbitrariness. It was

observed by the learned Single Judge that in the absence of site

verification the selection committee could not have adjudged the

suitability of the site/land offered by the respective candidates. It was

further held by the learned Single Judge that the selection was arbitrary

as it had been made by taking into consideration the facts which did not

exist. It was observed by the learned Single Judge that the lease deed

dated 18.3.2004 could not have been produced before the interview

committee. It is noticed by the learned Single Judge that prior to the

filing of the additional affidavit dated 28.5.2005 respondent No.2 had not

mentioned in any of the pleadings that lease deed dated 18.3.2004 was

in fact produced at the time of interview. It was, therefore, concluded by

the learned Single Judge that lease deed dated 18.3.2004 was not in 7 existence at the time of interview, but was subsequently, i.e., long after

the filing of the writ petition, manufactured by the respondent to defeat

the case of the appellant and conversely to strengthen the case of the

respondents.

12. We may notice here the observations made by the learned Single

Judge in regard to what we have noticed above. These observations are

as follows:

"True, this agreement apparently refers to the earlier Tenancy Agreement dated 16/3/2004 and purports to confer additional benefits/advantages to the respondent no: 2 allowing her the power to create sub-tenancy in respect of land offered by her in favour of IOCL (AOD). However, neither the counter-affidavits of the respondents nor their additional affidavits filed by them prior to 28/5/2005 throw any light on the existence of this documents even though it was projected to have been executed as early as 18/3/2004. It should have been, if there contention is correct, in the custody of either of the respondents. No satisfactory explanation is forthcoming from any of them for this mysterious omission. In view of this, I am persuaded to believe that Annexure 10 (tenancy agreement dated 18/3/2004) was not in existence at the time of the interview but was subsequently, i.e. long after the filing of this Writ Petition, manufactured by them to defeat the case of the appellant and conversely, to strengthen the case of respondent No: 1. Consequently, reliance cannot be placed upon this document to hold that the respondent No: 2, at the time of her interview, had any land of her own or land for creating long lease to the IOCL(AOD). Therefore, the Selection Committee has acted arbitrarily and grossly erred in law in placing the respondent No.2 as the No.1 candidate in the merit panel."

"16. In the instant case, I have recorded my findings that in the absence of site verification, which is the sine qua non for proper assessment on the suitability or otherwise of the lands offered by the respective candidates, the respondent No.1 and the Selection Committee constituted by it have violated the guidelines contained in the Brochure issued by 8 the IOC Ltd. and have not taken into account the relevant factors for selection of the dealership in question. I have also concluded that no Tenancy Agreement was produced by the respondent No.2 at the time of her interview evidencing her right to transfer any land to the respondent No.1 on long lese. Upon those findings, I have no alternative but to hold that the entire selection process for appointment of the dealership in question sands vitiated on the ground of non- application of mind and arbitrariness. It is, however, contended by Mr. D.B. Sengupta, the learned senior counsel for the respondent No.1, that the guidelines contained in the Brochure of the Corporation are merely instructions to be followed, have no force of law and are, therefore not binding upon the respondent No.1. According to him, while very effort was made by the respondent No.1 to comply with such guidelines in the selection process of the dealership in question, such guidelines, in the nature of things, having no force of law, any or every infraction thereof cannot have the effect of vitiating the selection process. It is true that administrative instructions or guidelines issued by the executive authorities do not have the force of law like a statute passed by legislatures and deviation from such instructions/guidelines may not have the same effect as violation of a statutory provisions. But it must be remembered that these guidelines are not framed only to be ignored or only to be observed in breach. On the contrary, they are framed to ensure fairness, transparency and non- arbitrariness by the executive authorities in their dealing with the public."

13. The learned Single Judge rejected the submission that there had

been substantial compliance with the applicable guidelines and that no

manifest injustice has been caused to the appellant. It is held that it

was open to the respondents to demonstrate that the course of action

adopted in this case was not arbitrary and was based on rational

principles. The learned Single Judge declined to take into consideration

that the pump outlet has been in operation since 12.5.2005. The

learned Single Judge also held it to be irrelevant that huge amounts of

9 money had been spent by respondent No.2 in establishing the retail

outlet. It was also considered to be irrelevant by the learned Single

Judge that the retail outlet has been functioning regularly and to the

benefit of general public. It was held that if the contentions of the

respondents were accepted "then every unsuccessful bidder in public

tender will be held barred by the principles even if the tender process is

vitiated by non application of mind, illegality, irrationality or procedural

impropriety thereby sounding the death-knell for judicial review of

administrative action. Therefore, the contention of the learned senior

counsel in this behalf has no force and is, accordingly, rejected." With

these observations the learned Single Judge granted the following

reliefs:

"For the reasons stated in the forgoing, W.P.(C) No.259 of 2004 is allowed. The letter of intent No. SM 2/8-482 dated the 8th July, 2004 issued by the respondent No.1 and the selection process in connection therewith are hereby quashed. The respondent No.1 shall now start the selection process afresh by constituting a Selection Committee, which shall consider the case of the petitioner and other eligible candidates for allotment of the dealership in question on the basis of the land documents etc. submitted by them as on 16.06.2004 and in accordance with the Brochure dated 01.11.2004 (or the Brochure/ guidelines applicable) issued by the IOC Ltd. and thereafter makes the selection. It is made clear that the Selection Committee shall not take into account the Tenancy Agreement dated 18.03.2004 (Annexure-10), the Sale Deed bearing No.1-13161 dated 15.12.2004 and the Sale Deed bearing No.1-13162 dated 15.12.2004, which obviously came into existence long after the date of interview. Having held that the respondent No.2 is not entitled to any mark on land and infrastructure, the respondent No.1 is directed to allow the respondent No.2 to wind up the Retail Outlet Dealership is question within 30 (thirty) days of the receipt of this judgment at her own cost of 10 expenses. W.P. (C) No.256 of 2004 is hereby dismissed. The parties in the two writ petitions are directed to bear their own costs."

14. Against the aforesaid judgment in WP (C) No.259/2004

respondents filed writ appeals being Writ Appeal Nos.53 and 54 of 2005.

Both the appeals have been allowed and the judgment of the learned

Single Judge was set aside by the impugned judgment dated 30.5.2008.

The Division Bench noticed the three issues identified by the learned

Single Judge which are as follows:

First Issue: Suppression of material facts by the appellant in her writ

petition.

Second Issue: Applicability of the norms for grant of dealership as

circulated by the brochure dated 1.11.2004 and the compliance of the

said norms by respondent No.1 - Corporation in the matter of selection

of respondent No.2.

The Third Issue separately identified by the learned Single Judge: Was

the lease deed dated 18.3.2004 brought on record by respondent No.2 in

the writ petition a genuine and acceptable document so as to form the

basis for deciding the eligibility of respondent No.2 for the award of 25

marks in the selection process under the head "capability to provide land

and infrastructure/facilities". The Division Bench, accordingly, confined

the consideration of the matter to the aforesaid three issues.

11 15. The Division Bench accepted the finding of the learned Single

Judge on the first issue and held that there was no suppression of

material facts by the writ petitioner, the appellant herein. It is noticed

that it was not the requirement of the advertisement that the land

documents had to be submitted along with the application.

16. The Division Bench however did not accept the conclusion of the

learned Single Judge on the second issue which was based on Clause 14

and the norms contained in the brochure dated 1.11.2004. It was held

that "A reading of policy circular dated 4.9.2003 would show that the

said circular comprehensively lays down the norms for dealer selection

under three different categories as already noted. Not only the eligibility

of the candidates and the selection procedure has been set out, even

three parameters on the basis of which the selection is to be conducted

by award of marks under different heads have been spelt out in the

Policy Circular dated 4.9.2003." The affidavit filed by respondent No.1

was accepted wherein it was clearly stated that the selection has been

held in accordance with policy circular dated 4.9.2003. It was, therefore,

held that since the policy circular dated 4.9.2003 held the field on the

date of the interview/selection on 16.6.2004, the circular

dated 1.11.2004 would have no application. It is further observed by the

Division Bench that under the policy circular dated 4.9.2003 site

verification prior to the interview is not contemplated. It was introduced

by the norms published in the brochure dated 1.11.2004. Therefore, the

12 learned Single Judge erred in holding that the selection process is

vitiated as the land of the appellant had not been verified prior to the

interview or the land of respondent No.2 was verified after the interview.

17. With regard to the third issue, the Division Bench has concluded

that even though the tenancy agreement dated 18.3.2004 has not been

registered, it could still be a genuine document. It has been held that

non registration of the document as required under Section 107 of the

Transfer of Property Act would not affect the genuineness of the

document which stands established by the attestation of the document

by a notary public notified under the Notaries Act, 1952. Therefore, even

though the document may not have been before the Selection Committee

at the time of award of 25 marks to respondent No.2, under the head of

"capability to provide land and infrastructure/facilities" the existence of

the document which has to be accepted will not materially influence the

end result, i.e., the award of 25 marks to respondent No.2.

Consequently, it is held that since the ultimate award of 25 marks in

favour of respondent No.2 will have to remain unchanged/unaltered the

grant of dealership to respondent No.2 cannot be said to be vitiated on

the ground of arbitrariness.

18. We may notice here that the Writ Petition (C) No.256 of 2004 filed

by Payel Biswas was also dismissed by the learned Single Judge. Her

grievance in the writ petition was against the failure of respondent No.1

to conduct spot verification of the land offered by the candidates 13 including her own. Her candidature was, however, rejected on the

ground that her husband is a partner of M/s. Biswas and Sons an

existing retail outlet dealing with Petroleum products, which is carrying

on such business at Agartala town. She was accordingly held not to be

eligible for dealership in terms of Clause 1(c) and (d) of the

advertisement. Consequently, the writ petition was dismissed on the

ground that she had no locus standi.

19. We have heard both the appeals together. Mr. Pradeep Ghosh

learned senior counsel appearing for the appellant submitted that the

entire selection process is vitiated. It is submitted that the important

note contained in the advertisement shows that the suitability of the land

offered by the candidate had to be considered from commercial angle. It

was necessary for the candidates to give details of the land which could

be offered on ownership/long lease to respondent No.1. Such a candidate

will have to be given preference. The candidates were required to furnish

details of the land which they may make available. An outer period of

two months has been prescribed to provide the land indicated in the

application form from the date of allotment. According to Mr. Ghosh,

since respondent No.2 was not in a position to offer land even on a

leasehold basis her candidature could not have been considered.

Mr. Ghosh has placed strong reliance on the negative covenant contained

in Clause 4 of the lease deed dated 16.3.2004 which was sought to be

rectified by execution of the supplementary lease deed dated 18.3.2004.

14 Even otherwise it could not have been relied upon as the same was not

registered. According to learned senior counsel, mere notarization would

not make it a valid lease, as it was for a term of 49 years. Therefore, on

the date of the application respondent No.2 was not having a valid lease

in her favour. Therefore, even if the lease deed had been furnished, the

same could not be taken into consideration. This would render the

decision of the selection committee arbitrary as no reliance could have

been placed on a non-existent document. Mr. Ghosh then submitted that

procedure provided in Clause 14 of the brochure dated 1.11.2004 having

been ignored, the selection is vitiated on this ground alone. Mr.Ghosh

then makes a reference to the norms for evaluating the candidates as

contained in Clause 16(1) of the brochure. According to the learned

senior counsel, since respondent No.2 could not be granted any marks

under the category for "capability to provide land and

infrastructure/facilities" her selection by granting her 25 marks out of a

total of 35 marks is clearly arbitrary and violates Article 14 of the

Constitution.

20. Countering the submissions, Mr. P.K. Goswami, learned senior

counsel appearing for respondent No.2, submits that the circular

dated 1.11.2004 was not applicable in this case. It came into force after

the entire selection process was over and the letter of intent having been

issued to respondent No.2. Learned counsel further submitted that

criteria for evaluation of candidates are elaborately stated in the policy

15 circular dated 4.9.2003. On the basis of this circular, respondent No.1

had issued the advertisement dated 19.2.2004. The advertisement clearly

stated that the applicant shall furnish details of land which she may

make available for the retail outlet. There was no requirement for

attaching any document in the application. Merely because the appellant

has attached the documents, is of no consequence. Respondent No.2 had

complied with the necessary requirements. Her candidature was

evaluated on the basis of the criteria laid down in the circular

dated 4.9.2003. The Division Bench correctly concluded that the

brochure dated 1.11.2004 has no application to the facts of this case.

Mr. Goswami submitted that the criteria under the circular

dated 4.9.2003 were not as rigid as the criteria under the circular

dated 1.11.2004. The procedure prescribed under this circular does not

require any site verification prior to the conduct of the interview. In

support of this submission, learned counsel had relied on Clause 5(2) of

the Circular which only provided that the candidate will be evaluated by

the selection committee through interviews based on the marking system

as given in Annexure-A. Under these criteria, the committee was required

to prepare a panel of three candidates in order of merit. Only thereafter,

it was necessary to conduct investigation. The procedure contemplated

under Clause 14(1) of the brochure dated 1.11.2004 would not be

applicable in this case. Mr.Goswami then submitted that the learned

Single Judge wrongly held that the supplemental lease dated 18.3.2004

was not produced by respondent No.2 at the interview. He has made a 16 reference to the pleadings of the respondent No.2 and submitted that the

lease deed dated 18.3.2004 was one of the original documents produced

before the interview board. All the applicants had been directed to bring

the original documents of all the enclosures as stipulated in the

application form. Even if the document was not registered, it could still

be relied upon by the selection board as it had been duly notarized. He

submitted that there was no material before the learned Single Judge to

conclude that the document dated 18.3.2004 is a manufactured

document. According to the learned counsel, the genuineness of the

document has rightly not been put in issue by the Division Bench, as it

has been duly notarized. Mr. Goswami then submitted that the

respondent No.2 had been correctly given 25 marks under the category

"capability to provide land and infrastructure/facilities". The criteria

contained in the circular dated 4.9.2003 did not require the candidate to

be a land owner/lease holder. The only requirement was that the

candidate has a firm offer from the land owner who is willing to give the

same to the company. In fact, even the candidate who can arrange land

would also be eligible. Therefore, according to Mr. Goswami, respondent

No.2 has been correctly given 25 marks. The decision of the selection

committee, according to him, is not against the provisions of the

applicable policy and, therefore, not arbitrary. Mr. Goswami then

submitted that even though the appellant had only submitted two

undertakings from her mother-in-law and father-in-law, she was also

given 25 marks. Therefore, respondent No.2 was in a better position 17 compared to the appellant as she had offered an unregistered lease

deed in her favour whereas appellant had only furnished the two

undertakings given by her in-laws. He further submitted that the

appellant having taken advantage of the same parameters cannot

possibly complain of any breach of Article 14 of the Constitution of India.

Lastly, he submitted that in view of the subsequent events, it would not

be an appropriate case for this Court to interfere with the judgment of

the Division Bench in exercise of extra ordinary jurisdiction under

Article 136 of the Constitution of India. Learned counsel highlighted that

respondent No.2 has made huge investments to a tune of more than

rupees one crore to commission and operate the petrol pump. At present

she has outstanding loans of more than rupees one crore. Even

respondent No.1 has spent Rs.25 lakhs or more in establishing the

outlet. According to the learned counsel, to shut down the dealership at

this stage would not be in public interest. Learned counsel also brought

to our notice that by two sale deeds dated 15.12.2004, respondent

No.2 had purchased substantial portion of the land. This fact was

brought to the notice of the learned Single Judge through additional

affidavit dated 27.7.2005. It was, however, wrongly not taken into

consideration. It is also brought to our notice that subsequently by sale

deed dated 14.12.2007 respondent No.2 has purchased even the

remaining portion of the land. The learned counsel added that the outlet

of respondent No.2 has been adjudged to be the best in the State of

Tripura. Apart from this, learned counsel submitted that the appellant 18 did not come within the three empanelled candidates in the order of

merit and, therefore, no relief can be granted to her. In support of his

submission, the learned counsel relies on a number of judgments of this

Court, viz. :- Kedarnath Agrawal & Anr. Vs. Dhanraji Devi & Anr.

( [2004] 8 SCC 76 paragraphs 16-31 ), Rashpal Malhotra Vs. Satya

Rajput ( [1987] 4 SCC 391), Municipal Board of Pratabgarh Vs.

Mahendra Singh Chawla ( [1982] 3 SCC 331 ), Taherakhatoon Vs.

Salambin Mohammad ( [1999] 2 SCC 635 ) and A.M.Allison Vs.

B.L.Sen ( [1957] SCR 359 ).

21. Mr. Parag P. Tripathi, learned senior counsel, appearing for

respondent No.1 has submitted that the aforesaid selection was

conducted at the time when respondent No.1 was trying to restructure

the selection procedure. The policy with regard to allotment of dealership

was in a transient period after the selection board had been disbanded.

The effort of the respondent No.1 was to make the criteria transparent.

The policy was undergoing refinements with issue of the successive

circulars. He has made a reference to a number of successive policy

circulars which have been issued making a reference to the provisions of

the circular dated 4.9.2003. Learned counsel submitted that respondent

No.1 was looking for candidates who were either owners of land or had

firm offer from land owners for purchase of land or those who could

arrange land. It was a flexible criteria not confined only to the owners or

lease holders of land. Learned counsel submitted that the policy has

19 been made uniformly applicable to all the candidates and therefore the

selection cannot be held to be arbitrary or violative of Article 14 of the

Constitution of India.

22. We have considered the submissions made by the learned counsel

for the parties. We have also perused the relevant clauses of the policy

circular dated 4.9.2003 and the brochure dated 1.11.2004. The public

notice dated 19.2.2004 stipulated that the candidate should furnish

along with application, details of land, which she may make available for

the retail outlet. This condition was certainly fulfilled by respondent

No.2. She had given the details of the land. No document was required to

be attached. Clause (b) of the important note stated that applicants

already having land and willing to transfer the land on ownership/long

lease to respondent No.1 would be given preference. It appears to us from

the facts noticed above that neither the appellant nor respondent No.2

would have been eligible for any preference. Whilst the appellant had

offered the undertakings given by her mother-in-law and father in law to

make the land available on lease, respondent No.2 was only in

possession of a lease, which contained a negative covenant. Therefore,

the candidature of both the appellant as well as respondent No.2 could

only be considered under the category that they were prepared to make

the site available.

23. The eligibility and the relative merit of the candidate was clearly to

be adjudged on the basis of the criteria contained in the policy circular 20 dated 4.9.2003. There could be no deviation therefrom. This circular

provides elaborate guidelines. The selection procedure is as follows:

"SELECTION PROCEDURE:

5.2.1 Advertisement:

Selection of dealers will be done through advertisement in the newspapers.

5.2.2 Application processing Fee:

An application processing fee (Non refundable) of Rs.1000/- will be charged from the applicants other than SC/ST. In case of SC/ST applicants, the application processing fee will be Rs.500/-.

5.2.3 Selection Committee:

The selection will be done by a Committee consisting of 3 `E' Grade officers of IOC from outside the State as nominated by the Head of the State Office providing such officers.

The candidates will be evaluated by the Selection Committee through Interviews based on the marking system as given in Annexure A.

The Selection Committee will prepare a panel of 3 candidates and the approval for award of dealership will be given by the State Head.

5.3 Preparation of Panel:

The Selection Committee will prepare a panel of 3 candidates in order of merit. The panel will be finalized immediately on completion of interview for a particular dealership. The State Head will approve issuance of Letter of Intent to the No.1 candidate in the merit panel.

5.4 Letter of Intent :

Letter of Intent will be issued to the No.1 candidate in the merit panel after conducting necessary Field Investigation. If the LOI to No.1 candidate has to be cancelled for any reason 21 like, he refuses to accept the dealership, is unwilling to give the land to IOC on acceptable terms within a specified period etc., the LOI will be given to the next candidate in the merit panel with the approval of the State Head."

Clause 6.7 provides for selection of site/location as per

existing guidelines in this regard. Clause 7 provides that all eligible

candidates will be called for interview by Committee consisting of

three officers of IOC. Evaluation parameters of the candidates are

set out in Clause 7.1 which is as under:

"7.1 Evaluation Parameters:

The selection committee will Interview the candidates as per the following evaluation criteria:

Retail Outlet:

Sr. Parameters Marks No. Retail SKO- Outlet LDO a. Capability to provide land and 35 35 infrastructure /facilities b. Capability to provide finance 25 35

24. The detailed evaluation system is provided in Annexure-A to the

instruction. The relevant portion of the evaluation criteria and weightage

for selection of dealer was as under:

"Evaluation criteria and weightage for selection of dealer:

The evaluation criteria has been designed as under to maintain uniformity, objectivity, transparency and the methodology of assessment has been designed for ease of quantification.

Each candidate during the interview will be assessed by the Selection Committee broadly under the following parameters: 22 Retail Outlet

a. Capability to provide land and infrastructure/ facilities 35 marks b. Capability to provide finance 25 marks c. Educational qualifications 15 marks d. Capability to generate business 10 marks e. Age 4 marks f. Experience 4 marks g. Business ability / acumen 5 marks h. Personality 2 marks Allocation of marks on various parameters

Exist Sub Description Marks Details/alloc ing heads ation of Head marks Land Suitable Owns 35 Marks to be and land for land/has allotted, infra retail firm offer owns land struc outlets from and willing ture landowner to give to /can company:

arrange 35, has firm land offer and willing to give to company: 25, owns land and not willing to give to company but is willing to use for development of Retail Outlet: 20, firm offer but not willing to give to company but is willing to use for development of Retail 23 Outlet : 15 Sub total 35"

25. Both the appellant as well as respondent No.2 were assessed on

the basis of the aforesaid criteria and secured 25 marks each out of a

total of 35 marks. From the record, it appears that on the date of the

application, respondent No.2 would not fall under the category of land

owner. She was, however, a lease holder, but was unable to create a sub

lease, in view of the negative covenant contained in Clause 4 of the lease

deed dated 18.3.2004. Furthermore in the application, she did not make

available any other material to show that she could make the land

available. She, however, claims to have produced the supplementary

lease deed dated 18.3.2004, at the time of the interview. But there

appears to be no material on the record to indicate that it was actually

produced before the Interview Board. Even at the time of hearing, no

material was produced before us by any of the respondents to show that

it was actually produced before the Interview Board. In such

circumstances, the learned Single Judge, in our opinion, correctly

observed that the lease deed dated 18.3.2004 was perhaps not produced

before the Interview Committee.

26. We, however, find that the Single Judge has unnecessarily jumped

to the conclusion that it was not a genuine document. It had been duly

notarized, therefore, it could not be said to be a fake document in the

absence of any other material. In our opinion, the Division Bench has

24 correctly accepted the genuineness of the document. Non-registration of

lease as required under Section 107 of the Transfer of Property

Act, 1882, may affect the legal rights of the parties inter se. But here

Respondent No.2 is not seeking to enforce any such rights. She merely

offered the lease deed as proof of her "capability to provide land" for

being used by Respondent No.1 as a Retail Outlet Dealership. By virtue

of Important Note (c) of the Public Notice dated 19.2.2004, respondent

No.2 could make the land available within two months of the issue of

Letter of Intent, which was issued on 8.7.2004. This, however, will not

change the legal position. Even if the second lease deed is genuine, the

same was not available before the interview board. No material was

placed before this court to show that the document was in fact available

at the time when the interview was conducted. Therefore, she could not

have been allotted any marks, for her capability to provide land, in view

of the negative covenant contained in the lease deed dated 16.3.2004.

27. A clear cut procedure has been laid down in the circular

dated 4.9.2003 for making the selection under Clause 5. It is clearly

provided that the candidates will be evaluated by the selection committee

through interviews based on the marking system as given in Annexure-A.

Annexure-A clearly stipulates three categories of candidates, namely,

i) owner of the land who is willing to give the land to respondent No.1 by

sale/lease; ii) individuals who have firm offers from land owner who are

willing to give the land to respondent No.1; and iii) candidates who can

25 arrange land. Both on the date of the application and the date of the

interview, in our opinion, the respondent No.2 did not fall within any of

the aforesaid categories. Therefore, her selection was vitiated, as the

Selection Committee has deviated from the criteria laid down in the

Circular dated 4.9.2003. In the absence of the lease deed

dated 18.3.2004, the Interview Committee had no material before it, to

award any marks to respondent No.2, against the column "capability to

provide land".

28. There is hardly any difference in the provisions contained in the

circular dated 4.9.2003 and the brochure dated 1.11.2004 with regard to

the candidate's capability to provide land. Clause 16(1) of the brochure

dated 1.11.2004 contained the same provision as the provisions

contained in Annexure A of the circular dated 4.9.2003. The brochure

dated 1.11.2004 clarified the parameters which were applicable to

individuals in the allocation of marks. Under the parameter "land and

infrastructure" ; sub head suitable land and retail outlet provides a clear

description of the desired candidates. In substance, however, the

provision in both the circulars dated 4.9.2003 and the brochure

dated 1.11.2004 are identical. On the issue of allocation of marks,

therefore, it would have made no difference as to whether the

candidature of the appellant and the respondent No.2 had been

considered under either of the guidelines.

26

29. The difference between the circular dated 4.9.2003 and the

brochure dated 1.11.2004 is that under the latter, Clause 14(1)

postulates that the site verification shall be before the interview for that

location. But this precondition, as noticed by the Division Bench, could

not be made applicable to the selection process which had been

completed. The interview in the ongoing selection has been held

on 4.6.2004. The panel, according to Clause 5.2.3 and Clause 5.3 is to

be prepared immediately on the completion of interview. Such a panel

was duly prepared. It is the accepted position before us that the

appellant did not fall within the panel of three most meritorious

candidates. Thereafter, according to Clause 5.4, the Letter of Intent had

to be issued to the candidate at No.1 of the merit list. Respondent No.2

being in such position was given the Letter of Intent on 8.7.2004. The

brochure was published after the letter of intent was issued to

respondent No.2. A provision which was not in existence when the

selection procedure was completed could have had no application, unless

it is made retrospective in operation.

30. Having said all that, we may now consider the question as to

whether it was necessary for the learned Single Judge to quash the entire

selection. We are of the considered opinion, that in the peculiar facts of

this case, the learned Single Judge adopted a very pedantic and

doctrinaire approach to a problem which in fact, had to be viewed

pragmatically. The Learned Single Judge not only failed to take note of

27 the ground realities, but ignored the relevant clauses of the policy

circular dated 4th of September, 2003. Under the aforesaid Circular,

upon the selection and appointment of respondent No.2 being declared

illegal, the entire selection could not have been held to be vitiated. In

such circumstances, the Letter of Intent would be issued to the next

candidate in the panel of three, in terms of Clause 5.4. This Clause

specifically provides that if the letter of intent is cancelled for any reason,

it will be given to the next candidate in the merit list. In this case, even

such an eventuality would not have arisen, as the candidates at Nos.2

and 3 were not the writ petitioners before the High court. Therefore, in

our opinion, the learned Single Judge needlessly set aside the entire

selection. At the same time the Division Bench also committed an error

of law, in upholding the selection of respondent No.2.

31. In view of our findings recorded above, the normal order would be

to set aside the impugned judgment of the Division Bench. Further

direction would have been to offer the dealership to the next candidate

on the panel of three. But these candidates have shown no interest in

these proceedings. In these circumstances, the learned counsel for

respondent No.2 has made strenuous efforts to persuade the Court, not

to interfere in the grant of the dealership to respondent No.2. The same

prayer was also made before the learned Single Judge. It was, however,

rejected with the observations reproduced in the earlier part of the

judgment. The learned Single Judge rejected the submission by placing

28 reliance on a judgment of this court in V. Purushotham Rao Vs. Union

of India and Others ( [2001] 10 SCC 305 ). In our opinion, the aforesaid

judgment was rendered under some very peculiar and exceptional

circumstances. It was a case where allotment of retail outlets or

petroleum products had been made by a Minister in violation of all

norms while exercising his discretionary powers for making the

allotments. These allotments had been made in the absence of any

guidelines. The circumstances were such that this court was constrained

to make the observations relied upon by the learned Single Judge which

are as under:

"23. So far as the fifth question is concerned, it is no doubt true that the appellants have invested considerable amount in the business and have operated it for about eight years but even on equitable considerations, we do not find any equity in favour of the appellants. The conduct of the Minister in making the discretionary allotments has been found to be atrocious, in the very three-Judge Bench decision of this Court and in relation to similar allotments made by the said Minister in favour of 15 persons who were respondents in common cause case. This Court came to hold that the allotments of the public property had been doled out in an arbitrary and discriminatory manner and the appellants had been held to be beneficiaries of such arbitrary orders and allotments. The question of granting the allottees relief on equitable consideration did not arise at all, for the same reasons in a case like this, a sympathetic consideration on the ground of equity would be a case of misplaced sympathy and we refrain from granting any relief on any equitable consideration. In our view, the appellants do not deserve any equitable consideration."

The above observations make it abundantly clear that this Court

was dealing with a situation where the concerned Minister had bestowed

29 undue favour on the appellants in that case. Such is not a situation in

the present case. Therefore, the aforesaid observations would be of little

assistance to the appellant herein.

32. The facts and circumstances of this case are not such where this

court would be reluctant to come to the aid of a selected candidate,

against whom there are no allegations of manipulation or any undue

favour having been shown to her. In our opinion, this is not a case of

such an exceptional nature where equitable considerations would be

impermissible. The peculiar facts of this case are such that it would be

appropriate for the Court to take into consideration the subsequent

events, in order to do complete justice between the parties. In the case of

Kedarnath (supra) this Court delineated the circumstances in which the

subsequent events could be taken into consideration in the peculiar facts

and circumstances of a particular case. It was emphatically observed as

follows:

"16. In our opinion, by not taking into account the subsequent event, the High Court has committed an error of law and also an error of jurisdiction. In our judgment, the law is well settled on the point, and it is this: the basic rule is that the rights of the parties should be determined on the basis of the date of institution of the suit or proceeding and the suit/action should be tried at all stages on the cause of action as it existed at the commencement of the suit/action. This, however, does not mean that events happening after institution of a suit/proceeding, cannot be considered at all. It is the power and duty of the court to consider changed circumstances. A court of law may take into account subsequent events inter alia in the following circumstances:

(i) the relief claimed originally has by reason of subsequent change of circumstances become inappropriate; or

30

(ii) it is necessary to take notice of subsequent events in order to shorten litigation; or

(iii) it is necessary to do so in order to do complete justice between the parties.

(Re Shikharchand Jain v. Digamber Jain Praband Karini Sabha, SCC p.681, para 10.)"

In view of the above, we find that the course adopted by the

Division Bench was appropriate, as well as being legally correct.

33. It appears to us that the learned Single Judge wrongly brushed

aside the observations made by this Court, in the case of Rashpal

Malhotra (supra) wherein it is observed as follows :-

"7. It has to be borne in mind that this is an appeal under Article 136 of the Constitution. This Court in Heavy Engineering Corporation Ltd., Ranchi v. K. Singh and Co., Ranchi expressed the opinion that although the powers of this Court were wide under Article 136 it could not be urged that because leave had been granted the court must always in every case deal with the merits even though it was satisfied that the ends of justice did not justify its interference in a given case. It is not as if, in an appeal with leave under Article 136, this Court was bound to decide the question if on facts at the later hearing the court felt that the ends of justice did not make it necessary to decide the point. Similarly in Baigana v. Deputy Collector of Consolidation this Court expressed the view that this Court was more than a court of appeal. It exercises power only when there is supreme need. It is not the fifth court of appeal but the final court of the nation. Therefore, even if legal flaws might be electronically detected, we cannot interfere save manifest injustice or substantial question of public importance. "

_______

"It has to be borne in mind that this Court in exercising its power under Article 136 of the Constitution acts not only as a court of law but also as a court of equity and must 31 subserve ultimately the cause of justice." (Emphasis supplied)

These observations are fully applicable to the present case.

34. Again in the case of Municipal Board of Pratabgarh (supra) this

Court observed as under:-

"6. What are the options before us. Obviously, as a logical corollary to our finding we have to interfere with the judgment of the High Court, because the view taken by it is not in conformity with the law. It is at this stage that Mr Sanghi, learned counsel for the respondent invited us to consider the humanitarian aspect of the matter. The submission is that the jurisdiction of this Court under Article 136 of the Constitution is discretionary and, therefore, this Court is not bound to tilt at every approach found not in consonance or conformity with law but the interference may have a deleterious effect on the parties involved in the dispute. Laws cannot be interpreted and enforced divorced from their effect on human beings for whom the laws are meant. Undoubtedly, rule of law must prevail but as is often said, `rule of law must run akin to rule of life. And life of law is not logic but experience'. By pointing out the error which according to us crept into the High Court's judgment the legal position is restored and the rule of law has been ensured its pristine glory. Having performed that duty under Article 136, is it obligatory on this Court to take the matter to its logical end so that while the law will affirm its element of certainty, the equity may stand massacred. There comes in the element of discretion which this Court enjoys in exercise of its extraordinary jurisdiction under Article 136. In approaching the matter this way we are not charting a new course but follow the precedents of repute. In Punjab Beverages (P) Ltd., Chandigarh v. Suresh Chand, this Court held that the order of dismissal made by the appellant in that case in contravention of Section 33(2)(b) of the Industrial Disputes Act did not render the order void and inoperative, yet this Court did not set aside the order of the lower court directing payment of wages under Section 33(2)(c) and affirmed that part of the order. While recording this conclusion this Court observed that in exercise of the extraordinary jurisdiction this Court was not bound to set aside every order found not in conformity or in consonance with the law unless the justice of the case so requires. The Court further observed that demands of social 32 justice are paramount while dealing with the industrial disputes and, therefore, even though the lower court was not right in allowing the application of the respondent, the Court declined to exercise its overriding jurisdiction under Article 136 to set aside the order of the Labour Court directing the appellant to pay certain amount to the workers. Following this trend in State of M.P. v. Ram Ratan, this Court while holding that the High Court was in error in directing reinstatement of the respondent in service, took note of the fact that by passage of time the respondent superannuated. The Court paid him back wages till the day of superannuation in the round sum of Rs.10,000. In other words, while formally setting aside the order of the High Court directing reinstatement, treated the respondent in that case in service and paid him back wages because physical reinstatement on account of passage of time was not possible. From the academic's point of view the later decision is the subject-matter of adverse comment but we feel reasonably certain that it stems from narrow constricted view of the jurisdiction of the Court under Article 136. We adhere to our view after meticulously examining the learned comment. Having noted that criticism, we still adhere to the view that legal formulations cannot be enforced divorced from the realities of the fact situation of the case. While administering law it is to be tempered with equity and if the equitable situation demands after setting right the legal formulations not to take it to the logical end, this Court would be failing in its duty if it does not notice equitable considerations and mould the final order in exercise of its extraordinary jurisdiction. Any other approach would render this Court a normal Court of appeal which it is not."

These observations leave no manner of doubt that the court

would be failing in its duty if it does not take due notice of the

equitable considerations and mould the relief, to do complete justice

between the parties.

35. The aforesaid observations were reiterated in the case of

Taherakhatoon (supra):

"19. We may in this connection also refer to Municipal Board, Pratabgarh v. Mahendra Singh Chawla9 wherein it was 33 observed that in such cases, after declaring the correct legal position, this Court might still say that it would not exercise discretion to decide the case on merits and that it would decide on the basis of equitable considerations in the fact situation of the case and "mould the final order."

36. In our opinion, the facts and circumstances of this case are such

that the approach adopted by the Division Bench, in taking note of the

subsequent events, was appropriate and legally permissible. The clumsy

handling of the entire selection process by respondent No.1 ought not to

result in disqualification of the respondent No.2 who was perhaps not

properly guided. There are no allegations made that respondent No.2

has either manipulated the selection or that any undue favour has been

shown to her by the Selection Committee. We also can not ignore the

fact that candidates at Nos.2 and 3 of the panel have not challenged the

selection and grant of dealership to respondent No.2. The appellant

could also not get any relief, not being in the panel of selected

candidates. It is also to be noted that the dealership has been operating

for more than five years. It is stated to be one of the best, if not the

topmost, outlet in the State. Entire infrastructure has been made

available with the combined efforts of respondents No.1 and 2. Closure

of the dealership, at this juncture, would result in disastrous

consequences to respondent No.2. We have already noted that the

decision of the Selection Committee is rendered arbitrary due to non-

observance of the stipulated criteria in the Policy Circular dated 4.9.2003

and the Public Notice dated 12.2.2004. We have also noted that it is not

34 a case where the selection is vitiated by proved mala fides; nor any

allegations of undue favour being shown to respondent No.2 have been

made. Even leaving aside the loss which would be incurred by

respondent No.2 it would not be possible for this court to ignore the far

reaching consequences of cancellation of the retail outlet in the small

State of Tripura where such facilities are not in abundance. Therefore,

keeping in view the over all public interest, we decline to exercise the

extra ordinary jurisdiction of this court under Article 136 of the

Constitution of India for setting aside the selection made in favour of

respondent No.2.

37. Both the appeals are dismissed with no order as to costs.

..............................................J. [ALTAMAS KABIR]

..............................................J. [CYRIAC JOSEPH]

..............................................J. [SURINDER SINGH NIJJAR] NEW DELHI:

JULY 30, 2010.

35