Indian Oil Corporation Ltd. vs Mohan Lal Jain

V.K. Jhanji, J.—This revision petition is directed against the orders of the Courts below whereby on an application filed by the plaintiff-respondent under Order 39 Rules 1 and 2, Code of Civil Procedure, Indian Oil Corporation, namely the petitioner, has been directed to restore the supply of oil products to the plaintiff (respondent herein) against payment and continue the supply during the subsistence of lease alleged to have been executed between Harpal Singh Gill who was a licensee and the plaintiff or upto the disposal of the suit, whichever is earlier.

Indian Oil Corporation (hereinafter referred to as Corporation) vide agreement dated 1.12.1967 appointed Harpal Singh Gill as its dealer for sale of Motor Spirit and High Speed diesel. Under the agreement, business was to be carried on by said Harpal Singh Gill as sole proprietor in the name and style of M/s White house Service Station. Clause 11 of the agreement provided that the dealer shall not assign or part with his rights under the agreement or any part thereof. Harpal Singh Gill died on 5.5.1992 and on coming to know of his death the Corporation stopped supplies of the petroleum products since it was not possible to have control on a person who was not the dealer appointed by the Corporation. The plaintiff who is claiming to be lessee from Harpal Singh filed a suit for prohibitory injunction claiming that the supplies stopped on the death of Harpal Singh Gill be restored forthwith as he is a lessee and had been carrying on the business on retail outlet even during the life time of Harpal Singh Gill. Along with the suit, plaintiff filed an application for grant of ad-interim injunction. The trial Court vide its order dated 15.6.1995 allowed the application of the plaintiff and the corporation was directed to restore the supply of oil products. Against the order of the trial Court, the Corporation through its attorney namely R. Kaul filed an appeal. The learned Additional District Judge, Ludhiana has dismissed the appeal on the ground that the attorney of the Corporation has no right to file and maintain the appeal. The orders of the Courts below are being impugned by the Corporation in the present revision petition.

Learned counsel for the petitioner has contended that R. Kaul being an attorney of the Corporation had the authority to file an appeal and he having done so, the first appellate Court has acted illegally in exercise of its jurisdiction in dismissing the appeal as incompetent. He also contended that in the circumstances of this case, plaintiff is not entitled to the grant of interim injunction.

In answer to these submission, Mr. M.L. Sarin, Sr. Advocate, counsel for the plaintiff has contended that before filing the appeal, steps were required to be taken by the Corporation to take decision to file appeal. In absence of such a decision by the Board of Directors, the appeal has rightly been dismissed being not maintainable. He also contended that the person who filed the appeal was not authorised to do so and on this score too the order under revision cannot be interfered with. In support of his submissions, he has made reference to judgments in Punjab Wakf Board through its Secretary, Ambala Cantt v. Darb Singh (Deceased) through his L.R.S. 1988 1 P.L.R. 525, Punjab State Electricity Board, Patiala v. Punjab Wakf Board and Ors (1983) 85 P.L.R. 85 and Municipal Committee, Bhatinda v. Sadhu Singh 1986 2 P.L.R 1. In regard to grant of injunction by the trial Court, he contended that for good reasons the trial Court has granted injunction which should not be interfered with by this Court in exercise of its revisional jurisdiction.

The first appellate Court has dismissed the appeal being incompetent primarily on two grounds; firstly, that no resolution of the Corporation has been produced on record to show that any decision was taken by the Board to file an appeal and secondly, R. Kaul had no authority to file the appeal. Counsel for the petitioner has placed before me minutes of the 101st meeting of the Board of Directors held on 11.4.1974 at the Registered Office, Bombay, whereby the Board approved the revised general power of attorney in favour of Secretary of the Corporation, Shri D.B. Purl Pursuant to this resolution, the Managing Director on behalf of the Board has executed power of attorney in favour of D.B. Puri, Secretary of the Corporation. Clause 12 of the power of attorney gives power to the attorney to sign, verify, declare and execute Vekalatnamas, plaints, written statements, counter claims, petitions, appeals, reviews, applications affidavits, power of attorney and papers of every description that may be necessary to be signed, verified and executed for the purpose of any suit, actions, appeals etc.. Clause 29 empowers the attorney to delegate and/or to sub-delegate any one or more or all of the powers and authorities under the clauses to any one or more officers or Executives of the Corporation by name or designation with express powers and authorities to such delegate and/or sub-delegate to further sub-delegate and empower and other employee of the Corporation in like manner and to the like extent or otherwise as may be necessary and to revoke and redelegate and withdraw such powers and authorities from time to time and to impose such conditions and limitations thereon as may in his discretion think fit from time to time. Subsequently, D.B. Puri delegated the powers to B.S. Chhikara vide power of attorney dated 18.10.1977 who has further sub-delegated the powers to R. Kaul under power of attorney dated 1.9.1984. Clauses 8 and 9 of power of attorney dated 1.9.1984 give power to the attorney to institute suit and file appeal etc. The appeal having been filed by R. Kaul was therefore not incompetent as has been held by the first appellate Court. Passing of a specific resolution to file appeal against the judgment of the trial Court was not necessary because the Board had already given authority to Sh. D.B. Puri who was Secretary of the Corporation to delegate and sub-delegate any one or more Or all of the powers to any one or more Officers or Executives of the Corporation. In somewhat similar circumstances, this Court in Hindustan Petroleum Corporation Ltd. and Anr. v. Sardar Chand and Anr. 1991 2 P.L.R. 669 has held that the matter of taking decision by the Board has to be considered in reference to the Memorandum and Articles of Association of the Corporation. The learned Judge relied upon the observations of this Court in Pepsu Road Transport Corporation, Patiala v. Kirat Mohinder Singh (1983) 85 P.L.R. 219 wherein it was held The resolution, fully authorised the General Manager to act on behalf of the petitioner in all the cases filed or to be filed by or against it. The passing of any specific resolution is not contemplated under the Act in each and every case. Moreover, it will depend upon the constitution of a Corporation and the manner in which its functions are regulated by the Statute itself. There cannot be any universal rule that every Corporation must act through resolutions passed, by it in each and every case." Keeping in view the resolution passed by the Board and also the various clauses contained in power of attorneys which were executed in delegated of the powers, the objection that R. Kaul had no authority to file the appeal cannot be entertained. The decision in Punjab Wakf Board''s case (supra) cited by counsel for the plaintiff was noticed in Sardar Chand''s case (supra) and for the reasons given therein, it has no application to the facts of the present case. Likewise, judgment in Sadhu Singh''s case (supra) can be of no assistance to the respondents. It was in context of Section 4 of the Punjab Municipal (Executive Officer) Act, 1931 it was held that besides passing a resolution deciding to file an appeal, the Municipal Committee must necessarily pass a separate resolution vesting authority in the Executive Officer to file the same. The power given to the Executive Officer u/s 4 was to carry on the administration of the Municipality. In other words, amongst other administrative functions he was to implement the resolution passed by the Municipal Committee. Since the decision to file an appeal on behalf of the Municipal Committee was not an administrative function it was held that to file an appeal a decision was required to be taken by the Municipal Committee itself. In Punjab State Electricity Board''s case (supra), counsel on his own had filed the appeal on behalf of the Board and therefore, it was held that counsel on its own could not take decision which could only be taken either by an attorney or anybody else authorised by the Board. As already noticed, in this case the Board who admittedly had to authority to institute, conduct, defend, compound or abandon any legal proceedings by or against the Corporation or its officers, or otherwise concerning the affairs of the Corporation, by resolution passed in meeting held on 11.4.1974 gave general power of attorney in favour of Secretary of the Corporation who in turn had delegated and sub-delegated the said power to employees of the Corporation.

Mr. M.L. Sarin, learned counsel for the plaintiff in order to defend the order of the trial Court granting injunction contended that Harpal Singh due to his weak health and bad financial position found it cumbersome to run the petrol pump and therefore, leased out the same to the plaintiff on the terms and conditions which were reduced into writing on 1.8.1991. He contended that earlier to it, relatives of the plaintiff, namely Sant Kumar, partner in M/s Sant Machinery Store and thereafter Yash Pal had been running the petrol pump and after Yash Pal Sanjeev Dhir had been running the petrol pump. He thus, contended that in the lease agreement, it has clearly been mentioned that plaintiff would be free to run the petrol pump at his own expense and the plaintiff has an independent right to get supply of petroleum products from the defendant.

The principal consideration in the grant of injunction is that the Court must be satisfied that the plaintiff has made out a prima-facie case and that irreparable injury will result to him if injunction is not granted and that there is no other remedy open to him by which he could protect himself from the consequence of the apprehended injury and that the apprehended injury must be material one in the sense that it cannot be adequately compensated in terms of damages. One of the considerations for grant of interim injunction is that interim injunction would not be granted where the final relief cannot be granted. The Court would refuse to grant injunction in a suit for permanent injunction where it finds that the material available at the hearing of the application for inter-locutory injunction fails to disclose any real prospect of succeeding at the final trial.

It is thus, required to be determined whether the plaintiff has any prospect of succeeding at the final trial. It is not in dispute that dealership of the petrol pump was given by the Corporation to M/s White House Service Station whose sole proprietor was Harpal Singh. Under Clause 11 of the agreement, the dealer appointed by the Corporation had no right to assign or part with his rights under the agreement. In the agreement, it was clarified that expression "dealer" would include the present members and/or permitted future members. The Corporation had been supplying petroleum products to M/s. White House Service Station during the life time of Harpal Singh and when it was brought to the notice of the Corporation that Harpal Singh has died, the Corporation stopped supplying its petroleum products to the Service station. Counsel for the plaintiff was unable to explain as to how the lease agreement, if any executed between the plaintiff and Harpal Singh is binding on the Corporation. Plaintiff is not a contracting party to the agreement entered into between Harpal Singh and the Corporation. A person not a party to the contract cannot enforce the terms of contract. Injunction will only be granted to prevent breach of an obligation existing in favour of a person seeking injunction. Thus, in order to obtain injunction, the plaintiff must satisfy the Court that he has a prima-facie case in support of the title which he asserts or in other words he must show that his cause is founded on the existence of a legal right. Plaintiff in this case has failed to place any material on record to show the existence of any legal right or obligation in his favour, the breach of which is required to be protected by means of injunction. As would be apparent from a reading of Sec. 36 of Specific Relief Act, perpetual injunction can be granted to prevent breach of an obligation existing in favour of plaintiff, whether expressly or by implication; or where such obligation arises from a contract which can be specifically enforced. In the present case, the Corporation is not under any obligation in law to supply petroleum products to the plaintiff nor the Corporation has threatened or has invaded any right of the plaintiff; rather the plaintiff in law has no right to ask the Corporation to resume the supply. In such a situation, if the plaintiff is not entitled to relief of perpetual injunction, I fail to understand as to how the plaintiff is entitled to interim relief at the preliminary hearing of the suit. Otherwise too, where the discretionary and equitable jurisdiction of the Court is invoked, the plaintiff must come with clean hands and show that his own acts which are relevant to the controversy had been fair and equitable. It was to the knowledge of the plaintiff that dealership agreement specifically prohibited the dealer from assigning or parting with his rights under the agreement or any part thereof, and despite this restraint if he had chosen to enter into such an agreement with the dealer, it was entirely at his own risk. He cannot seek assistance of the Court to perpetuate a wrong.

It was next contended by Mr. Sarin that the Corporation had been dealing with the plaintiff for a very-very long time and therefore, the Corporation is estopped from denying the entitlement of the plaintiff to receive the supply of petroleum products. In support of this contention, he has made reference to certain observations of the Supreme Court in Mahabir Auto Stores and Ors v. Indian Oil Corporation and Ors 1990(2) S.L.R. 69. The contention of the learned counsel is factually incorrect. The material placed on record by the plaintiff himself has revealed that the Corporation throughout had been dealing with M/s White House Service Station whose sole proprietor was Harpal Singh. If at all there was any agreement between Harpal Singh and the plaintiff or his relatives, it was not to the knowledge of the Corporation. The correspondence between the Corporation and the dealer was always under the name and style of firm namely white House Service Station. At no stage, the plaintiff directly made any correspondence with the Corporation. In Mahabir Auto Stores''s case (supra), not only the appellant-firm was given permanent customer code number but the Corporation had been dealing with the said firm since 1951 without any formal contract and in these circumstances the Corporation was directed to consider the case of the appellant-firm afresh. However, in the present case according to his own showing in the plaint the plaintiff for the first time entered into these agreement with Harpal Singh on 1.8.1991, admittedly to which the Corporation was not a party.

Lastly, it was contended by Mr. Sarin that the Corporation at least be directed to supply the petroleum products upto 31.7.1996 when the period of lease would come to an end. To accept this contention would mean foisting upon the Corporation a stranger over whom the Corporation has no control. The Ministry of Petroleum and Chemicals has published a notification namely Motor Spirit and High Speed Diesel (Prevention of Mal-practices and Supply of distribution) Order, 1991 in exercise of powers conferred on the Government by Section 3 of the Essential Commodities Act, 1955 wherein the dealer has been defined as under:-

" ''dealer'' means a person appointed by the Oil Company to purchase, receive, store and sell motor-spirit and high speed diesel oil whether or not in conjunction with any other business and shall include his representative, employees and agents."

Plaintiff is neither a dealer nor representative of the dealer or is his employee or an agent. On the demise of Harpal Singh, there infact was no dealer to carry on the business in the name and style of M/s. White House Service Station, Ludhiana as the agreement between the Corporation and Harpal Singh came to en end. In this view of the matter, this contention too cannot be accepted.

Consequently, the revision petition is allowed, orders of the Courts below are set aside and in consequence thereof, application under Order 39 Rules 1 and 2, Code of Civil Procedure, stands dismissed. There shall be no order as to costs.