Sivabharathi Gas Services, Viyoor, Kollam and others v. Indian Oil Corporation and others
Case Details & Bench
- Court
- High Court of Kerala
- Hon'ble Judges
- Anu Sivaraman
- Judgment Date
- 2018-03-19
- Court Decision / Holding
- The writ petitions are ordered accordingly.
- Final Disposition
- Disposed of; writ petitions disposed with directions to consider complaints and allow Exhibit P6 implementation subject to representations and area-manager redressal of grievances.
Parties to the Case
Appellants / Petitioners
- Jeeju N.K.
- Nidhin Joy
- Sudheer Kumar M.
- Mridula Jayaraj
- Sheena P.K.
- P.V. Gopinath
- K. Preethi
- P. Chandran
- Saraswathy Sivan
- Sivabharathi Gas Services, Viyoor, Kollam
Respondents
- Indian Oil Corporation
- Bharath Petroleum Corporation Ltd.
- Territory Manager (LPG Division), Bharath Petroleum Corporation
- Sales Officer, LPG (Sales), Bharath Petroleum Corporation, Calicut
Legal Representation & Advocates
Counsels for Petitioners
- • Sumathy Dandapani
- • Millu Dandapani
Counsels for Respondents
- • M. Gopikrishnan Nambiar
- • P. Gopinath
- • K. John Mathai
- • Joson ManavalAN
- • Kuryan Thomas
- • Pauloose C. Abraham
Case Synopsis & Summary
These writ petitions challenge Exhibit P6, a circular issued by Oil Marketing Companies (OMCs) restructuring the transfer of LPG customers from existing distributors to newly commissioned distributors based on viability norms. The petitioners are existing distributors with defined areas and a free-delivery zone of 5 km, who allege that Exhibit P6 transfers customers without consent and harms customer convenience and stability. They argue that the advertisement Exhibit P5 inviting new distributors confirmed competition without guaranteeing customers, and that Exhibit P6 reassigns customers to distributors who may not meet viability criteria, undermining contractual commitments and prior letters of intent (Exhibits P7). They contend the policy was mooted earlier (Exhibit P7, 2004) and dropped, then reintroduced without consultation, violating natural justice. They further claim that customers could be disadvantaged if moved to new distributors with insufficient resources, disrupting service. The respondents contend the policy is legal, uniform across OMCs, and grounded in distributorship agreements and letters of intent; they rely on the Division Bench decision in All India LPG Distributors Federation v. Union of India to justify transfers based on viability norms. They propose addressing complaints via Area Managers. The court, without deciding merits, notes the cited precedent, and directs consideration of complaints with notice to existing distributors while allowing Exhibit P6’s implementation subject to representations. The petitions are ordered accordingly.
Submissions & Arguments
Contentions of Appellants / Petitioners
The petitioners contend that they are existing LPG distributors with fixed territor ies and a 5 km free-delivery zone. Exhibit P6 transfers customers to newly commissioned distributorships based on viability norms, without prior consultation, consent of customers, or due regard to contractual commitments (including letters of intent). They emphasize that Exhibit P5 advertised fresh distributors without guaranteeing customers, suggesting the policy undermines customer service and investor security. They argue the policy was mooted in 2004 (Exhibit P7) and subsequently dropped, only to be reintroduced without proper consultation, violating principles of natural justice. The petitioners seek restraint or modification of Exhibit P6 and demand a consultative process with opportunities to address customer grievances while ensuring reasonable protection for incumbents during implementation.
Contentions of Respondents
The respondents submit that the policy is a uniform, legally permissible measure to ensure viability and service efficiency across OMCs. They rely on the contract letters of intent and prior agreements to justify transfers of customers to incoming distributors under viability norms. They cite All India LPG Distributors Federation v. Union of India (2003(2) KLJ 451) to support transfers in line with viability norms, and argue that customer objections can be addressed by Area Managers rather than blocking the policy. They contend there is no inherent right for incumbents to prevent transfers and that the policy aims to rationalize operations for broader service. They assert grievances will be considered in due course under Exhibit P6 with proper process and that implementation should proceed subject to the resolution of individual representations.
Cited Precedents (1)
| Case Name | Citation | Treatment | Explanation |
|---|---|---|---|
| All India LPG Distributors Federation v. Union of India | 2003(2) KLJ 451 | Positive | The Division Bench’s conclusion that distributors have no right to prevent transfer of existing customers is cited as authority supporting the legality and uniformity of the policy, and the current court aligns with that reasoning to allow the transfers to proceed subject to addressing grievances. |
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