Rambha Sinha and Ajay Kumar Singh V. The Union of India & Ors

CWJC/11985/2006

AI Insights

The case involves two writ applications filed by Rambha Sinha and Ajay Kumar Singh against the Indian Oil Corporation (IOC) and the Union of India, concerning the non-implementation of the Parliamentary Petitions Committee's recommendations for issuing Letters of Intent (LOI) for retail outlets. The IOC had initially not selected the petitioners for dealership but was later directed by the Parliamentary Committee to issue LOIs, which the IOC failed to implement, leading to the writ applications. The court examined the authority of the Parliament over government undertakings and the binding nature of its recommendations.

• Counselvise Citation: [2008] 140 COUNSELVISE.COM (IT) 803582 (HC-PATNA)
• Appeal Type: Others
• Pronouncement Date: 19-08-2008
• Assessment Year: misc
• Other Referred Cases: Chintapalli Agency Taluk Arrack Sales Co-operative Society Limited etc. Vs. Secretary (Food and Agriculture) Government of Andhra Pradesh and Others, Bhopal Sugar Industries Limited Vs. Income-tax Officer, Bhopal, Smt. S. R. Venkataraman Vs. Union of India and Another
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: ANIL JHA; ARUN KUMAR; RATAN KUMAR; SATYENDRA JHA
• Assessee Lawyers: S A NARAIN; RAKESH SINGH; NEERAJ SINGH
• Keywords: Indian Oil Corporation; Letter of Intent; Writ application; Parliamentary supremacy; Petitions Committee

Judgement Text

"IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.11985 of 2006 RAMBHA SINHA Versus THE UNION OF INDIA & ORS WITH CWJC No. 11447 of 2006 AJAY KUMAR SINGH Versus THE UNION OF INDIA & ORS ----------------- For the Petitioner: Mr. S.A. Narain, Sr.Adv. (In both) Mr. Rakesh Singh,Adv. Mr. Neeraj Singh, Adv. For the Indian Oil: Mr. Anil Kumar Jha, Adv. Corporation Mr. Arun Kumar (In both) For the Union of India: Dr. Ratan Kumar, C.G.C. (In CWJC No. 11985 of 2006) Mr. Satyendra Kr. Jha, Adv. (In CWJC No. 11447 of 2006) ---------------- 08 19.08.2008 Whether in a democratic country governed by Constitution is the Parliament or the government undertaking supreme is the question in these writ applications? In defence to the writ applications the Indian Oil Corporation, a Government of India undertaking, has chosen to challenge the authority of the Parliament to interfere in its business. I must note that Union of India in the Ministry of Petroleum and Natural Gas is also a party to the writ application, but, in my view, has rightly chosen not to challenge the authority of the Parliament of India as Indian Oil Corporation has chosen. As all parties have appeared and filed their counter affidavits and rejoinders, with their consent the writ applications are being 2 disposed of at the stage admission of itself. The first writ application relates to setting up of a retail liquefied petroleum gas (LPG) retail outlet at Basantpur in the district of Siwan, as a dealer of Indian Oil Corporation Limited. The second writ application relates to Kerosene (SKO) & Lowspeed diesel oil (LDO) dealership of Indian Oil Corporation Limited at Jalalpur in the district of Saran. The material facts are similar, inasmuch as, the writ petitioners in both the cases were originally not selected, but, on moving the Petitions Committee of the Parliament, they were directed to be selected and letter of intent (LOI) issued in their favour, which recommendation was not carried out by the Indian Oil Corporation Limited. Their objection was then reheard by the Parliamentary Committee and rejecting their objections the earlier recommendation was reiterated. It’s failure to implement those recommendations, that the two writ applications have been filed. As facts are similar, for the sake of brevity and convenience, I will be referring to the facts of the first case. Indian Oil Corporation Limited is a Corporation incorporated under the Indian Companies Act, 1956, of which till recently the entire share holding was that of the Central Government, which still retains majority share holding therein. It is a public sector undertaking and prior to nationalization of other Oil Companies in the year 1973-74; it was the only public sector crude oil refinery for retail selling its products including liquefied petroleum gas (LPG) and Kerosene (SKO) & Lowspeed diesel oil (LDO). For marketing its products the Corporation 3 establishes retail outlets at various places in the country. For proper selection of retail outlets Government of India in the Ministry of Petroleum and Natural Gas had framed certain guidelines for the public sector oil companies to be followed. It, under the guidelines of Ministry of Petroleum and Natural Gas issues public advertisements. On applications being received it scrutinizes the same and then a Committee evaluates the candidature by a process which also includes interview and then a panel is prepared and forwarded to the Corporation who then conducts a field survey and issues letter of intent (LOI) giving time to the selected candidate to establish the retail outlet. In the first case, for the location at Basantpur in the district of Siwan in the State of Bihar the Corporation advertised for setting up a retail LPG outlet reserved for woman category. Petitioner and others applied. Petitioner was not finally selected. She made a representation to the Board, which did not find favour, thereafter; she filed a petition before the Petitions Committee of the Lok Sabha. The Petitions Committee of Lok Sabha of the Parliament noticed the Ministry, the Indian Oil Corporation, the petitioner and the selected and empanelled candidates and heard the matter and considered material placed before it by the parties. The Committee then made its recommendation in the shape of 15th report of the Committee on petitions (14th Lok Sabha), which was presented to the House (Lok Sabha) on 23rd of May 2006. Pursuant to the aforesaid recommendation, the same was forwarded to the Ministry of Petroleum by the Secretariat of the Lok Sabha for follow 4 up action. The recommendations were two fold, firstly, the Petitions Committee of Lok Sabha felt that certain Officers of the Indian Oil Corporation mis-conducted themselves because of which petitioner suffered. They accordingly cancelled the selection and directed that the petitioner ought to have been selected and consequently recommended that petitioner should be issued letter of intent (LOI) within a period of one month. The petitioner tried her level best to seek implementation of the said recommendation. The Indian Oil Corporation on its part purported to act on the first part of the recommendation i.e. taking “some” actions against its Officers, but, instead of issuing letter of intent (LOI) to the petitioner, as recommended by the Parliamentary Committee, cancelled the whole selection process and refused to issue letter of intent (LOI) in favour of the petitioner. On this writ application being filed, Indian Oil Corporation in the counter affidavit took stand that it had given reasons for not acting on the recommendation of the Parliamentary Committee and sent it to the Ministry concerned, who had forwarded it to the Lok Sabha Secretariat to be placed before the Petitions Committee. In the reply to the said counter affidavit of the Indian Oil Corporation, the petitioner has placed on record the proceedings of the Petitions Committee, as communicated to her under Memo dated 9th May 2008 by the Lok Sabha Secretariat. These proceedings show that again the Petitions Committee reviewed the whole matter including the stand taken by the Indian Oil Corporation for not implementing its recommendation. The Committee took evidence 5 and examined Officials of the Ministry and thereafter rejected the representation of the Indian Oil Corporation and directed once again that letter of intent (LOI) should be issued without further loss of time as already about four and half years had been lost. Thus, the matter rested and so did. Indian Oil Corporation until upon writ applications being filed, they (Indian Oil Corporation) has now chosen to challenge the authority of the Parliament of the country. The submission on behalf of the Indian Oil Corporation is that the recommendations of the Parliamentary Committee are only recommendatory and not binding and as such can be ignored. This contempt shown by Indian Oil Corporation is unbelievable. It is a contempt shown to the Parliamentary institution in a Parliamentary democracy. Such a stand is incomprehensible for a government institution or government institutionality it cannot put itself above the Parliament of the country, which is a democratically elected body and performs sovereign function. This stand of Indian Oil Corporation has to be rejected out right otherwise the result would be chaotic. More over, the statute relating to constitution and term of the Committee formed by the Speaker of the Lok Sabha is relevant. This is contained in part-III thereof. Clause 20 provides for constitution of Committee on petitions consisting not less than 15 Members (elected Members of the Lok Sabha), who are to be nominated by the Speaker of the Lok Sabha. It has a Chairman, who is appointed by the Speaker of the Lok Sabha. It is specifically provided that a Minister is not to be 6 nominated as a Member of the Committee. The Members of the Committee have to disclose, whether they have any personal, pecuniary or direct interest in a subject matter under examination. Once, the Committee makes a recommendation, the implementation, thereof, is dealt by Chapter VIII and in particular Clauses 71 onwards. The recommendation is forwarded to the petitioner and to the Ministry concerned, recommending implementation of the recommendations. Once, such recommendations are made, then, Ministry in its turn is required to submit an action taken report before Committee. Clause 73 provides that if the Ministry or the Department is not in a position to implement or feels any difficulty in implementing the recommendations made by the Petitions Committee, the Ministry is to inform the Lok Sabha Secretariat of its views on the matter and these are placed before the Committee. The Committee after considering these views make a further report as it thinks fit. Thus, seen, though, prima facie, the jurisdiction of the Petitions Committee of the Lok Sabha is recommendatory, the very fact that action taken report has to be submitted, reasons for not implementing disclosed, which are subject to review by the Petitions Committee again clearly predicate a duty to obey being cast upon authorities to whom recommendation are made, rather than, defy and/or ignore the recommendations. In my view, it is well settled that even a request by the superior to a subordinate is taken to be a command and cannot be ignored, much less with impunity; otherwise the entire system would 7 collapse. Here, I may usefully refer to the decision of the Apex Court in the case of Chintapalli Agency Taluk Arrack Sales Co-operative Society Limited etc. Vs. Secretary (Food and Agriculture) Government of Andhra Pradesh and Others AIR 1977 Supreme Court 2313, wherein, their Lordships in paragraph 24 of the reports held as follows:- “It was submitted, however, that there was no direction in the order which was only by way of “request” and suggestion. We, however, unable to accept the submission as correct. Any “request” of the government to a subordinate authority is tantamount to a positive direction or order and it will be difficult for the subordinate authority to disregard the same.” In a Parliamentary democracy, where the Parliament makes a recommendation to an instrumentality of the State, in my view, it is a far cry to say that instrumentality can disregard the recommendation. More so, when the reasons for not implementing were reconveyed to the Parliamentary Committee, who reviewed the matter and reiterated their recommendation, thus, rejecting the stand taken by the Corporation. It must be remembered that a Committee of Lok Sabha is a representative 8 body of the elected citizen Members and in the democratic system of governance represents the will of the people which cannot be rescinded by a subordinate institution nor can it be ignored in any manner. This is one of the facets of Parliamentary supremacy in a democratic set up. Regrettably, the Corporation does not accept the same. The stand of the Corporation is neither legal nor correct. It is bound by the recommendation so made, especially, when it’s decent was considered and overruled by the Committee itself. It is next submitted that the parameters of judicial review as available, to this Court in matters of administrative decision under Article 226 of the Constitution is limited and this is not one of the cases in which this Court has the jurisdiction to interfere. It is submitted that this Court in exercise of powers under Article 226 cannot sit as an Appellate Authority, it cannot review the decision, but, it can only review the decision making process. For this proposition reliance has been placed on the judgment in the case of K. Vinod Kumar Vs. S. Palanisamy and Others (2003) 10 Supreme Court Cases 681. In my view, the proposition is too well established to call for a discussion and the argument on behalf of the Corporation is a self defeating argument. This Court is not interfering in the decision but in the decision making process. The decision making process of the Corporation stands totally vitiated, when they refused to abide by the decision of the Parliamentary Committee, which as held above is binding on them. This Court is not sitting as an Appellate Authority over an administrative decision of the 9 Corporation. It is the decision making process of the Corporation, which has gone haywire and that is being corrected by this Court. This is well within the jurisdiction of Article 226 of the Constitution and well within the parameters of the jurisdiction of this Court, as laid down in the judgment aforesaid. Here, I may usefully refer to a decision of the Constitution Bench of the Apex Court in the Case of Bhopal Sugar Industries Limited Vs. Income-tax Officer, Bhopal AIR 1961 Supreme Court 182. In that case the Income-tax Appellate Tribunal had given certain direction to the Income-tax Officer concerned. The directions of the Tribunal were not being followed/implemented by the Income-tax Officer. The assessee, Bhopal Sugar Industry then moved the Judicial Commissioner, seeking a writ of mandamus for carrying out the directions given by the Income-tax Tribunal. It would be noticed from paragraphs 8 and 9 of the reports, as to how, the learned Judicial Commissioner refused to issue mandamus on the ground that the direction as issued by the Tribunal was itself wrong and no injustice being done by not implementing the same. The Apex Court was at pains to notice that such a refusal by the Judicial Commissioner to issue mandamus was in effect a denial of justice and destructive on the basic principles of administration of justice based, as it is in this country on hierarchy of Courts. If a certain Tribunal refuses to carry out the direction given to it by the superior Tribunal in exercise of its appellate power, the result would be chaos in the administration of justice. The 10 Apex Court, further, held that the Judicial Commissioner was not sitting in appeal over the order of the Tribunal and it was not open to it to say that the order of the Tribunal was wrong and therefore there was no injustice in disregarding the order. Such a stand in view of the Apex Court would be destructive of one of the basic principles of administration of justice. The principle enunciated therein, in my view, equally applies to the present case. On failure of the Indian Oil Corporation to carry out the recommendations of the Parliamentary Committee has brought the citizen to this Court for a mandamus. Under the aforesaid circumstances, this Court is bound to issue mandamus and cannot sit in appeal over the order of the Parliamentary Committee as an Appellate Authority. Neither the Indian Oil Corporation can urge nor can this Court go into the question of correctness or otherwise of the recommendations of the Parliamentary Committee. This Court, in order to avoid utter administrative chaos is bound to issue mandamus, in such circumstances. Lastly, it has been submitted that neither malafide on the part of the Corporation or its Officers having been pleaded or alleged, the actions of the Corporation cannot be challenged, nor the Corporation directed to act in pursuant to recommendation of the Parliamentary Committee. This argument is only noted to be rejected. There is a big difference between malice in fact and malice in law. Petitioner has challenged the action of the Indian Oil Corporation on grounds of malice in law as distinct from malice in fact. As has been held by the Apex Court 11 in the case of Smt. S. R. Venkataraman Vs. Union of India and Another AIR 1979 Supreme Court 49, malice in its legal sense means malice such as may be assumed from the doing of a wrongful act intentionally, but, without just cause or excuse or for want of reasonable or probable cause. Their Lordships have then held that malice in law is however quite different in the words of their Lordships, as per the said report : Malice in law is, however, quite different. Viscount Haldane described it as follows in Shearer V. Shields, (1914)AC 808 at p.813:- “A person who inflicts an injury upon another person in contravention of the law is not allowed to say that he did so with an innocent mind; he is taken to know the law, and he must act within the law. He may, therefore, be guilty of malice in law, although, so far the state of his mind is concerned, he acts ignorantly, and in that sense innocently.” In the present case, the petitioner pleads malice in law and has in my view succeeded in establishing the same. I may notice here that apart from a vague assertion in their counter affidavit that “some action” has been taken against its Officers as recommended by the Parliamentary Committee nothing further has been disclosed. 12 Thus, having considered the matter from all angles, in my view, the writ application must succeed. Let writ in the nature of mandamus be issued to the Indian Oil Corporation forthwith to implement the recommendations of the Parliamentary Petitions Committee, in question. The matter having lingered now for over 5 years, it is expected that the Corporation would act immediately. With the aforesaid direction, the writ applications stand allowed. Trivedi/ (Navaniti Prasad Singh,J.) "