Durga Oil Company and Another vs State of U.P. and Others

R.R.K. Trivedi and M. Katju, JJ.—Heard learned Counsel for Petitioners and learned Counsel appearing for Respondent Nos. 1 to 3 and Sri Dilip Gupta for M/s. Shyam Filling Centre.

This petition has been filed challenging the order dated 14th August, 1997 passed by the District Supply Officer, Shahjahanpur by which he has asked the Petitioners to stop using underground tank and dispensing pump unit for sale of petrol and diesel in retail sale. The learned Counsel, for Petitioners has challenged the order on the ground that the Petitioners are licensee under Form XI granted to them under Petroleum Rules, 1976 and also licensee under the High Speed Diesel Oil and Light Diesel Oil Order, 1981. Copies of the licences have been filed as Annexures 1 and 2 to the writ petition. Learned Counsel for the Petitioners has submitted that Petitioners were permitted to use underground tank and dispensing pump unit under the no-objection certificate granted by the District Magistrate by order dated 8.3.1990, a copy of which has been filed as Annexure 5. Learned Counsel for Petitioner has also submitted that under the Rules, only the District Magistrate is the licensing authority and he alone was authorised to issue the impugned notice, and hence the order passed by the District Supply Officer i:5 without authority. He has lastly submitted that this Court in various judgments including the judgment copies of which are Annexure 12 has already taken the view that even a retail dealer may use the dispensing pump unit for purpose of sale subject to permission of the oil company. In our opinion, since the Petitioners are licensee in Form XI, they are not entitled to either store the petroleum products in underground tank or to sell the same by using the dispensing pump unit. Article 4 of the First Schedule to the Petroleum Rules, 1976, provides the purpose for which licence in Form XI is granted which is as under:

to import and store petroleum Class B otherwise than in bulk in quantity not exceeding 25,000 litres.

The licensing authority for licence in Form XI is the district authority, whereas the licence in Form XII is granted to store petroleum in tank or tanks in connection with pump outfit for fuelling motor conveyances, and the authority to grant the licence in Form XII is the Chief Controller or Controller of Explosives authorised in this behalf by the Chief Controller. Form XII under the aforesaid Rules, further provides for a licence to store petrol in tank and tanks in connection with the pump outfit for fuelling motor conveyances. Thus, from a close reading of Articles 4 and 5 of the Schedule to the Rules and Form XII, it is clear that the Diesel can be stored in underground tank only by a licence holder of Form XII and not by licence holder in Form XI. The alleged no-objection certificate granted in favour of the Petitioner is without authority and is of no relevance for this purpose. Licence in Form XI is provided for petroleum Class B which is to be packed in airtight tins or drums approved by the authority as stated in the description part of Form XI, whereas the description part at the end of Form XII shows that the holder of Form XII can use underground tank and pump. The difference between Form XI and Form XII is striking, as is evident from comparison of the two. In our opinion, such comparison clearly shows that only a holder of Form XII of the Petroleum Rules can use an underground tank and pump unit, and not a holder of Form XI. The aforesaid legal position is further clarified by the provisions of U.P. High Speed Diesel Oil and Light Speed Diesel Oil (Maintenance of Supplies and Distribution) Order, 1981. In the aforesaid Control Order, definition of Retailer and Wholesaler has been provided in Clauses (1) and (n) of para 2 as under:

(1) ''retailer'' means a dealer who is not a wholesaler;

(n) wholesaler'' in the case of Light Diesel Oil means a dealer who deals in light diesel oil exceeding 100 litres in a single transaction and in the case of High Speed Diesel Oil a dealer who sells High Speed Diesel Oil by means of dispensing pumps.

From a perusal of the aforesaid provisions, it is clear that only a wholesaler can use dispensing pump unit and not a retailer. Admittedly the Petitioner is a retailer and not a wholesaler.

In the circumstances, the order passed on 14th August, 1997 is justified and Petitioners are not entitled to store the High Speed or Light Diesel Oil in underground tanker use dispensing pump unit.

Learned Counsel for the Petitioners has submitted that the order passed by the District Supply Officer is without authority as he is not the licensing authority. In our opinion, the submission of learned Counsel for the Petitioners has no force. By the impugned order, the District Supply Officer has only reminded the Petitioners against using the underground tank and dispensing pump unit for the sale of diesel oil, he has not cancelled nor suspended the licence of the Petitioners. Further as the Petitioners'' activities are against the provisions of law, we do not find it a fit case for interference under Article 226 of the Constitution, as interference will amount to permit the Petitioners to continue their activities which are contrary to law. The learned Counsel also relied on the judgment of this Court, filed as Annexure 12 to the writ petition. However, from a perusal of judgment, it is clear that the provisions which we have considered, were not placed before the learned Judges deciding the petition and were not noticed. Paragraph 3 of the aforesaid judgment reads as follows:

No doubt counter-affidavit has been filed in another similar matters by the Respondents but nothing has been pointed out to show that if the Petitioner are allowed to install dispensing pump unit, that will be in contravention of some statutory restriction issued by the State Government. Thus, in our opinion subject to permission of Bharat Oil Company, the Petitioners are permitted to install dispensing pump unit.

The aforesaid paragraph makes it clear that the relevant provisions were not placed before the learned Judges. In the circumstances the Petitioners cannot claim any benefit from the judgment filed as Annexure 12.

At the end, learned Counsel for the Petitioners submitted that by virtue of licence in Form XI, the Petitioners are entitled to store diesel oil upto 25,000 litres, while by the impugned order, this capacity has been reduced to 4,000 litres which is illegal. For this purpose, Petitioners may make a representation before the District Magistrate stating rules and relevant provisions under which they can store diesel oil, if such a representation is filed, the same shall be decided in accordance with law within a month from the date a certified copy of this order is filed before him.

For the reasons recorded above, we do not see any force in this petition and subject to above direction, it is rejected.