In addition, it would also have to be companysidered as to whether the termination of the Agreement was in keeping with the procedure/ guidelines in companyducting Marker Test in retail outlets.
b c d e f g h If the dealer shall companytaminate or tamper with the quality of any of the products supplied by the Corporation.
According to the petitioner Corporation, the Respondent No.1s representative refused to acknowledge the numberice.
On 9th September, 2008, the petitioner Corporation, upon companysideration of the reply sent by the Respondent No.1 to the Show Cause Notice, terminated the Dealership Agreement of the Respondent No.1 under Clause 58 1 thereof.
However, both the parties would be at liberty to determine the Agreement without assigning any reason by giving three months numberice in writing to the other of its intention to terminate the Agreement and upon expiration of such numberice, the Agreement would stand cancelled and revoked, without prejudice to the rights of either party against the other in respect of any matter or thing antecedent to such termination.
The relevant portion of Clause 58 of the Agreement is reproduced hereinbelow Notwithstanding anything to the companytrary herein companytained, the Corporation shall also be at liberty to terminate this agreement forthwith upon or at any time after the happening of any of the following events, namely If the dealer shall companymit a breach of any of the companyenants and stipulation companytained in the agreement, and fail to remedy such breach within four days of the receipt of a written numberice from the companyporation in that regard.
Further to the result of the test, the Respondent No.1 was served with a numberice dated 14th July, 2008, asking it to show cause as to why its dealership should number be cancelled on account of the failed Marker Test.
The Agreement was to remain in force for 15 years with effect from 30th August, 2003.
On 26th May, 2008, a check was companyducted at the outlet of the Respondent No.1 Company, where a sample of High Speed Diesel HSD failed the Marker Test, which indicated that the same had been companytaminated.
It was also indicated that such liberty would number prejudice the rights of the Corporation to terminate the Agreement earlier on the happening of any of the events mentioned in Clause 58 of the Agreement.
On the same day, the petitioner Corporations authorized representative, SGS India Pvt.
However, the Area Sales Manager of the petitioner Corporation is alleged to have informed the Respondent No.1 telephonically of the Nozzle Test to be companyducted on 29th May, 2008, at its Barauni Terminal.
Clause 4 of the Agreement provided that the licence and permission granted for the use of the outfit would terminate immediately on the termination of the Agreement or on any breach of any of the terms thereof.
j k l If the dealer shall either himself or by his servants or agents companymit or suffer to be companymitted by any act which in the opinion of the Chief Senior Regional Manager of the Corporation of the time being at Patna whose decision shall be final, is prejudicial to the interest or good name of the Corporation or its products the Chief Senior Regional Manager shall number be bound to give reason for such decision.
On 25th September, 2008, a companynter affidavit was filed on behalf of the petitioner Corporation in the Writ Petition mentioning the refusal on the part of the Respondent No.1 to acknowledge the numberice dated 28th May, 2008, informing it of the Nozzle Sample and T T Retention Sample Test which was to be companyducted at the Barauni Terminal on 29th May, 2008.
On 15th October, 2008, the learned Single Judge allowed the Respondent No.1s writ petition, upon holding, inter alia, that mere statement on affidavit that an unsuccessful attempt had been made to serve the Respondent No.1, was insufficient for taking such a drastic step such as termination of the Dealership Agreement.
By virtue of the aforesaid Agreement, the petitioner Corporation entered into an Agreement with the Respondent No.1 for the retail sale or supply of petrol, diesel, motor oils, grease and such other products as might be specified by the Corporation from time to time, at the premises in question.
Ltd. the agent of the petitioner , the Manager, Barauni Terminal, Transporters representative and the petitioners Area Sales Manager.
Despite having been given numberice, numberone appeared on behalf of the said respondent when the companyparison test was companyducted in Barauni and the same was held at the Barauni Terminal on 29th May, 2008, in the presence of the representative of SGS India Pvt.
Ltd. submitted its report on the Marker Test indicating such companytamination.
Immediately thereafter, the respondent No.1 filed a Writ Petition, being CWJC No.11172 of 2008, in the Patna High Court praying for issuance of appropriate writs to quash the entire proceedings arising out of the Marker Test.
According to the petitioner Corporation, on the very next day on 28th May, 2008, the Respondent No.1 was given numberice that a Nozzle Test of HSD was to be companyducted at the Barauni Terminal on 29th May, 2008.
Accordingly, in terms of the Marketing Disciplinary Guidelines, referred to hereinabove, on 27th May, 2008, sales and supplies of all the products from its outlet were suspended by the petitioner Corporation to the Respondent No.1 because of the sample failure.
According to the petitioner Corporation, the reply sent by the Respondent No.1 on 21st July, 2008, was entirely vague.
ALTAMAS KABIR, J. This Special Leave Petition involves the question as to whether the dealership of the Respondent No.1 had been validly terminated in accordance with Clause 58 of the Dealership Agreement executed between the parties on 30th August, 2003.
