Full Judgment Text
2025 INSC 426
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. OF 2025
(Arising out of SLP(C) No.7845 of 2024)
THE GENERAL MANAGER
BUSINESS NETWORK PLANNING (RETAIL)
BHARAT PETROLEUM
CORPORATION LIMITED & ANR. ... APPELLANT(S)
VERSUS
P. SOUNDARYA ...RESPONDENT(S)
J U D G M E N T
SANJAY KAROL, J.
Leave granted.
2. This appeal is filed at the instance of Bharat Petroleum
1 th
Corporation Limited assailing the judgment and order dated 14
Signature Not Verified
Digitally signed by
NAVEEN D
Date: 2025.04.02
17:18:31 IST
Reason:
1
Hereinafter “BPCL”
CA@ SLP(C) No. 7845 of 2024 Page 1 of 18
December, 2023 passed by the High Court of Judicature at
Madras in W.A.No.866 of 2023, which confirmed the judgment
th
and order of the learned Single Judge dated 8 February 2023 in
W.P.No.3641 of 2023.
3. The issue before the Courts below pertains to the grant of
a retail outlet dealership of BPCL to the respondent, wherein the
respondent had apparently, mistakenly shown herself to belong
to Group 2 - those who have a “firm offer” for a suitable piece of
land, as opposed to Group 1 – those who already possess suitable
land. When she attempted to have the same rectified, BPCL took
no action and hence, recourse to the law had to be taken.
4. The brief facts required to be noticed in the adjudication of
an appeal are that BPCL issued an advertisement for the selection
of a retail outlet in November 2018. Annexure P-2 reveals that
the group type reflected against the name of the respondent,
which was at serial No.4, was Group 2. On realizing the error,
th
the respondent sent clarificatory letters on 12 February 2019,
th th
18 February 2019 and 28 July 2020, requesting that her
candidature be considered under Group 1. Given that there was
no response to these representations, the respondent preferred
Writ Petition No.2965 of 2021, which was disposed of vide order
th
dated 18 March 2021, wherein it was observed that her
representations be considered in accordance with law, within four
weeks from the date of receipt of the order. Said representations
CA@ SLP(C) No. 7845 of 2024 Page 2 of 18
th
were rejected by BPCL through a communication dated 5 April,
2021, giving the following reasons:
• “It may be noted that the Selection Guidelines
clearly prescribes that applicant should fill up the
details in Application form diligently/carefully
as these details will be picked up automatically
in the relevant field on the application form and
that there will be no further scope for editing
after the registration process is completed.
• The selection of candidate is based on the Group
indicated by the applicant in On-line application
and the process is online. In your on-line
application, you have mentioned the group of
applicant as Group 2. The list of candidates for
the location as per priority Group-I, Group-II and
Group-III is available in the portal
www.petrolpumpdealerchayan.in is available in
the portal www.petrolpumpdealerchayan.in and
your status is showing as Group 2 applicant.
• Your request for reclassify your applicant as
Group I may not be considered in view of extant
selection guidelines. Draw of lots was already
held for subject location om 06.02.2019 among
the Group I applicants and selection process is
underway.”
5. The respondent then filed Writ Petition No.13355 of 2021,
th
which was disposed of vide order dated 10 January 2022,
recording as follows :
“4. The learned counsel appearing for the respondents
further submitted that thereafter S. Rasan was selected
and he was directed to submit his documents on
10.01.2020 and land verification and field verification of
credentials are also completed and letter of intent will be
issued.
CA@ SLP(C) No. 7845 of 2024 Page 3 of 18
5. The learned counsel appearing for the petitioner
submitted that the said S. Rasan is also ineligible and
further submitted that till date, letter of intent was not
issued in favour of S. Rasan. Hence, the Court may issue
direction to the respondents to consider the petitioner’s
application in Group I.
6. In response, the learned counsel appearing for the
respondents submitted that if the said S. Rasan is found
to be ineligible, all applications under Group II will be
considered and if no other eligible person is available in
Group II, the petitioner’s application will be considered
in the manner known to law.
7. If the said S. Rasan is found to be ineligible, the
respondents are directed to consider the applications
under Group II (eligible candidate under Group I) and
pass appropriate orders.”
th
6. BPCL then issued a letter dated 14 November 2022
inviting the respondent to participate in the draw of lot for retail
th
outlet dealership scheduled to take place on 24 November 2022
at the given location and time. Since there was no response in
accordance with the order passed in W.P.(C)No.13355 of 2021,
the respondent once again approached the High Court by filing
Writ Petition No.3461 of 2023 praying for setting aside the
st
communication dated 31 January 2023 and awarding the
dealership to her, treating her to be a candidate under Group 1.
7. The learned Single Judge observed that since the
advertisement for Retail Outlet Dealership was specifically
meant for persons belonging to the Scheduled Caste Category,
BPCL was obligated to “extend a helping hand, even if there are
CA@ SLP(C) No. 7845 of 2024 Page 4 of 18
some defects in the application. They must guide all those who
submit their applications .” Referring to the order passed in an
earlier writ petition (reproduced above), it was observed that the
direction to consider her application under Group 1 and pass
appropriate orders arose out of the ineligibility of two persons. It
was observed that BPCL should first consider her application and
thereafter move to Group 2 if she is found ineligible.
In the writ appeal filed by BPCL, the learned Division
Bench observed that the direction of the learned Single Judge’s
observations/directions were reasonable since, as on the relevant
date, the respondent herein was in possession of the land as
required, and for the requisite time as well.
BPCL, being aggrieved, has carried such an order in
appeal before us.
8. We have heard Mr. Dhruv Mehta and Mr. Shailesh
Madiyal, learned Senior Counsel for BPCL and the respondent,
respectively.
9. The short question that arises for determination is whether
the High Court’s direction to consider the application of the
respondent as Group 1 was justified in law.
10. Before proceeding with the merits of the matter, it is
important to take note of the provisions concerning ‘land’ given
in the advertisement, as also other relevant parts of the same.
CA@ SLP(C) No. 7845 of 2024 Page 5 of 18
“(v) Land (Applicable to all categories) :
The applicants would be classified into three groups
as mentioned below based on the land offered or
land not offered by them in the application form :-
Group 1 : Applicants having suitable piece of land
in the advertised location/area either by way of
ownership/long term lease for a period of minimum
19 years 11 months or as advertised by the OMC.
Group 2 : Applicants having Firm Offer for a
suitable piece of land for purchase or long term lease
for a period of minimum 19 years 11 months or as
advertised by the OMC.
x x x
d) The applicant(s) under Group-1 should have
documents to establish ownership of land offered for the
Dealership as on date of application, such as :-
• Khasra/Khatauni or any equivalent revenue
document or certificate from revenue official
confirming status of the ownership of the land.
• Registered Sale deed/Registered Gift deed.
• Registered Lease deed for a minimum period of
19 years and 11 months (as advertised by
respective oil company).
• Any other type of ownership/transfer deed
document.
• Lease agreement or firm allotment letter issued
by Government/Semi Government bodies.
e) The land owned by the family member(s) will also be
considered as belonging to the applicant (Group-1)
subject to producing the consent letter in the form of
affidavit (Appendix III A) from the concerned family
member(s).
For this purpose family members would comprise of :-
(i) Self
(ii) Spouse
CA@ SLP(C) No. 7845 of 2024 Page 6 of 18
(iii) Father/Mother including Step Father/Step
Mother
(iv) Brother/Sister/Step Brother/Step Sister
(v) Son/Daughter/Step Son/Step Daughter
(vi) Son-in-law/Daughter-in-law
(vii) Parents-in-law
(viii) Grand Parents (both maternal & paternal)
f) For Group 2 applicants, the “firm offer” of land will
include land offer from third party based on Agreement
to purchase/long term lease (as per terms and conditions
of the OMCs). Offer letter should be in the form of an
Affidavit (Appendix III A) along with documents,
mentioned in Clause (d) above, to establish the
ownership of land offered for the Dealership.
x x x
k) Each applicant will have to declare, in the application
form, the category under which offered land falls.
Supporting the above, confirmatory letter from an
advocate (Appendix III B) giving details of the current
ownership, documents relied upon and the category
under which the land falls (Group 1 to Group 2), as on
date of application, is also to be furnished as and when
advised. The Group under which the applicant’s land
falls, would be determined based on the declaration
given in the application and confirmatory letter from the
advocate regarding the same.”
(Emphasis supplied)
11. The impugned judgment and order was passed by the High
Court under Article 226 of the Constitution of India.
12. Interference by Writ Courts in contractual matters is an
issue that has engaged this Court on numerous occasions.
CA@ SLP(C) No. 7845 of 2024 Page 7 of 18
12.1 This Court in Subodh Kumar Singh Rathour v. The
2
Chief Executive Engineer & Ors. , speaking through
Pardiwala, J. for a three-Judge Bench, took note of a number
of earlier decisions and held thus :
“ 39. Thus, for a period of time the courts recognized that
there was a clear brightline distinction between when a
State or its instrumentalities could be said to be acting in
its executive capacity and when it could be said to be
acting in its private capacity, with the existence of a
‘contractual relation’ inter-se the parties being the
determinative factor. Wherever, there was a contract, the
State's relations and all its actions were said to be within
the field of a contract i.e., within the realm of private law,
and the courts would resile from interfering with the
same under their writ jurisdiction or embarking upon a
judicial review of such actions.
40. Such reluctance on the part of the courts stemmed
from its understanding that State or any of its
instrumentalities must have the flexibility or the
discretion to take decisions that are in the best interest of
the public and efficient governance. Government being
the decision-maker of the State is said to be the best
judge of when a contract or an agreement is in its interest
and by its extension in the interest of the public, and as
such the courts should not interfere in the State's
discretion to award or terminate contracts. One another
reason why contractual disputes were precluded from
being espoused under the writ jurisdiction of the courts
was due to the summary nature of such proceedings,
which do not allow for an exhaustive review unlike civil
suits. [See : Radhakrishna Agarwal (supra) at para 11]
41. This simplistic approach of the courts in deeming
every act and action of the State which was complained
of as nothing more than a ‘contractual dispute’ or a case
of ‘breach of contract’ often led to the State abusing its
position and acting unfairly under the misconceived
2
2024 SCC OnLine SC 1682
CA@ SLP(C) No. 7845 of 2024 Page 8 of 18
notion, that all its actions such as award of contracts or
tenders were nothing but a ‘largess’ - a generosity
bestowed upon its citizens, which it can at its own whims
choose to deny, alter, modify, or take away without any
consequences. This often led to a conflation of power
with duty, and resulted in every arbitrary exercise of
power by the State under the guise of a ‘contractual
dispute’ to remain unchecked and undisputable before
the courts and out of the reach of judicial review,
undermining the rights of the citizen to have their
interests safeguarded and protected. We may in this
regard refer to Indian Medicines Pharmaceuticals Corp
Ltd. v. Kerala Ayurvedic Co-operative Society
Ltd. reported in 2023 SCC OnLine SC 5 wherein this
Court speaking eruditely through one of us, Dr. D.Y.
Chandrachud, CJI made the following pertinent
observations:—
“11 The welfare State plays a crucial role in
aiding the realisation of the socioeconomic
rights which are recognised by the
Constitution. Social welfare benefits
provided by the State under the rubric of its
constitutional obligations are commonly
understood in the language of ‘largesse’, a
term used to describe a generous
donation. Terming all actions of
government, ranging from social security
benefits, jobs, occupational licenses,
contracts and use of public resources - as
government largesse results in doctrinal
misconceptions. The reason is that this
conflates the State's power with duty. The
Constitution recognises the pursuit of the
well-being of citizens as a desirable goal. In
doing this the Constitution entrusts the State
with a duty to ensure the well-being of
citizens. Government actions aimed at
ensuring the well-being of citizens cannot be
perceived through the lens of a ‘largess’. The
use of such terminology belittles the sanctity
of the social contract that the ‘people of
CA@ SLP(C) No. 7845 of 2024 Page 9 of 18
India’ entered into with the State to protect
and safeguard their interests.”
(Emphasis in original)
12.2 In Silppi Constructions Contractors v. Union of
3
India , this Court observed as under :
“ 19. This Court being the guardian of fundamental rights
is duty-bound to interfere when there is arbitrariness,
irrationality, mala fides and bias. However, this Court in
all the aforesaid decisions has cautioned time and again
that courts should exercise a lot of restraint while
exercising their powers of judicial review in contractual
or commercial matters. This Court is normally loathe to
interfere in contractual matters unless a clear-cut case of
arbitrariness or mala fides or bias or irrationality is made
out. One must remember that today many public sector
undertakings compete with the private industry. The
contracts entered into between private parties are not
subject to scrutiny under writ jurisdiction. No doubt, the
bodies which are State within the meaning of Article 12
of the Constitution are bound to act fairly and are
amenable to the writ jurisdiction of superior courts but
this discretionary power must be exercised with a great
deal of restraint and caution. The courts must realise
their limitations and the havoc which needless
interference in commercial matters can cause. ... As laid
down in the judgments cited above the courts should not
use a magnifying glass while scanning the tenders and
make every small mistake appear like a big blunder. In
fact, the courts must give “fair play in the joints” to the
government and public sector undertakings in matters of
contract. Courts must also not interfere where such
interference will cause unnecessary loss to the public
exchequer.
3
(2020) 16 SCC 489 : 2019 SCC OnLine SC 1133
CA@ SLP(C) No. 7845 of 2024 Page 10 of 18
20. The essence of the law laid down in the judgments
referred to above is the exercise of restraint and caution;
the need for overwhelming public interest to justify
judicial intervention in matters of contract involving the
State instrumentalities; the courts should give way to the
opinion of the experts unless the decision is totally
arbitrary or unreasonable; the court does not sit like a
court of appeal over the appropriate authority; the court
must realise that the authority floating the tender is the
best judge of its requirements and, therefore, the court's
interference should be minimal...”
(Emphasis supplied)
12.3 We may also refer to the observations made in
4
Uflex Ltd. v. State of T.N. with reference to its earlier
decision in Caretel Infotech Ltd. v. Hindustan Petroleum
5
Corpn. Ltd. as follows :
“ 6. The burgeoning litigation in this field and the same
being carried to this Court in most matters was the cause
we set forth an epilogue in Caretel Infotech
Ltd. v. Hindustan Petroleum Corpn. Ltd. [ Caretel
Infotech Ltd. v. Hindustan Petroleum Corpn. Ltd. ,
(2019) 14 SCC 81] Even if it amounts to repetition, we
believe that it needs to be emphasised in view of the
controversy arising in the present case to appreciate the
contours within which the factual matrix of the present
case has to be analysed and tested :
“ 37 . We consider it appropriate to make
certain observations in the context of the
nature of dispute which is before us.
Normally parties would be governed by their
contracts and the tender terms, and really no
writ would be maintainable under Article
4
(2022) 1 SCC 165
5
(2019) 14 SCC 81
CA@ SLP(C) No. 7845 of 2024 Page 11 of 18
226 of the Constitution of India. In view of
Government and public sector enterprises
venturing into economic activities, this
Court found it appropriate to build in certain
checks and balances of fairness in procedure.
It is this approach which has given rise to
scrutiny of tenders in writ proceedings under
Article 226 of the Constitution of India. It,
however, appears that the window has been
opened too wide as almost every small or big
tender is now sought to be challenged in writ
proceedings almost as a matter of routine.
This in turn, affects the efficacy of
commercial activities of the public sectors,
which may be in competition with the
private sector. This could hardly have been
the objective in mind. An unnecessary, close
scrutiny of minute details, contrary to the
view of the tendering authority, makes
awarding of contracts by Government and
Public Sectors a cumbersome exercise, with
long-drawn out litigation at the threshold.”
(Emphasis supplied)
13. It is clear from the above pronouncements that in writ
jurisdiction, when parties to the dispute involve an organization
deemed to be an instrumentality under Article 12 of the
Constitution, there exists a responsibility of the State to act in a
fair, reasonable manner and free from arbitrariness. The Court is
bound to interfere when these qualities are either in doubt or are
absent and in other situations, is to exercise restraint.
14. In the impugned judgment, the only reason(s) that appears
is that the respondent made representations to BPCL which were
not acted upon and that since the advertisement was specifically
CA@ SLP(C) No. 7845 of 2024 Page 12 of 18
directed towards persons belonging to Scheduled Caste category,
the State should have adopted an understanding approach and
helped all the applicants who have furnished applications.
Nowhere has it been shown that any of the facets of Article 14
stand violated.
15. As reproduced above, Clause (k) of the advertisement
provides that each applicant has to declare the category under
which the land they have offered for the purpose of retail outlet
dealership, falls. In doing so, a letter issued by an advocate
giving details of current ownership and the documents relied
upon to prove the same, also has to be furnished. Further, we
find that Clause (d) also lists various documents that the applicant
should be in possession of, on the date of the application, serving
as proof of ownership of the land. It is clear from the above two
requirements that mentioning the incorrect group in the
application form is not an exercise in simpliciter and requires the
presence/furnishing of various documents. The respondents’
application under Group 2 cannot be a mere error of filling up the
form incorrectly, for along with the form documents establishing
ownership of land, in case the application is by a person falling
under Group 1. The respondent was fully aware of her limitation
and, as such, took a chance by filling up the wrong category.
16. The observations/direction of the High Court to consider
the respondent as part of Group 1, therefore, has to be faulted
CA@ SLP(C) No. 7845 of 2024 Page 13 of 18
with. Public Sector Undertakings in the nature of BPCL or the
like, deal with matters of petroleum and gasoline, which are
precious natural resources held by the State in Public Trust. The
doctrine of Public Trust, for which reliance is often placed on a
judgment of the Supreme Court of the United States of America
6
in Illinois Cent R Co v. State of Illinois , which in turn referred
to a judgment of the New York Court of Appeals in People v.
7
Ferry Co . , - the relevant paragraphs of which are worth
reproduction below :
“'The title to lands under tide waters, within the realm of
England, were by the common law deemed to be vested
in the king as a public trust, to subserve and protect the
public right to use them as common highways for
commerce, trade, and intercourse. The king, by virtue of
his proprietary interest, could grant the soil so that it
should become private property, but his grant was
subject to the paramount right of public use of navigable
waters, which he could neither destroy nor abridge. In
every such grant there was an implied reservation of the
public right, and so far as it assumed to interfere with it,
or to confer a right to impede or obstruct navigation, or
to make an exclusive appropriation of the use of
navigable waters, the grant was void. In his treatise De
Jure Maris (page 22) Lord Hale says : 'The jus privatum
that is acquired by the subject, either by patent or
prescription, must not prejudice the jus publicum,
wherewith public rivers and the arms of the sea are
affected to public use.' And Mr. Justice Best, in Blundell
v. Catterall, 5 Barn. & Ald. 268, in speaking of the
subject, says : 'The soil can only be transferred subject to
the public trust, and general usage shows that the public
6
1892 SCC OnLine US SC 237
7
68 N. Y. 71, 76
CA@ SLP(C) No. 7845 of 2024 Page 14 of 18
right has been excepted out of the grant of the soil.'
*
'The principle of the common law to which we have
adverted is founded upon the most obvious principles of
public policy. The sea and navigable rivers are natural
highways, and any obstruction to the common right, or
exclusive appropriation of their use, is injurious to
commerce, and, if permitted at the will of the sovereign,
would be very likely to end in materially crippling, if not
detroying, it. The laws of most nations have sedulously
guarded the public use of navigable waters within their
limits against infringement, subjecting it only to such
regulation by the state, in the interest of the public, as is
deemed consistent with the preservation of the public
right.'”
This doctrine found its firm place in Indian Jurisprudence
8
with its recognition by this Court in M.C. Mehta v. Kamal Nath .
Although, its application was originally confined only to cases
dealing with the environment, however, in Reliance Natural
9
Resources Ltd. v. Reliance Industries Ltd . . Sathasivam, J. (as
His Lordship then was) held that this doctrine was of wider
import and application.
In the context of the controversy at hand, reference may be
made to the Constitution Bench decision in Natural Resources
10
Allocation, In re, Special Reference No. 1 of 2012 , wherein
the principle that even when the allotment of petrol pumps is
8
(1997) 1 SCC
9
(2010) 7 SCC 1
10
(2012) 10 SCC 1
CA@ SLP(C) No. 7845 of 2024 Page 15 of 18
made on the basis of a particular criterion, no fault can be found
with a decision of the authority as a matter of policy, however,
even so a proper method has to be evolved so that the choice can
be made out of a pool of eligible candidates, without
arbitrariness.
17. BPCL has formed a detailed advertisement and also an
application for such purposes. It has been stated therein that the
application shall solely be decided on the basis of the information
given thereunder. The relevant extract of the application form
reads as under :
“15 UNDERTAKING BY THE APPLICANT
a. I am aware that eligibility for Retail Outlet
Dealership will be decided based on information
given in the application above. On verification by
the Oil Company if it is found that the information
given by me is incorrect/false/misrepresented then
my candidature will stand cancelled and I will be
declared ineligible for the Retail Outlet Dealership.
b. I also confirm that I am in possession of the
supporting documents in original in respect of the
information given by me in this application and if
selected, failure to present these documents in
original will result in cancellation of selection due to
submission of false/unsupported information in this
application.”
(Emphasis supplied)
Since a clear procedure stands laid down by the competent
authority, there exists no room for any discretion to be exercised
CA@ SLP(C) No. 7845 of 2024 Page 16 of 18
in favour of the respondent. The representations made by the
respondent terming her application under Group 2 to be an error,
cannot be considered. Even if she had the requisite land, the
Rules provide no leeway for a category change to be made.
18. In view of the aforesaid discussion, we conclude that the
High Court fell in error directing, as it did, for the respondent’s
application to be considered not in the Group in which it was filed
but in another one. The appeal is, therefore, allowed and the
judgment and order of the High Court with particulars as
described in paragraph one is set aside. The appellant shall
proceed with the allotment process/formalities in accordance
with the Rules and Regulations.
19. Before we part with this matter, we are constrained to
observe that the manner in which the respondent took recourse to
the law was unjustified. The filing of multiple writ petitions at
almost every stage, despite being fully aware of the fact that both
the advertisement and the application form made it abundantly
clear that consideration of the application could only be as per
the documents submitted, led to prolonged litigation, which in
actuality ought not to have originated at all. In effect, the High
Court in its writ jurisdiction passed the order out of sympathy,
which may have been misplaced as a ground of exercise of such
power. The respondent hoped, by the effect of the law to get an
advantage to which she was in no way entitled, leading to loss of
CA@ SLP(C) No. 7845 of 2024 Page 17 of 18
judicial time and public money. The fact of the matter is that the
petrol pump could not be established in the last 7 years, thereby
seriously prejudicing public interest.
No Costs.
Pending application(s), if any, shall stand disposed of.
……………………J.
(SANJAY KAROL)
……………………J.
(MANMOHAN)
New Delhi;
nd
2 April, 2025.
CA@ SLP(C) No. 7845 of 2024 Page 18 of 18
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. OF 2025
(Arising out of SLP(C) No.7845 of 2024)
THE GENERAL MANAGER
BUSINESS NETWORK PLANNING (RETAIL)
BHARAT PETROLEUM
CORPORATION LIMITED & ANR. ... APPELLANT(S)
VERSUS
P. SOUNDARYA ...RESPONDENT(S)
J U D G M E N T
SANJAY KAROL, J.
Leave granted.
2. This appeal is filed at the instance of Bharat Petroleum
1 th
Corporation Limited assailing the judgment and order dated 14
Signature Not Verified
Digitally signed by
NAVEEN D
Date: 2025.04.02
17:18:31 IST
Reason:
1
Hereinafter “BPCL”
CA@ SLP(C) No. 7845 of 2024 Page 1 of 18
December, 2023 passed by the High Court of Judicature at
Madras in W.A.No.866 of 2023, which confirmed the judgment
th
and order of the learned Single Judge dated 8 February 2023 in
W.P.No.3641 of 2023.
3. The issue before the Courts below pertains to the grant of
a retail outlet dealership of BPCL to the respondent, wherein the
respondent had apparently, mistakenly shown herself to belong
to Group 2 - those who have a “firm offer” for a suitable piece of
land, as opposed to Group 1 – those who already possess suitable
land. When she attempted to have the same rectified, BPCL took
no action and hence, recourse to the law had to be taken.
4. The brief facts required to be noticed in the adjudication of
an appeal are that BPCL issued an advertisement for the selection
of a retail outlet in November 2018. Annexure P-2 reveals that
the group type reflected against the name of the respondent,
which was at serial No.4, was Group 2. On realizing the error,
th
the respondent sent clarificatory letters on 12 February 2019,
th th
18 February 2019 and 28 July 2020, requesting that her
candidature be considered under Group 1. Given that there was
no response to these representations, the respondent preferred
Writ Petition No.2965 of 2021, which was disposed of vide order
th
dated 18 March 2021, wherein it was observed that her
representations be considered in accordance with law, within four
weeks from the date of receipt of the order. Said representations
CA@ SLP(C) No. 7845 of 2024 Page 2 of 18
th
were rejected by BPCL through a communication dated 5 April,
2021, giving the following reasons:
• “It may be noted that the Selection Guidelines
clearly prescribes that applicant should fill up the
details in Application form diligently/carefully
as these details will be picked up automatically
in the relevant field on the application form and
that there will be no further scope for editing
after the registration process is completed.
• The selection of candidate is based on the Group
indicated by the applicant in On-line application
and the process is online. In your on-line
application, you have mentioned the group of
applicant as Group 2. The list of candidates for
the location as per priority Group-I, Group-II and
Group-III is available in the portal
www.petrolpumpdealerchayan.in is available in
the portal www.petrolpumpdealerchayan.in and
your status is showing as Group 2 applicant.
• Your request for reclassify your applicant as
Group I may not be considered in view of extant
selection guidelines. Draw of lots was already
held for subject location om 06.02.2019 among
the Group I applicants and selection process is
underway.”
5. The respondent then filed Writ Petition No.13355 of 2021,
th
which was disposed of vide order dated 10 January 2022,
recording as follows :
“4. The learned counsel appearing for the respondents
further submitted that thereafter S. Rasan was selected
and he was directed to submit his documents on
10.01.2020 and land verification and field verification of
credentials are also completed and letter of intent will be
issued.
CA@ SLP(C) No. 7845 of 2024 Page 3 of 18
5. The learned counsel appearing for the petitioner
submitted that the said S. Rasan is also ineligible and
further submitted that till date, letter of intent was not
issued in favour of S. Rasan. Hence, the Court may issue
direction to the respondents to consider the petitioner’s
application in Group I.
6. In response, the learned counsel appearing for the
respondents submitted that if the said S. Rasan is found
to be ineligible, all applications under Group II will be
considered and if no other eligible person is available in
Group II, the petitioner’s application will be considered
in the manner known to law.
7. If the said S. Rasan is found to be ineligible, the
respondents are directed to consider the applications
under Group II (eligible candidate under Group I) and
pass appropriate orders.”
th
6. BPCL then issued a letter dated 14 November 2022
inviting the respondent to participate in the draw of lot for retail
th
outlet dealership scheduled to take place on 24 November 2022
at the given location and time. Since there was no response in
accordance with the order passed in W.P.(C)No.13355 of 2021,
the respondent once again approached the High Court by filing
Writ Petition No.3461 of 2023 praying for setting aside the
st
communication dated 31 January 2023 and awarding the
dealership to her, treating her to be a candidate under Group 1.
7. The learned Single Judge observed that since the
advertisement for Retail Outlet Dealership was specifically
meant for persons belonging to the Scheduled Caste Category,
BPCL was obligated to “extend a helping hand, even if there are
CA@ SLP(C) No. 7845 of 2024 Page 4 of 18
some defects in the application. They must guide all those who
submit their applications .” Referring to the order passed in an
earlier writ petition (reproduced above), it was observed that the
direction to consider her application under Group 1 and pass
appropriate orders arose out of the ineligibility of two persons. It
was observed that BPCL should first consider her application and
thereafter move to Group 2 if she is found ineligible.
In the writ appeal filed by BPCL, the learned Division
Bench observed that the direction of the learned Single Judge’s
observations/directions were reasonable since, as on the relevant
date, the respondent herein was in possession of the land as
required, and for the requisite time as well.
BPCL, being aggrieved, has carried such an order in
appeal before us.
8. We have heard Mr. Dhruv Mehta and Mr. Shailesh
Madiyal, learned Senior Counsel for BPCL and the respondent,
respectively.
9. The short question that arises for determination is whether
the High Court’s direction to consider the application of the
respondent as Group 1 was justified in law.
10. Before proceeding with the merits of the matter, it is
important to take note of the provisions concerning ‘land’ given
in the advertisement, as also other relevant parts of the same.
CA@ SLP(C) No. 7845 of 2024 Page 5 of 18
“(v) Land (Applicable to all categories) :
The applicants would be classified into three groups
as mentioned below based on the land offered or
land not offered by them in the application form :-
Group 1 : Applicants having suitable piece of land
in the advertised location/area either by way of
ownership/long term lease for a period of minimum
19 years 11 months or as advertised by the OMC.
Group 2 : Applicants having Firm Offer for a
suitable piece of land for purchase or long term lease
for a period of minimum 19 years 11 months or as
advertised by the OMC.
x x x
d) The applicant(s) under Group-1 should have
documents to establish ownership of land offered for the
Dealership as on date of application, such as :-
• Khasra/Khatauni or any equivalent revenue
document or certificate from revenue official
confirming status of the ownership of the land.
• Registered Sale deed/Registered Gift deed.
• Registered Lease deed for a minimum period of
19 years and 11 months (as advertised by
respective oil company).
• Any other type of ownership/transfer deed
document.
• Lease agreement or firm allotment letter issued
by Government/Semi Government bodies.
e) The land owned by the family member(s) will also be
considered as belonging to the applicant (Group-1)
subject to producing the consent letter in the form of
affidavit (Appendix III A) from the concerned family
member(s).
For this purpose family members would comprise of :-
(i) Self
(ii) Spouse
CA@ SLP(C) No. 7845 of 2024 Page 6 of 18
(iii) Father/Mother including Step Father/Step
Mother
(iv) Brother/Sister/Step Brother/Step Sister
(v) Son/Daughter/Step Son/Step Daughter
(vi) Son-in-law/Daughter-in-law
(vii) Parents-in-law
(viii) Grand Parents (both maternal & paternal)
f) For Group 2 applicants, the “firm offer” of land will
include land offer from third party based on Agreement
to purchase/long term lease (as per terms and conditions
of the OMCs). Offer letter should be in the form of an
Affidavit (Appendix III A) along with documents,
mentioned in Clause (d) above, to establish the
ownership of land offered for the Dealership.
x x x
k) Each applicant will have to declare, in the application
form, the category under which offered land falls.
Supporting the above, confirmatory letter from an
advocate (Appendix III B) giving details of the current
ownership, documents relied upon and the category
under which the land falls (Group 1 to Group 2), as on
date of application, is also to be furnished as and when
advised. The Group under which the applicant’s land
falls, would be determined based on the declaration
given in the application and confirmatory letter from the
advocate regarding the same.”
(Emphasis supplied)
11. The impugned judgment and order was passed by the High
Court under Article 226 of the Constitution of India.
12. Interference by Writ Courts in contractual matters is an
issue that has engaged this Court on numerous occasions.
CA@ SLP(C) No. 7845 of 2024 Page 7 of 18
12.1 This Court in Subodh Kumar Singh Rathour v. The
2
Chief Executive Engineer & Ors. , speaking through
Pardiwala, J. for a three-Judge Bench, took note of a number
of earlier decisions and held thus :
“ 39. Thus, for a period of time the courts recognized that
there was a clear brightline distinction between when a
State or its instrumentalities could be said to be acting in
its executive capacity and when it could be said to be
acting in its private capacity, with the existence of a
‘contractual relation’ inter-se the parties being the
determinative factor. Wherever, there was a contract, the
State's relations and all its actions were said to be within
the field of a contract i.e., within the realm of private law,
and the courts would resile from interfering with the
same under their writ jurisdiction or embarking upon a
judicial review of such actions.
40. Such reluctance on the part of the courts stemmed
from its understanding that State or any of its
instrumentalities must have the flexibility or the
discretion to take decisions that are in the best interest of
the public and efficient governance. Government being
the decision-maker of the State is said to be the best
judge of when a contract or an agreement is in its interest
and by its extension in the interest of the public, and as
such the courts should not interfere in the State's
discretion to award or terminate contracts. One another
reason why contractual disputes were precluded from
being espoused under the writ jurisdiction of the courts
was due to the summary nature of such proceedings,
which do not allow for an exhaustive review unlike civil
suits. [See : Radhakrishna Agarwal (supra) at para 11]
41. This simplistic approach of the courts in deeming
every act and action of the State which was complained
of as nothing more than a ‘contractual dispute’ or a case
of ‘breach of contract’ often led to the State abusing its
position and acting unfairly under the misconceived
2
2024 SCC OnLine SC 1682
CA@ SLP(C) No. 7845 of 2024 Page 8 of 18
notion, that all its actions such as award of contracts or
tenders were nothing but a ‘largess’ - a generosity
bestowed upon its citizens, which it can at its own whims
choose to deny, alter, modify, or take away without any
consequences. This often led to a conflation of power
with duty, and resulted in every arbitrary exercise of
power by the State under the guise of a ‘contractual
dispute’ to remain unchecked and undisputable before
the courts and out of the reach of judicial review,
undermining the rights of the citizen to have their
interests safeguarded and protected. We may in this
regard refer to Indian Medicines Pharmaceuticals Corp
Ltd. v. Kerala Ayurvedic Co-operative Society
Ltd. reported in 2023 SCC OnLine SC 5 wherein this
Court speaking eruditely through one of us, Dr. D.Y.
Chandrachud, CJI made the following pertinent
observations:—
“11 The welfare State plays a crucial role in
aiding the realisation of the socioeconomic
rights which are recognised by the
Constitution. Social welfare benefits
provided by the State under the rubric of its
constitutional obligations are commonly
understood in the language of ‘largesse’, a
term used to describe a generous
donation. Terming all actions of
government, ranging from social security
benefits, jobs, occupational licenses,
contracts and use of public resources - as
government largesse results in doctrinal
misconceptions. The reason is that this
conflates the State's power with duty. The
Constitution recognises the pursuit of the
well-being of citizens as a desirable goal. In
doing this the Constitution entrusts the State
with a duty to ensure the well-being of
citizens. Government actions aimed at
ensuring the well-being of citizens cannot be
perceived through the lens of a ‘largess’. The
use of such terminology belittles the sanctity
of the social contract that the ‘people of
CA@ SLP(C) No. 7845 of 2024 Page 9 of 18
India’ entered into with the State to protect
and safeguard their interests.”
(Emphasis in original)
12.2 In Silppi Constructions Contractors v. Union of
3
India , this Court observed as under :
“ 19. This Court being the guardian of fundamental rights
is duty-bound to interfere when there is arbitrariness,
irrationality, mala fides and bias. However, this Court in
all the aforesaid decisions has cautioned time and again
that courts should exercise a lot of restraint while
exercising their powers of judicial review in contractual
or commercial matters. This Court is normally loathe to
interfere in contractual matters unless a clear-cut case of
arbitrariness or mala fides or bias or irrationality is made
out. One must remember that today many public sector
undertakings compete with the private industry. The
contracts entered into between private parties are not
subject to scrutiny under writ jurisdiction. No doubt, the
bodies which are State within the meaning of Article 12
of the Constitution are bound to act fairly and are
amenable to the writ jurisdiction of superior courts but
this discretionary power must be exercised with a great
deal of restraint and caution. The courts must realise
their limitations and the havoc which needless
interference in commercial matters can cause. ... As laid
down in the judgments cited above the courts should not
use a magnifying glass while scanning the tenders and
make every small mistake appear like a big blunder. In
fact, the courts must give “fair play in the joints” to the
government and public sector undertakings in matters of
contract. Courts must also not interfere where such
interference will cause unnecessary loss to the public
exchequer.
3
(2020) 16 SCC 489 : 2019 SCC OnLine SC 1133
CA@ SLP(C) No. 7845 of 2024 Page 10 of 18
20. The essence of the law laid down in the judgments
referred to above is the exercise of restraint and caution;
the need for overwhelming public interest to justify
judicial intervention in matters of contract involving the
State instrumentalities; the courts should give way to the
opinion of the experts unless the decision is totally
arbitrary or unreasonable; the court does not sit like a
court of appeal over the appropriate authority; the court
must realise that the authority floating the tender is the
best judge of its requirements and, therefore, the court's
interference should be minimal...”
(Emphasis supplied)
12.3 We may also refer to the observations made in
4
Uflex Ltd. v. State of T.N. with reference to its earlier
decision in Caretel Infotech Ltd. v. Hindustan Petroleum
5
Corpn. Ltd. as follows :
“ 6. The burgeoning litigation in this field and the same
being carried to this Court in most matters was the cause
we set forth an epilogue in Caretel Infotech
Ltd. v. Hindustan Petroleum Corpn. Ltd. [ Caretel
Infotech Ltd. v. Hindustan Petroleum Corpn. Ltd. ,
(2019) 14 SCC 81] Even if it amounts to repetition, we
believe that it needs to be emphasised in view of the
controversy arising in the present case to appreciate the
contours within which the factual matrix of the present
case has to be analysed and tested :
“ 37 . We consider it appropriate to make
certain observations in the context of the
nature of dispute which is before us.
Normally parties would be governed by their
contracts and the tender terms, and really no
writ would be maintainable under Article
4
(2022) 1 SCC 165
5
(2019) 14 SCC 81
CA@ SLP(C) No. 7845 of 2024 Page 11 of 18
226 of the Constitution of India. In view of
Government and public sector enterprises
venturing into economic activities, this
Court found it appropriate to build in certain
checks and balances of fairness in procedure.
It is this approach which has given rise to
scrutiny of tenders in writ proceedings under
Article 226 of the Constitution of India. It,
however, appears that the window has been
opened too wide as almost every small or big
tender is now sought to be challenged in writ
proceedings almost as a matter of routine.
This in turn, affects the efficacy of
commercial activities of the public sectors,
which may be in competition with the
private sector. This could hardly have been
the objective in mind. An unnecessary, close
scrutiny of minute details, contrary to the
view of the tendering authority, makes
awarding of contracts by Government and
Public Sectors a cumbersome exercise, with
long-drawn out litigation at the threshold.”
(Emphasis supplied)
13. It is clear from the above pronouncements that in writ
jurisdiction, when parties to the dispute involve an organization
deemed to be an instrumentality under Article 12 of the
Constitution, there exists a responsibility of the State to act in a
fair, reasonable manner and free from arbitrariness. The Court is
bound to interfere when these qualities are either in doubt or are
absent and in other situations, is to exercise restraint.
14. In the impugned judgment, the only reason(s) that appears
is that the respondent made representations to BPCL which were
not acted upon and that since the advertisement was specifically
CA@ SLP(C) No. 7845 of 2024 Page 12 of 18
directed towards persons belonging to Scheduled Caste category,
the State should have adopted an understanding approach and
helped all the applicants who have furnished applications.
Nowhere has it been shown that any of the facets of Article 14
stand violated.
15. As reproduced above, Clause (k) of the advertisement
provides that each applicant has to declare the category under
which the land they have offered for the purpose of retail outlet
dealership, falls. In doing so, a letter issued by an advocate
giving details of current ownership and the documents relied
upon to prove the same, also has to be furnished. Further, we
find that Clause (d) also lists various documents that the applicant
should be in possession of, on the date of the application, serving
as proof of ownership of the land. It is clear from the above two
requirements that mentioning the incorrect group in the
application form is not an exercise in simpliciter and requires the
presence/furnishing of various documents. The respondents’
application under Group 2 cannot be a mere error of filling up the
form incorrectly, for along with the form documents establishing
ownership of land, in case the application is by a person falling
under Group 1. The respondent was fully aware of her limitation
and, as such, took a chance by filling up the wrong category.
16. The observations/direction of the High Court to consider
the respondent as part of Group 1, therefore, has to be faulted
CA@ SLP(C) No. 7845 of 2024 Page 13 of 18
with. Public Sector Undertakings in the nature of BPCL or the
like, deal with matters of petroleum and gasoline, which are
precious natural resources held by the State in Public Trust. The
doctrine of Public Trust, for which reliance is often placed on a
judgment of the Supreme Court of the United States of America
6
in Illinois Cent R Co v. State of Illinois , which in turn referred
to a judgment of the New York Court of Appeals in People v.
7
Ferry Co . , - the relevant paragraphs of which are worth
reproduction below :
“'The title to lands under tide waters, within the realm of
England, were by the common law deemed to be vested
in the king as a public trust, to subserve and protect the
public right to use them as common highways for
commerce, trade, and intercourse. The king, by virtue of
his proprietary interest, could grant the soil so that it
should become private property, but his grant was
subject to the paramount right of public use of navigable
waters, which he could neither destroy nor abridge. In
every such grant there was an implied reservation of the
public right, and so far as it assumed to interfere with it,
or to confer a right to impede or obstruct navigation, or
to make an exclusive appropriation of the use of
navigable waters, the grant was void. In his treatise De
Jure Maris (page 22) Lord Hale says : 'The jus privatum
that is acquired by the subject, either by patent or
prescription, must not prejudice the jus publicum,
wherewith public rivers and the arms of the sea are
affected to public use.' And Mr. Justice Best, in Blundell
v. Catterall, 5 Barn. & Ald. 268, in speaking of the
subject, says : 'The soil can only be transferred subject to
the public trust, and general usage shows that the public
6
1892 SCC OnLine US SC 237
7
68 N. Y. 71, 76
CA@ SLP(C) No. 7845 of 2024 Page 14 of 18
right has been excepted out of the grant of the soil.'
*
'The principle of the common law to which we have
adverted is founded upon the most obvious principles of
public policy. The sea and navigable rivers are natural
highways, and any obstruction to the common right, or
exclusive appropriation of their use, is injurious to
commerce, and, if permitted at the will of the sovereign,
would be very likely to end in materially crippling, if not
detroying, it. The laws of most nations have sedulously
guarded the public use of navigable waters within their
limits against infringement, subjecting it only to such
regulation by the state, in the interest of the public, as is
deemed consistent with the preservation of the public
right.'”
This doctrine found its firm place in Indian Jurisprudence
8
with its recognition by this Court in M.C. Mehta v. Kamal Nath .
Although, its application was originally confined only to cases
dealing with the environment, however, in Reliance Natural
9
Resources Ltd. v. Reliance Industries Ltd . . Sathasivam, J. (as
His Lordship then was) held that this doctrine was of wider
import and application.
In the context of the controversy at hand, reference may be
made to the Constitution Bench decision in Natural Resources
10
Allocation, In re, Special Reference No. 1 of 2012 , wherein
the principle that even when the allotment of petrol pumps is
8
(1997) 1 SCC
9
(2010) 7 SCC 1
10
(2012) 10 SCC 1
CA@ SLP(C) No. 7845 of 2024 Page 15 of 18
made on the basis of a particular criterion, no fault can be found
with a decision of the authority as a matter of policy, however,
even so a proper method has to be evolved so that the choice can
be made out of a pool of eligible candidates, without
arbitrariness.
17. BPCL has formed a detailed advertisement and also an
application for such purposes. It has been stated therein that the
application shall solely be decided on the basis of the information
given thereunder. The relevant extract of the application form
reads as under :
“15 UNDERTAKING BY THE APPLICANT
a. I am aware that eligibility for Retail Outlet
Dealership will be decided based on information
given in the application above. On verification by
the Oil Company if it is found that the information
given by me is incorrect/false/misrepresented then
my candidature will stand cancelled and I will be
declared ineligible for the Retail Outlet Dealership.
b. I also confirm that I am in possession of the
supporting documents in original in respect of the
information given by me in this application and if
selected, failure to present these documents in
original will result in cancellation of selection due to
submission of false/unsupported information in this
application.”
(Emphasis supplied)
Since a clear procedure stands laid down by the competent
authority, there exists no room for any discretion to be exercised
CA@ SLP(C) No. 7845 of 2024 Page 16 of 18
in favour of the respondent. The representations made by the
respondent terming her application under Group 2 to be an error,
cannot be considered. Even if she had the requisite land, the
Rules provide no leeway for a category change to be made.
18. In view of the aforesaid discussion, we conclude that the
High Court fell in error directing, as it did, for the respondent’s
application to be considered not in the Group in which it was filed
but in another one. The appeal is, therefore, allowed and the
judgment and order of the High Court with particulars as
described in paragraph one is set aside. The appellant shall
proceed with the allotment process/formalities in accordance
with the Rules and Regulations.
19. Before we part with this matter, we are constrained to
observe that the manner in which the respondent took recourse to
the law was unjustified. The filing of multiple writ petitions at
almost every stage, despite being fully aware of the fact that both
the advertisement and the application form made it abundantly
clear that consideration of the application could only be as per
the documents submitted, led to prolonged litigation, which in
actuality ought not to have originated at all. In effect, the High
Court in its writ jurisdiction passed the order out of sympathy,
which may have been misplaced as a ground of exercise of such
power. The respondent hoped, by the effect of the law to get an
advantage to which she was in no way entitled, leading to loss of
CA@ SLP(C) No. 7845 of 2024 Page 17 of 18
judicial time and public money. The fact of the matter is that the
petrol pump could not be established in the last 7 years, thereby
seriously prejudicing public interest.
No Costs.
Pending application(s), if any, shall stand disposed of.
……………………J.
(SANJAY KAROL)
……………………J.
(MANMOHAN)
New Delhi;
nd
2 April, 2025.
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