Disability Rights Require Consideration of Family Substitution in LPG Dealership, Calcutta High Court Rules; Orders Fresh Review

Pursuant to an advertisement dated 21 January 2014, Petitioner No. 1 was selected for an RGGLV LPG distributorship at Dakshin Akraberia, South 24 Parganas, and was issued a conditional Letter of Intent (LOI) on 30 March 2015. The LOI was subject to the outcome of pending litigation challenging his selection. He obtained the requisite governmental no-objection certificates, and PESO conditionally approved the site layout and construction plan on 5 May 2015. The challenge to his selection was ultimately dismissed by the Supreme Court on 21 September 2023

The petitioner completed the godown and showroom and sought commissioning of the distributorship. However, discrepancies were noted in the construction and the PESO licence was not granted. PESO subsequently rejected the application for non-compliance with its requisitions. The petitioner contended that the prolonged delay was attributable to the pending litigation and inter-departmental processing rather than to him

During the pendency of the process, Petitioner No. 1 was diagnosed with schizophrenia and certified as suffering from 70% temporary disability. He sought substitution or reconstitution of the LOI in favour of his elder brother, Petitioner No. 2, so that the remaining formalities could be completed. The request was not accepted. HPCL thereafter withdrew the LOI on 19 February 2025 and forfeited the ₹20,000 deposited towards field verification

The petitioners challenged the withdrawal, contending that the authorities had failed to consider the petitioner’s disability, the doctrine of reasonable accommodation under the Rights of Persons with Disabilities Act, 2016 (“RPWD Act”), and the substantial investment made pursuant to the LOI

Whether the writ petition was maintainable under Article 226 despite the availability of an alternative statutory remedy against the PESO-related order?

Whether the respondents were required to consider substitution of Petitioner No. 1 by his elder brother on account of the petitioner’s disability, notwithstanding the absence of total and permanent disability under the applicable guidelines?

Whether an LOI issued at the pre-approval stage could be transferred or substituted in favour of the petitioner’s elder brother before grant of the PESO licence?

The Court held that the existence of an alternative remedy does not bar exercise of writ jurisdiction where the impugned action is arbitrary or implicates constitutional and statutory rights, including rights under the RPWD Act

An LOI is not equivalent to a concluded contract or final licence; it ordinarily creates no vested or transferable right and remains subject to fulfilment of statutory conditions, as recognised in Dresser Rand S.A. v. Bindal Agro Chem Ltd., (2006) 1 SCC 751

The Court also relied on State of Orissa v. Harinarayan Jaiswal, (1972) 2 SCC 36, for the principle that no fundamental right exists to carry on business in rights or privileges belonging to the Government

At the same time, public authorities must exercise contractual or statutory discretion fairly, reasonably, and non-arbitrarily

The doctrine of reasonable accommodation under Section 2(y) of the RPWD Act requires necessary and reasonable modifications to enable persons with disabilities to exercise legal rights, unless such accommodation causes disproportionate or undue burden

Relying on Jeeja Ghosh v. Union of India, (2016) 7 SCC 761, the Court recognised reasonable accommodation as part of substantive equality, dignity, and the right to life under Article 21

The applicable RGGLV guidelines permitted reconstitution in specified circumstances such as death or total and permanent disability, but the Court held that the authorities were nevertheless required to consider the petitioner’s supervening disability consistently with the RPWD Act

The Court held that the petition was maintainable because Petitioner No. 1 was the original selectee and had suffered direct legal injury from withdrawal of the LOI; the challenge alleged arbitrariness and violation of disability rights, rather than merely seeking enforcement of a private contract

Although the LOI did not confer a vested right to the distributorship, the petitioner had acted upon it, obtained prior approval of the site plan, made substantial investments, and advanced the licensing process to an important stage

The Court distinguished transfer of an existing PESO licence from substitution of an applicant before any licence had been granted; provisions governing transfer of a licence could not automatically determine the latter situation

Since no licence had yet been issued, the proposed substitution would not dilute existing regulatory control, alter the approved premises, or compromise public safety

The authorities had rejected the request on the assumption that substitution at the pre-approval stage was categorically impermissible, without considering the petitioner’s supervening disability and the possibility of reasonable accommodation. That failure rendered the decision arbitrary and legally unsustainable, although the Court did not direct automatic transfer or grant of the licence

It further held that, although the LOI did not create a vested or transferable right, the absence of an existing PESO licence meant that the request concerned substitution of the applicant before grant of the licence, not transfer of an existing licence

The HPCL letter dated 19 February 2025 withdrawing the LOI and forfeiting ₹20,000 was quashed and set aside. The competent authority was directed to reconsider the matter, provide an opportunity of personal hearing, and pass a reasoned order within eight weeks of communication of the judgment, with communication of the decision within one week thereafter. Status quo regarding the approved premises was directed to be maintained pending the fresh decision. The writ petition was accordingly allowed and disposed of without costs