|``Dealer's act damaged IOC's image and was prejudicial to public interest''|
CHENNAI : Holding that the Indian Oil Corporation could not allow anyone to bring disrepute to its name and goodwill, the Madras High Court has upheld the termination of a dealer, who operated a petrol pump with a damaged totaliser seal.
Reversing a single-judge order, which had set aside the IOC's order terminating the dealership of Kamala Filling Station on Pantheon Road in Egmore, a Division Bench comprising Justice P. Sathasivam and Justice N. Paul Vasanthakumar said if a dealer continued to be incorrigible, the Corporation could not be a silent spectator.
"It is the duty of the Corporation to correct the situation in order to serve the general public," the Bench remarked.
The IOC passed the impugned order in June 2002 after an inspection revealed that the totaliser seal was absent in the pumps.
(Totaliser seal is affixed by the Weights and Measures Department on the totaliser component of the dispensing unit. The seals are installed for the benefit of the dealers to know the sales which take place in a day).
Holding that it amounted to breach of terms, conditions, covenants and stipulations contained in the dealership agreement, the IOC cancelled the dealership as the act damaged its image besides being prejudicial to public interest.
However, in August 2003, a single judge set aside the cancellation on the ground that the termination order had been passed in a hurry.
The IOC preferred the present appeal.
The Bench, pointing out that the dealer himself had admitted that his employees had damaged the totaliser seal, said that under clause 47 of the agreement, the dealer alone was responsible for any breach or contravention of his servants or agents.
Rejecting the arguments that the impugned order was bereft of details or reasons, the judges said, "in view of the fact that the dealer had committed three irregularities and appropriate action was taken prior to the irregularity committed in 2002, we are of the view that the IOC is justified in terminating the dealership agreement, particularly when the servants of the dealer tampered with the totaliser seal."
They further observed, "it not only causes disrepute to the IOC but also affects the public interest."
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