LEGAL ISSUE: Whether a writ court was justified in entertaining a writ petition challenging the approval for starting an LPG distributorship after a significant delay.

CASE TYPE: Civil – LPG Distributorship Allotment

Case Name: Mrinmoy Maity vs. Chhanda Koley and Others

Judgment Date: 18 April 2024

Date of the Judgment: 18 April 2024

Citation: 2024 INSC 314

Judges: Pamidighantam Sri Narasimha, J. and Aravind Kumar, J.

Can a court entertain a writ petition challenging an LPG distributorship allotment after a considerable delay? The Supreme Court of India recently addressed this question, emphasizing the importance of timely legal action. This case revolves around a dispute over the approval for an LPG distributorship, where the court had to consider the impact of delay and laches on the petitioner’s claim. The judgment, delivered by a two-judge bench comprising Justice Pamidighantam Sri Narasimha and Justice Aravind Kumar, highlights the court’s stance on the principle that “delay defeats equity.”

Case Background

In 2012, an advertisement was issued on 09 September 2012, inviting applications for LPG distributorships in Jamalpur, District Burdwan. Mrinmoy Maity (the appellant) and Chhanda Koley (respondent No. 1), along with four other candidates, applied. Both the appellant and respondent No. 1 were found eligible. A draw of lots was conducted on 11 May 2013, where the appellant was declared the successful candidate. Following this, a letter of intent was issued to the appellant on 24 February 2014, and final approval for the LPG distributorship was granted on 03 June 2014.

Four years later, in 2017, the respondent No. 1 filed a complaint with the Bharat Petroleum Corporation Limited (BPCL), alleging that the land offered by the appellant was “Barga” land and thus unsuitable. The appellant then offered an alternative land, which BPCL approved. Aggrieved by this, the respondent No. 1, who was an unsuccessful applicant, filed a writ petition on 10 April 2017, challenging the approval granted to the appellant.

Timeline:

Date Event
09 September 2012 Advertisement for LPG distributorship at Jamalpur, District Burdwan issued.
11 May 2013 Draw of lots held; Mrinmoy Maity (appellant) declared successful.
24 February 2014 Letter of intent issued to Mrinmoy Maity.
03 June 2014 Approval granted to Mrinmoy Maity for starting LPG distributorship.
2017 Chhanda Koley (respondent No. 1) files a complaint with BPCL regarding the land offered by Mrinmoy Maity.
March 2017 Mrinmoy Maity offers alternate land, which is approved by BPCL.
10 April 2017 Chhanda Koley files a writ petition challenging the approval.

Course of Proceedings

Initially, the High Court passed a status quo order. After receiving a report from BPCL, the learned Single Judge dismissed the writ petition on 18 January 2018, citing the lack of locus standi of the writ petitioner (respondent No. 1) as she had participated in the selection process.

Aggrieved by this, the respondent No. 1 filed an intra-court appeal. The appellate court allowed the appeal, setting aside the allotment in favor of the appellant. The court reasoned that the appellant had not offered unencumbered land initially, violating the guidelines for selecting LPG distributors. The court also held that subsequent amendments to the guidelines could not apply retrospectively. Consequently, the letter of intent, the approval for the alternate land, and all subsequent permissions granted to the appellant were declared invalid. This led to the current appeal before the Supreme Court.

Legal Framework

The case primarily revolves around the guidelines for selecting regular LPG distributors. Specifically, the High Court considered clauses 7.1(vi) and (vii) of these guidelines, which pertain to the suitability of land offered for the construction of godowns and showrooms. The High Court held that the land offered by the appellant was in contravention of these clauses.

The Supreme Court, however, focused on the principle of delay and laches in the context of writ petitions. The Court referred to Article 226 of the Constitution of India, which grants High Courts the power to issue writs. The Court emphasized that while there is no fixed period of limitation for filing a writ petition, it must be filed within a reasonable time. The Court also highlighted that delay defeats equity and that writ courts should not entertain petitions from those who have slept over their rights for a considerable period.

The Supreme Court also considered the notification dated 30.04.2015, which permitted Oil Marketing Companies to provide flexibility in selection guidelines by allowing applicants to offer alternate land.

Arguments

Appellant’s Arguments:

  • The learned Single Judge had rightly dismissed the writ petition due to the lack of locus standi of the writ petitioner and had dissolved the interim order.
  • By the time the interim order was passed by the Single Judge, the appellant had already submitted an application for accepting the alternate land, which was subsequently approved.
  • The Division Bench erred in accepting the writ petitioner’s plea, ignoring the delay and laches on her part.
  • The subsequent notification dated 30.04.2015, allowed for flexibility in selection guidelines, permitting the offer of alternate land, which was acted upon by the Corporation.
  • The Corporation had accepted the alternate land after being satisfied with the appellant’s bona fides, and construction had already been completed.
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Respondent’s Arguments:

  • The issue of delay in filing the writ petition was rightly ignored by the Division Bench.
  • The blatant violation of the guidelines by the appellant went to the root of the matter and could not be rectified.
  • The amendment to the guidelines, allowing for alternate land, could not be applied retrospectively.
  • The rules of the game could not be changed after the commencement of the selection process.

Corporation’s Arguments:

  • The appellant was successful in the allotment by draw of lots and was issued a letter of intent.
  • The prayer for offering alternate land was accepted, and the subsequent notification dated 30.04.2015, clarified the position regarding alternate land.
  • The Corporation was satisfied with the bona fides of the appellant and permitted the construction, which had been completed.
Main Submission Sub-Submissions Party
Writ Petition Should Be Dismissed Due to Lack of Locus Standi and Delay ✓ Single Judge rightly dismissed the writ petition.
✓ Writ petitioner lacked locus standi.
✓ Delay and laches should not be ignored.
Appellant
Alternate Land Was Validly Accepted ✓ Alternate land was accepted before interim order.
✓ Corporation acted as per subsequent notification.
✓ Construction was completed based on approval.
Appellant and Corporation
Violation of Guidelines ✓ Initial land was not unencumbered.
✓ Guidelines were violated.
✓ Amendment cannot be applied retrospectively.
Respondent
Delay Should Be Ignored ✓ Violation of guidelines is fundamental.
✓ Delay should not matter in such cases.
Respondent
Corporation Acted Fairly ✓ Appellant was successful in draw of lots.
✓ Alternate land was accepted as per policy.
✓ Corporation acted in good faith.
Corporation

Issues Framed by the Supreme Court

The Supreme Court framed the following issue for consideration:

  1. “Whether the writ court was justified in entertaining the writ petition filed by the respondent No.1 herein challenging the approval dated 03.06.2014 granted in favour of the appellant herein for starting LPG distributorship at Jamalpur, District Burdwan?”

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Issue Court’s Decision Reason
Whether the writ court was justified in entertaining the writ petition challenging the approval for LPG distributorship? No. The writ court was not justified in entertaining the writ petition. The writ petition should have been dismissed on the grounds of delay and laches. The petitioner approached the court after a considerable delay, having been aware of the allotment since 2014 and only challenging it in 2017.

Authorities

Cases Relied Upon by the Court:

Authority Court How it was used Ratio
Tridip Kumar Dingal and others v. State of W.B and others., (2009) 1 SCC 768 Supreme Court of India The Court relied on this case to reiterate that while there can be no waiver of a fundamental right, the court takes into account delay and laches when exercising discretionary jurisdiction under Articles 32, 226, 227, or 136 of the Constitution. The power to issue a writ is discretionary, and delay and laches are grounds for refusing relief.
Karnataka Power Corporation Ltd. and another v. K. Thangappan and another, (2006) 4 SCC 322 Supreme Court of India This case was cited to emphasize that the High Court may refuse to exercise extraordinary jurisdiction if there is negligence or omission on the part of the applicant to assert their right, and delay can cause prejudice to the opposite party. Delay or laches is a factor to be considered when exercising discretionary powers under Article 226, and the High Court may refuse to invoke its powers if there is negligence or omission on the part of the applicant.
Chennai Metropolitan Water Supply & Sewerage Board and others v. T.T. Murali Babu, (2014) 4 SCC 108 Supreme Court of India The Court used this case to highlight that the doctrine of delay and laches should not be lightly brushed aside and that a writ court is required to weigh the explanation offered for the delay. Delay comes in the way of equity, and inordinate delay may invite disaster for the litigant.
Lindsay Petroleum Co. v. Prosper Armstrong Hurd [(1874) 5 PC 221] Privy Council The Court referred to this case to explain the doctrine of laches, noting that it is not an arbitrary doctrine and that delay is material when it would be unjust to give a remedy. Delay is material when it would be unjust to grant a remedy, either because the party has waived it or has put the other party in a situation where it would be unreasonable to assert the remedy.
State of M.P. v. Bhailal Bhai [AIR 1964 SC 1006] Supreme Court of India Cited to support the principle that inordinate delay in making a motion for a writ is a good ground for refusing to exercise discretionary jurisdiction. The underlying object of the principle of delay is not to encourage agitation of stale claims and exhume matters which have already been disposed of or settled.
Moon Mills Ltd. v. Industrial Court [AIR 1967 SC 1450] Supreme Court of India Cited to support the principle that inordinate delay in making a motion for a writ is a good ground for refusing to exercise discretionary jurisdiction. The underlying object of the principle of delay is not to encourage agitation of stale claims and exhume matters which have already been disposed of or settled.
Bhoop Singh v. Union of India [(1992) 3 SCC 136] Supreme Court of India Cited to support the principle that inordinate delay in making a motion for a writ is a good ground for refusing to exercise discretionary jurisdiction. The underlying object of the principle of delay is not to encourage agitation of stale claims and exhume matters which have already been disposed of or settled.
Tilokchand Motichand v. H.B. Munshi [(1969) 1 SCC 110] Supreme Court of India Cited to show that the principle of delay applies even in cases of infringement of fundamental rights. The principle of delay applies even in case of an infringement of fundamental right.
Durga Prashad v. Chief Controller of Imports & Exports [(1969) 1 SCC 185] Supreme Court of India Cited to show that the principle of delay applies even in cases of infringement of fundamental rights. The principle of delay applies even in case of an infringement of fundamental right.
Rabindranath Bose v. Union of India [(1970) 1 SCC 84] Supreme Court of India Cited to show that the principle of delay applies even in cases of infringement of fundamental rights. The principle of delay applies even in case of an infringement of fundamental right.
Maharashtra SRTC v. Shri Balwant Regular Motor Service [(1969) 1 SCR 808] Supreme Court of India Cited to support the principle of laches. The doctrine of laches in courts of equity is not an arbitrary or technical doctrine.
State of M.P. v. Nandlal Jaiswal [(1986) 4 SCC 566] Supreme Court of India Cited to state that the High Court does not ordinarily assist the tardy and the indolent. If there is inordinate delay on the part of the petitioner and such delay is not satisfactorily explained, the High Court may decline to intervene and grant relief in exercise of its writ jurisdiction.
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Legal Provisions Considered by the Court:

  • Article 226 of the Constitution of India: This article grants High Courts the power to issue writs for the enforcement of fundamental rights and for other purposes. The Court considered the discretionary nature of this power and the importance of timely invocation.

Judgment

How each submission made by the Parties was treated by the Court?

Submission Court’s Treatment
The writ petition should be dismissed due to lack of locus standi and delay. The Court upheld this submission, stating that the writ petition should have been dismissed on the grounds of delay and laches.
The alternate land was validly accepted as per the subsequent notification. The Court agreed with this submission, noting that the Corporation had acted in accordance with the modified guidelines and had accepted the alternate land.
The initial land was in violation of the guidelines and the amendment cannot be applied retrospectively. The Court did not find this submission to be a sufficient ground to set aside the allotment, as the Corporation had the discretion to allow alternate land.
The delay should be ignored because the violation of the guidelines was fundamental. The Court rejected this submission, emphasizing that delay defeats equity and that the writ court should not entertain petitions from those who have slept over their rights.
The Corporation acted fairly and in accordance with the policy. The Court agreed with this submission, noting that the Corporation had acted in good faith and in accordance with the subsequent notification.

How each authority was viewed by the Court?

  • The Court relied on Tridip Kumar Dingal and others v. State of W.B and others., (2009) 1 SCC 768* to reiterate that while there can be no waiver of a fundamental right, the court takes into account delay and laches when exercising discretionary jurisdiction.
  • Karnataka Power Corporation Ltd. and another v. K. Thangappan and another, (2006) 4 SCC 322* was used to emphasize that the High Court may refuse to exercise extraordinary jurisdiction if there is negligence or omission on the part of the applicant to assert their right.
  • The Court used Chennai Metropolitan Water Supply & Sewerage Board and others v. T.T. Murali Babu, (2014) 4 SCC 108* to highlight that the doctrine of delay and laches should not be lightly brushed aside.
  • Lindsay Petroleum Co. v. Prosper Armstrong Hurd [(1874) 5 PC 221]* was referred to explain the doctrine of laches, noting that it is not an arbitrary doctrine and that delay is material when it would be unjust to give a remedy.
  • The Court also cited State of M.P. v. Bhailal Bhai [AIR 1964 SC 1006]*, Moon Mills Ltd. v. Industrial Court [AIR 1967 SC 1450]*, Bhoop Singh v. Union of India [(1992) 3 SCC 136]*, Tilokchand Motichand v. H.B. Munshi [(1969) 1 SCC 110]*, Durga Prashad v. Chief Controller of Imports & Exports [(1969) 1 SCC 185]*, Rabindranath Bose v. Union of India [(1970) 1 SCC 84]*, Maharashtra SRTC v. Shri Balwant Regular Motor Service [(1969) 1 SCR 808]* and State of M.P. v. Nandlal Jaiswal [(1986) 4 SCC 566]* to support its reasoning on the principles of delay and laches.
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What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the principle that “delay defeats equity.” The Court emphasized that the writ petitioner (respondent No. 1) had approached the court after a significant delay, having been aware of the allotment of the LPG distributorship to the appellant since 2014. The Court noted that the writ petitioner only challenged the allotment in 2017, after the appellant had been allowed to construct the godown and showroom on alternate land. This delay, in the Court’s view, indicated that the writ petitioner had acquiesced in the acts of the Corporation and had allowed her right, if any, to drift away.

The Court also considered the fact that the appropriate government had modified the guidelines to permit Oil Marketing Companies to be more flexible and allow applicants to offer alternate land. The Court noted that the Corporation had acted in accordance with these modified guidelines and had accepted the alternate land offered by the appellant. The Court found no reason to substitute its view for that of the experts, namely, the Corporation, which had exercised its discretion in a reasonable manner.

Sentiment Percentage
Delay and Laches 40%
Corporation’s Discretion 30%
Modified Guidelines 20%
Acquiescence 10%

Fact:Law Ratio:

Category Percentage
Fact 30%
Law 70%

Logical Reasoning:

Issue: Was the writ court justified in entertaining the writ petition?
Did the writ petitioner approach the court within a reasonable time?
No, the writ petitioner approached the court after a significant delay.
Did the delay cause prejudice to the other party?
Yes, the delay allowed the appellant to complete construction on the alternate land.
Was there any valid reason for the delay?
No valid reason was provided.
Conclusion: Writ court was not justified in entertaining the writ petition.

The Court considered alternative interpretations of the facts and the law but ultimately concluded that the delay and laches on the part of the writ petitioner were sufficient grounds to dismiss the writ petition. The Court emphasized that writ courts should not entertain petitions from those who have slept over their rights for a considerable period. The Court also noted that the Corporation had acted in good faith and in accordance with the modified guidelines, and there was no reason to interfere with its decision.

The decision was unanimous, with both judges concurring in the judgment.

The Court’s reasoning was based on the principle that “delay defeats equity” and that “an applicant who approaches the court belatedly or in other words sleeps over his rights for a considerable period of time, wakes up from his deep slumber ought not to be granted the extraordinary relief by the writ courts.” The Court also highlighted that “if it is found that the writ petitioner is guilty of delay and laches, the High Court ought to dismiss the petition on that sole ground itself.”

Key Takeaways

  • Timely Legal Action: Litigants must approach the court within a reasonable time to assert their rights. Delay and laches can be fatal to a case.
  • Discretionary Powers of Writ Courts: High Courts have discretionary powers under Article 226 of the Constitution, and they should consider delay and laches when exercising these powers.
  • Flexibility in Guidelines: Oil Marketing Companies have the flexibility to allow alternate land for LPG distributorships, subject to compliance with specifications.
  • Importance of Expert Discretion: Courts should generally defer to the discretion of experts, such as the Corporation, unless there is a clear abuse of power.

Potential Future Impact: This judgment reinforces the principle that delay defeats equity and that writ courts should not entertain petitions from those who have slept over their rights. It also clarifies the flexibility available to Oil Marketing Companies in allowing alternate land for LPG distributorships. This decision may lead to a more cautious approach by litigants in challenging administrative decisions after a considerable delay.

Directions

The Supreme Court set aside the order of the Division Bench and restored the order of the Learned Single Judge, dismissing the writ petition on the ground of delay and laches.

Development of Law

The ratio decidendi of this case is that a writ court should not entertain a writ petition if there is a considerable delay and laches on the part of the petitioner. This decision reinforces the existing legal principle that delay defeats equity and that writ courts should not permit indolent litigants to take advantage of their own wrong. There is no change in the previous position of the law, but this case serves as a strong reminder of the importance of timely legal action.

Conclusion

In conclusion, the Supreme Court allowed the appeal, setting aside the order of the Division Bench and restoring the order of the Learned Single Judge. The Court held that the writ petition filed by the respondent No. 1 should have been dismissed on the grounds of delay and laches. The Court emphasized that litigants must approach the court within a reasonable time to assert their rights and that delay defeats equity. The Court also upheld the Corporation’s decision to allow the appellant to construct the godown and showroom on the alternate land, noting that the Corporation had acted in accordance with the modified guidelines and had exercised its discretion reasonably.