//Shut them down, SC rules on BJP-tainted petrol pumps

Shut them down, SC rules on BJP-tainted petrol pumps

Tanu Sharma, Indian Express ,Saturday, January 13, 2007

Express effect: Court upholds panel’s finding that 70% of cases probed by Express indeed irregular

NEW DELHI, JANUARY 12: Five years after The Indian Express exposed the nationwide allotment of petrol pumps to the relatives and friends of the BJP by the NDA government at the Centre, the Supreme Court today stamped its approval on the cancellation of over 70% of the allotments highlighted by the newspaper.

 The verdict from the outgoing Chief Justice Y K Sabharwal, who retires on January 14, comes in line with the report submitted by the two-member court-appointed committee.

The bench headed by Justice Sabharwal said those allotments cancelled on the basis of the report will have to close their outlets within three months.

The court rejected the contention that the court-appointed committee, comprising former Supreme Court judge S C Agarwal and former Delhi High Court Justice P K Bahri, did not have the jurisdiction to go into the issue of allotment.

However, those allotments that were protected by the interim order will continue until further orders of the court. The Bench referred the matter to the registry for placing it before the next Chief Justice to assign the matter to another bench.

The two-member committee was appointed to look into the procedure adopted by the Dealer Selection Boards for approving the allotments after a reported expose in 2002.

The committee had said that most of the allotments were illegal and were given on extraneous considerations and had recommended cancellation of such allotments. The apex court on the basis of the report cancelled many of them. Over 400 cases of tainted allotment reported by The Indian Express were referred to the Committee.

In December 2002, the Supreme Court had quashed the Central Government’s notification cancelling all the 3,760 allotments.

The three-member Bench reiterated the committee’s finding that no allotment was cancelled “merely on the ground of political linkage/patronage but while considering the legality or otherwise of the allotment, political linkage/patronage was kept in mind as one of the factors.”

Even after recording a finding that there was a political linkage for the allotment, the Committee considered whether the authorities made the allotment at the cost of merit and ignoring public interest, the Court said.

“Only in those cases where merits have suffered or allotment has been made on extraneous considerations that the Committee held the allotment as contrary to law,” the Bench, which also included Justice C K Thakker and R V Raveendran, said.

The Court rejected the “preliminary objection” raised by the applicants. “It could not be said that the Court was to consider only political linkage/patronage and the Committee had exceeded its powers and/or jurisdiction in taking into account other extraneous matters. In fact, the Court’s direction was to consider extraneous considerations, if any, in allotment and if so, to pass an appropriate order and to report on those aspects,” the judgment said.

Of the 409 cases, more than 100 cases were approved on merit and 297 allotments were found being not in accordance with the guidelines and therefore could not be approved.

“Maybe the petitioners have spent some amount. But once the allotment itself was found to be vitiated, obviously they cannot claim any benefit as allotment was contrary to law. Moreover, such allotment has been made in remote past and even though an order of cancellation had been passed by the Central Government as early as in August, 2002, the allottees have been protected by (an) interim order passed by this Court,” the order said.

Accepting the contention of Additional Solicitor General Gopal Subramaniam, who was appointed as the amicus, that the Committee carried out a “Herculean task,” the Judges made it clear that individual complaint of an allottee would only be considered “if he can successfully satisfy this Court that in the facts and circumstances of the case, the finding of the Committee that the allotment was not on merits was not correct.”

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How Supreme Court traced the case

Express News Service  January 13, 2007

NEW DELHI:: The Supreme Court took cognizance of a news report in The Indian Express edition dated August 2, 2002 alleging political patronage in allotment of retail outlets of petroleum products, LPG distributorship and SKO-LDO dealership. Further reports between August 2 and August 5, 2002 brought to light how dealers/distributors were appointed on the basis of political patronage/linkage, sidelining the norms.

 Consequent criticism by the Press and even Parliament led to cases being reviewed on August 5, 2002 by the then Prime Minister Atal Behari Vajpayee, who directed the Ministry of Petroleum & Natural Gas to cancel all allotments made with effect from January, 2000.

A formal order, cancelling all allotments, was issued on August 9, 2002 by the Ministry of Petroleum & Natural Gas.

However, the order was challenged by allottee in several High Courts. Transfer petitions were filed in the apex court, which on December 20, 2002, in case titled Onkar Lal Bajaj, disposed of all the petitions by setting aside the Government’s order of August 9. The SC appointed a committee comprising Justice S.C. Agrawal, a retired SC Judge and Justice P.K. Bahri, a retired Judge of the High Court of Delhi, to examine 413 cases of allotment. The Ministry of Petroleum and Natural Gas and the four oil companies were directed to render full, complete and meaningful assistance to the committee and place all the relevant records before the committee within five days.

The Ministry was also directed to appoint a nodal officer not below the rank of a Joint Secretary for effective working of the committee. The order also said that if the Committee, on preliminary examination of any case, thinks that the allotment was made on merits and not as a result of political connections or other extraneous considerations, it would be open to the committee not to proceed with probe in detail.

The committee examined each case and concluded: “The correctness of this proposition cannot be disputed. Merely because a person has a political connection should not operate as a handicap in his/her being considered for allotment on his/her own merits. But, if from other surrounding circumstances, it is apparent that the political connection of an applicant has weighed in the matter of consideration of the application by the DSB and an allotment has been made in his favour, then such an allotment would be open to challenge on the ground that it is not made on merits but on extraneous considerations.”

The committee in all scrutinised 409 cases of alleged tainted allotments in Himachal Pradesh, Haryana, Rajasthan, Uttar Pradesh, Bihar, Jharkhand, Orissa, Madhya Pradesh, Chhattisgarh, Gujarat, Maharashtra, Andhra Pradesh, Tamil Nadu and Karnataka. Out of these, in 297 allotments, it found, “the selection could not be said to have been made on merits.” The allottee either did not fulfill the eligibility requirements or had incurred disqualification on account of suppression/concealment of material information relating to their eligibility for consideration or other extraneous considerations. Almost 73 per cent of tainted allotments examined by the committee were found to be improper.

The findings of the committee, holding certain allotments being not made on merits and therefore
were not sustainable, led the applicants approach the SC.

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