Court restores cooking gas agency licence of widow

GANDHINAGAR - The Gujarat High Court Wednesday set aside the Indian Oil Corporation’s (IOC) decision to cancel the licence of a cooking gas agency co-owned by an army personnel’s widow on the grounds of breach of agreement.

The licence was cancelled by the company alleging that she had misrepresented facts at the time of entering into an agreement with it.

A division bench of the court, comprising Chief Justice S.J. Mukhopadhaya and Justice K.M. Thaker, allowed the appeal of Hamidabegum Sheikh and her partnership firm, Megani Indane, who challenged the termination of their agency by the IOC.

A single judge bench had earlier upheld the IOC’s decision to cancel the licence, alleging that she did not disclose that she was teaching at the time of signing an agreement with it.

The division bench said that non-disclosure of information does not mean misrepresentation of facts.

The chief justice said that the IOC and the single judge erred in interpreting the agreement and had not applied their mind.

“The agreement talks of the future when it states that the applicant shall not take any employment without prior permission of the company. It does not talk about any prior employment taken,” the court said.

“The allegation that she provided false information cannot be held correct when she had stated that she has not taken any employment after entering into the agreement,” the court said.

Sheikh’s husband died in 1985 while on duty and she took up work as a substitute teacher at the army school in Ahmedabad cantonment. In 1998, the IOC advertised for appointment of distributors. Sheikh applied and was granted licence for Naroda area of Ahmedabad.

In 2002, she entered into a partnership and sought from the IOC the grant of distributorship to the partnership firm which was confirmed by the company.

More than a decade later, IOC issued a show cause notice to Sheikh alleging breach of agreement.

The company charged her with not disclosing that she was employed and misrepresenting facts. Also that the information provided while entering into the agreement was untrue and incorrect.

“Another term states that if she breached any term of the agreement she would have four days to remedy the breach. As she has already resigned, it is not a breach of the agreement,” the division bench noted.

The chief justice came down heavily on the counsel of the IOC when he argued that the court was sympathetically considering the case of appellant as she was a woman.

The court admonishingly asked: “What do you mean by your argument, Mr counsel? You tell us what’s the gender of IOC?”

“Please also let us know the gender of Meghani Indane, the partnership firm. Your argument in this manner would lead us to observe in our judgment that such uncalled for arguments have been raised and hence we are imposing costs,” the chief justice said.

Following this, the counsel apologized to the court and withdrew his submission.