LAW OF CONTRACT (LW1011)

CASE COMMENT

B.R CHOWDHURY VS INDIAN OIL CORPORATION LTD AND ORS

APPEAL(CIVIL) CASE NUMBER-472 OF 1998

MADE BY

NIRLIPTA MOHANTY

ROLL NO. 2182051

BBA LLB SECTION A

 INTRODUCTION

This case is an classic example of suppression of material fact which lead to a

disruption in the recruitment process by a corporation(Indian Oil Corporation Ltd).In this
case,we will also know about the way how the company dealt with the matter concerned.We
would also know about the court’s way of interpretation of facts and its judgement in a
precise manner.

In this case,there were several writ petitions filed against the appellant for presenting
misinformation to get the opportunity(dealership).The courts had also disposed these
petitions directing the Indian Oil Corporation ltd. to freshly constitute the panel for the
process of giving dealership.The lower courts have also considered the evidence of the
certificate which clearly shows that the appellant is employed in a firm named as M/s. Denis
Chem ltd. from 23rd of February 1987 to 3rd April 1989.But in the document regarding the
dealership,the appellant had stated ‘NIL’ in the column of employment.It clearly shows that
he had given false information regarding his status of employment.The report of enquiry by
Mr. N.K Gupta(Chief Consumer Manager of IOCL) is also a great evidence which had
concluded that that Mr. Choudhury(appellant) was employed on the date when the dealership
was offered to him. All these evidences are much enough to be considered to prove that the
appellant should not be given preferential treatment of dealership on the basis of
employment.
After the writ petitions filed against the appellant, the court had directed the
corporation to take adequate steps by freshly considering all the facts including the certificate
which is not produced by the appellant. Subsequently, the corporation had terminated the
dealership to the appellant and gave it to the respondent number 5(the person who had filed
petition against the appellant for suppression).After that, the appellant had challenged the
correctness of the order by filing a writ petition C.O. No.17843(W) of 1996 at 11th October
1996.According to his side, this order was completely against the decision of the corporation
and the Oil Board. Respondent No. 5 was eligible to be considered for dealership under no
circumstance. It was also stated that no suppression of facts was done. He had stated that he
was a trainee of that firm, not as a employee. The Learned Single Judge had passed the order
on 10th October 1997 stating that the Oil Board was no more capable for deciding the
concerned matter.The decision of cancellation of the dealership to the appellant was upheld.
The court had also terminated the offer of dealership to respondent no.5.It was directed that
the corporation should take necessary legal actions regarding this matter.After that,the
aggrieved parties had filed 3 petitons (Nos.445,508 and 511) of 1997 before the Divisional
Bench.The Divisional Bench of High Court had dismissed the three appeals stating that they
didn’t found any good reason to interfere with the judgement of the learned single judge.The
Learned Senior Counsel for the appellant had urged that the cancellation of the dealership
was only done on the basis of the report of enquiry which is prepared on a pre assumption
that there is some irregularity in the information.But the appellant was only working as a
trainee in that firm.So,it cannot be told that the appellant was working as an employee in that
firm.The Corporation had also not clarified that the cancellation of the dealership is
justified.The learned council for the corporation had also argued in the support of the
order.The Learned senior counsel for the respondent had also stated that the order for
cancellation of the dealership to the appellant was fully justified.
The Court had passed the order by stating that the appeal of the appellant was only
considered.The had also said that the Court was not told to examine the correctness of the
cancellation of dealership to respondent no. 5.The only matter is regarding the validity of the
decision of cancellation of the dealership to the appellant. The Court had stated after
considering all the facts which are not under dispute that the decision which was taken b the
corporation is justified. The appellant had also stated himself in the affidavit which was
submitted in the court that if any information is false then, the company is able to withdraw
the letter of intent from him. The report of Mr. N.K Gupta had also proved that there is false
information in the column of employment. So, it was ordered that the Court would not
interfere in the impugned judgement.

BACKGROUND

This case is about suppression of material facts. There are many cases like Mithoolal
Nayak vs Life Insurance Corporation of India Ltd on 15th January 1962, Amar Chand
Agarwalla vs Shanti Bose And another etc on 22ND December 1972,etc.But this case has been
cited in 12 cases. Like in Smt Asha Lohia vs The Union of India and others on 23rd June
2016,N. Muthuraman vs The State of Tamil Nadu on 1st April 2005.Mahendrasinh Dolatsinh
Thakor vs Chairman And Managing Director on 14 March,2005 and many more. So the
analysis of this case will lead us to know the crux of many cases. So, this case becomes more
important to be discussed.

ANALYSIS

The court’s decision was appropriate with respect to this case.The court had considered all
the facts and gave this decision.This can be stated with the following arguments.
The court had already directed to the corporation to take necessary actions by constituting the
panel by freshly considering all the facts.Even the corporation had also constituted a panel
twice for investigating this matter.The court had also taken the report of Mr. N.K Gupta in
confidence. So, the corporation should have no objection in this order.The corporation cannot
state this decision as unanimous as the court had considered all the aggrieved parties .The fact
that is found by Mr. N.K. Gupta has proved that the suppression of the material facts is done
by the appellant.The corporation cannot say this decision as an interference in their
employment work because the court had also taken the panels into confidence. So, by all
these arguments, it is clear that the order is just to the corporation.

If we will examine the fairness of decision with respect to the appellant,then there is no doubt
that the court had given a right decision. According to the arguments of the appellant, he had
stated that there is no irregularity in the information. But in the report by the panel of Mr.
N.K. Gupta, it is clear that there is an irregularity. The affidavit by the appellant had clearly
mentioned that if any false information is there the, the company can withdraw the letter of
intent within its rights. So, the evidence from M/s Denis Chem. Lab Ltd. clearly proves that
the appellant was employed as a Trainee Professional Sales Representative at the time when
the dealership was offered to him. So, the appellant is bound with his affidavit which he had
submitted for the safety of his dealership. In the form which is submitted to the corporation,
he had stated ‘NIL’ in the column of employment. But he was employed at that time. Another
argument by him claims that he was a trainee in that firm but not as a employee. This
statement is completely baseless.The word ‘trainee’ merely does not mean that it is not an
employee.There is also an argument that the company had given any clarification about the
termination of dealership of the appellant. But this argument is also baseless as the investing
committee by Mr. N.K. Gupta had given all the justifications and proved the reason of
terminaton of dealership.So, the question of validity and its justifications are ruled out.

Now we will discuss about the justification of this order with respect to the respondent
no.5.The order is justified as he had only appealed about the suppression of material fact
against the appellant.So,there is no question about more discussion.But there is a problem
about the second order which had also terminated the dealership of him which was previously
given to the appellant.The point here is also valid.The court had stated directly that the matter
is about the rightness in the decision to give the dealership .So they were not liking to
interfere with the decision of termination of dealership to respondent no.5.So, the question is
that if the main subject of the matter is regarding to the appellant then why the learned single
judge had given the order to terminate the dealership of respondent no.5. Why the single
judge had interfered in that matter if it was right?

At last,I would like to say that the judgment is right.It is completely decided with proper
reasoning which was used in previous cases.By the analysis by all the arguments above,it can
be clearly understood that this judgment has given justice to everybody.But it also raise
questions about the decision regarding the respondent no.5.If the court is saying that the
matter about the appellant is only to be considered then why they the learned single judge had
given the order about the termination of dealership to respondent no.5.After that the court is
stating that it is not fit too interfere as it is not the subject matter.So, here a logical fallacy is
seen.
 CONCLUSION

The case is about the suppression of material facts.The judgment is only based on facts and
findings.It was given in a wise and precise manner.The court had also taken every side into
confidence.It has examined all the evidences in every possible manner.The judgment also
gives a fair treatment to every aggrieved party.There is complete unbiasedness in this
decision.But the judgment to respondent no. 5 not seems to be right as the subject matter was
not about the dealership to respondent no.5.But the decision regarding the appellant is
completely right as it serves justice without any prejudice.On a whole, the reasoning in this
case is very accurate.This is also with the respect to all the previous cases like this.On an
average,the decision is right and it made the justice to prevail in our democracy.