Indian Oil Land Grabbing unique case first of its Kind in India.
We had been running a Indianoil (IOC) petrol pump on freehold land registered in my name from last 48 years. in year 2009 the dealership agreement with IOC was terminated by the company as we had stopped lifting the products from IOC as the PUMP had become unviable.
There is a clause in the above dealership agreement as follows:
The corporation shall have the right at any time during the currency of the Agreement or within three months after the termination thereof for any reason whatsoever by notice in writing to acquire the dealer to sell or to assign( according as the site held by the dealer may be freehold or leasehold tenure) to the corporation or its nominee the premises together with all fixed assets thereon and thereupon the dealer shall sell or assign the premises to the corporation or its nominee within three months next after the receipt of such notice at or for a price which shall be computed as follows, that is to say which shall comprise FIRST a sum equivalent to such capital monies as the Dealer may have paid by the way of premium of price as consideration for the acquistion of the site…………………..
After termination the company has invoked the above clause and asked us to assign the land to them at the price at which we have purchased in year 1959. The above land is valued at 15.00 Crores and we have purchased it at Rs.2800.00 in year 1959. After we denied that we will not give the land to IOC. The company started arbitration as per the dealership agreement and appointed a employee of the company as arbitrator as per the agreement. The award was passed by the arbitrator extract of which is given below:
In view of the Validly executed and concluded contract I hold that the claimant is justified to ask the respondent to transfer the land to the claimant in accordance and as per the scheme provided in the dealership agreement.
The have challanged the award in district court under following major points:
FOR THAT the Ld. Arbitrator, in making/passing the impugned Award, has failed to appreciate that the impugned Petrol and HSD Dealership Agreement dated 21.10.1967 is a Standard Form of Contract and the O.P./Claimant has considerably greater bargaining power than the petitioner/respondent and the petitioner/respondent had to sign on the dotted line on the said Standard Form of Contract under economic duress, undue influence and also under coercion and thereby violates Section 16(3) and Section 23 of the Indian Contract Act.
FOR THAT the Ld. Arbitrator, in making/passing the impugned Award, has failed to appreciate that the said impugned Agreement was executed after 5 years of grant of dealership to the said M/s. Siliguri Trading Corporation and the petitioner/respondent was compelled and/or coerced to sign on the dotted line in a standardized form of agreement in which single will of the O.P./Claimant was predominant.
FOR THAT the Ld. Arbitrator, in making/passing the impugned Award, has failed to understand that the O.P./Claimant being a government owned oil company and a State within the meaning of the expression in Article 12 of the Constitution cannot be allowed to take unauthorized advantage of a term of agreement which has been set at their wish and operate at the disadvantage of the other party, who for the sake of his livelihood and to obtain dealership had no option but to sign on the dotted line and gives improper advantage to the superior party in the contract. The inappropriate advantage of the claimant in the said clause is evident from the manner/method of determination of the valuation as prescribed in clause 20 (a) of the said agreement dated 21/10/1967. The method of valuation as provided is absolutely (other word also defrauding) arbitrary and opposed to the public policy regarding valuation as can be gathered from the laws governing Land Acquisition, Registration and Pre-emption. It is apparent that the object of clause 20 (a) of the said agreement dated 21/10/1967 is unlawful as it implies injury to the property of the dealer and also opposed to public policy being contrary to the intentions of the legislatures in various Central and State legislations and thus void in terms of the provisions of
Section 23 of the Indian Contract Act, 1872 read with Sections 10 and 19 of the said Act.
FOR THAT the Ld. Arbitrator, in making/passing the impugned Award, has failed to understand that the object of clause 20 (a) of the said agreement dated 21/10/1967 is unlawful and patently illegal as it implies injury to the property of the dealer and also opposed to public policy being contrary to the intentions of the legislatures in various Central and State legislations and thus void in terms of the provisions of Section 23 of the Indian Contract Act, 1872 read with Sections 10 and 19 of the said Act.
FOR THAT the Ld. Arbitrator, in making/passing the impugned Award, has failed to appreciate that Clause 20(a) of the impugned Agreement dated 21.10.1967 is vague because neither consideration money nor time frame for the sale is prescribed therein and as such the same is not enforceable in law in view of Section 9 of the Specific Relief Act 1963
FOR THAT the basic ingredient of a contract is “Consenous-Ad-idim” of the contracting parties and the absence of this essential ingredient in the Standard form of Contract strikes at the very basic structure or framework of the contract. Incorporation of Arbitration clause to the advantage of Superior contracting party virtually puts the other side to sing to the dictates and will of the superior contracting party and further the proceedings being adjudicated by the superior contracting party himself which is contrary to the settled principle of law and prudence to the fact that “no man can be a judge of his own cause” and the purported agreement is the result of unconscionable bargain.
We would like to know what we can do to save our land from the greedy Indian oil which wants the land of crores at Rs.2800.00 only.
And the court proceedings will start within a month , we want some help and sugesstion to make our case strong. And would also want the opinion that what will be the outcome of the case.
As this a unique case of its kind in India, as all other similiar cases IOC has still kept the party in arbitration only for decades by not giving any award. If we win the case then it will set a precedent to all other dealers of IOC which are suffering from decades.
Rajesh Kumar Agarwal