Page 1        REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.  9101    2012.

(Arising out of SLP(C) No.31932 of 2010) 

SR. DIVISIONAL RETAIL SALES MANAGER, 

INDIAN OIL CORPORATION LTD.

THROUGH POA HOLDER & ORS.    . . APPELLANT(S)

VERSUS

ASHOK SHANKARLAL GWALANI        . .RESPONDENT(S)

J U D G M E N T

SUDHANSU JYOTI MUKHOPADHAYA, J.

Leave granted.

2.The present appeal has been filed against  

the   impugned   order   dated   29

th

  September,   2010 

passed by the Bombay High Court in Writ Petition  

No.   5032   of   2010   wherein   the   High   Court   has 

granted the Writ of Mandamus directing the Indian  

Oil Company to allot the dealership of the site  

located   at   Thane   Belapur   Road,   Village   Mahape, 

Navi Mumbai, Maharashtra to Shri Ashok Shankarlal  

1

Page 2 Gwalani   (hereinafter   referred   to   as   the  

“respondent”)

3.The relevant facts as pleaded by the appellant  

are as follows:

On   11

th

  June,   2005,   the   Indian   Oil  

Corporation Limited (hereinafter referred to as  

the   “Company”)   published   a   proclamation   in  

leading newspapers and invited applications for  

grant   of   petrol/diesel   retail   outlets  

(dealership) for various locations in the State  

of   Maharashtra.     The   respondent   on   14

th

  July, 

2005,   amongst   others   applied   for   the   same.  

Interviews   were   conducted   on   9

th

­10

th

  December, 

2005.   One Mr. Nilesh L. Kudalkar was placed at  

the top of the merit panel while the respondent  

was placed second and one Mr. K. Srinadha Rao was  

third.  However, since the difference between the  

marks of the top three candidates was within 5%,  

the result of the interview was kept in abeyance  

in   accordance   with   the   policy   of   the   company 

dated April 7, 2005.       A   Screening Committee  

was established which reviewed the markings and  

carried   out   another   interview   of   the   three  

2

Page 3 candidates.  The result was declared on 4

th

 April, 

2006 and Mr. Nilesh L. Kudalkar was first in the  

merit panel.

4.Being aggrieved respondent and Mr. K. Srinadha  

Rao   both   made   complaints   on   10.4.2006   and 

19.4.2006 respectively to the company alleging  

irregularities  in  the  selection   process.    In  

accordance with the policy dated 1

st

 September, 

2005, an investigation was made by the Company  

into   the   allegations   made   by   them.     It   was 

found, among other things, that the respondent  

and   Mr.   Srinadha   Rao   had   not   been   marked 

correctly as regards their financial capability  

and   that   both   had   failed   to   provide   the 

attested   documents   as   had   been   specifically 

required  under  the  advertisement.     Since  the  

allegations   in   the   complaints   were   found   to 

have merit, the selection was cancelled and all  

the   candidates   were   to   be   called   for   re­

interview.     In   the   meantime,   on   28

th

  April, 

2006,  one Mr. Pritesh Chhajed,  who was an M&H  

Contractor  operating  on  the   site  filed  Civil  

Suit No. 230/2006 before the Thane Sr. Division  

3

Page 4 Court seeking an injunction against the company  

from terminating the contract and evicting him  

from the land.  He was unsuccessful in the same  

and   filed   an   appeal   before   the   Bombay   High 

Court which was dismissed by the High Court on  

27

th

 June, 2008 and he was asked to vacate the  

site by December 31, 2008.

5.Re­interviews   were   conducted   on   22

nd

  and   24

th 

December, 2008.  The respondent was found to be  

the   only   candidate   in   the   merit   panel.  

However,   complaints   were   received   from   Mr.  

Pritesh Chajjed (who had also appeared in the  

interviews) on 26

th

 December, 2008 and from Mr.  

K.   Srinadha   Rao   on   16.12.2008,   23.12.2008,  

30.12.2008, 2.01.2009 and 10.02.2009.     Again  

on 30.12.2008, a one man Inquiry Commission was  

appointed   to   investigate   the   allegations  

contained   in   the   complaints.     Also   on  

14.1.2009, Mr. Nilesh L. Kudalkar filed a Writ  

Petition   vide   no.   113   of   2009   against   the 

company   for   cancelling   the   merit   list   and 

declaring him to be the no.1 candidate.   The  

4

Page 5 High Court of Bombay was pleased to dismiss the  

aforementioned writ petition in April, 2009.

6.In the meantime, the inquiry instituted by the  

Company  revealed  that  the  complaints   made  by  

various persons had merit.  

7.Therefore, on 6

th

  August, 2009, the appellants  

sought approval from their management for re­

advertisement of the location.  On 18

th

 August, 

2009, the Company management advertised for re­

interview   of   all   the   candidates   including  

scrutiny   of   all   documents   from   the   initial 

stage in order to remove all errors from the  

selection  process.  Since  the   code  of  conduct  

for  elections  was  in  force,   the  re­interview  

was deferred till its withdrawal.

8.In   December,   2009,   the   L­1   Committee   was  

appointed before which the applications along  

with   other   documents   of   all   ten   eligible  

candidates were placed. The Committee submitted  

its report. The candidature of the respondent  

was   rejected   on   the   ground   that   the  

‘Relationship Affidavit’   was not as per the  

format.

5

Page 6 9.On 3

rd

  June, 2010, respondent was communicated  

about the rejection of his application.

10.Being   aggrieved   respondent   filed   a   writ  

petition being WP(C) No. 5032 of 2010 before  

the   Bombay   High   Court   on   17.6.2010   praying 

inter alia for issuing of an appropriate writ  

directing   the   appellants   to   allot   the  

dealership at the site as per the advertisement  

dated  11.6.2005  and  setting   aside  the  letter  

dated 3.06.2010 to enforce the decision of the  

Selecting Committee dated 24.12.2008, which was  

allowed by the impugned order.

According to the appellants, considering that all  

the former merit panels were vitiated on account  

of   grave   errors,   including   complaints   received 

with regard to all the interviews, the Company is  

desirous of undertaking the selection process de  

novo by re­advertising the location.

11.Learned counsel for the appellant submitted  

that  on 8

th

 December, 2009, L­I Committee was  

nominated in view of   the complaints filed by  

one Srinadhrao and Shri Pritesh Chajed.  These  

6

Page 7 complaints   were   thoroughly   investigated   and  

report dated 24

th

  March, 2009 was received by  

the Company.   Pursuant to the said report the  

Company decided to look into the matter from  

the scrutiny level and to re­interview all the  

candidates so as to remove the defects in the  

selection   process.     Re­scrutiny   of   all   the 

applications was made and during that process  

the   documents   including   the   application  

submitted   by   the   respondent   found   to   be  

suffering from deficiencies.  It was contended  

that the affidavit submitted by the respondent  

was not as per the format and, therefore, his  

application was liable to be rejected as per  

the policy. Consequently, the impugned letter  

was issued to the respondent.

12.The   aforesaid   fact   was   disputed   by   the  

learned   counsel   appearing   on   behalf   of   the 

respondent.   They invited the affidavit filed  

by the Company in Writ Petition No. 113 of 2009  

wherein they supported the selection process as  

well   as   the   merit   list   prepared   by   the  

Selection Committee on 24.12.2008.  In the said  

7

Page 8 affidavit, the allegation that the respondent  

was less meritorious was denied by the Company.  

The  stand of the Company was that the decision  

to award dealership to the respondent did not  

suffer  from  any  manifest  error,   equity,  fair  

play   and   justice.       In   the   said   case,   the 

Company pleaded that the decision in favour of  

the   respondent   was   transparent   and   was   not 

motivated   on   any   consideration   other   than  

probity.     The said case was filed by second  

person   challenging   the   selection   of   the  

respondent.  The  Division  Bench   of  the  Bombay  

High Court after hearing both the parties vide  

order dated 17

th

  April, 2009 in Writ Petition  

No. 113 of 2009 held that the High Court could  

not   sit   in   appeal   over   the   decision   of   the 

selection   committee   and   the   decision   is   not 

arbitrary.     The   Court   further   held   that   the 

writ petitioner of the said case (Writ Petition  

No.   113/2009)   having   participated   in   the  

subsequent selection without any protest, could  

not   revert   back   to   the   earlier   selection  

process. 

8

Page 9 13.On 17

th

  September, 2012, after hearing both  

the parties, this Court requested   the learned  

Attorney General who was appearing on behalf of  

the Company to give us the reasons in detail  

for cancellation of the first and second rounds  

of   the   selection   process   held   by   the  

authorities   concerned.   The     learned   Attorney 

General after meeting with the representative  

of the Company in his office on 22

nd

 September, 

2012   and   after   going   through   the   relevant 

papers of interviews submitted a report;   the  

relevant portion of which reads as under:­

“ In respect of the first round of  

the   selection   process,     in   which  

interviews   were   conducted   on   9

th

  land 

10

th

  December,   2005,     the   Screening  

Committee   had   released   the   results   on 

4.4.2006 subsequent to which complaints  

received   from   Shri   Ashok   Shankarlal  

Gwalani on 10.04.2006 and from Shri K.  

Srinadha Rao on 19.4.2006.  The General  

Manager, Maharashtra State Office of the  

Indian   Oil   Corporation   appointed   an  

inquiry   committee   to   investigate   the  

complaints.     Based   on   the   Inquiry  

Report, which was submitted  on October  

7, 2006,   the Maharashtra State Office  

prepared a Note dated 17.10.2006 which  

was   finally   approved   and   endorsed   on 

November 7, 2006 by   which a decision  

was taken in   accordance with existing  

guidelines   to   re­interview     eligible  

candidates as the merit panel had been  

vitiated due to errors in    evaluating  

9

Page 10 financial parameters of the  candidates  

in the merit panel which resulted in a  

change in the merit panel.       A typed  

copy of the Note dated 17.10.2006  has  

been annexed by the petitioner  in the  

Application   to   bring   on   record   facts, 

subsequent events and documents, marked  

as Annexure P­5 thereto.

4.In respect of the second round of the  

selection   process,  in   which   interviews 

were conducted on December 22­24, 2008,  

two complaints were received from Shri  

Pritesh Chhajed on  26.12.2008 and from  

Shri K.Srinadha Rao on 16.12.2008 with a  

reminder   on   10.1.2009.     An   inquiry  

report   was   prepared   by     investigating 

officer on 24.3.2009 which was finalized  

by   the   Maharashtra   State   Office   vide 

Note dated 13.4.2009.   In relation  to  

the complain of Shri Pritesh Chhajed, it  

was found that  after giving benefit to  

the complainant, the following position  

emerged:

“a)Even   if   it   is   considered  

giving benefits to the complainant  

candidates   Sri   Pritesh   J.   Chajjed 

as   eligible   based   on   enquiry  

findings, the number one empanelled  

candidate   remains   unchanged   as   1

st 

in   the   Merit   Panel,   however,   the 

panel   will   get   changed   by   adding 

other   qualified   candidates   in   2

nd 

rank at least.

b)The   other   two   complainant  

candidates   would   be   ranked  

hypothetically as below”

Name   of 

the 

candidat

e

Marks   by  

the     L1  

committee

Marks   by 

the   L2 

committee

%   marks 

allotted 

by 

intervie

w 

committe

e   (out 

Empanelme

nt   by  

interview 

committee

%   marks 

evaluate

d   if  

deviatio

ns   taken 

into 

consider

Empanelmen

t   after 

deviations 

taken into 

considerat

ion 

(analysis)

1

Page 11 of   total 

65 

marks)

ation

Shri 

Ashok 

Gwalani

41.78 5.2 72.38

%

1 NA

Shri 

Pritish 

Chhajed

35.67 7.4 Ineligibl

e (42.07) 

(66.26)

Inelig

ible

66.

26%

1

Page 12 Shri K. 

Shrinadhar

ao

31.00 6.9 58.30 Not 

qualifi

ed

NA

Shri 

Keshavra

o 

Gopairao 

Shinde 

32.85 5.8 59.46 Not 

qualif

ied

NA

Based on evaluation by L1 (Annexure A)  

and L2 (Annexure B) committee the mark  

sheet   as     complied   by   the   interview 

committee   (Annexure   C),   the   marks  

awarded to the complainant Sri Pritosh  

Chhajjed   is   computed     in   the   above 

table, though the same was not declared  

by   the   committee   due   to   his  

ineligibility.)

Considering that the marks allotted by  

L1 (35.67) and L2 (7.4) to Sri Pritish  

Chajjed is added, he gets 66.26% marks  

(i.e. 43.07 out of 65) and would have  

become 2

nd

  in the merit panel   whereby  

the original merit  panel dated 23.12.08  

undergoes a change with two candidates  

in   the   merit   panel   instead   of   one 

empanelled   candidate   and   thus   the  

selection gets vitiated.  Hence, as per  

policy   in   vogue,   since   the   above  

referred   selection   gets   vitiated   and  

also there are other eligible candidates  

available,     the   location   should   be  

reinterviewed   with   all   the     eligible 

candidates.

c)From   the   records,   it   is   also  

observed   that   the   location   Mahape   had 

been originally advertised on 11.6.2005  

against which based on interview,   the  

first   merit   panel   was   declared   on  

4.4.4006,     thereafter   there   were  

complaints   and   after   investigation   as 

per grievance   redressal procedure and  

the decision by the competent authority,  

re­interview   of   all   the   eligible  

candidates was conducted on 22.12.08 to  

1

Page 13 24.12.2008   and   accordingly   the   above  

referred   merit   panel   dated   24.12.2008 

was declared by the interview committee.  

The selection process for this location  

remained inconclusive for the last four  

years   and   is   yet   to   be   concluded. 

Further it is   also observed that this  

will be a case of 2

nd

  re­interview with 

all the eligible candidates for the same  

location.  In all likelihood,  based on  

the   above   investigation   details   and  

analysis,  there may not be any further  

change in the merit panel in  respect of  

the   first     empanelled   candidate.  

Additionally,   there   may   be   other  

candidates who may come in the panel in  

the 2

nd

  and 3

rd

  position.       Though as 

per   policy   in   vogue     re­interviews  

recommended.”

5.In   view   of   this,     the   following  

recommendations   were   put   up   for   final  

verdict by the competent authority in the  

matter:­

“  1.       Since   the   above   referred  

selection process on investigation gets  

vitiated   and   also   there   are   other  

eligible   candidates   available,   the  

location   should  be   re­interviewed   with 

all   the   eligible   candidates   as   per  

selection guidelines in  vogue.

     2.         However,     the   competent 

authority,   i.e.   State   Head,   MSO   while 

giving   the   final   order   in   the   above 

investigation   (vide   report   dated  

6.2.2009   and   24.3.2009   by   Sri   R.  

Ganeshan as placed below), may also like  

to take a view on the facts given in  

para (c) above,     whether to continue  

with   the   existing   merit   panel   dated 

24.12.08 with the lone candidate whose  

position is not disturbed as per above  

analysis   remaining     as   1

st

  empanelled 

candidate or to go for re­interview as  

per extant guidelines.

1

Page 14   3.Action   is   recommended   in   view   of 

the   lapses   by   the   DO   Coordinating  

officer   and   interview     committee   (L2) 

for   not   accepting   the   duplicate   of  

original marksheet as detailed above in  

the IO’s report in tabulation.

6.These   recommendations   were  

studied/reviewed by the new Retail team at  

the   MSO   and   comments   were   prepared   on 

29.07.2009,   which   were   approved   on  

3.08.2009:

1.Since   vitiation   in   the   selection  

process   has   been   established,   as  

recommended, it is agreed/recommended  

that   the   location   should   be   re­

interviewed as per the extant policy  

guidelines.

2.In view of Sr. No.1 above, in which  

vitiation   in   the   selection   process 

has been established and re­interview  

recommended,   in   order   to   have  

transparency   in   selection   it   is  

recommended that re­interview be done  

with   all   the   eligible   candidates   as 

per the extant policy guidelines.

3.Chief Manager (RS), MSO has proposed  

action   against   the   DO   Co­ordinating 

and the L2 Committee.   Our comments  

are as under:

In   this   case   the   candidate   had 

brought the Duplicate copy of the  

original, which in its strictest  

sense   is   not   the   original.  

Logically   duplicate   copy   of   the 

documents   should   have   been  

considered   as   original   for   the 

purpose   verification.     This  

could/should   have   been   got  

confirmed   by   the   coordinating  

officer and implemented.

However   it   appears   that   the   DO 

coordinating   officer/L2Committee  

1

Page 15 has strictly gone by the policy  

guidelines   in   this   regard   to  

verify the attested copy of the  

document   submitted   with   the  

application, from the Original to  

be   brought   by   the   candidate   at 

the   time   of   interview.  

Therefore   technically   the   DO  

coordinating Officer/L2 Committee  

has   strictly   followed   the  

guidelines. 

ED MSO has detailed his views &  

finally opined as follows in:

“In   order   to   avoid   any   further 

complication   and   to   give   fair 

chance to everyone, in my opinion  

this selection process should be  

cancelled and the location should  

be Re­advertised.  Since there is  

no specific policy in this regard  

it is suggested that HO opinion  

may be sought.”

14.From the pleading of the parties as noticed  

above   and   the   record,   the   following   facts 

emerges:­

(a)The proclamation was made on 11.6.2005  

i.e.   more   than   seven   years   ago   but   till 

date   no   person   has   been   granted   the  

dealership in question.  

(b)The   first   interview   was   conducted   on 

9

th­

10

th

  December,   2005   in   which   one   Mr. 

Nilesh L. Kudalkar was placed at the top of  

1

Page 16 the   merit   panel   while   the   respondent   was 

placed second and one Mr. K. Srinadha Rao  

was   third.     When   complaints   were   made  

against   the   selection   as   well   as   an  

allegation of irregularity in the process,  

after investigation, the Company found that  

the respondent and Mr. Srinadha Rao had not  

been   marked   correctly   and   both   failed   to 

provide the attested documents as had been  

specifically   required   under   the  

advertisement   and   therefore   the   first  

selection was cancelled.

(c)The second re­interview was called for  

and   conducted   on   22

nd

  and   24

th

  December, 

2008.     In   the   said   re­interview   the  

respondent was the only eligible candidate  

in the merit panel.   On the basis of the  

complaints made by other persons a one man  

Inquiry Commission was appointed.   On the  

basis of the report of the   Investigating  

Officer   dated  6.2.2009 and   24.3.2009,   it 

was found that there were lapses by the DO  

Coordinating   Officer   and   the   interview  

1

Page 17 committee   (L2),   in   not   accepting   the  

duplicate of the original mark­sheet of a  

candidate   as   detailed   in   the   Inquiry  

Officer report in tabulation.  

(d)The   record   further   shows   that   the  

respondent   submitted   a   representation  

before   the   Chairman   of   the   Company   on 

24.8.2009   with   the   reminder   filed   on  

different   dates   including   the   one   dated 

23.1.2010.   The   Senior   Divisional   Retail  

Sales   Manager   by   communication   dated  

3.06.2010 informed the respondent that “ on 

perusing   the   application   and   the  

accompanying documents it is observed that  

Relationship Affidavit not as per format.  

We   regret   that   in   view   of   the   same   your 

application is found ineligible. ”  

In the aforesaid background, the DGM (RC)  

by its note dated 13.8.2009 rejected the opinion  

submitted by the Office for re­interview.

15.It is not clear as to how the assessment  

was made by the authorities as apparent from the  

investigation   report   (Annexure­R6).     The  

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Page 18 Investigating   Officer   in   the   summary   of  

investigation   submitted   his   conclusion,   the  

relevant potion of which reads as follows:

“Summary of Investigation :

Based   on   documents   provided/handed  

over   by   DO,   as   also   application   the 

policy guidelines RO/6002 dt. 7.4.2005 &  

4.4.2006   the   following   is   the  

conclusion:

A) L­1 Committee has not strictly  

followed   the   guidelines  

regarding   signing   of   all  

documents   for   assessment.  

However,   irrespective   of   this 

deviation,   L­1   Committee   has 

considered   all   documents   for 

assessment.

B)In   case   of   ‘Liquid   Cash   in   the 

form   of   Bank   Fixed   Deposit   etc.   and 

‘Fixed and Movable Assets” as detailed  

in my report, for financial capability,  

the   L­1  Committee,   Screening   Committee 

has   given   weight­age   to   documents   of 

family   members/   relatives   even   though 

‘No   Consent’   affidavit/letter   is  

available.   Therefore,   in   my   final  

assessment, in line with the policy ‘No  

weight­age has been given to documents  

without consent.  Therefore final marks  

have undergone change.   Hence  in line  

with the above the final result is as  

under:

As   per   Interview   Committee   (in   line 

with merit):

Sr.N

o.

Name of candidate Total 

marks

1 Shri  Nilesh  Laxmikant 

Kudalkar

56.50

2 Dr   Ashok   Shankarlal 

Gwalani

55.33

3 Shri K. Srinadharao 54.33

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Page 19 As   per   Screening   Committee   (in   line 

with merit):

Sr.N

o.

Name of candidate Total 

marks

1 Shri  Nilesh  Laxmikant 

Kudalkar

59.0

2 Shri K. Srinadharao 57.0

3 Dr   Ashok   Shankarlal 

Gwalani

52.0

As   per   Investigation   (in   line   with 

merit):

Sr.N

o.

Name of candidate Total 

marks

1 Dr   Ashok   Shankarlal 

Gwalani

56.78

2 Shri K. Srinadharao 53.63

3 Shri  Nilesh  Laxmikant 

Kudalkar

48.52

From the aforesaid report, it is clear that  

the Interview Committee, Screening Committee and  

the   Investigation   Officer   assessed   the   three  

candidates in three different groups due to which  

the   position   of   the   candidates   changed   in   the 

merit list prepared by the Interview Committee,  

Screening   Committee   and   the   investigation  

Officer. 

16.In the present case, the High Court has not  

noticed   and   discussed   the   aforesaid   facts   and 

without   discussing   the   further   developments   as 

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Page 20 taken   place   after   24.12.2008,   directed   the  

appellants   to   issue   the   Letter   of   Intent   in 

favour of the respondent.  Though the High Court  

noticed the stand taken by the appellants that  

the   ‘relationship   affidavit’   submitted   by   the  

respondent was not as per format, it failed to  

discuss   the   effect   of   such   an   incomplete  

affidavit in the matter of selection.

17.Generally,   if   an   irregularity   is   detected 

in the matter of selection or preparation of a  

panel it is desirable to have a fresh selection  

instead of re­arranging the panel which is found  

to   be   vitiated.     The   Authority   empowered   to 

appoint, is the competent authority to decide as  

to   whether   the   panel   should   be   discarded   and 

there should be a fresh selection in view of the  

facts narrated above.  In such circumstances, the  

High Court under Article 226 of the Constitution  

of India ought to not have interfered with the  

decision of the competent authority in canceling  

the selection. 

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Page 21 18.For the reasons aforesaid, we have no other  

option but to set aside the order of the High  

Court.  Accordingly, the order and judgment dated  

29.9.2010 passed by the High Court of Bombay is  

set   aside   with   a   liberty   to   the   Competent  

Authority   to   re­advertise   the   petrol/diesel  

retail outlets in question and to make a fresh  

selection in accordance with law. The appeal is  

allowed   with   aforesaid   observation   and  

directions.  There shall be no order as to costs.

………..………………………………………..J.

      ( SWATANTER KUMAR )

………………………………………………….J.

        (SUDHANSU JYOTI 

MUKHOPADHAYA)

NEW DELHI,

DECEMBER 14, 2012.

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