Reportable  

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 1649 OF 2011 [Arising out of SLP(C) No.13480 of 2007]

Senior Law Manager, Indian Oil  Corporation Ltd. And Anr.

.......Appellants  

Versus

Guru Shakti Singh and Anr. .....Respondents

O R D E R

R. V. Raveendran J.,

Leave granted. Heard.  

2. The appellants (Indian Oil Corporation Ltd.), issued  

an  advertisement  inviting  applications  for  grant  of  LPG  

distributorship  for  Sohawal,  District  Faizabad,  Uttar  

Pradesh.  The Dealer Selection Committee constituted by the  

appellants interviewed the eligible candidates and declared  

a panel of three candidates, on 30.3.2005, in the following  

order  of  merit  :  (1)  Guru   Shakti    Singh   (first  

respondent); (2) Sardar Mahinder Singh; and (3) Lal Rajendra  

Nath Singh. As per the said selection first respondent had  

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to be granted the LPG distributorship.

2. The second candidate in the list (Sardar Mahinder  

Singh)  filed  a  complaint  with  the  appellants,  alleging  

illegalities and irregularities in  awarding marks by the  

Selection Committee, resulting in the first respondent being  

placed as the first in the merit panel. Shortly thereafter,  

the  said  Sardar  Mahinder  Singh  filed  a  writ  petition  

challenging  the  selection  process  and  the  panel  of  

candidates. The said writ petition filed on 4.5.2005, was  

withdrawn on 18.5.2005.  Sometime thereafter the said Sardar  

Mahinder Singh died.

3. The  appellants  thereafter  cancelled  the  entire  

selection process on 27.10.2005, and took a decision for re-

interview the candidates.  The first respondent filed a writ  

petition for quashing the said order dated 27.10.2005 and  

seeking a direction to the appellant to issue him the letter  

of intent for Distributorship as he was the first in the  

merit  panel.  The  said  writ  petition  was  allowed  by  the  

impugned order dated 6.2.2007 holding that there should be  

no re-interviews and the appellant should proceed with the  

selection as already conducted in accordance with law.  The  

effect of the order was that the first respondent should be  

granted the distributorship. The said order is challenged in  

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this appeal by special leave.

4. It is not disputed by the first respondent that the  

mere fact of a merit panel being prepared with him in the  

first  place  does  not  entitle  him  to  be  appointed  as  a  

distributor. The case of the first respondent is that as the  

second respondent who challenged the selection as per the  

merit panel withdrew the writ petition and none else had  

questioned the merit panel, the said merit panel continued  

to be in force and was valid; and therefore, there was no  

need for re-interviews and he ought to have been granted the  

distributorship. But the issue is not whether there was a  

challenge, but whether there was any irregularity in the  

selection process, and as a consequence whether the decision  

of appellants to have fresh interviews is open to challenge.  

5. Sardar  Mahinder  Singh  filed  a  complaint  alleging  

that he had been awarded lesser marks and first respondent  

had been awarded more marks. His grievances in regard to  

marks were as under :  

(a) Though he owned a land and the respondent did not own  any land on the date of interview, yet, both were given  equal 18 marks. He should have been awarded full marks of  25.

(b) He had not been given proper marks in respect of the  parameter  “capability  to  arrange  finance”.  In  spite  of  providing requisite financial details, he was awarded only 7  out of 35.  

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{c) He had been given lesser marks of 2 out of 5 under the  parameter  “business  ability/acumen”  though  he  was  doing  business for last 20 years, for which records were placed.  

6. The appellant got the said complaint investigated by  

a committee of senior officers. The investigation revealed  

that under the evaluation parameter “capability to provide  

infrastructure” Sardar Mahinder Singh had been awarded only  

18 marks whereas he ought to have been awarded 25 marks as  

per the company policy as he had submitted the documents in  

support of ownership of land, along with his application. It  

was  also  found  that  under  the  evaluation  parameter  

“capability  to  provide  finance  :  Banker's/Financial  

Institution's certificate for loan”, Sardar Mahinder Singh  

had been awarded zero marks out of 7 marks even though he  

had submitted a certificate dated 20.2.2004 from Bank of  

Baroda for credit-worthiness along with his application and  

that he deserved marks under that head also.  

7. In view of the said findings of the investigation, the  

second appellant (General Manager, IOC, UP State Office)  

took  a  decision  that  the  selection  process  violated  the  

guidelines and was vitiated. As a consequence, he directed  

that the merit panel prepared by the Selection Committee  

should be cancelled and ordered a re-interview.  He also  

directed that disciplinary action should be taken against  

the  Selection  Committee  Members.  The  above  factual  

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background leading to the direction for re-interview was  

completely overlooked by the High Court.   

8. The High Court allowed the writ petition filed by the  

respondents on a rather strange reasoning. We extract below  

the relevant portion of the impugned order :

“As already observed, since the Indian Oil Corporation  after being satisfied about the illegality committed  by the Committee in awarding marks to a particular  candidate  (since  deceased),  decided  to  re-interview  all the candidates, but before the said exercise could  be started, the said person died as such no relief can  now be granted to him.  Rest of candidates have not  raised any grievance about their failure in selection,  therefore,  there  is  no  question  for  reconsidering  their case.”

The High Court appears to have proceeded on the basis that  

even  though  the  selection  process  was  illegal,  as  the  

complainant (Sardar Mahinder Singh), who had alleged the  

irregularities had died, the irregularities were no longer  

relevant  and  would  no  longer  exist  and  the  merit  panel  

should be accepted.  Unfortunately, the High Court failed to  

deal  with  the  larger  issue  as  to  whether  the  Selection  

Committee  had  acted  fairly  and  properly  in  awarding  the  

marks and preparing the merit panel.  If the finding was  

that the marks were wrongly assigned to the complainant and  

consequently, first respondent had benefited, it does not  

follow that when the complainant dies, the irregularity in  

assigning marks could be brushed aside or ignored. In such  

selections,  any  illegality  or  material  irregularity  in  

assigning marks in regard to any person with the intention  

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of favouring some one or excluding some one, vitiates the  

entire selection process. Such a selection process cannot be  

saved by holding that the person in regard to whom lesser  

marks were given had died or failed to pursue his remedy.  

Once the appellants took cognizance of the illegality in the  

selection process, the withdrawal of writ petition on death  

of the aggrieved complainant lost significance. The issue,  

as already noticed, is whether the selection process was  

fair and proper and whether the appellant acted arbitrarily  

or unreasonably in taking a decision to scrap the selection  

process and re-interview the candidates.

9. Assigning of lesser marks to Sardar Mahinder Singh not  

only  denied him  the first  place in  the panel,  but also  

unjustly and undeservedly gave the first respondent, the  

first place in the panel. The manner of assigning marks  

showed a clear intention to favour the first respondent at  

the cost of the other applicants. It is this finding that  

persuaded the General Manager of IOC to scrap the selection.  

The High Court having recorded a finding that the appellant  

was  satisfied  about  the  illegality  committed  by  the  

selection  committee,  ought  to  have  rejected  the  writ  

petition, as the decision of the appellants to scrap the  

selection was reasonable and not arbitrary.   

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10. As a result, the appeal is allowed, the order of the  

High Court is set aside and the writ petition filed by the  

first respondent is dismissed. The appellants are permitted  

to deal with the LPG distributorship as per its policy.  It  

can either re-interview the candidates or at liberty to deal  

with the matter in accordance with the existing policy.  

  ......................J.             ( R.V. RAVEENDRAN )

New Delhi;    .....................J. February 14, 2011.              ( A.K. PATNAIK )

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