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by sayum
26 May 2026 1:56 PM
“It was entirely the misrepresentation of the respondents themselves that created a situation, where the petitioner, having pursued her application in a fair and honest manner, is suffering…” - Bombay High Court (Aurangabad Bench) decisively ruled in favour of Pradnya Nitin Patil, a woman entrepreneur whose Letter of Intent (LOI) for a rural retail petrol outlet had been arbitrarily withdrawn by Bharat Petroleum Corporation Ltd. (BPCL) after she had nearly completed all formalities for launching the dealership.
The Division Bench of Justices Manish Pitale and Y.G. Khobragade, delivering judgment held that “nothing could be more arbitrary” than the actions of BPCL, which advertised the location as rural but later turned around and denied the LOI on the ground that the outlet was on a State highway.
“Once BPCL Approved the Land, Conducted Inspections and Took Deposits, It Cannot Shift Blame to the Applicant”
“The location of the Retail Outlet was categorized by the respondents themselves in the advertisement as a Rural Retail Outlet. Hence, there was no question of the petitioner having provided any incorrect information.”
The dispute arose when BPCL issued an advertisement in November 2018 inviting applications for rural retail dealerships, including one at Kaijgaon to Tarwade Kh (Jalgaon District) — the exact location where the petitioner proposed her site. She complied with all requirements, underwent scrutiny, paid mandatory deposits (including a ₹5 lakh non-refundable deposit), and even began installing infrastructure such as tanks.
However, just before the petrol pump was to be operationalized in 2020, BPCL uninstalled the partially installed tank, and much later, in January 2023, abruptly cancelled the LOI, claiming that a rural outlet cannot be on a State highway, and accused the petitioner of misrepresentation.
The Court categorically rejected this defence, observing: “The LOI was issued only after the officers of the respondents conducted spot inspection of the land offered by the petitioner and after being fully satisfied with the same... Nothing could be more arbitrary than the conduct of the respondents.”
“Clause 22 of the Brochure Cannot Justify Arbitrariness” — High Court Rejects False Information Argument
“Clause 22 of the brochure cannot be invoked by the respondents… It was entirely the misrepresentation of the respondents themselves.”
BPCL attempted to rely on Clause 22 of the Dealership Brochure, which allowed it to cancel the LOI in case of false or incorrect information. But the Court noted that:
The Court held: “We are of the opinion that in the facts and circumstances of the present case, no fault can be found with the petitioner... She cannot be alleged to have indulged in falsity or given incorrect information.”
Thus, Clause 22 could not be weaponized to penalize the petitioner for BPCL's own misclassification in its advertisement.
“Petitioner Had Reached Final Stage of Operationalization — Arbitrary Denial Violates Article 14”
“The officers of the respondents had physically visited the land... found it suitable... The Retail Outlet was established... only commissioning and operationalization was to be done.”
The Court criticized BPCL’s conduct for being unilateral, opaque, and lacking in fairness, highlighting that the petitioner had even placed an order for stock, deposited ₹2.10 lakhs more in early 2020, and had the pump infrastructure nearly complete.
BPCL did not inform her of the complaint it received or the reclassification of the road. She only learned of the State highway objection through a reply affidavit during litigation, not through any formal communication.
The Court remarked: “She was not even aware that a complaint was lodged... The respondents did not even reply to her legal notice. Their conduct is highly arbitrary, for which the petitioner cannot be made to suffer.”
“Judicial Protection for Women Entrepreneurs” — High Court Invokes Article 15(3)
The Court relied heavily on its earlier rulings in:
In all these cases, the arbitrary cancellation of dealership LOIs was quashed by the Court. In Suvarna Deore, the Court specifically invoked Article 15(3) of the Constitution, observing that special protection for women was undermined by the petroleum company’s conduct.
Echoing this, the Bench in the present case held: “A woman entrepreneur has been made to run from pillar to post... she deserves relief.”
LOI Restored with Revised Terms — Petitioner to Pay Difference of ₹11.02 Lakhs for Regular Outlet
While ruling in her favour, the Court acknowledged that since the outlet lies on a State highway, the classification must now be Regular Retail Outlet, which attracts higher fees than rural ones.
The petitioner voluntarily offered to pay the difference, which BPCL quantified as:
The Court accepted the offer and directed:
“The LOI stands revived... subject to the petitioner depositing the amount of ₹11,02,000 within six weeks... The respondents shall then take all further steps to ensure the outlet is operationalized.”
“Government Corporations Must Be Held to High Standards of Administrative Fairness” — Court Sends Stern Message
This judgment sets a strong precedent on how public sector undertakings must act fairly in administrative decisions, especially where entrepreneurship, livelihood, and substantial investments are at stake.
The Court’s message is unequivocal — once a dealership is sanctioned, and the applicant has made financial and infrastructural commitments in good faith, a public entity cannot act arbitrarily to the detriment of the applicant, and then shift blame under fine print clauses.
Date of Judgment: 23rd September 2025
