Supreme Court Holds No Discretion To Reclassify Petrol Pump Applicants; Sets Aside High Court Order

A Bench of Justices Sanjay Karol and Manmohan heard an appeal by Bharat Petroleum Corporation Limited (BPCL) challenging a Madras High Court order that had directed BPCL to treat the respondent’s application for a retail outlet dealership as a Group 1 candidature instead of Group 2. The question before the Court was whether the High Court’s direction to reclassify the applicant’s category was justified in law.

The Supreme Court allowed the appeal, set aside the High Court judgment, and directed BPCL to proceed with allotment formalities in accordance with the published selection rules. The Court held that the advertisement and application form laid down a clear procedure and that no discretion existed to change the category declared by an applicant after submission. The Court noted the need for restraint in writ jurisdiction over contractual and commercial matters involving State instrumentalities, while also recognizing the duty of such bodies to act fairly. The Court, in its reasoning, observed: “Since a clear procedure stands laid down by the competent authority, there exists no room for any discretion to be exercised in favour of the respondent. The representations made by the respondent terming her application under Group 2 to be an error, cannot be considered. Even if she had the requisite land, the Rules provide no leeway for a category change to be made.” The Court further directed that BPCL proceed with the allotment process/formalities in accordance with the Rules and Regulations and recorded that no costs were awarded.

Background BPCL issued an advertisement in November 2018 inviting applications for a retail outlet dealership and classified applicants into Group 1 (applicants having suitable land as on date of application) and Group 2 (applicants having a “firm offer” for land). The respondent’s name appeared in the online list as a Group 2 applicant. She sent multiple representations (12 Feb 2019, 18 Feb 2019 and 28 July 2020) seeking reclassification to Group 1 on the ground that she possessed the requisite land, but BPCL did not accede. BPCL rejected the request on 5 April 2021, citing the selection guidelines and the online process which did not permit post-registration editing; BPCL also pointed out that draw of lots among Group I applicants had already been held.

The respondent filed successive writ petitions in the Madras High Court. One order disposed of an earlier petition with a direction that her representations be considered; subsequent proceedings recorded that if an ineligible Group II candidate were found so, Group II applications would be considered and, if no eligible candidate existed, the petitioner’s application could be considered. The Single Judge later observed that because the advertisement targeted Scheduled Caste applicants, BPCL was obligated to “extend a helping hand, even if there are some defects in the application. They must guide all those who submit their applications,” and directed consideration of the respondent as a Group 1 candidate. The Division Bench upheld that direction on the basis that the respondent was, on the relevant date, in possession of the land required by the advertisement.

On appeal to the Supreme Court, counsel for BPCL and for the respondent were heard. The Court examined the advertisement clauses requiring applicants to declare the land category and to furnish an advocate’s confirmatory letter and supporting documents; the application form’s undertaking stated that “eligibility for Retail Outlet Dealership will be decided based on information given in the application above” and warned that false or unsupported information would render candidature liable to cancellation. Applying precedents cautioning restraint in judicial interference in contractual and tender matters, the Court found no ground to override the clear procedural mandate. The Court also observed that the respondent’s repeated writ petitions, despite the clear terms of the advertisement and application, resulted in protracted litigation and potential prejudice to public interest. The appeal was allowed and the High Court order was set aside; BPCL was to continue the allotment process per the rules.

Case Details: Case No.: 2025 INSC 426 (Civil Appeal arising out of SLP(C) No. 7845 of 2024) Case Title: The General Manager, Business Network Planning (Retail), Bharat Petroleum Corporation Limited & Anr. v. P. Soundarya Appearances: For the Petitioner(s): Mr. Dhruv Mehta, Senior Counsel For the Respondent(s): Mr. Shailesh Madiyal, Senior Counsel