Himachal Pradesh High Court overturns LPG dealership rejection, citing “Flexible Policy” of Oil companies

Shimla, July 11,

The High Court of Himachal Pradesh overturned a decision by Bharat Petroleum Corporation Ltd. (BPCL) to reject an LPG distributorship application, emphasizing the “flexible policy” adopted by oil companies regarding land suitability. The judgment, delivered by Chief Justice G.S. Sandhawalia and Justice Ranjan Sharma, allows the appellant, Vijay Kumar, another opportunity for field verification of his offered land.
The case, LPA, challenged a December 27, 2024, judgment by a learned Single Judge that had dismissed Kumar’s writ petition.
Vijay Kumar had applied for an LPG distributorship in Dharampur (Rural), District Mandi, H.P., under the Scheduled Caste Category, following a joint public notice issued by Indian Oil Corporation Ltd., Bharat Petroleum Corporation Ltd., and Hindustan Petroleum Corporation Ltd. on August 13, 2017. He was selected in a draw of lots on January 11, 2018, and was asked to deposit Rs. 20,000 and submit relevant documents.
The core issue arose during the Field Verification of Credentials (FVC) on January 17, 2018, when a BPCL official, Ravinder Singh, found “overhanging high tension electric wires passing through the plot” offered by Kumar. Although Kumar stated he would address the issue and carve out a suitable portion of his larger land, his application was rejected on January 30, 2018, and subsequently on April 15, 2020, after a representation. The rejection cited failure to meet eligibility criteria, specifically the requirement that land for a godown should be “plain and contiguous and free from live overhead power transmission or telephone lines”.
However, the High Court highlighted that the appellant had subsequently “removed the deficiencies as such of the electric wires over the land”.
Chief Justice G.S. Sandhawalia stated, “The principle on the basis of which the learned Single Judge rejected the case of the writ petitioner and dismissed the writ petitions apparently does not suffer from any infirmity, if one has to look from the strict principles of the applicant being bound by his offer of the plot. However what has to be kept in mind is that the respondent-Corporation themselves have softened the rigour of the piece of land which has to be offered”.
The court referenced two Supreme Court judgments, Mrinmoy Maity vs. Chhanda Koley and others (AIR 2024 SC 2717) and Jagwant Kaur vs. Union of India (2025) 2 Supreme 337, which emphasized the flexibility introduced in the selection guidelines for LPG distributorships. These judgments affirmed that applicants could offer alternate land if the initially proposed land was found deficient or unsuitable, provided the specifications were met.
The High Court observed that the initial rejection failed to consider this “flexible policy”. The court distinguished the present case from previous rulings where rejections were upheld due to fundamental defects like the absence of registered lease deeds or concealment of co-ownership.
“The aspect of flexibility and the law of the Apex Court on the said issue having not been brought to the notice of the learned Single Judge thus leads us to hold that the action of the respondents at the time of remand was not in consonance with the policy in vogue which the learned Single Judge failed to keep in mind,” the judgment reads.
Consequently, the High Court set aside the Single Judge’s judgment and the rejection orders of January 30, 2018, and April 15, 2020.

The court has directed a fresh FVC of the land offered by Vijay Kumar within four weeks, with the matter to be re-considered in light of the changed circumstances and the oil companies’ flexible policy.

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The HimachalScape Bureau comprises seasoned journalists from Himachal Pradesh with over 25 years of experience in leading media conglomerates such as The Times of India and United News of India. Known for their in-depth regional insights, the team brings credible, research-driven, and balanced reportage on Himachal’s socio-political and developmental landscape.

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Himachalscape bureau

The HimachalScape Bureau comprises seasoned journalists from Himachal Pradesh with over 25 years of experience in leading media conglomerates such as The Times of India and United News of India. Known for their in-depth regional insights, the team brings credible, research-driven, and balanced reportage on Himachal’s socio-political and developmental landscape.