A cocktail of petrol and cola is unlikely to do your stomach or your car any good. But what’s even harder to digest is the fact that a government agency would be injudicious enough to use soft drink bottles to collect samples of petrol to be tested for adulteration.
This imprudent act has led to Hindustan Petroleum Corporation Ltd (HPCL) losing a case against a fuel pump owner, who, the former alleged, had been doctoring his petrol. The Bombay High Court upheld an arbitral award in favour of Snehdeep Auto Centre, which ran a petrol pump on SV Road at Bandra.
On July 25, Justice Anoop Mohta upheld the award, observing, “The learned arbitrator has recorded rightly that the drawing of sample directly from the underground MS tank 1 during the inspection…and further using the ordinary soft drink bottles instead of sampling equipment for the purpose were not correct; and as per the recommended procedures.”
He added that though the proprietor, one Naresh Advani, had acquiesced to the collection, this did not mean that industry guidelines could be ignored.
Another mistake made by HPCL was sending the sample to an unscheduled lab in Manmad, for which there was no justification. Moreover, the specimens were collected from different tanks.
The arbitrator had also added, “Therefore, it is not possible to compare the test reports of the retail outlet sample with the reference sample, which was a requirement under the law.”
On June 1, 1995, HPCL and Advani, entered into a dealership agreement. During an inspection in February 2001, HPCL’s inspectors noticed problems, which were brought to the dealer’s notice.
A sample tested at the Manmad lab revealed the unleaded petrol in the underground tanks failed to meet quality standards, and the owner was informed via a letter on October 26, 2002.
HPCL then ended its agreement with Advani and took possession of the premises on December 11, 2002.
On June 20, 2005, the matter was referred to arbitration, as per a clause in the agreement.
The arbitrator passed an award on April 10, 2008, concluding that both HPCL and the anti-adulteration cell of ministry of petroleum and natural gas had ‘not followed the prescribed guidelines’ for sampling and testing.
HPCL was directed to pay Advani Rs 9,94,068 towards full value of the product stock it took from him when the agreement was terminated.
However, due to various technical faults on Advani’s part, the high court modified the interest in the arbitral award from 18% commencing 2001 to 12%.