Held, we find that the writ petition challenging the clauses was maintainable. It is not disputed that GAIL is a Public Sector Undertaking and thus qualifies under the definition of ‘State’ as per Article 12 of the Constitution. At the time of entering into contract, GAIL was enjoying a monopolistic position with respect to the supply of natural gas in the country. IPCL, having incurred a significant expense in setting up the appropriate infrastructure, had no choice but to enter into agreement with GAIL. Thus, there was a clear public element involved in the dealings between the parties. Further, writ jurisdiction can be exercised when the State, even in its contractual dealings, fails to exercise a degree of fairness or practices any discrimination. We are fortified in our view by this Court’s decision in ABL Enterprises9 and Joshi Technologies10. In the present case, GAIL’s action in levying ‘loss of transportation charges’ was ex facie discriminatory, insofar as IPCL was mandated to build its own pipeline in terms of the allocation letter and was not using GAIL’s HBJ pipeline at all. Thus, it cannot be said that merely because an alternative remedy was available, the Court should opt out of exercising jurisdiction under Article 226 of the Constitution and relegate the parties to a civil remedy. Para 21

[GAIL v. Indian Petrochemicals Corpn. Ltd., (2023) 3 SCC 629]

Leave a Reply

Your email address will not be published. Required fields are marked *

error: Do not copy the content of this website.

Terms And condition

The rules of the Bar Council of India prohibit law firms from soliciting work or advertising in any manner. By clicking on ‘I AGREE’, the user acknowledges that:

  1. The user wishes to gain more information about Re Legal, its practice areas for his/her own information and use
  2. That the information provided in the website is only for personal use or reference of the visitor and is provided only on his/her specific request.
  3. That the material available for downloading on the website and other information provided on the website would not create any lawyer-client relationship.
  4. That we are not responsible for any consequence of any action taken by the user relying on material/information provided under this website.
  5. That in case the visitor has any legal issues; he or she should seek independent legal advice.

The information provided under this website is for informational purposes only and solely available at your request. It should not be interpreted as soliciting or advertising.