DB sets aside Writ Court’s Order in IOC Lease Case Involving Kargil War Widow, holds courts should not interfere in matters governed by private contractual remedies unless fundamental rights violated

16/09/2025

Srinagar, Sep 15: The High Court of Jammu & Kashmir and Ladakh at Srinagar has allowed an appeal by the Indian Oil Corporation (IOC), setting aside a judgment that had directed the company to either purchase or revoke a lease agreement involving a petrol station leased from a Kargil war widow.
A Division Bench comprising Justice Sindhu Sharma and Justice Shahzad Azeem delivered the verdict in LPA No. 70/2025, filed against the Writ Court's judgment dated September 24, 2024, in the case titled Zareena Akhter vs. Union of India & Ors.
Background of the Case
Zareena Akhter, a resident of Sopore, is the widow of Late Gh. Mohammad Khan, an Army personnel who died in the 1999 Kargil War. Under the Government of India's Operation Vijay Scheme for war widows, she was allotted a petrol pump dealership at Bumhama, Kupwara in 2004.
A lease agreement was simultaneously executed, granting IOC the right to use her land (measuring over 2 kanals) for 30 years on a monthly rent. The outlet operated under the name "M/S Shaheed G. M. Filling Station."
However, in 2010, the dealership was terminated by IOC after a surprise inspection allegedly revealed adulteration in fuel samples. This led to registration of an FIR and suspension of operations.
Akhter challenged the termination in a writ petition (OWP No. 585/2010) and, later in 2023, filed a second petition (WP(C) No. 3441/2023) seeking revocation of the lease so she could sell the property.
Writ Court Ruling
On September 24, 2024, the Writ Court dismissed the first petition citing the existence of an arbitration clause in the dealership agreement but allowed the second, directing IOC to either buy the leased land or revoke the lease agreement, citing prolonged non-use of the land and Akhter's urgent medical and financial needs.
High Court's Judgment
The Division Bench disagreed with the Writ Court's findings, stating that both the dealership and lease agreements are independent legal instruments, and disputes arising from them must be addressed separately, particularly when arbitration clauses exist in both.
The court observed that while Akhter's situation is sympathetic, legal procedures and contractual obligations cannot be bypassed, especially where specific arbitration mechanisms are laid out.
The bench emphasized that the existence of arbitration clauses in both agreements bars writ jurisdiction under Article 226 of the Constitution, unless there is a violation of constitutional rights or principles of natural justice-which the court found lacking in this case.
Observations on the Lease
While Akhter argued that the land had remained unused since 2010 and she needed to sell it due to health issues, IOC countered that they had applied for interim permission to reassign or utilize the land, as per the lease terms. The court noted that IOC had not violated the lease agreement, and that their rights to use or assign the land remained intact under Clause 4(e).
Final Order
The court held that:
"The Writ Petition under Article 226 of the Constitution ought not to be entertained where an alternative and efficacious remedy exists."
Consequently, the court set aside the Writ Court's judgment, allowed the appeal, and dismissed WP(C) No. 3441/2023.
Legal Significance: The ruling reiterates the binding nature of arbitration clauses and reinforces the principle that courts should not interfere in matters governed by private contractual remedies unless fundamental rights are violated.

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