JUDGMENT 1. - The petitioner challenged the order dated 28.8.92 passed by the Resident Engineer Head Quarters, Rajasthan Housing Board, Jaipur, by which, the petitioner-Firm has been black-listed for the purpose of any contract from the Rajasthan Housing Board. 2. The learned counsel for the petitioner submits that the order dated 28.8.92 is highly arbitrary, malicious and contrary to the principles of natural justice. It was alleged by the petitioner that the basic object of passing this order after lapse of period of 5 years is to defeat the just payments due to the petitioner Firm and also to make face saving by the respondents in the public by which shifting their liability to the petitioner firm. Therefore, the order dated 28.8.92 is ex facie illegal and is violative of the Article 14 of the Constitution of India and other fundamental rights of trade and profession under Articles 19(1) (g) and 21 of the Constitution of India. 3. The petitioner Firm is a registered partnership Firm working in the name and style of M/s. Ashok Construction Company and this Firm has got specialisation in the construction of buildings and is carrying out various construction works under various contracts with the Rajasthan Housing Board and Jaipur Development Authority. The petitioner Firm was declared as `A' Class contractor by the Rajasthan Housing Board by which it has been facilitated to put in tenders for unlimited amount without making payment of the earnest money. The State Government under Section 52(1)(c) of the Rajasthan Housing Board Act, 1970 (for short, the Act of 1970) the State of Rajasthan has power to frame rules in the manner and form in which the contracts shall be entered into under Section 25. Under Section 53 of the act of 1970, the Board has got the power to make regulations with the prior approval of the state Government and under section 54 the Board can make bye-laws not inconsistent with the Act of 1970 and the rules and regulations framed thereunder. In pursuance to the provisions of Section 26 of the act of 1970, the Board undertook to construct quarters for the Police employees in the Chandpole Police Lines, Jaipur, and also in the Rajasthan Police Academy, Shastrinagar, Jaipur. 4. The Rajasthan Housing Board invited tenders for the execution of the building work of the above noted works. In pursuance to the provisions of Section 26 of the act of 1970, the Board undertook to construct quarters for the Police employees in the Chandpole Police Lines, Jaipur, and also in the Rajasthan Police Academy, Shastrinagar, Jaipur. 4. The Rajasthan Housing Board invited tenders for the execution of the building work of the above noted works. The petitioner Firm was allotted contract for the construction work of 90 police employees quarters at the Chandpole Police Lines and 120 Police quarters at the Rajasthan Police Academy, Shastrinagar, Jaipur. The Rajasthan Housing Board provided drawings and specifications and structural designing to the petitioner Firm. 5. Learned counsel for the petitioner contended that the drawing and specification which was provided by the Rajasthan Housing Board was not up to the mark and to this effect the petitioner Firm wrote a letter dated 22.10.86 to the Resident Engineer, Rajasthan Housing Board, to change the specification of the foundation and RCC design. In reply to the letter the petitioner Firm was asked to start the work immediately. In the meantime, on 16.6.1987, one block of 12 quarters in Zone 5 of the Rajasthan Police Academy, Shastrinagar, Jaipur collapsed. After this incident, the Rajasthan Housing Board vide its order dated 17.6.87, withhold all the payments due to the petitioner Firm. Consequently, the petitioner Firm filed a writ petition in the as High Court which was registered as D.B. Civil Writ Petition No. 2167/87 challenging the withholding the payment of the petitioner Firm. The Division Bench of this Court vide its order dated 1.11.88 rejected the writ petition with the observation that the petitioner will be at liberty to file a civil suit to vindicate his rights. However, the Court ordered for calling a report from the Chairman of the Rajasthan Housing Board for the reasons due to which of the building collapsed. On receipt of the report from the Rajasthan housing Board the Court vide order dated 8.12.1988, ordered to recover the amount of loss of the collapsed building from the Engineers concerned and report back within a period of three months. But, no action was taken by the Rajasthan Housing Board till then nor any report has been submitted as desired by the High Court. But, no action was taken by the Rajasthan Housing Board till then nor any report has been submitted as desired by the High Court. Besides all this, the Resident Engineer, Headquarters, Rajasthan Housing Board, Jaipur issued the order dated 28.8.1992 which is the subject matter of this writ petition, by which, the petitioner Firm has been black-listed as mentioned above. 6. The petitioner challenged the legality of the order dated 28.8.1992 on several grounds: It is submitted that the contracts in reference are regulated by Sections 22 to 25 of the Act of 1970 and it is only the Rajasthan Housing Board who can take any decision whatsoever with reference to the passing of this order. Whereas this order has been passed by the Resident Engineer on behalf of the Chief Engineer. Neither the Chief Engineer nor the Resident Engineer come within the definition of the `Board' as defined in Section 4 of the Act of 1970 and thus this order dated 28.8.1992 is perverse, void, illegal and without jurisdiction and deserves to be quashed. Any dispute arising out between the parties has to be regulated in accordance with the terms and conditions of the contract or the general condition of the contract and any dispute if arises shall only be referred to the Arbitrator and no proceedings have been started by the Board with reference to Arbitration by now. The petitioner Firm has moved to the District Court for appointment of Arbitrator in respect of contract and the District Court appointed Arbitrator in the matter of each contract and the arbitration proceedings are going on. 7. Besides all the aforesaid contentions, the main contention of the learned counsel is that a contractor who is being black-listed must be afforded opportunity of hearing and not doing so, the order dated 28.8.92 passed by the Rajasthan Housing Board is against the principles of natural justice and the same should be set aside. 8. In this regard to the learned counsel for the petitioner has cited the following judgments 9. In the case Ashok Kumar v. Rajasthan Housing Board, RLR 1990 (2) 647 the petitioner's contract was accepted by the Housing Board. Thereafter Housing Board forfeited earnest money and also debarred petitioner from taking tender from the Board in future on the ground of breach of contract on the part of petitioner. In the case Ashok Kumar v. Rajasthan Housing Board, RLR 1990 (2) 647 the petitioner's contract was accepted by the Housing Board. Thereafter Housing Board forfeited earnest money and also debarred petitioner from taking tender from the Board in future on the ground of breach of contract on the part of petitioner. No show cause notice, given-It was held - "Order debarring him from obtaining tender forms in future is against principles of natural justice and as such quashed. 10. In the case Joseph Vilangandan v. The Executive Engineer (P.W.D.) Ernakulam, AIR 1978 Supreme Court 930 , the Apex Court has held that- "Opportunity to represent the case should given to contractor." 11. In the case M/s. Erusian Equipment and Chemicals Ltd. v. State of West Bengal, AIR 1975 Supreme Court 266 it was held by the Apex Court that a person is entitled to be heard before his name is put on black list. 12. In the case Govinda Chandra Mishra v. The Superintendent, Government Ayurvedic Pharmacy, Bolangir, AIR 1992 Orissa 37 it was held as under : 13. "Blacklisting a businessman is a stigma and affects his career in the business and prospects therein. Accordingly such blacklisting has civil so consequences. It affects reputation of the person black-listed not only in his dealings with other private persons. So, principles of natural justice is required to be followed in such cases. In the show cause notice, the petitioner was not called upon to explain why the outstanding amount should not be recovered or explained why he should not be blacklisted, the order being viollative of principles of natural justice was liable to be quashed." 14. In the case Raghunath Thakur v. State of Bihar, 1989 (1) Supreme Court Cases 229 the Apex Court has held as under : "Blacklisting of contractor cannot be done without affording an opportunity of hearing to the affected party. 15. Mr. Garg, learned counsel appearing on behalf of the respondents is lot able to submit the reason as to why the petitioner has not been given opportunity of being heard prior to passing of the order dated 28.8.92. 16. Mr. Garg only submits that the order dated 28.8.1992 was rightly passed on the basis of enquiry conducted by the Housing Board. 17. 16. Mr. Garg only submits that the order dated 28.8.1992 was rightly passed on the basis of enquiry conducted by the Housing Board. 17. It is not disputed that in the instant case also no opportunity of hearing was afforded to the petitioner Firm blacklisting it vide order dated 28.8.1992 by the Resident Engineer. In view of the ratio decided by the Apex Court and other High courts it is necessary to afford opportunity of hearing to the affected party prior to passing of order of black listing. 18. The writ petition is, accordingly, allowed. The order dated 28.8.1992 is set aside. 19. However, the Rajasthan Housing Board is free to take steps for blacklisting the petitioner Firm in accordance with the law i.e. after giving due notice to the petitioner Firm and opportunity of making representation.Writ petition allowed. *******