ORDER The petitioner has challenged two proceedings dated 24.9.2004 passed by the second and third respondents and the proceedings dated 3.1.2005 passed by the second respondent. In the first proceedings, resolution of the panchayat has been passed, whereby and whereunder, the petitioner's contract period has not been renewed. In the second proceedings, based on the resolution, the Executive Officer has passed an order that as per the Engineering Manual of Urban Local Bodies in Tamil Nadu, the renewal of registration has to be done within three months time otherwise their names from the registration will be removed. Also, the order includes a decision that out of 15 members of the panchayat, 14 members have taken a decision not to renew his contract. Both the above decisions are under challenge and the petitioner is seeking to quash the same. 2. The case of the petitioner is that he is a contractor in Coimbatore District, doing various contract works and there is no remarks from any one at any point of time about his performance. The respondents are the authorities functioning under the provisions of the Tamil Nadu Panchayat Act. The said Act has been enacted to impart certainty continuity and to strengthen the democratic unit of self Government. The various tender and contractual works in the panchayat are being regulated by the Tamil Nadu Panchayats (Preparation of Plans and Estimates for Works and Mode and Conditions of Contracts) Rules, 1988 and also under the provisions of the Tamil Nadu Transparency in Tenders Act, 1998. 3. It is stated that the Tamil Nadu Panchayat Rules, 1988 came into force with effect from 31.12.1998 to provide transparency in the public procurement and to regulate the procedure, while inviting and accepting tenders and matters connected there with. The object of the enactment is to promote healthy competition among the tenderers and to provide fair and equitable opportunity to all the tenderers. According to Rule 18, only tenders from the registered contractors shall be considered but in exceptional cases, the panchayat can deviate from the normal process of inviting tenders subject to the limitation prescribed under Rule 11. In all other cases, the tenders should be invited only from the registered contractors. 4. According to Rule 18, only tenders from the registered contractors shall be considered but in exceptional cases, the panchayat can deviate from the normal process of inviting tenders subject to the limitation prescribed under Rule 11. In all other cases, the tenders should be invited only from the registered contractors. 4. It is the further case of the petitioner that he being one of the registered contractors in the second respondent panchayat, participated in various tenders for the last two years and obtained tenders. He has completed all the works allotted to him to the satisfaction of the respondents. It is also stated that the third respondent used to demand 2% commission to award contract work and if any contractor refused to pay the said commission, the third respondent will instruct the second respondent not to issue tender schedule to the said contractor. 5. It is submitted by the petitioner that in the above said situation, the petitioner made a representation to the first respondent, who is the Inspector of Panchayats, complaining the activities of respondents 2 and 3 in refusing to issue tender schedule to the petitioner, especially when they are bound to follow the procedure contemplated under the Tamil Nadu Transparency in Tenders Act, 1998. Immediately, the then Collector of Coimbatore District issued instruction to the second respondent to follow the mandate inbuilt in the above said Act and also directed to furnish tender schedule to the petitioner. Thereafter, the petitioner was awarded contract work on various occasions. 6. As there is no provision in the Tamil Nadu Panchayat Act and the Tamil Nadu Panchayat Rules, 1988 compelling the registered contractors to renew their names every year in the list of contractors maintained by the second respondent, the petitioner submitted a representation dated 9.8.2004 for renewal of registration of his name in the list of contractors, to which, the second respondent gave a reply by his proceedings dated 18.8.2004 that the petitioner's request will be placed before the Panchayat Council for appropriate decision. Accordingly, the same was placed before the Council on 24.9.2004 and the Council passed a resolution not to renew the petitioner's name in the list of registered contractors. 7. The further case of the petitioner is that once again on 30.9.2004, he made a representation to the second respondent requesting him to furnish a copy of the said resolution dated 24.4.2004. 7. The further case of the petitioner is that once again on 30.9.2004, he made a representation to the second respondent requesting him to furnish a copy of the said resolution dated 24.4.2004. Even though the petitioner has paid the necessary fee, the second respondent directed him to refer the Engineering Manual of Urban Local Bodies in Tamil Nadu to clarify his queries. The second respondent issued tender Notification dated 4.11.2004, wherein he conveniently introduced a clause that the registered contractors alone are eligible to participate in the process of tender, thereby prevented the petitioner from participating in the tender. Hence, the petitioner sent telegraphic representations to the first respondent complaining the action of the second respondent. 8. Under the above said circumstances, earlier the petitioner filed W.P. No. 34836 of 2004 praying for a direction to respondents 2 and 3 to renew his name in the list of registered contractors. This Court, by order dated 7.12.2004, directed respondents 2 and 3 to furnish the copy of the rejection order and the resolution passed by the panchayat council. Thereafter, the second respondent passed an impugned order dated 24.9.2004 stating that out of 15 members of the panchayat, 14 members have taken a decision not to renew his contract. 9. In the counter affidavit filed by the second respondent, it is stated that the petitioner is a registered contractor under the second respondent and he has not completed his contract works within the stipulated time. It is further stated that during the year 2004, the petitioner's contract was cancelled as per the Resolution No. 125 of 2004 dated 11.6.2004. It is also stated that the third respondent town panchayat passed unanimous resolution on 24.9.2004 refusing to extend the contract period of the petitioner since he has not completed the contract works during the year 2002-2003, 2003-2004 and 14 members of the panchayat council out of 15 were against the petitioner's extension of contract. Therefore, the respondents pray for dismissal of the writ petition. 10. Heard Mr. N. Manokaran, learned counsel appearing for the petitioner and Mr. N. Senthil Kumar, learned Additional Government Pleader for the first respondent and Mr. P.S. Jayakumar, learned counsel appearing for respondents 2 and 3. 11. It is contended by the learned counsel for the petitioner that the impugned proceedings dated 24.4.2004 and 3.1.2005 are without notice to the petitioner and not affording an opportunity of hearing. N. Senthil Kumar, learned Additional Government Pleader for the first respondent and Mr. P.S. Jayakumar, learned counsel appearing for respondents 2 and 3. 11. It is contended by the learned counsel for the petitioner that the impugned proceedings dated 24.4.2004 and 3.1.2005 are without notice to the petitioner and not affording an opportunity of hearing. The resolution passed by the panchayat and the decision taken by the second respondent are contrary to the Rules and the principles of natural justice. 12. The learned counsel for the petitioner also contended that it is only a renewal of the registration and there is no extension of contract. He would contend that in the impugned proceedings of the second respondent dated 24.9.2004, it was communicated that if the registration has not been made within the time prescribed, then it will have an automatic cessation of the registration and therefore, it only follows the removal of the name of the contractors. In this regard, the learned counsel argued that Rule 13(7) contemplates an opportunity of hearing to the parties and only after receipt of explanation, if any, decision can be taken. 13. Per contra, learned counsel for respondents 2 and 3 has strenuously contended that the work performance of the petitioner for the past periods viz., 2003-2004, 2004-2005 has not been satisfactory and on an earlier occasion also, a contract was cancelled for having not done the work within the stipulated time. The authorities are empowered to take a decision, if the contractor has not followed the principle laid down in performance of the contract. Therefore, the decision taken by the authorities is valid and it cannot be questioned. Learned counsel would also contend that based on extension of contract, the registration has not been done and therefore, there is no continuation of contract. 14. Learned Additional Government Pleader appearing for the first respondent has submitted that the procedure contemplated under the Act and Rules have to be followed by the second respondent and it is followed in this case. 15. I have given heedful consideration to the submissions of the learned counsel appearing for the parties and also perused the material documents filed in support of their case and the relevant provisions of the Act and the Rules. 16. It is not in dispute that the petitioner is a registered contractor. 15. I have given heedful consideration to the submissions of the learned counsel appearing for the parties and also perused the material documents filed in support of their case and the relevant provisions of the Act and the Rules. 16. It is not in dispute that the petitioner is a registered contractor. He has to apply for the renewal of contract within the time prescribed as per the Engineering Manual of Urban Local Bodies in Tamil Nadu. In the said Manual, it is stated that renewal of registration has to be done within the time and registration of the contractor shall be renewed every year on payment of fees as prescribed and it should be made within three months from the commencement of the financial year. However, if a contractor fails to renew his name within the time frame, his name shall be deemed to have been removed from the list of contractors. Belated application for renewal shall be considered only on production of required documents along with the payment or penalty of Rs.500/-. 17. It is also seen from Rule 13(7) of the Tamil Nadu Panchayats (Preparation of Plans and Estimates for Works and Mode and Conditions of Contracts) Rules, 1998 that the names of the contractors may be removed from the register of contractors by the Executive Authority or Commissioner or Secretary as the case may be for any proved misconduct or any financial incapacity or for any other reasons provided that before ordering the removal of the name of any contractor from the register, a notice in writing shall be given to him to show case against such removal and his explanation be obtained in writing for consideration and place the details for consideration of the village panchayat or panchayat union council or district panchayat as the case may be. 18. A reading of the above provision would make it clear that the removal of a contractor for any other reasons, should be done after issuing notice and on obtaining explanation and then, the matter has to be taken into consideration and decision has to be arrived at. From the resolution of the panchayat as well as the impugned order passed by the second respondent in his proceedings dated 24.9.2004, it is clear that there was no procedure for issuing any notice or calling for explanation before removal or not extending the renewal of the contract. From the resolution of the panchayat as well as the impugned order passed by the second respondent in his proceedings dated 24.9.2004, it is clear that there was no procedure for issuing any notice or calling for explanation before removal or not extending the renewal of the contract. If there is an order by the second respondent based on the resolution to the effect that out of 15 members, 14 members have objected to it, it must be done in accordance with the Rules contemplated, after issuing a notice to the petitioner and after affording an opportunity of hearing. Therefore, the resolution of the panchayat and the decision taken by the second respondent are not in conformity with the Rules as stated supra. 19. In view of the above, the decision of the panchayat by the impugned proceedings dated 24.9.2004 cannot be sustained and the proceedings of the second respondent dated 3.1.2005 are set aside. However, they are not precluded from proceeding further, after issuing a notice and after affording an opportunity to take a decision, if there is any reason for not renewing the registration or for removal then it could be done after affording an opportunity of hearing and after following the procedure contemplated under the above provisions. Therefore, it is open to the respondents to proceed in accordance with the procedure contemplated and in accordance with law as discussed above. 20. In the light of the discussion made above, in my considered opinion, the impugned proceedings are unsustainable in law and therefore the same are set aside and the matter is remitted back to the respondents for fresh consideration after issuing appropriate notice and following the procedure and also affording reasonable opportunity of hearing to the parties concerned and pass appropriate orders within a period of eight weeks from the date of receipt of a copy of this order. 21. The writ petition is allowed on the above terms. No costs. Petition allowed.