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2013 DIGILAW 575 (CAL)

PASCHIM BANGA NARI O SISHU KALYAN SANSTHA v. STATE OF WEST BENGAL

2013-08-13

SANJIB BANERJEE

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JUDGMENT 1. The State has handed over copies of two letters dated November 14, 2011 and February 15, 2012 issued by the District Magistrate, North 24-Parganas to the Principal Secretary, Department of Women & Child Development & Social Welfare. Both letters recommend the relevant Integrated Child Development Scheme project to be taken up by the Government from the NGOs inter alia as "there arc gross irregularities and functioning is not smooth." There are several other reasons indicated that would, probably, justify any Government action against the NGOs if they were found to be correct, but it is not necessary to go into such matters at this stage. 2. The grievance of the petitioner society is that the Secretary to the department, by a unilateral order of May 20, 2013, decided that the permission granted to the petitioner society to implement the ICDS project would not be renewed. If the letter or the memorandum had stopped there, an argument may have been possible on the part of the State by referring to Clause 15 of the agreement between the petitioner society and the Government for the implementation of the project. However, the Secretary asserted that the "performance of the project run by the said NGO is not satisfactory" and went on to add that there were "serious nature of irregularities ... committed by the NGO." 3. Clause 15 of the relevant agreement dated September 9, 1998 that the State refers to, provides as follows: "Notwithstanding anything contained in these presents, the Governor reserves the right to terminate the present agreement at any time before the date of termination of this agreement without assigning any reason thereto and to take over the aforesaid ICDS Project in his own part for the effective running and implementation of the programmes of said ICDS Project." 4. It is too late in the day, especially in our constitutional scheme of things and the wide sweep of Articles 11, 19 and 301 of the Constitution, for the State or any instrumentality of the State to suggest that the State or any instrumentality of the State may deign to terminate a contract or renege thereon with such gay abandon as a private person in a private arrangement may. The Constitution mandates all action of the State and its instrumentalities to be informed by reason and be reasonable and without discrimination. The Constitution mandates all action of the State and its instrumentalities to be informed by reason and be reasonable and without discrimination. For sure, the State and its instrumentalities are allowed adequate elbow-room as a contracting party to not enter into contractual relationships or resile therefrom, provided the decision is not arbitrary or "unconscionable and a fair procedure is adopted. 5. The relevant clause that the State refers to cannot override the Constitutional command and is subject to the State decision to terminate the agreement being fair and reasonable. The clause does not relieve the State of its obligation as a model contracting party to adopt an equitable procedure before terminating the agreement. 6. In any event, the decision of May 20, 2013 was stated to be on account of the petitioner society not conforming to the conduct that was expected of it; and, charges of irregularity are also levelled against it. No State or instrumentality of the State can level a charge and cause a stigma to be attached to any party without affording the party a reasonable opportunity of presenting its version in defence to the charge. Clause 15 may be printed in Government contracts, but Articles 14, 19 and 301 of the Constitution would not permit the State to resort to any arbitrary action by virtue thereof; or, not justify such action when it is subjected to judicial review merely by reference to such clause. 7. One would have thought that in the seventh decade of the Constitution and after its consistent judicial interpretation on such aspect, the Court would not be subjected to the agony of having to reiterate the elementary principles of fair play and reasonableness on which State action is to be founded. 8. It is true that the agreement in this case may have expired by efflux of time, but it has also to be recognised that the petitioner society continued to run and manage the project for several years after the expiry of the time stipulated in the agreement. It was open to the State to invite offers for the project to be implemented and the petitioner society may not have been heard to complain against such action. It was open to the State to invite offers for the project to be implemented and the petitioner society may not have been heard to complain against such action. But once it is evident that the petitioner society has been removed on the ground of a perception of its improper conduct, as evident from the letters relied on by the State, it was incumbent on the State to call upon the petitioner society to explain or justify its conduct before annulling the arrangement. 9. The unilateral decision of May 20, 2013 is found to be arbitrary, unconscionable and in derogation of the constitutional requirement of a fair procedure to be adopted by the State before arriving at a decision adversely affecting a person. In such order founding the decision contained therein on allegations against the petitioner society without affording the petitioner society an opportunity to deal with the same, it is in abject violation of the fundamental canons of natural justice. 10. WP No. 19537(W) of 2013 is allowed by quashing the notice dated May 20, 2013 but by leaving the respondent authorities free to take appropriate steps in accordance with law in respect of the matters covered by the relevant notice upon affording the petitioner society a fair opportunity of dealing with the charges that may be levelled against such society. 11. There will be no order as to costs. 12. Certified website copies of this order, if applied for, be urgently made available to the parties, subject to compliance with all requisite formalities.