Bhardwaj Agencies v. J and K Medical Supplies Corporation Ltd. Jammu
2021-12-24
TASHI RABSTAN
body2021
DigiLaw.ai
JUDGMENT : Tashi Rabstan, J.-Instant petition has been filed by the petitioner-firm through its Proprietor seeking quashment of Order No.28 dated 13.10.2021 issued by the respondent No.2, whereby the petitioner has been debarred/blacklisted from J&K Medical Supplies Corporation Ltd. for a period of two years, with a further direction to respondents to allow the petitioner-firm to participate in the tendering process for finalization of rate contract for procurement of medicines and medical equipment without any hindrance, obstruction or interruption. 2. Briefly, facts leading to filing of the present writ petition are that petitioner is a firm dealing with surgical, pharmaceutical, medical equipments, lab. kits, physiotherapy, hospital furniture and machinery. The petitioner-firm is duly registered with the J&K Medical Supplies Corporation Ltd. Respondents issued e-bid for finalization of rate contract for supply of “Anti Viral and other medicines related to Covid-19” bearing reference No. JKMSCL/Anti-Viral Medicines/2021/458 dated 03.04.2021. The petitioner being fully eligible in terms of the aforesaid e-bid notification, participated in the finalization of rate contract after depositing fee of Rs.10,000/- and submitted his e-bid on 16.04.2021 after the petitioner having been authorized by M/s Protect Telelinks to submit the bid, process the same further, to raise invoice, enter into a tripartite contract with the respondent No.1 as per the requirements and to receive payments in reference to aforesaid e-bid. The authorization was duly given in favour of the petitioner firm by Mr. Madan Mohan authorized signatory of M/s Azzurra Pharamconutrtion who was empowered by Protect Telelinks to quote manufacturing products in all the institutes in domestic market for Government/PSUs/Private Hospitals vide authorization dated 22.01.2021. Soon after submission of e-bid by petitioner, the respondent No.3 issued communication dated 15.05.2021 to the petitioner stating therein that M/s Protech Telelinks vide letter 06.05.2021 have intimated that the petitioner has given fake authority letter on its behalf in the aforesaid tendering process and asked to submit a reply within a period of two days, i.e., by 17.05.20221. It is pertinent to mention that letter of Protech Telelinks dated 06.05.2021 was not enclosed with the said communication dated 15.05.2021 and also in view of the lockdown/restrictions imposed due to the second wave of Covid-19 pandemic, the petitioner was not in a position to submit proper reply and as such sought extension of time in submission of the reply vide his letter dated 17.05.2021.
On 27.07.2021, the respondent No.4 issued show cause notice bearing No.JKMSCL/Adm/2073-78 dated 27.07.2021 by virtue of which the petitioner was called upon to explain his position as to why action warranted under Clause 36 of Annexure-B (terms and conditions of bid and rate contract) and Policy of HJMSCL may not be initiated against him. The petitioner on receipt of aforesaid show cause notice contacted Mr. Madan Mohan, authorized signatory of M/s Azzurra Pharamconutrition who is authorized representative of M/s Protech Telelinks to clarify the issue as to why the petitioner was being unnecessarily harassed by the respondents and as to why authority letter issued to him is being disputed. Upon this, M/s Protech Telelinks issued a letter dated 29.07.2021 to the respondent No.2 in which it was clarified that the petitioner is authentic dealer who has been authorized by one of the authorized persons of the company. The aforesaid letter dated 29.07.2021 was also sent to the petitioner by proprietor of M/s Azzurra Pharamconutrition through WhatsApp on 29.07.2021 itself. However, the petitioner being extra cautious demanded that the said communication dated 29.07.2021 be addressed to him directly by M/s Protech Tellinks in order to avoid any further complications or misunderstanding in future. Upon this, said communication was sent by Mr. Rajat an employee of M/s Protech Telelinks to the petitioner on 29.07.2021. Upon being fully satisfied, the petitioner addressed a communication dated 29.07.2021 to the respondent No.2 enclosing therewith the aforesaid clarification with regard to the authenticity of authorization issued in its favour.
Upon this, said communication was sent by Mr. Rajat an employee of M/s Protech Telelinks to the petitioner on 29.07.2021. Upon being fully satisfied, the petitioner addressed a communication dated 29.07.2021 to the respondent No.2 enclosing therewith the aforesaid clarification with regard to the authenticity of authorization issued in its favour. M/s Azzurra Pharamaconutrition in order to solidify the position that the petitioner is the authorized party sent an email dated 07.08.2021 to respondent No.2 clarifying that the confusion with respect to authenticity of authorization issued in favour of the petitioner happened due to their internal miscommunication as they were communicating during Covid-19 pandemic with limited resources only, but, respondent No.5 without affording any opportunity of being heard to the petitioner after receiving the aforesaid clarification, and without associating the petitioner in the enquiry which was conduct at the back of the petitioner, made highly erroneous and perverse recommendations against the petitioner and the respondent No.2 without recording any reason worth the name or without coming to any findings and without affording an opportunity to the petitioner to explain his position with respect to the inquiry conducted by respondent No.5, has issued the impugned order dated 13.10.2021 whereby the petitioner has been debarred/blacklisted from JKMSCL for a period of two years. Being aggrieved of order dated 13.10.2021 present writ petition has been filed on the following grounds:- (i) That order impugned is violative of basic legal requirement of following the principles of natural justice as the respondents have not given an opportunity of being heard to petitioner before taking punitive action against it; (ii) That order impugned is stigmatic and harsh and same has been issued by the respondents seeking blacklisting of petitioner concern without providing any opportunity of being heard, as such, the same is liable to be quashed. (iii) That the petitioner has challenged the impugned order on the ground that firstly, the petitioner has not been given a fair, proper and adequate opportunity of being heard and secondly, that the complete process is tainted by arbitrariness and non-application of mind. 3. Respondents have filed the objections contending therein that the petitioner has been blacklisted for two years on account of submitting false authorization with his bid documents on behalf of M/s Protech Telelinks.
3. Respondents have filed the objections contending therein that the petitioner has been blacklisted for two years on account of submitting false authorization with his bid documents on behalf of M/s Protech Telelinks. It is contended that the as per terms and conditions of NIT, the petitioner has submitted an undertaking which under clause 13 provides as under:- “Authorization from principal manufacturer/importer (On the letterhead of Principal manufacturer/Sole importer)/in case authorization to the bidder is furnished by the Sole Importer/India subsidiary, document confirming authorization from foreign Principal Manufacturer in favour of India Subsidiary/Sole Importer is to be submitted)”. It is contended in the objections that in terms of the aforesaid specific clause, petitioner intentionally and deliberately submitted fake authorization on behalf of M/s Protech Telelinks. For further verification, a team was constituted to visit Himachal and Faridabad office to ascertain the authentication/genuineness of the documents. The said team formulated a questionnaire replied by Principal manufacturer, M/s Protech Telelinks, through its partner Aniket Dingra who categorically stated that authority letter and subsequent communication dated 29.07.2021 are fake. Thus, the verification led to issuing of order dated 13.10.2021 thereby blacklisting the petitioner from participating in tender process with the answering respondents. It is also contended that the petitioner has been afforded opportunity of being heard twice, vide letters dated 15.05.2021 and 27.07.2021, before blacklisting him, hence he cannot plead that he has not been granted any opportunity of hearing. It is also contended that the order of blacklisting has been issued keeping in view the terms and conditions of the NIT, specifically clause 36, which provides that any certificate/document/information submitted by the bidder found to be false/forged/fabricated etc. then bidder shall be liable for the appropriate legal action along with disqualification, banning suspension etc. for the limited or unlimited period. 4. Heard learned counsel for the parties and perused the record. 5. As maintained in the writ petition, the petitioner had participated in the tendering process in reference to tender, bearing no. JKMSCL/Anti-Viral Medicines/2021/458 dated 03.04.2021, by submitting his e-bid dated 16.04.2021. The respondent no.1 thereafter issued letter dated 15.05.2021 to the petitioner alleging that the petitioner had submitted fake authority letter and required the petitioner to submit his reply. It is further case of the petitioner that vide letter dated 17.05.2021, the petitioner sought extension of time on account of Covid-19 restrictions and lockdown.
The respondent no.1 thereafter issued letter dated 15.05.2021 to the petitioner alleging that the petitioner had submitted fake authority letter and required the petitioner to submit his reply. It is further case of the petitioner that vide letter dated 17.05.2021, the petitioner sought extension of time on account of Covid-19 restrictions and lockdown. The proceedings were deferred and thereafter the respondent issued show cause letter dated 27.07.2021 informing the petitioner that the authority letter submitted by the petitioner is fake and sought his explanation as to why an action under Clause 36 of the terms and conditions of bid and rate contract, and Policy of JKMSCL should not be initiated against him. The petitioner submitted his reply vide letter dated 29.07.2021 attaching the authority/clarification letter which he has received from the M/S Protech and its authorized representative electronically. The respondents on the receipt of the same constituted a Committee, vide Order no. JKMSCL/258/2255-61 dated 06.08.2021, which visited the original manufacturer at Sirmour, Himachal Pradesh and Faridabad office, where the owner of M/S Protech denied the authority letter and the clarification letter dated 29.07.2021 as fake. Based upon the report submitted by the Verification Committee, the impugned Order no.28 of 2021 dated 13.10.2021 came to be issued whereby the petitioner firm has been debarred/blacklisted from JKMSCL for a period of 02 years from the date of issuance of impugned order. The respondents have contended that vide show cause notice dated 27.07.2021 the petitioner has been afforded the opportunity of being heard as is required under law and no further opportunity was required to be given to the petitioner before passing the order impugned. 6. Learned counsel for the petitioner has contended that the show cause notice was only for the purpose of initiation of action and when the said action was initiated, the verification committee was constituted at the back of the petitioner, which Committee did not at all associate the petitioner in the verification process and submitted report at his back, as a result of which the petitioner was condemned unheard in the matter. It is also the case of the petitioner that neither the verification report was made available to the petitioner-firm nor was given an opportunity to confront the findings returned in the verification report dated 12.08.2021.
It is also the case of the petitioner that neither the verification report was made available to the petitioner-firm nor was given an opportunity to confront the findings returned in the verification report dated 12.08.2021. The aforesaid verification report was submitted to the Disciplinary Committee, which verification report was acted upon by the Disciplinary Committee in its meeting held on 01.10.2021 by recommending blacklisting of the petitioner firm. Learned counsel for the petitioner has also contended that no opportunity of being heard has ever been afforded by the Disciplinary Committee to the petitioner before making the recommendations against the petitioner-firm thereby depriving the petitioner of right to agitate against the verification report as well as the quantum of punishment sought to be recommended against the petitioner. Respondent no.2 on receipt of the recommendation did not put the petitioner to any notice nor was any opportunity ever afforded to the petitioner to show cause against the penalty of blacklisting sought to be imposed upon the petitioner and straightway passed the order impugned without returning his own findings by completely accepting the recommendations of the Disciplinary Committee. Thus, the impugned decision is actuated with arbitrariness and non-application of mind. It is specifically argued that the petitioner could have been imposed with a variety of punishments/penalties but it has been imposed with the harshest punishment of blacklisting which is termed as a civil death of a person. The respondents have not denied in their reply that the petitioner was given an opportunity or hearing by the Verification Committee or by the disciplinary committee or even by respondent no.2. Learned counsel argued that had an opportunity of being heard been given to the petitioner, the petitioner would have confronted the original manufacturer with the clarification dated 29.07.2021 which was received by him electronically from the original manufacturer as well as its authorized representatives. 7. In the above backdrop, it would be most appropriate to say that a fair opportunity would require that the petitioner is served with the verification report and other material, relied upon by the respondents in blacklisting the petitioner. It is apparent from the objections filed by the respondents that the petitioner was not provided with the report of the Verification Committee nor was any other material provided to it. A fair hearing gives a sense of satisfaction and reposes the trust of public in the process of law.
It is apparent from the objections filed by the respondents that the petitioner was not provided with the report of the Verification Committee nor was any other material provided to it. A fair hearing gives a sense of satisfaction and reposes the trust of public in the process of law. Learned counsel for petitioner has heavily relied upon a judgment of the Hon’ble Supreme Court of India in Medipol Pharamceutical India Pvt. Ltd. Vs. Post Graduate Institute of Medical Education & Research and others reported as MANU/SC/0585/2020 in which it has been held as under:- “In Kulja Industries Ltd. v. Chief General Manager, Western Telecom Project BSNL MANU/SC/1014/2013 : (2014) 14 SCC 731 , this Court referred to the leading judgment of Erusian Equipment (supra) and subsequent decisions of this Court, following the ratio of this decision, as follows: 18. The legal position on the subject is settled by a long line of decisions rendered by this Court starting with Erusian Equipment & Chemicals Ltd. v. State of W.B. [MANU/SC/0061/1974 : (1975) 1 SCC 70 ] where this Court declared that blacklisting has the effect of preventing a person from entering into lawful relationship with the Government for purposes of gains and that the authority passing any such order was required to give a fair hearing before passing an order blacklisting a certain entity. This Court observed: (SCC p. 75, para 20) 20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains. The fact that a disability is created by the order of blacklisting indicates that the relevant authority is to have an objective satisfaction. Fundamentals of fair play require that the person concerned should be given an opportunity to represent his case before he is put on the blacklist. Subsequent decisions of this Court in Southern Painters v. Fertilizers & Chemicals Travancore Ltd. MANU/SC/0294/1994 : [1994 Supp (2) SCC 699 : AIR 1994 SC 1277 ]; Patel Engg.
Fundamentals of fair play require that the person concerned should be given an opportunity to represent his case before he is put on the blacklist. Subsequent decisions of this Court in Southern Painters v. Fertilizers & Chemicals Travancore Ltd. MANU/SC/0294/1994 : [1994 Supp (2) SCC 699 : AIR 1994 SC 1277 ]; Patel Engg. Ltd. v. Union of India [MANU/SC/0438/2012 : (2012) 11 SCC 257 : (2013) 1 SCC (Civ) 445]; B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd. [MANU/SC/8598/2006 : (2006) 11 SCC 548 ]; Joseph Vilangandan v. Executive Engineer (PWD)[MANU/SC/0034/1978 : (1978) 3 SCC 36 ] among others have followed the ratio of that decision and applied the principle of audialterampartem to the process that may eventually culminate in the blacklisting of a contractor. 19. Even the second facet of the scrutiny which the blacklisting order must suffer is no longer res integra. The decisions of this Court in Radhakrishna Agarwal v. State of Bihar [MANU/SC/0053/1977 : (1977) 3 SCC 457 : (1977) 3 SCR 249 ]; E.P. Royappa v. State of T.N. [MANU/SC/0380/1973 : (1974) 4 SCC 3 : 1974 SCC (L&S) 165]; Maneka Gandhi v. Union of India [MANU/SC/0133/1978 : (1978) 1 SCC 248 ]; Ajay Hasia v. Khalid MujibSehravardi [MANU/SC/0498/1980 : (1981) 1 SCC 722 : 1981 SCC (L&S) 258]; Ramana Dayaram Shetty v. International Airport Authority of India [MANU/SC/0048/1979 : (1979) 3 SCC 489 ] and DwarkadasMarfatia and Sons v. Port of Bombay [MANU/SC/0330/1989 : (1989) 3 SCC 293 ] have ruled against arbitrariness and discrimination in every matter that is subject to judicial review before a writ court exercising powers Under Article 226 or Article 32 of the Constitution.” 8. The respondents have invited attention of this Court to Notice Inviting Bid (NIB) wherein it has been mentioned that only original manufacturer or its authorized representative can bid in the tendering process. This argument of the respondent does not hold good for the reason that the petitioner has not impugned rejection of the bid but in fact has come to the Court challenging the order of debarring/blacklisting it for a period of 02 years. The petitioner was given authority letter by the authorized representative of the original manufacturer, who was given authority vide letter dated 22.01.2021 and in furtherance of the same petitioner participated in the tendering process by acting upon the said authority letter.
The petitioner was given authority letter by the authorized representative of the original manufacturer, who was given authority vide letter dated 22.01.2021 and in furtherance of the same petitioner participated in the tendering process by acting upon the said authority letter. The authorized representative, i.e., M/s Azzura Pharamconutrition of original manufacturer, had also informed the respondent no.2 through email dated 7th August 2021 that he holds the authority letter of the original manufacturer, namely, M/s Protect Telelinks, which has been completely overlooked and brushed aside by respondent no.2 while passing the order impugned. It seems that the petitioner has been victimized in a dispute which has arisen interse the original manufacturer and its authorized representative, inasmuch as the original manufacturer has disowned the authority given to the petitioner by its authorized representative. 9. Law is firmly grounded and does not even demand much amplification. The necessity of compliance with principles of natural justice, by giving opportunity to a person against whom action of blacklisting is sought to be taken, has a valid and solid rationale behind it. With blacklisting, many civil and/or evil consequences follow. It is described as “civil death” of a person who is foisted with the order of blacklisting. Such an order is stigmatic in nature and debars such a person from participating in Government Tenders which means precluding him from the award of Government contracts and consequently denuded of right to life. In this connection it will be highly useful to reproduce the observations made by the Supreme Court in the case of Gorkha Security Services v. Govt. of NCT of Delhi and others reported in AIR 2014 SC 3371 , herein below for convenience: “2. Present appeals raise an interesting question of law pertaining to the form and content of show cause notice, that is required to be served, before deciding as to whether the notice is to be blacklisted or not. We may point out at the outset that there is no quarrel between the parties on the proposition that it is a mandatory requirement to give such a show cause notice before black listing. It is also undisputed that in the present case the show cause notice which was given for alleged failure on the part of the appellant herein to commence/execute the work that was awarded to the appellant, did not specifically propose the action of blacklisting the appellant firm.
It is also undisputed that in the present case the show cause notice which was given for alleged failure on the part of the appellant herein to commence/execute the work that was awarded to the appellant, did not specifically propose the action of blacklisting the appellant firm. The question is as to whether it is a mandatory requirement that there has to be a stipulation contained in the show cause notice that action of blacklisting is proposed? If yes, is it permissible to discern it from the reading of impugned show cause notice, even when not specifically mentioned, that the appellant understood that it was about the proposed action of blacklisting that could be taken against him? ............................................. ............................................ 15. It is in this backdrop, question which has arisen for our consideration in the present case is as to whether action of blacklisting could be taken without specifically proposing/contemplating such an action in the show cause notice? To put it otherwise, whether the power of blacklisting contained in Clause 27 of the NIT, was sufficient for the appellant to be on his guards, and to presume that such an action could be taken even though not specifically spelled out in the show cause notice? ............................................ ............................................ Necessity of serving show cause notice as a requisite of the Principles of Natural Justice: 17. It is a common case of the parties that the blacklisting has to be preceded by a show cause notice. Law in this regard is firmly grounded and does not even demand much amplification. The necessity of compliance with the principles of natural justice by giving the opportunity to the person against whom action of blacklisting is sought to be taken has a valid and solid rationale behind it. With blacklisting many civil and/or evil consequences follow. It is described as “civil death” of a person who is foisted with the order of blacklisting. Such an order is stigmatic in nature and debars such a person from participating in Government Tenders which means precluding him from the award of Government contracts.
With blacklisting many civil and/or evil consequences follow. It is described as “civil death” of a person who is foisted with the order of blacklisting. Such an order is stigmatic in nature and debars such a person from participating in Government Tenders which means precluding him from the award of Government contracts. Way back in the year 1975, this Court in the case of M/s. Erusian Equipment & Chemicals Ltd. v. State of West Bengal & Anr.; (1975) 1 SCC 70 , highlighted the necessity of giving an opportunity to such a person by serving a show cause notice thereby giving him opportunity to meet the allegations which were in the mind of the authority contemplating blacklisting of such a person. This is clear from the reading of Para Nos. 12 and 20 of the said judgment. Necessitating this requirement, the Court observed thus: “12. Under Article 298 of the Constitution, the executive power of the Union and the State shall extend to the carrying on of any trade and to the acquisition, holding and disposal of property and the making of contracts for any purpose. The State can carry on executive function by making a law or without making a law. The exercise of such powers and functions in trade by the State is subject to Part III of the Constitution. Article 14 speaks of equality before the law and equal protection of the laws. Equality of opportunity should apply to matters of public contracts. The State has the right to trade. The State has there the duty to observe equality. An ordinary individual can choose not to deal with any person. The Government cannot choose to exclude persons by discrimination. The order of blacklisting has the effect of depriving a person of equality of opportunity in the matter of public contract. A person who is on the approved list is unable to enter into advantageous relations with the Government because of the order of blacklisting. A person who has been dealing with the Government in the matter of sale and purchase of materials has a legitimate interest or expectation. When the State acts to the prejudice of a person it has to be supported by legality. 20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains.
When the State acts to the prejudice of a person it has to be supported by legality. 20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains. The fact that a disability is created by the order of blacklisting indicates that the relevant authority is to have an objective satisfaction. Fundamentals of fair play require that the person concerned should be given an opportunity to represent his case before he is put on the blacklist”. Again, in Raghunath Thakur v. State of Bihar and ors., (1989) 1 SCC 229 the aforesaid principle was reiterated in the following manner:- “4. Indisputably, no notice had been given to the appellant of the proposal of blacklisting the appellant. It was contended on behalf of the State Government that there was no requirement in the rule of giving any prior notice before blacklisting any person. Insofar as the contention that there is no requirement specifically of giving any notice is concerned, the respondent is right. But it is an implied principle of the rule of law that any order having civil consequence should be passed only after allowing the principles of natural justice. It has to be realized that blacklisting any person in respect of business ventures has civil consequence for the future business of the person concerned in any event. Even if the rules do not express so, it is an elementary principle of natural justice that parties affected by any order should have right of being heard and making representations against the order. In that view of the matter, the last portion of the order insofar as it directs blacklisting of the appellant in respect of future contracts, cannot be sustained in law. In the premises, that portion of the order directing that the appellant be placed in the blacklist in respect of future contracts under the Collector is set aside. So far as the cancellation of the bid of the appellant is concerned, that is not affected. This order will, however, not prevent the State Government or the appropriate authorities from taking any future steps for blacklisting the appellant if the Government is so entitled to do in accordance with law i.e. after giving the appellant due notice and an opportunity of making representation.
This order will, however, not prevent the State Government or the appropriate authorities from taking any future steps for blacklisting the appellant if the Government is so entitled to do in accordance with law i.e. after giving the appellant due notice and an opportunity of making representation. After hearing the appellant, the State Government will be at liberty to pass any order in accordance with law indicating the reasons therefor. We, however, make it quite clear that we are not expressing any opinion on the correctness of otherwise of the allegations made against the appellant. The appeal is thus disposed of.” Recently, in the case of Patel Engineering Ltd. v. Union of India and Anr.; (2012) 11 SCC 257 speaking through one of us (Jasti Chelameswar, J.) this Court emphatically reiterated the principle by explaining the same in the following manner: “13. The concept of “blacklisting” is explained by this Court in Erusian Equipment & Chemicals Ltd. v. State of W.B. as under: “20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains.” 14. The nature of the authority of the State to blacklist the persons was considered by this Court in the abovementioned case and took note of the constitutional provision (Article 298), which authorizes both the Union of India and the States to make contracts for any purpose and to carry on any trade or business. It also authorizes the acquisition, holding and disposal of property. This Court also took note of the fact that the right to make a contract includes the right not to make a contract. By definition, the said right is inherent in every person capable of entering into a contract. However, such a right either to enter or not to enter into a contract with any person is subject to a constitutional obligation to obey the command of Article 14. Though nobody has any right to compel the State to enter into a contract, everybody has a right to be treated equally when the State seeks to establish contractual relationships. The effect of excluding a person from entering into a contractual relationship with the State would be to deprive such person to be treated equally with those, who are also engaged in similar activity. 15.
The effect of excluding a person from entering into a contractual relationship with the State would be to deprive such person to be treated equally with those, who are also engaged in similar activity. 15. It follows from the above judgment in Erusian Equipment case that the decision of the State or its instrumentalities not to deal with certain persons or class of persons on account of the undesirability of entering into the contractual relationship with such persons is called blacklisting. The State can decline to enter into a contractual relationship with a person or a class of persons for a legitimate purpose. The authority of the State to blacklist a person is a necessary concomitant to the executive power of the State to carry on the trade or the business and making of contracts for any purpose, etc. There need not be any statutory grant of such power. The only legal limitation upon the exercise of such an authority is that the State is to act fairly and rationally without in any way being arbitrary- thereby such a decision can be taken for some legitimate purpose. What is the legitimate purpose that is sought to be achieved by the State in a given case can vary depending upon various factors.” 10. Indubitably, in the present case also, no opportunity of being heard was afforded by the disciplinary committee to the petitioner before making the recommendations against the petitioner firm thereby depriving the petitioner of right to agitate against the verification report as well as the quantum of punishment sought to be recommended against it. Respondent No.2 on receipt of the recommendation did not put the petitioner to any notice nor was any opportunity ever afforded to the petitioner to show cause against the penalty of blacklisting sought to be imposed upon the petitioner and straightway passed the order impugned without returning his own findings by accepting the recommendations of the disciplinary committee. It is specifically argued that the petitioner could have been imposed a variety of punishments/penalties but has been imposed the harshest punishment of blacklisting, which is termed as a civil death of a person. It is an implied principle of the rule of law that any order having civil consequence should be passed only after following the principles of natural justice.
It is an implied principle of the rule of law that any order having civil consequence should be passed only after following the principles of natural justice. It has to be realized that blacklisting any person in respect of business ventures has civil consequence for the future business of the person concerned. Even if the rules do not express so, it is an elementary principle of natural justice that parties affected by any such order should be heard and given right to make representation against the order. 11. For the aforesaid reasons, I am of the view that the impugned Order bearing No. 28 of 2021 dated 13.10.2021 passed by the respondent No.2 whereby the petitioner has been debarred/blacklisted from J&K Medical Supplies Corporation Ltd. for a period of two years, is violative of principles of natural justice. Accordingly, impugned Order bearing No. 28 of 2021 dated 13.10.2021 is set aside. However, the respondents are at liberty to take appropriate action on the blacklisting of the petitioner-firm after complying with the necessary procedural formalities and constitutional mandates, as required under law as also the principles of natural justice. 12. Disposed of as above along with connected CM(s).