JUDGMENT : The present writ petition has been filed for quashing the letter dated 24.05.2021 (Annexure-5 to the writ petition) issued by the respondent no. 4- Staff Officer (E&M), Piperwar Area, Central Coalfields Limited (CCL) to the petitioner whereby it has been banned for two years from being eligible to submit bid in Coal India Limited (CIL) and its subsidiaries with immediate effect alleging violation of Clause-14.2 (B), (C) & (E) of NIT No. SO(E&M)/PPR/e-NIT/20-21/97 dated 02.01.2021 (hereinafter to be referred “as the said tender”). Further prayer has been made for issuance of direction upon the respondents to award the said tender in favour of the petitioner as it was declared L1. The petitioner has also prayed for quashing the letter dated 24.06.2021 issued by the respondent no. 4 by which work order for the said tender has been issued in favour of Sweta Construction, Bachra, District- Chatra (the respondent no 5). 2. Mr. Kalyan Roy, learned counsel for the petitioner, while arguing the case, confines the prayer only to the extent of quashing letter dated 24.05.2021 issued by the respondent no. 4 in connection with NIT No. SO(E&M)/PPR/e-NIT/20-21/97 dated 02.01.2021 whereby the petitioner has been banned for two years from being eligible to submit bid in CIL and its subsidiaries with immediate effect alleging violation of Clause-14.2(B), (C) & (E) of said NIT. 3. Learned counsel for the petitioner submits that the said tender was invited by Electrical and Mechanical (E&M) Department of CCL, Piparwar Area, Chatra for the work of “repairing and maintenance of 11 KV, 440 volts overhead lines, light fittings, transformers etc. installed at Garhi Filter Plant, Bachra Siding, Kalyanpur Coal Dump, rehabilitation centre under CHP-CPP for a period of 1 year”. The petitioner participated in the said tender and submitted its online bid on 11.01.2021. It also submitted all the documents on the same day which were required to meet the eligibility criteria as per the provisions of the said NIT. On submission of bid, the petitioner was declared L1. The petitioner participated in the said tender and submitted its online bid on 11.01.2021. It also submitted all the documents on the same day which were required to meet the eligibility criteria as per the provisions of the said NIT. On submission of bid, the petitioner was declared L1. However, after technical evaluation of documents uploaded by the petitioner, some deficiencies were found by the tender committee and as such, the petitioner was requested to upload required shortfall documents within 7 days w.e.f. 26.01.2021 at 11:00 a.m. to 02.02.2021 at 11:00 A.M. on e-portal of Coal India Limited as per Clause 14.2(B) of the said NIT which was duly uploaded by it on 01.02.2021 in the e-procurement system of CCL. 4. It is further submitted that though a valid electrical contractor license was uploaded in the portal by the petitioner along with valid license of electrical wireman having authorization for working in HT overhead line and HT installations, however the evaluator gave wrong description of the shortfall documents submitted by the petitioner on the e-procurement system of CCL, pursuant to which, the respondent no. 4, vide letter dated 24.05.2021, ordered for banning the business of the petitioner for 2 years from being eligible to submit bid in CIL and its subsidiaries with immediate effect. 5. It is also submitted that issuance of letter dated 24.05.2021 is illegal, arbitrary and bad in law as no show cause notice was issued to the petitioner at any point of time. Moreover, no opportunity of hearing was given before passing the order of banning it from submitting the future tenders of CIL and its subsidiaries. According to learned counsel for the petitioner, the guidelines as mentioned in the e-tender notice under the heading “Guidelines for Banning of Business” have to be strictly followed by CIL and its subsidiary companies for effecting ‘Banning of Business’ in respect of works and services contracts. Clause-1 of the said guidelines specifically speaks about the ‘observance of principles of natural justice’ before banning the business dealings with any contracting entity which is completely absent in the present case. It is a settled principal of law that before taking a harsh decision of banning of business, the person concerned should be given ample opportunity to represent his case. 6. It is a settled principal of law that before taking a harsh decision of banning of business, the person concerned should be given ample opportunity to represent his case. 6. Per contra, learned counsel for the respondents submits that as per clause 14.2(E) of the e-tender notice, the defaulting contractor is to be banned for 2 years from being eligible to submit bids in CIL and its subsidiaries from the date of issuance of such letter. The petitioner has been banned as a penal action for non-compliance of the technical requirements even after giving ample opportunity as per the NIT. The petitioner was given 07 days’ time from 26.01.2021 to upload the required shortfall documents, however it could not submit the same. Thus, on the basis of recommendation of the Tender Committee as well as approval of the competent authority, impugned letter dated 24.05.2021 was issued as per the terms and conditions of the NIT banning the petitioner for two years. 7. It is further submitted that as per the terms and conditions of the NIT, the petitioner has remedy of preferring appeal before the appellate authority. The license of electrical wiremen submitted by the petitioner was not as per the requirement of NIT since Wiremen namely Sri Sahels Laguri and Ravi Kumar did not have authorization for working in HT installation work as was required in terms with the tender documents. 8. Heard learned counsel for the parties and perused the materials available on record. 9. The primary argument of learned counsel for the petitioner is that no show cause notice was issued to the petitioner before passing the impugned order dated 24.05.2021 banning it for the period of two years and as such the same is vitiated in law on the ground of violation of the principles of natural justice. On the other hand, the contention of learned counsel for the respondents is that Clause- 14.2(E) of the E-tender notice itself provides for rejection of bid as well as banning for two years in case the L-1 bidder fails to submit the requisite documents online as per NIT or if any information/declaration furnished by L-1 bidder online is found to be wrong by Tender Committee during evaluation of scanned documents uploaded by the bidder, which changes its eligibility status. It has also been contended that since the petitioner had failed to fulfil the shortcomings within seven days as per NIT in spite of opportunity given to it, the respondent no. 4 passed the order of banning the petitioner for two years as well as cancelled its tender invoking Clause 14.2(E) of the e-tender notice. 10. Thus, the first question falls for consideration of this Court is as to whether the tender inviting authority was bound to serve specific show cause notice to the petitioner before passing the order of banning it despite the fact that there was a stipulation in the tender document for putting the bidder to blacklist for any such default. 11. The Hon’ble Supreme Court in the case of Kulja Industries Limited Vs. Chief General Manager, Western Telecom Project Bharat Sanchar Nigam Limited & Others reported in (2014) 14 SCC 731 , has held that blacklisting simply signifies a business decision by which the party affected by the breach decides not to enter into any contractual relationship with the party committing the breach. The freedom to contract or not to contract is unqualified in the case of private parties. However, if such decision is taken by the State or any of its instrumentalities, the same is subject to judicial review. This implies that such decision is open to scrutiny not only on the touchstone of the principles of natural justice but also on the doctrine of proportionality. A fair hearing to the party being blacklisted thus becomes an essential precondition for a proper exercise of the power and a valid order of blacklisting made pursuant thereto. Similarly, the writ court can examine as to whether the order itself is reasonable, fair and proportionate to the gravity of the offence. 12. In the case of Erusian Equipment & Chemicals Ltd. v. State of West Bengal & Another reported in (1975) 1 SCC 70 , the Hon’ble Supreme Court has held that blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for the purposes of gains. Since a disability is created by an order of blacklisting, the concerned authority is required to have an objective satisfaction. Fundamentals of fair play demand that the person concerned should be given an opportunity to represent his case before he is put on the blacklist. 13. Since a disability is created by an order of blacklisting, the concerned authority is required to have an objective satisfaction. Fundamentals of fair play demand that the person concerned should be given an opportunity to represent his case before he is put on the blacklist. 13. In the case of Gorkha Security Services Vs. Government (NCT of Delhi) & Others reported (2014) 9 SCC 105 , the Hon’ble Supreme Court has held that the necessity of compliance with the principles of natural justice by giving an opportunity to the person against whom action of blacklisting is sought to be taken, has a valid and solid rationale behind it. Many civil and/or evil consequences follow the order of blacklisting. 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. 14. For better appreciation of this case, it would also be appropriate to refer paragraph-25 of the judgment rendered by the Hon’ble Supreme Court in the case of UMC Technologies Private Limited Vs. Food Corporation of India and Another reported in (2021) 2 SCC 551 , which reads as under:- “25. The mere existence of a clause in the bid document, which mentions blacklisting as a bar against eligibility, cannot satisfy the mandatory requirement of a clear mention of the proposed action in the show-cause notice. The Corporation's notice is completely silent about blacklisting and as such, it could not have led the appellant to infer that such an action could be taken by the Corporation in pursuance of this notice. Had the Corporation expressed its mind in the show-cause notice to blacklist, the appellant could have filed a suitable reply for the same. Therefore, we are of the opinion that the show-cause notice dated 10-4-2018 does not fulfil the requirements of a valid show-cause notice for blacklisting. In our view, the order of blacklisting the appellant clearly traversed beyond the bounds of the show-cause notice which is impermissible in law. As a result, the consequent blacklisting order dated 9-1-2019 cannot be sustained.” 15. Therefore, we are of the opinion that the show-cause notice dated 10-4-2018 does not fulfil the requirements of a valid show-cause notice for blacklisting. In our view, the order of blacklisting the appellant clearly traversed beyond the bounds of the show-cause notice which is impermissible in law. As a result, the consequent blacklisting order dated 9-1-2019 cannot be sustained.” 15. Thus, it is well settled that though the power of blacklisting is inherent in the party allotting the contract, yet such decision is open to scrutiny on the touchstone of fairness, relevance, natural justice, non-discrimination, equality, reasonableness and proportionality. Serving of show cause notice specifying the grounds on the basis of which an action is proposed to be taken, is a mandatory requirement so as to enable the noticee to answer the case before an order of blacklisting/banning is passed as the same has not only a long lasting civil consequence, but it also tarnishes the blacklisted person’s reputation. The issuance of show cause notice cannot be excused on mere ground that there is a stipulation of blacklisting in the bid document on violation of any of the terms and conditions of the tender. Moreover, the blacklisting/debarment cannot be permanent. 16. In the case in hand, on perusal of the record it appears that no specific show cause notice was issued to the petitioner before passing the order of banning and thus in view of the propositions laid down by different judicial pronouncements, this Court is of the view that the impugned order of banning the petitioner for two years is bound to be vitiated on the ground of violation of the principles of natural justice. 17. Learned counsel for the respondents has tried to convince this court that the petitioner has not fulfilled the shortcomings found in required uploaded documents within the stipulated time and as such the respondent no. 4 has rightly cancelled its bid and has passed the impugned order of banning it for two years. I am of the view that since the impugned order of banning the petitioner has failed to overcome the test of compliance of the principles of natural justice i.e., the requirement of serving prior show cause notice, there is no need to enter into the other contentions of learned counsel for the respondent-CCL. 18. In view of the aforesaid discussion, the impugned letter dated 24.05.2021 issued by the respondent no. 18. In view of the aforesaid discussion, the impugned letter dated 24.05.2021 issued by the respondent no. 4 cannot be sustained in law and hence the same is quashed. Since the petitioner has faced rigors of ban/debarment from doing business from the date of issuance of the said letter itself as it was made ineligible to submit bids to CIL and its subsidiaries for about one year ten months, this Court does not think it appropriate to remit the matter to the said respondent for taking any fresh decision on the present issue. 19. The writ petition is accordingly allowed. 20. I.A. No. 7406 of 2021 also stands disposed of accordingly.