Heera Lal vs State of Punjab and Others

Ajay Kumar Mittal, J.

C.M. No. 8013 of 2013

Application is allowed as prayed for. Reply filed along with the application on behalf of respondents No. 2 and 3 is taken on record subject to all just exceptions.

CM stands disposed of accordingly.

CWP No. 9530 of 2013

Challenge in this writ petition filed under Article 226 of the Constitution of India is to order dated 22.4.2013 (Annexure P-3) passed by respondent No. 3 whereby the security deposit made by the petitioner amounting to Rs. 15,000/- has been forfeited and he has been blacklisted. The facts necessary for adjudication of the present petition as narrated therein are that the official respondents vide tender notice dated 30.3.2013 (Annexure P-1) invited tenders for the work of transportation and labour/cartage/storage points (Open Plinths) and PEG, godowns for the period from 1.4.2013 to 31.3.20I4. The tenders were to be submitted upto 3.4.2013 at 5.00 P.M. and were to be opened on 2.5.2013 at 9.00 AM. The petitioner submitted the tender for District Warehousing Corporation, Fatehgarh Sahib by quoting the rate 20% above the basic rates. Respondent No. 4 also submitted the tender. Inspite of being lower rate quoted by the petitioner as compared to respondent No. 4, his tender was rejected on 4.4.2013. Again on 8.4.2013, the tenders were invited and in pursuance thereof, the petitioner submitted his tender quoting 30% rate above the basic rate. But his tender was not accepted. The petitioner was neither allotted the tender nor he was intimated with regard to the result of the tender. However, on 20.4.2013, Shri Surinder Kumar, dealing Clerk in the office of respondent No. 3 verbally asked the petitioner to start the work at the increased rate of 20%. The petitioner told that he cannot start the work until and unless he was awarded the tender. The Clerk got in writing from the petitioner that he was ready to start the work as per the tender submitted by him on 8.4.2013 at the rate above 30% of the basic rates. Since, the said tender of the petitioner was not accepted, therefore, he could not start work on 20.4.2013. On 29.4.2013, the petitioner received a telegram that his tender dated 8.4.2013 had been rejected. Respondent No. 3 vide impugned order dated 22.4.2013 (Annexure P-3) ordered for forfeiture of security amount of Rs. 15,000/- and blacklisted him. Hence, the present writ petition.

Learned counsel for the petitioner submitted that vide order, Annexure P-3, whereby the security amount had been forfeited and the petitioner had been blacklisted was passed without following the principles of natural justice inasmuch as no opportunity of hearing was provided to the petitioner.

Controverting the aforesaid submission, learned counsel for respondents No. 2 and 3 submitted that the petitioner in his application form, Annexure R-2, had stated that he was not able to perform his part of the agreement on the terms and conditions of the tender. It was urged that once there was a writing made on the form and the department had given various opportunities to the petitioner to start his work which he had failed to perform, in such circumstances, the forfeiture of the security amount and blacklisting the petitioner was in terms of the tender notice.

We have heard the learned counsel for the parties and perused the record.

It may be noticed that serious civil consequences flow from blacklisting of a contractor which affects his reputation. In such a situation, the State is required to proceed with care and responsibility before blacklisting any contractor and adopting such a drastic step against a person. The principles of natural justice embody opportunity of personal hearing before such right is taken away from the petitioner by blacklisting him. The Hon''ble Supreme Court in Grosons Pharmaceuticals (P) Ltd. and Another Vs. The State of Uttar Pradesh and Others, observed as under:--

...It is true that an order blacklisting an approved contractor results in civil consequences and in such a situation in the absence of statutory rules, the only requirement of law while passing such an order was to observe the principle of audi alteram partem which is one of the facets of the principles of natural justice....

Further, the forfeiture of the security amount for nonperformance of the contract would also require providing of an opportunity of hearing before forfeiture is made. Admittedly, no opportunity of hearing had been provided to the petitioner. Accordingly, the writ petition is allowed and the impugned order, Annexure P-3, is hereby quashed. However, it shall be open to respondents No. 2 and 3 to proceed afresh against the petitioner, in accordance with law.