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2021 Supreme(Pat) 735

IN THE HIGH COURT OF JUDICATURE AT PATNA
Chakradhari Sharan Singh, J.
Star Build Max Pvt. Limited - Appellant
Versus
The State Of Bihar & Ors. - Respondent
Civil Writ Jurisdiction Case No. 8777 of 2020
Decided On : 21-10-2021

Advocates Appeared:
Mr. Ranjeet Kumar, Advocate, Mr. Kundan Kumar, Advocate, Mr. Yogesh Kumar, Advocate, for the Appellant; Mr. Manoj Kumar Ambastha, S.C.-26, for the Respondent.

Headnote:

Bihar Contractors Registration Rules, 2007 – Rule 11(A)(ii) read with 8.1.B of Departmental Order No.154 – Black-listing – Graver is adverse effect of an action of a quasi judicial functionary, heavier is obligation on authorities exercising such power to act fairly, reasonably, in a transparent manner and in conformity with principles of natural justice – This duty becomes very onerous in background of grave fall out of action of black-listing on a contractor – Black-listing order involves serious civil consequences and casts slur and creates a barrier between persons black-listed and Government, in the matter of contractual transactions – Keeping in mind gravity of consequences of action of black-listing, authority exercising such power cannot afford to adopt a casual approach – Recording of reasons is one of basic, but most essential requirement for a quasi judicial functionary, if its order has adverse civil/evil consequences – In absence of this minimum basic requisite, order of black-listing would become vulnerable – Impugned orders quashed with cost of Rs.50,000/- to be paid by Engineer-in-Chief to petitioner within one month – Competent authority given liberty to pass fresh order. (Paras 23, 24, 26 to 29 and 32)

(2014) 9 SCC 105; AIR 2011 SC 2161; AIR 2017 SC 2712; (1975) 1 SCC 70; (1989) 9 SCC 29; (2014) 9 SCC 105; 2020 SCC OnLine SC 934 – Referred.

(1975) 1 SCC 70; (1989) 9 SCC 29; (2014) 9 SCC 105; 2019 SCC OnLine SC 1607; 2020 SCC OnLine SC 934; (2010) 13 SCC 427; (2010) 9 SCC 496 – Relied.

JUDGMENT

1. The petitioner is a company registered as Class-I contractor under Bihar Contractors Registration Rules, 2007, issued in the nature of office order by the Road Construction Department, Government of Bihar. It was awarded certain work relating to construction of road in 2015.

2. By an order dated 27.12.2019, issued by the Engineer-in-Chief, Road Construction Department, Patna (respondent No. 2), the petitioner has been black-listed for a period of 15 years in exercise of power under Rule 11(A)(ii) of the Rules of 2007 read with 8.1.B of the Departmental Order No. 154 as contained in Memo No. 5403(S). The said order of black-listing was challenged by the petitioner before this Court by filing a writ petition giving rise to C.W.J.C. No. 1127 of 2020 on various grounds including the ground that the show cause notice issued to the petitioner before issuance of the order of black-listing did not indicate about the proposed final action in the event the explanation in response to the show cause notice was not found satisfactory. Reliance had been placed on Supreme Court's decision in case of Gorkha Security Services vs Govt. of NCT of Delhi & Ors., reported in (2014) 9 SCC 105. A coordinate Bench of this Court, upon looking into the tenor of the show cause notice issued by the Department, in its order dated 21.01.2020 passed in the said C.W.J.C. No. 1127 of 2020, reached a conclusion that the show cause notice could not be faulted with on the said ground. In respect of the other grounds taken by the petitioner, the coordinate Bench, while disposing of the matter gave the petitioner a liberty to prefer an appeal before the Departmental Secretary. Relevant portion of the order dated 21.01.2020 reads as under : -

"However, the other ground which has been urged by the petitioner is that notwithstanding the aforesaid facts, the period for which the petitioner has been blacklisted is highly disproportionate in relation to the deficiencies in the work at three places only and for which the petitioner has furnished an explanation that the inspection was conducted behind his back and much later i.e. after the onset of the monsoon season.

This aspect does require a re-look.

Under the aforesaid circumstances, this Court provides that in case the petitioner prefers an appeal before the Departmental Secretary and places every fact before him, he shall take a holistic view of the matter including the ground of bias which has been raised during the course of argument by the petitioner and shall pass a reasoned order in accordance with law within a period of sixty days.

The appellate authority shall also take a call on the issue whether the order of blacklisting be deferred till the final decision by the Tribunal in Case No. 129 of 2009.

With the aforesaid direction/observation, the writ petition stands disposed off. "

3. A Letters Patent Appeal was preferred by the petitioner, giving rise to L.P.A. No. 95 of 2020, which was disposed of by an order dated 01.05.2020 of a Division Bench of this Court, relevant portion of which reads as under : -

"That during the course of the day, the writ petitioner/appellant shall prefer an appeal in terms of the directions issued by the learned Single Judge of this Court vide impugned judgment dated 21.01.2020 passed in CWJC No. 1127 of 2020 titled as "Star Build Max Pvt. Limited Balua Tal, Motihari Versus The State of Bihar & Ors".

Sri Vikas Kumar, learned Standing Counsel-11, states that on or before 5th of May, 2020, the appropriate authority shall positively decide the same.

We see no reason to interfere with the impugned judgment and as such the present appeal is disposed on the above mutually agreeable terms. "

4. Purportedly, in compliance with the direction of the coordinate Bench of this Court, contained in the aforesaid order dated 21.01.2020 (supra) and subsequent Division Bench order dated 01.05.2020 (supra), the Additional Chief Secretary, Road Construction Department, Government of Bihar, has rejected

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