IN THE HIGH COURT OF JUDICATURE AT PATNA
SANJAY KAROL, S. KUMAR, JJ.
M/s Vijeta Projects and Infrastructure Pvt. Ltd. – Petitioner
Versus
The State of Bihar – Respondent
Civil Writ Jurisdiction Case No. 8357 of 2020
Decided On : 17-05-2022
Government Contract – Black-listing – Rescission of Agreement – In a four line communication without any assigning reasons, respondent authorities have rescinded contract by simply stating that contract, in question, is being rescinded and contractor blacklisted – Passing of such an order entails civil consequences – Impugned order whereby petitioner's agreement stands rescinded is not only highly cryptic but also unreasoned, apart from being passed without adherence to principles of natural justice – Order whereby agreement stands rescinded and contractor blacklisted, quashed and set aside – Consequential orders also quashed and set aside – It is open for authorities to take appropriate action in accordance with law. (Paras 10 to 12)
JUDGMENT :
SANJAY KAROL, J.
1. Petitioner has prayed for the following reliefs:
2. On 21.10.2020, initially when the matter was taken up, the Court had directed that no coercive steps shall be taken against the petitioner.
3. On 17.03.2021, the Court had observed as under:
Mr. Anjani Kumar, learned AAG-4, has submitted in response that instructions would be required to be sought from the respondents as to whether they are ready to permit the petitioner to complete the remaining work since the agreement in question has been terminated vide order dated 31.8.2020 on account of breach of the terms and conditions of contract by the petitioner and on account of suppression of facts by the petitioner.
Having considered the rival contentions of the learned Senior Counsels appearing for the parties, I deem it fit and proper to grant time to the respondents to inform this Court as to whether they are willing to allow the petitioner to complete the balance work within a stipulated time frame, on the old rates. If need be, the respondents may hold parleys amongst themselves as also with the representatives of the petitioner.
List this case on 12.04.2021.”
4. On 9th May, 2022, we had passed the following order:
From the order of 17.03.2021, it appears that allegedly petitioner completed 80 per cent of the work.
On ‘special mention’ the matter stands listed before this Bench.
Having briefly heard learned counsel for the parties, we are of the considered view that today three options are available with the parties and each one without prejudice to their respective rights and contentions:
(a) A fresh show cause notice be issued by the appropriate authority to the petitioner to be responded to within the time bound period and decide expeditiously.
(b) The petition be heard on merits.
(c) The petitioner be allowed to complete the remaining work within the time bound period without any further pecuniary benefit on the same terms and conditions moreso the consideration contained therein.
Let the learned counsel for the State obtain instructions.
List this case tomorrow i.e. 10.05.2022.
Mr. Anjani Kumar AAG-4 states that at this point of time 3rd option is not open.
Mr. S.D. Sanjay, learned counsel for the petitioner under instruction states that 3rd option is acceptable to the petitioner.”
5. On 11th May, 2022, we had passed the following order:
Evidently, 67 per cent of the work stands completed by the petitio
Contract termination invalid due to delayed, uncommunicated extension order despite genuine delay reasons; extension granted to original contractor.
The court upheld the administrative decision to terminate a contract for delay in completion due to the petitioner's failure to adhere to the agreement terms.
A contract termination must adhere to principles of natural justice, including the right to a personal hearing, and disputes regarding breaches must be adjudicated by an independent forum rather than....
The court emphasized that public authority's arbitrary termination of a contract without following due procedures violates principles of fairness and justness, meriting judicial intervention.
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