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2023 Supreme(Cal) 323

IN THE HIGH COURT AT CALCUTTA
MOUSHUMI BHATTACHARYA, J.
M/s E.C. Blades and Tools Pvt. Ltd. – Petitioner
Versus
Union of India and Others – Respondents
W.P. (A) No. 26052 of 2022
Decided On : 08-05-2023

Advocates:
Advocate Appeared:
For the Petitioners: S.K. Kapur, Vineeta Meheria, Laboni Chaudhuri, Subhomoy Paul, Soumik Dey.
For the Respondents: Amitabha Nayak, Susmmita Saha Dutta.

Headnote:

Constitution of India, 1949 – Article, 226 – General Financial Rules (GFRs), 2017 – Rule 151 – Violation of principles of natural justice - Petitioner assails impugned decision to delist petitioner on ground of breach of principles of natural justice - Held, Court principle of fair play warrants that person receiving end of a decision and adversely affected by it must be given a chance to defend himself herself decision is given effect to – Equipment and Chemicals hold that effect of blacklisting is to prevent person from privilege and advantage of entering into lawful relationship government which requires that authority concerned must have an objective satisfaction – Writ petition disposed of.

JUDGMENT :

MOUSHUMI BHATTACHARYA, J.

1. The petitioner seeks setting aside of an order dated 12.5.2022 passed by a Committee consisting of three Officials of the respondent Chittaranjan Locomotive Works (CLW) which was confirmed by the General Manager of CLW on 21.5.2022. The impugned order recommended delisting of the petitioner for a period of 1 year from the date of delisting and made the decision subject to review based on change in circumstances. The impugned decision was communicated by a letter dated 28.5.2022; a hearing was given to the petitioner and held on 6.5.2022.

2. The petitioner assails the impugned decision to delist the petitioner on the ground of breach of the principles of natural justice. Learned counsel appearing for the petitioner urges that the petitioner was not given any prior intimation of the intention to delist in the form of a show-cause notice or otherwise. Counsel submits that the General Manager, CLW, being the Appellate Authority, simply agreed with the recommendation of the Committee without indicating reasons for the same. Counsel submits that the petitioner was also not given any opportunity to explain its position before the Appellate Authority. Counsel submits that since delisting involves severe consequences, the impugned order being approved by the Appellate Authority and that too without a hearing to the petitioner is void. Counsel further submits that the reason given for delisting is arbitrary since the only ground indicated in the impugned order is a pending FIR.

3. Learned counsel appearing for the respondent CLW and its officers submits that the petitioner was given a hearing before the Committee of CLW which would appear from the letter issued by the Deputy Chief Electrical Engineer (CEE) on 28.5.2022. The letter records that the authorised representatives of the petitioner were heard on 6.5.2022 and the written submissions of the petitioner were also taken into account. Counsel relies on the Procedure for Vendor Development of the Indian Railways, CLW and on Clause 6.4.3 thereunder which provides that CLW may be advised to delist a vendor without giving notice. Counsel submits that the petitioner along with a few of the officers of CLW was found guilty of malpractice and that CBI proceedings are pending against those officers.

4. The undisputed facts in the present case which would appear from the material disclosed to the Court is that the petitioner was delisted on the basis of a decision taken by the (three) Members of a Hearing Committee on 12.5.2022. A hearing was given to the petitioner following a direction of the High Court of Punjab and Haryana dated 27.4.2022. The Committee heard the authorised representatives of the petitioner on 6.5.2022. The Committee dealt with the factual matters in detail and recommended that the petitioner be delisted “on account of malpractice/unethical practice...” and also for the reason that “... the case is sub judice...” The recommendation to delist the petitioner was for a period of 1 year from the date of delisting. The decision to delist was also made subject to review based on a change in circumstances.

5. The last page of the impugned decision dated 12.5.2022 taken by the three-Member Hearing Committee bears a handwritten endorsement of the Appellate Authority being the General Manager of CLW in the following words : “I agree with the recommendation of the Committee.”

6. The above writing is also under challenge and is dated 21.5.2022.

7. The case sought to be made out on behalf of the petitioner is premised on violation of the principles of natural justice. The impugned order of the Hearing Committee reflects that the petitioner was not given a hearing before the recommendation of the Committee was accepted by the General Manager / Appellate authority of CLW. The endorsement of the General Manager is solitary sentence without disclosing the basis for accepting the recommendation of delisting the petitioner.

8. The principles of natural justic

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