The representation made by a party must be established as fraudulent with certainty before imposing punitive measures such as blacklisting. The serious consequences of blacklisting require a higher level of scrutiny in evaluating the imposition of such punitive measures.

Vibhu Bakhru, J.

Introduction

1. The petitioner (hereafter “Malviya”) has filed the present petition inter alia assailing an order dated 28.03.2017 (hereafter “the impugned order”) passed by respondent no.1 (hereafter “NHAI”) debarring Malviya and M.C. Consulting Engineers Pvt. Ltd. (hereafter “MCC”) for three years from directly or indirectly participating in any work with NHAI. The impugned order was based on the recommendations of a three member committee of CGMs of NHAI (hereafter “the Committee”), submitted on 14.03.2017.

2. The Committee had also considered the issue of imposing punitive measures on Technocrats Advisory Services Pvt. Ltd. (hereafter “TASPL”) and the Committee had unanimously recommended that a warning letter be issued to TASPL. However, no punition has been imposed on TASPL by the impugned order.

3. The controversy in the present petition stems from the certificates of experience submitted by Malviya, MCC and TASPL with regard to rendering services of an Independent Engineer (hereafter “IE Services”) to Madhya Pradesh Road Development Corporation Ltd. (hereafter “MPRDC”) in respect of four laning of Rewa-MP/UP Border (NH-7) Road Project (hereafter referred to as “the Rewa-MP Project”) on the basis of an agreement dated 12.09.2012. Multiple experience certificates were issued by MPRDC in respect of the IE Services. Whereas all such certificates certified that the work of IE Services in question was carried out by 'M/s M.C. Consulting Engineers Pvt. Ltd. JV M/s L.N. Malviya Infra Projects Pvt. Ltd.', the certificate issued to Malviya - and furnished by it to NHAI - also indicated the ratio in which the work was carried out by MCC and Malviya: Malviya was stated to have carried out 96% of the works and the balance 4% was attributed to MCC.

4. The business of consultancy in the field of roads, highways and bridges carried out by MCC was demerged under a scheme of arrangement framed under Sections 391 to 394 of the Companies Act, 1956 and such undertaking along with all employees, assets and liabilities was vested in TASPL (resulting/ transferee company). TASPL also bid for the work of IE Services claiming experience of the IE Services rendered to MPRDC in respect of the Rewa-MP Project.

5. NHAI faced with multiple experience certificates for the same work, conducted an enquiry and found that since MPRDC had awarded the work of IE services in relation to the Rewa-MP Project to MCC, the experience certificates furnished by Malviya (claiming experience to the extent of 96%) as well as MCC (claiming the entire experience) amounted to misrepresentation. Malviya had contested the aforesaid allegation. According to Malviya, its representation that it had provided IE Services to MPRDC was correct. Although the Agreement for the Rewa-MP Project was entered into between MPRDC and MCC, the fact of a pre-bidding joint venture (JV) agreement between Malviya and MCC was within the knowledge of MPRDC and accordingly, all payments by MPRDC were also made to the account of the JV between MCC and Malviya. Malviya claimed that the IE Services were, in fact, rendered by it and thus, furnishing of the experience certificate by it, could not by any stretch be held to be misrepresentation.

Factual background

6. Malviya is a consultancy firm inter alia providing professional engineering services in projects for infrastructure development in India. It has been appointed by NHAI in several of its projects for construction of highways throughout the country. TASPL is also a concern providing consultancy services in the field of infrastructure development. Malviya and MCC had formed a JV under the name and style: “MC Consulting Engineers Pvt. Ltd. JV L.N. Malviya Infra Projects Pvt. Ltd.” by an agreement dated 09.01.2012 (hereafter “the JV Agreement”) to submit common proposal to MPRDC to provide consultancy services pursuant to the request for the expression of interest issued by the Managing Director, MPRDC.

7. On 28.03.2012, MPRDC