The severity of the effects of blacklisting and the resultant need for strict observance of the principles of natural justice before passing an order of blacklisting.

JUDGMENT

Manoj Kumar Ohri, J. (Oral)

1. By way of the present petition filed under Articles 226 and 227 of the Constitution of India, the petitioner has assailed order dated 08.02.2022 passed by the respondent, whereby it has been debarred from participating in any tenders of Delhi Jal Board (in short, 'DJB') and/or having any business dealing with DJB for a period of five years from the date of issuance of the order. Other ancillary reliefs have also been sought.

2. The facts of the case are that vide NIT dated 27.03.2018, the DJB had issued an e-tender for 24 separate works. One such work was Item 21, i.e. "improvement of electrical supply system in main LT panel at BHARATNAGAR SPS". The petitioner participated in the e-tender process and was awarded work order No.2 dated 25.04.2018 for supply of two Air Circuit Breakers (hereinafter, 'ACBs') and other items/adjoining accessories, as well as to install/test/commission work. The work was valued at Rs.6,49,264/- and was to be carried out in 30 days. Pursuant to award of the work, the parties entered into Agreement dated 01.05.2018.

On 02.04.2019, the respondent issued Show Cause Notice to the petitioner asking it to explain as to why blacklisting/removal/temporary suspension action be not taken against it for raising bills despite not having carried out the work as per specifications and causing financial loss of Rs.6,49,264/- to DJB. The same was replied to by the petitioner vide letter dated 26.04.2019. An opportunity of personal hearing was granted to the petitioner on 08.07.2019. The respondent, thereafter, passed a circular dated 14.10.2019 debarring the petitioner.

Aggrieved, the petitioner approached this Court by way of W.P.(C) No.2252/2020, praying for setting aside of the proceedings against it including circular dated 14.10.2019. Vide order dated 10.12.2021 passed in the said writ petition, this Court directed that the circular dated 14.10.2019 shall not operate against it till the respondent passed 'a reasoned and speaking order, after considering the petitioner's reply'. Pursuant to order dated 10.12.2021, the respondent passed the impugned order and the petitioner has filed the instant petition assailing the same.

3. Learned counsel for the petitioner has submitted that the impugned order dated 08.02.2022 suffers from the same infirmity as circular dated 14.10.2019, being bereft of reasons and for not having considered the petitioner's reply. It is contended that the decision-making authority in connection with the impugned order dated 08.02.2022 is different from the authority who gave personal hearing to the petitioner. As such, the principle 'he who hears must decide' has not been adhered to. It is also contended that the impugned order dated 08.02.2022 debarred the petitioner for a reason beyond the show cause notice dated 02.04.2019.

4. Learned counsel for the respondent, on the other hand, has supported the impugned order. She has contested the maintainability of the present petition. Without prejudice, it is submitted that the petitioner's conduct has caused financial losses to the respondent. It is also submitted that the petitioner was granted two opportunities to present its case, however, it was unable to give a satisfactory explanation. Therefore, the debarment committee decided to debar the petitioner.

5. I have heard learned counsels for the parties and perused the material placed on record.

6. The petitioner contends that the work under order dated 25.04.2018 stood completed on 24.05.2018, the guarantee period of 6 months expired on 24.11.2018, and after installation of the equipment, it had no watch and ward over the site i.e. Bharatnagar Sewage pumping station (SPS). The inquiry by the respondent started in a premeditated manner by letter dated 13.02.2019, which was not served on the petitioner and showed that the competent authority had decided to debar the petitioner even before the issuance of the show cause notice. It is alleged that the i