The principle of natural justice requires that the affected party be given a reasonable opportunity to defend themselves, and any proposed penalty/action should be mentioned specifically and unambiguously in the show cause notice.

JUDGMENT

Subramonium Prasad, J.

1. The present Writ Petition challenges the Order dated 31.05.2023, passed by the Respondent No.3 herein, terminating the Contract Agreement dated 19.08.2020, entered into between the Additional Director, CGHS (HQ) and M/s Goel Medicos against Tender ID No. 2020_DGHS_555011_1 for supply of indented medicines to the CGHS Wellness Centres at Sonipat, and the forfeiture of the Performance Bank Security of Rs.12,10,000/- and also debarring M/s Goel Medicos from participating in any tender or award of contract in any tender published by the CGHS pan India or continuation of any contract with CGHS for a period of two years.

2. Shorn of unnecessary details, the facts, leading to the present Writ Petition are as under:

a. The Petitioner herein is the Proprietor of a Proprietorship concern, namely, M/s Goel Medicos, which carries on business of retail pharmacy, pharmacy distributor and institutional supplier of medical/pharmaceutical products in Delhi-NCR Region. It is stated that M/s Goel Medicos is empanelled with CGHS as Authorized Local Chemist for supplying of Allopathic medicines to three CGHS Wellness Centers, namely, Dilshad Garden, Ghaziabad and Sonipat.

b. It is stated that on 08.04.2020 Respondents issued a notice inviting tender vide open tender notice No. F. No. 55-01/2016- 17/CGHS/MSD/ALC for empanelment of authorized local chemists for CGHS Delhi/NCR for the Financial Year 2020 to 2023. It is stated that the said tender was advertised on the Public Procurement Portal vide tender ID No. 2020_DGHS_555011_1.

c. It is stated that the Petitioner herein participated in the said tender and was declared as a successful bidder for several CGHS Wellness Centres including the Sonipat CGHS Wellness Centre.

d. It is stated that Mrs. Usha Goel, i.e. the mother of the Petitioner herein, was the sole proprietor of M/s Goel Medicos. It is stated that by way of a Gift Deed dated 31.07.2020, Mrs. Usha Goel transferred the proprietorship of M/s Goel Medicos to the Petitioner herein.

e. It is stated that on 18.08.2020, i.e. after executing the Gift Deed dated 31.07.2020 in favour of his son, Mrs. Usha Goel executed a Power of Attorney in favour of one Mr. Akash Jain, who was an employee of M/s Goel Medicos, authorizing him to sign the tender documents on her behalf in her absence.

f. It is stated that on the basis of the PoA, the tender documents were signed by Mr. Akash Jain on behalf of Mrs. Usha Goel, who had ceased to be the owner of M/s Goel Medicos pursuant to execution of Gift Deed dated 31.07.2020 in favour of her son, i.e. the Petitioner herein.

g. It is stated that a Contract Agreement dated 19.08.2020 was entered into between the Additional Director, CGHS (HQ) and M/s Goel Medicos. A Performance Security dated 17.08.2020 for a sum of Rs.12,10,000/- was submitted on behalf of M/s Goel Medicos vide BG No. 0255NDLG00004621 by Akash Jain.

h. It is stated that show cause notice dated 06.04.2023 with respect to CGHS Wellness Centre at Sonipat was issued by the Respondents against M/s Goel Medicos on the ground that the intimation of change of the proprietorship of M/s Goel Medicos was not given to the Respondent No.3 and the bid documents were signed by Mr. Akash Jain on the basis of the PoA executed by Mrs. Usha Goel who ceased to be the proprietor of M/s Goel Medicos subsequent to her signing the Gift Deed dated 31.07.2020 in favour of her son and the same amounts to fraudulent act/misrepresentation of facts on the part of M/s Goel Medicos as a false Power of Attorney, which is a notarized legal document, has been submitted to the CGHS based on which the Contract Agreement was executed between Goel Medicos through authorized signatory Akash Jain and Additional Director, CGHS (HQ) and, therefore, the Agreement does not have any legal sanctity. Relevant portion of the said Show Cause Notice reads as under:

"The Tender Inviting Authority CGHS Delhi, for tender ID 2020_DGHS_555011_1, i.e., Additional Director CG