Blacklisting in procurement processes must be justified, time-bound, and proportionate to the offense; indefinite blacklisting lacks legal support.

JUDGMENT

Prathiba M. Singh, J. (Oral)--The Petitioner is aggrieved by the blacklisting order dated 18th January, 2021 passed by Respondent No. 1 -New Delhi Municipal Council (hereinafter referred as `NDMC').

2. Bids were invited on 23rd November, 2017 from manufacturers and authorised distributors of Ayurvedic medicines. The Petitioner had submitted its bid along with the Earnest Money Deposit (hereinafter referred as `EMD'), but withdrew the same on 29th December, 2017. The NDMC, however, found that the Petitioner had submitted laboratory reports which, according to it, were false, as per the information obtained from the laboratory. In view thereof, the first blacklisting order of the NDMC was passed vide its order dated 28th March, 2018, which blacklisted the Petitioner indefinitely and barred it from participating in the procurement of Ayurvedic Medicines of NDMC. The EMD was also forfeited, as per Clause 18 of the tender documents. This blacklisting order was challenged by way of a writ petition in WP (Civil) 3336/2018 titled Rhonpal Biotech Pvt. Ltd. v. New Delhi Municipal Council & Anr. The blacklisting order was set aside and remanded by the Court in the following terms:

"The impugned order dated 28.03.2018 would stand withdrawn. However, it is made clear that the respondents would be at liberty to take appropriate action against the petitioner by issuing a fresh show cause notice and granting an opportunity to the petitioner to submit its explanation. The respondents would also give an opportunity of personal hearing to the petitioner's authorized representative and would be at liberty to pass a fresh order as deemed fit, on all grounds including the grounds taken in the impugned order."

3. This was followed by a show cause dated 25th April, 2018, issued by the NDMC by which the Petitioners were called upon to show cause as to why they should not be proceeded against in view of the false and fabricated test reports etc., On 9th May, 2018, the Petitioner filed its response to the said show cause notice. The second blacklisting order, dated 21st February, 2020, was then issued, by which the Respondent blacklisted the Petitioner for a period of 2 years with respect to all procurements of the NDMC and the forfeiture of the Petitioner's EMD was also confirmed.

4. The Petitioner was aggrieved by this second blacklisting order and approached this Court in W.P. (C) No. 3642/2020 titled Rhonpal Biotech Pvt. Ltd. v New Delhi Municipal Council & Ors. Vide order dated 21st February, 2020, the blacklisting order was upheld in the following terms:

"53. As observed by me above, the period of blacklisting the petitioner and whether it has to be only with respect to those Ayurvedic medicines for which the petitioner had participated in the tender, has not been properly considered by the respondents. I therefore, follow the approach guided by the Supreme Court.

54. The impugned order dated 21.02.2020, blacklisting the petitioner is upheld. The respondents shall, however, redetermine the period and whether the same is to operate with respect to all or some of the Ayurvedic medicines, afresh. The needful shall be done by the respondents/competent authority expeditiously but not later than three months from today."

5. Thus, the Court had directed that on the period of blacklisting and whether the same should apply qua all Ayurvedic medicines or only those medicines which were sought to be supplied by the Petitioner, the matter would be redetermined. Vide the impugned order, the Respondents have reiterated the ban period for a period of two years from 21st February, 2021 and for all medicines in the following terms:

"28. NOW, therefore, in the pursuance to the Hon'ble High Court Order dated 25.09.2020, it