Actions taken without affording a personal hearing violate principles of natural justice and are unsustainable in law.

ORDER :

1. The present petition has been filed assailing the impugned letter/ communication dated 18.03.2025 bearing no. CODIV-11036/2/2025-CO Division/Debar/14 issued by the National Highway Authority of India [NHAI / respondent] in regard to Amdi Fee Plaza (Annexure-P2).

2. Vide the above impugned letter / communication, the following action has been taken against the petitioner:

(i) the ongoing contract agreement dated 22.12.2023 (hereinafter ‘the contract agreement)’ between the parties, pursuant to which the petitioner operates the Amdi Fee Plaza as the user fee collection agency, has been terminated in terms of Clause 35(3) of the Contract Agreement between the parties;

(ii) the petitioner has been debarred from participating in future tender/s issued by the respondent no.1 for a period of two years in terms of Clause 21(i) of the Contract Agreement and Clause 3.1 & 3.2 of the Request for Qualification dated 01.01.2021 (RFQ) between the petitioner and the respondent;

(iii) on the basis of the above, the performance securities with respect to the contract agreements for operating each of the aforesaid fee plazas, deposited by the petitioner in terms of Clause 2.4 of the RFQ, have been sought to be encashed.

3. Learned senior counsel for the petitioner submits that the impugned action has been taken on the basis of a show cause notices issued on 04.02.2025 where, apart from a cryptic reference to an investigation by the Uttar Pradesh Special Task Force (UPSTF) resulting in an FIR No. 0017 filed on 22.01.2025 at P.S. Lalganj, Distt Mirzapur, Uttar Pradesh, no specific attribution/ lapse against the petitioner has been pointed out.

4. Further, it is submitted that a detailed response to the said show cause notice was submitted vide communication dated 08.02.2025 wherein the following points were emphasised:-

i. That there is no specific averment in the FIR as regards the petitioner, or any attribution of any fraudulent activity against the petitioner. Moreover, the allegations of carrying out fraudulent activities made by the accused in the report of the UPSTF have been made against the user fee collection agency (A.K. Construction) which managed the Amdi Fee Plaza prior to the petitioner and have not been made against the petitioner.

ii. That nothing was found during surprise search inspections conducted by the Project Director, PIU Officials, system integrators and NHAI software developers.

iii. It was further emphasised that the operations of the petitioner were in compliance with the NHAI guidelines.

It is submitted that the impugned letter fails to even notice much less deal with the elaborate submissions made by the petitioners in response to the show cause notice.

5. Further, it is brought to the attention of this Court that whereas the show cause notice sought to debar the petitioner only for a period of one year, the impugned letter purports to terminate the contract and also debar the petitioner for a period of two years.

6. It is further submitted that the show cause notice made no reference to any termination action by the respondent.

7. It is submitted that subsequent to the show cause notice being issued, surprise checks at the Amdi Fee Plaza were conducted by the supervision consultant (M/s. Bloom Companies LLC) of the respondent on 29.01.2025, 13.02.2025 and 25.02.2025. However, nothing untoward was found during the said checks.

8. Lastly, it is submitted that the impugned communications have been passed in utter violation of the principles of natural justice inasmuch as no hearing whatsoever was afforded to the petitioner. This is not refuted by learned counsel for the respondent.

9. Issue notice.

10. Learned counsel, as aforesaid, accepts notice on behalf of the respondent.

11. Respective counsel for the parties have been heard at some length.

12. It is noticed that communications / letters issued by the NHAI which are similar to the impugned communication in the present case and were issued in an identical factual matrix, ha