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2025 Supreme(HP) 140
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
AJAY MOHAN GOEL, J.
Hem Raj - Appellant
Versus
The State of Himachal Pradesh and Others - Respondents
CWP No. 4344 of 2025
Decided On : 04-04-2025
Advocate Appeared:
For the Appellants : P.S. Goverdhan, Rakesh Thakur
For the Respondents: Pushpinder Singh Jaswal, Shravan Kumar Himalayan
A show cause notice must align with the grounds for action, and any order taken must be based solely on those grounds to uphold principles of natural justice.
Headnote:
(A) Contract Law - Principles of Natural Justice - The impugned order dated 31.12.2024 rescinded the agreement and blacklisted the petitioner based on a show cause notice that cited non-compliance with a condition not present in the contract - The court emphasized that actions with civil consequences must align with the grounds stated in the show cause notice. (Paras 6, 8, 9)
(B) Show Cause Notice - The court reiterated that a show cause notice must provide clear grounds for action, and the final order must be consistent with those grounds. (Paras 9)
Facts of the case:
The petitioner entered into a contract for transportation of essential commodities but was blacklisted and had his security forfeited based on alleged non-compliance with vehicle requirements not stipulated in the contract.
Findings of Court:
The court found the impugned order unsustainable as it was based on grounds not mentioned in the show cause notice, violating principles of natural justice.
Issues: The main issues were whether the petitioner was required to provide a minimum of 5 vehicles fitted with GPS/VTS and whether the impugned order was justified.
Ratio Decidendi: The court ruled that the impugned order was invalid as it relied on conditions not present in the contract and emphasized the necessity for show cause notices to align with the grounds for action.
Result: Writ petition allowed; the impugned order set aside.
JUDGMENT :
Ajay Mohan Goel, J.
1. By way of this writ petition, the petitioner has, inter alia, prayed for the following reliefs:
“(a) That necessary order, direction and writ may please be issued thereby quashing the impugned order dated 31.12.2004 (Annexure P-1) and further direction may please also be issued to decide the matter afresh by affording an opportunity of being heard to the petitioner.
(b) To issue necessary direction, order or writ thereby directing the respondents to allow the petitioner to perform his contractual obligations as per agreement dated 30.03.2024 (Annexure P-2).”
2. The case of the petitioner is that in terms of Annexure P-2 dated 30.03.2024, an agreement was entered into between him and respondent No.2 through its Area Manager qua the transportation of essential commodities from the wholesale godown of respondent No.2 at Ramshehar District Solan to the identified distribution centres. The grievance of the petitioner is that despite the fact that he did not violate any of the terms and conditions mentioned therein, yet, in terms of Annexure P-1 dated 30.12.2024, this agreement was rescinded and the security amount of Rs.80,000/- was ordered to be forfeited and he was blacklisted from participating in future bids. Learned Senior Counsel for the petitioner submitted that the impugned order dated 30.12.2024 is based on show cause notice dated 07.11.2024 copy whereof is appended as Annexure R-11 with the reply filed by the respondents. He submitted that perusal thereof would demonstrate that it was mentioned therein that the petitioner was mandated to provide 5 vehicles fitted with GPS/VTS for the purpose of the transportation and as he failed to do so, therefore, he was called upon to show cause why the tender be not rescinded and the security amount be not forfeited. Learned Senior Counsel argued that a perusal of the impugned order demonstrates that the same has not been passed on the basis of the contents of the show cause notice, but on considerations beyond the content of the show cause notice. Learned Senior Counsel further submitted that though it is a matter of record that the petitioner did not file any reply to the show cause notice nor he appeared before the Authority, but the same could not prejudice the case of the petitioner for the reason that there was no such condition signed by the petitioner, as would be evident from agreement Annexure P-2, in terms whereof, the petitioner was mandated to provide 5 vehicles fitted with GPS/VTS, as was mentioned in the show cause. He argued that adequate number of vehicles were provided as were required, duly fitted with GPS/VTS. Accordingly, he submitted that as the impugned order is per se bad in law and not sustainable in the eyes of law, the writ petition be allowed, as prayed for.
3. Learned Additional Advocate General vehemently argued that there is no merit in the writ petition as there is no infirmity in the order impugned. He submitted that the tender was invited in the year 2023 for 2 years, though, agreements were entered annually. Learned Additional Advocate General referred to the reply filed by the respondents and submitted that the petitioner was a habitual offender and there was always dereliction of duty on his part and several complaints were filed by the stakeholders. All these facts were holistically taken into consideration by the Authority while passing the order of termination of contract. Learned Additional Advocate General further submitted that termination of contract was done in larger public interest and, therefore, as the petition is without merit, the same be dismissed.
4. On 25.03.2025, this Court allowed the petitioner to participate in the bid subject to the final outcome of the writ petition. Thereafter, this Court directed the respondents to provide the result of the bids in a sealed cover. The record has been made available for the perusal of the Court and the same demonstrates that the petitioner is L-1 as far as HPSCSC
