2018 Supreme(Jhk) 1383
IN THE HIGH COURT OF JHARKHAND AT RANCHI
RONGON MUKHOPADHYAY, J.
Webel Technology Limited - Petitioner
Versus
The State of Jharkhand & Ors. - Respondents
W.P. (S) No. 5001 of 2009
Decided On : 05-02-2018
For the Petitioner:Mr. Abhay Kumar Singh, Senior Advocate.
For the Respondents: Mr. Ajit Kumar, AAG.
Headnote:
Arbitration and Conciliation Act, 1996 – Section 11 – Black Listed – Quashing of the order – In this writ application, the petitioner has prayed for quashing of the order as contained in Memo issued under the signature of the Under Secretary, Information Technology Department, Government of Jharkhand whereby and whereunder the petitioner-company has been black listed. – Held, State authorities at the time of entering into an agreement had entered into a dialogue and subsequently necessity was felt to revise the agreement. – It cannot be inferred by the authorities concerned that the act of the petitioner in invoking the arbitration clause by delaying signing of the revised agreement is a deliberate act. – In fact the impugned order seems to be based on presumptions and assumptions without there being any valid proof with respect to the charges which have been alleged against the petitioner-company. – It seems from a perusal of the impugned order as well as from the order, that the respondent-authorities had approached the issue with a biased frame of mind may be on account of the Award having been passed in favour of the petitioner. – Absence of proper consideration of the show-cause submitted by the petitioner-company and basing the order on surmises without there being any justifiable reasons, the impugned order becomes unsustainable in the eye of the law. – Writ Application Allowed
Heard Mr. Abhay Kumar Singh, learned senior counsel for the petitioner and Mr. Ajit Kumar, learned AAG for the respondents-State.
2. In this writ application, the petitioner has prayed for quashing of the order as contained in Memo No. 645 dated 10.07.2009 issued under the signature of the Under Secretary, Information Technology Department, Government of Jharkhand whereby and whereunder the petitioner-company has been black listed.
3. The factual aspects of the case briefly stated reveals that an agreement was entered into between the petitioner-company and the Department of Information Technology, Government of Jharkhand dated 02.04.2003 for execution of future literacy programme in 500 selected government schools under the government over a period of 5 years. It is the case of the petitioner that the Information Technology Department was not willing to provide the list of schools unless the petitioner agreed to the changes in the terms and conditions of the agreement dated 02.04.2003 and accepted execution of a new agreement replacing the original agreement. Since it is the case of the petitioner that it was prevented from performing its reciprocal promise, it had no other option but to invoke the arbitration clause by filing an application under Section 11 (6) of the Arbitration and Conciliation Act, 1996 for appointment of Arbitrator. The said application bearing A.A. No. 17 of 2004 was allowed and Hon'ble Justice Sateshwar Roy (retired) was appointed an Arbitrator for deciding the dispute between the parties. The order of appointment for an Arbitrator was challenged in this Court in W.P.(C) No. 1777 of 2005 which however was dismissed. It was also challenged before the Hon'ble Supreme Court in S.L.P. No. 14655 of 2005 which also was dismissed on 08.05.2006. The arbitration proceeding finally concluded with an Award being passed by the sole Arbitrator on 23.07.2009. In the meantime, a decision was taken by the government to black list the petitioner with immediate effect vide Memo No. 1656 dated 26.10.2006. The said order was challenged by the petitioner in W.P.(C) No. 352 of 2008 in which vide order dated 16.07.2008, the impugned order was quashed with a liberty to the respondents that if they intend to take any action with the petitioner-company they may do so after complying with the principles of natural justice. The appeal preferred against the Award dated 23.07.2007 was also dismissed vide judgment dated 16.06.2009. Immediately thereafter a show-cause notice was issued to the petitioner as to why it should not be blacklisted to which a reply was filed. Ultimately vide impugned order dated 10.07.2009, the petitioner-company was black listed by the Government of Jharkhand and the Department of Information Technology with a further direction that it shall not be eligible to participate in any tendering process involving any project of the Government of Jharkhand or any of its agencies.
4. It has been stated by Mr. Abhay Kumar Singh, learned senior counsel for the petitioner that the punch-line is that the order is motivated because of Arbitration Award which shows the mala-fide nature of the respondents. He submits that the allegations are not supported by facts. He however submits that there is no charge of fraud, but the impugned order has given a finding in that respect. Learned senior counsel submits that the charge no. 2 affects the representation of the petitioner-company and whether the author of the impugned order could have framed the charge or could have decided the issue of fraud. He submits with respect to the questions formulated by stating that only a Court could have conducted an inquiry and come to a finding. He submits that the charge could have been proved by an ordinary Civil Court and only then the said charge could have been included in the show-cause notice. Stating further Mr. Singh submits that no rule of blacklisting in the Information & Technology Department has been formulated and in fact