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2022 Supreme(Ori) 70

IN THE HIGH COURT OF ORISSA, CUTTACK
B.R.Sarangi, V. Narasingh, JJ.
M/s. Durga Electricals And Electronics - Appellant
Versus
Mahanadi Coalfields Limited & Ors. - Respondents
W. P. (C) No. 17239 of 2021
Decided On : 15-02-2022

Advocates Appeared:
Mr. Manmaya Kumar Dash, Advocate, for the Appellant; M/S D. Mohanty, A. Mishra, B.P. Panda and D. Behera, Advocates, for the Respondent.

The central legal point established in the judgment is the requirement to comply with the principles of natural justice, including providing a fair hearing, in the process of blacklisting a bidder.

Headnote:

BID REJECTION - Blacklisting of Petitioner - Clause-14(E) of the NIT - [Clause-14(E) of the NIT] - The court discussed the rejection of the petitioner's bid and the subsequent blacklisting based on Clause-14(E) of the NIT. It highlighted the lack of specific information on the documents required to be submitted online and emphasized the violation of principles of natural justice in the blacklisting process. The court referred to various legal provisions and precedents to support its decision to quash the order banning the petitioner from submitting bids.

Fact of the Case:

The petitioner participated in a tender process and was declared as L-1 bidder. However, the bid was rejected and the petitioner was banned for two years from submitting bids in CIL and its subsidiaries, based on Clause-14(E) of the NIT, without a hearing. The petitioner challenged this decision through a writ petition.

Finding of the Court:

The court found that the rejection of the bid and the subsequent blacklisting of the petitioner without complying with the principles of natural justice were illegal. It quashed the order banning the petitioner from submitting bids.

Issues: The key issue was the legality of the rejection of the petitioner's bid and the subsequent blacklisting based on Clause-14(E) of the NIT, without providing an opportunity for a hearing.

Ratio Decidendi: The court emphasized the importance of complying with the principles of natural justice in the process of blacklisting and referred to various legal precedents to support its decision.

Final Decision: The writ petition was allowed, and the order banning the petitioner from submitting bids was quashed.

JUDGMENT

Dr. B.R. Sarangi, J. - The petitioner, by means of this writ petition, seeks to quash the order dated 26.05.2021 in Annexure-5, by which the bid of the petitioner has been rejected and the petitioner has been banned for 2 (two) years from being eligible to submit bids in CIL and its subsidiaries from the date of its issuance, taking recourse to Clasue-14(E) of the NIT; as also the consequential work order dated 26.05.2021 issued in favour of opposite party no.5 (inadvertently numbered as 4') vide Annexure-6; and to issue direction to the opposite parties to consider the representation of the petitioner dated 30.05.2021 under Annexure-7, within a stipulated period.

2. The factual matrix of the case, in brief, is that the petitioner is a proprietorship firm and participated in the process of tender, pursuant to the online bid invited by opposite party no.3, having digital signature certificate authorized by the Controller of Certifying Authority (CCA), Government of India, in respect of the work 'Conversion of 3.3 kV overhead line (Pump feeder) to 33 kV overhead line to feed power to proposed temporary field substation near stock No-6 of Ananta OCP of Jagannath Area'. Following due procedure of selection, the petitioner was declared as L-1 bidder. When the petitioner was waiting for the work order, on 26.05.2021, it was issued with a letter intimating that with reference to the NIT, the petitioner has participated in the tender and became L-1 bidder, but it failed in submitting the requisite document online as per NIT. Therefore, as per Clause-14(E) of the NIT, the bid of the petitioner was rejected and it was banned for 2 (two) years from being eligible to submit bids in CIL and its subsidiaries from the date of issue of the said letter. The very fact, that the petitioner was declared as L-1, establishes that it had produced all the relevant documents. Therefore, it was urged that subsequent rejection of its bid and banning the petitioner from participating for two years in the bids of CIL and its subsidiaries, vide Annexure-5 dated 26.05.2021, which amounts to blacklisting, is illegal, arbitrary and contrary to the settled position of law, and so also the consequential issuance of work order vide Annexure-6 in favour of opposite party no.5. Hence this writ petition.

3. Mr. M.K. Dash, learned counsel for the petitioner contended that the impugned communication/ order, vide Annexure-5 dated 26.05.2021, banning the petitioner for two years from being eligible to submit bids in CIL and its subsidiaries, cannot be sustained in the eye of law, having been passed without giving opportunity of hearing to the petitioner, which amounts to gross violation of principles of natural justice. To substantiate his contention, he has placed reliance on TELSA Transformers Limited v. Odisha Power Transmission Corporation Limited, 2016 (II) ILR CTC-237 and UMC Technologies Private Limited v Food Corporation of India (Civil Appeal No. 3687 of 2020 disposed of on 16.11.2020).

4. Mr. Debraj Mohanty, learned counsel appearing for the opposite parties, vehemently contended that since the petitioner had not submitted the requisite documents through online as per NIT, taking recourse to Clause-14(E) of the NIT, the bid of the petitioner has been rejected. As the petitioner has not adhered to the terms and conditions of the bid, it is not entitled to participate in the future bids. Therefore, the order impugned dated 26.05.2021 has been passed, for which no fault can be found with the authorities.

5. This Court heard Mr. M.K. Dash, learned counsel for the petitioner and Mr. D. Mohanty, learned counsel appearing for the opposite parties by hybrid mode, and perused the record. Pleadings having been exchanged between the parties, with their consent this writ petition is being disposed of finally at the stage of admission.

6. Though multiple reliefs have been sought before this Court, in course of hearing, Mr. M.K. Dash, learned counsel for the petitioner

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