The judgment establishes that the exercise of unfettered discretion by the Authorities, without complying with the Principles of Natural Justice, renders their decision illegal and subject to judicial scrutiny.

JUDGMENT :

B.R. Sarangi, J.

The Petitioner, which is a Proprietorship Firm and was engaged in transportation of food grains, has filed this Writ Petition, represented through its Proprietor-Prabhat Kumar Biswal, seeking to quash the letter dated 27.09.2016, under Annexure-8, issued by Opposite Party No.1 terminating the contract and forfeiting the Security Deposit including Bank Guarantee of the Petitioner Firm lying with the Food Corporation of India (FCI) against the contract and getting the work done for the unexpired period of the contract at his risk and cost, on account of breach of contract.

2. The factual matrix of the case, in brief, is that the Food Corporation of India (FCI), a Public Sector Undertaking of Govt. of India, was set up under the Food Corporations Act, 1964, in order to fulfill the objectives of the Food Policy. Opposite Party No.1-FCI issued a Notice on 10.03.2015 inviting tenders through online in respect of handling of food grains at Railhead, Hirakud and transportation to Food Storage Depot (FSD), Hirakud, and vice-versa for a period of two years. Abide by the terms and conditions of the tender prescribed in the Notice Inviting Tender (NIT), the Petitioner submitted his tender and being the lowest bidder, he was awarded with the work. On being called upon, the Petitioner deposited a sum of Rs.5,75,000/- towards 50% of the Security deposit, as rest 50% was to be deducted from the admitted bills of the Petitioner. The Petitioner, as per the terms and conditions of the NIT, also furnished a Bank Guarantee of Rs.23,00,000/- bearing No.0972415-BG0000138 dated 29.05.2015 issued by SBI, SME Branch, Sambalpur, forming 10% of the contract value of Rs.2,30,00,000/-, which was to remain in force and effective up to 28.11.2017. After work was awarded, the Petitioner started execution of the same by transporting food grains, by engaging trucks of various truck owners of Sambalpur Truck Owners Association, from the FSD of the FCI, at Hirakud, to Railhead, Hirakud, and vice-versa. The distance from FSD, Hirakud to Railhead, Hirakud, is about 11 Kms. The food grains were being loaded on the trucks supplied by the Petitioner by labourers of the FCI at the Depot and the food grains were unloaded at the Railhead, Hirakud, by the labourers engaged by Opposite Party No.1. After loading of the food grains, the said trucks were duly sealed by the FCI personnel and in course of transportation from Depot to Railhead, 10 vehicles were used to ply at a time, and there used to be two personnel of the FCI, one at the front end and the other at the rear end of the convoy.

2.1 On 06.06.2016, a written complaint was lodged by the ASI of Police, Khetrajpur, Sambalpur, alleging therein that on 31.05.2016, while performing patrolling duty, 30 bags weighing 50 Kgs., each lying near Biraja Temple, Laxmidunguri were found. On enquiry by the local police, it was found that the said rice packets were deposited at FSD, Hirakud, and on intimation by the FCI Manager it came to light that the said rice packets were destined to Dumka/Jasidih, Jharkhand, being transported by the Petitioner on 31.05.2016 by Rice Rake being loaded at Railway siding. Basing on the said written complaint, FIR was drawn against the Petitioner U/s 407 IPC for alleged commission of criminal breach of trust, pursuant to which, the Petitioner approached this Court by filing ABLAPL No.11302 of 2016 and this Court, vide Order dated 31.08.2016, allowed the Petitioner on bail. Thereafter, the Petitioner approached this Court by filing CRLMC No.2688 of 2016 U/s 482 of the Cr.P.C. for quashing of the criminal proceeding, which is pending for consideration.

2.2 Opposite Party No.5-Superintendent of Police, Sambalpur, intimated and requested Opposite Party No.2 to cancel the license of the Petitioner. Opposite Party No.2, vide letter dated 22.07.2016, unilaterally intimated the Petitioner regarding recovery of the cost of 30 bags of rice from his bills and further gave a warning tha