Termination of contracts requires explicit reasons and adherence to principles of natural justice, including the provision of a fair hearing and proper fact-finding.

JUDGMENT :

B.P. Routray, J.

1. Heard Mr. Rath, learned counsel for the Petitioner and Mr. Mohapatra, learned counsel for Opposite Party No.1 – Rourkela Municipal Corporation, and Mr. Dash, learned Additional Government Advocate for State-Opposite Party.

2. Both the writ petitions being interlinked and between same parties are heard together and disposed of by this common Judgment.

3. W.P.(C) No.22944 of 2025 has been filed with the prayer to quash the impugned order of termination of contract dated 25^th July 2025 under Annexure-9, and the second writ petition in W.P.(C) No.34578 of 2025 has been filed by the same Petitioner praying for release of the admissible outstanding dues from April, 2025 onwards.

4. The Petitioner is a Kine house registered under the Indian Trust Act as a charitable trust running for the benefit of cattles, particularly stray cattles. It is submitted that more than three hundred cattles have been boarded inside Petitioner’s Kine house. The Opposite Party, i.e. Rourkela Municipal Corporation (in short ‘RMC’) used the services of the Petitioner for its purpose as a rehabilitation ground for stray cattle as well as dead animals and carcasses thereof from RMC area. On 25^th July 2025, a notice of termination the contract between the Petitioner’s Kine house and RMC was issued by the RMC citing reasons that the Kine house is indulged in activities in violation of terms and conditions outlined in the Operation and Maintenance (O & M) Agreement as per Annexure-5. The same was challenged in first writ petition, i.e. W.P.(C) No.22944 of 2025 and this Court vide order dated 20^th August 2025 passed an interim order directing that the impugned order of termination dated 25^th July 2005 under Annexure-9 shall not be given effect to till next date, along with the direction to release such pending outstanding bills against the RMC, if there is no other legal impediment. The said interim order of stay of impugned termination order dated 25^th July 2025 is in force till date. But what happened in the meantime is that, the pending outstanding dues of the Petitioner due on RMC has been withheld on the ground that the same are not supported with requisite bank statements as proof of expenditure in terms of Clause (v) of the Contract. Accordingly, the Petitioner filed the second writ petition, i.e. W.P.(C) No.34578 of 2025 with the prayer afore-stated.

5. Admittedly, the bills of the Petitioner from July 2025 onwards are pending with RMC till date. Clause (v) of the Contract (Annexure- 5) dated 1^st March 2025 speaks that, “during submission of the bill, which should be accompanied with bank statement regarding expenditure details”.

6. Coming now to the challenge in respect of the order of termination of contract dated 25^th July 2025, it is found that the show cause submitted by the Petitioner pursuant to notice issued by RMC is not found satisfactory in the opinion of the RMC. It needs to be mentioned here that it is well settled that when a party is asked to submit his show cause and the punitive action is taken pursuant to consideration of the show cause reply, the same must reflect the reasons dealing with the grounds taken in the show cause reply. But on bare perusal of the impugned order dated 25^th July 2025 (Annexure-9 to first writ petition), the same does not reveal any such reason assigned or mentioned by RMC while terminating the contract, except mentioning one line that the show cause is found unsatisfactory.

7. In the same order, it is though mentioned that certain ongoing activities happening in the kind house are in violation of terms and conditions outlined in the co