IN THE HIGH COURT OF ALLAHABAD
M. KATJU, SUNIL AMBWANI
VEEKAY CONNECTORS (P) LTD - Appellant
Versus
NATIONAL SMALL INDUSTRIES CORPORATION ltd - Respondents
C. M. W. P. 35782 Of 2004
Decided On : 10/02/2004
Fraud and Forgery - Indian Companies Act - S. N. Mukherjee v. Union of India, AIR 1990 SC 1984 - State of Orissa v. Dhaniram Lohar (2004) 5 SCC 58 : (AIR 2004 SC 1794) - [Indian Companies Act, S. N. Mukherjee v. Union of India, AIR 1990 SC 1984, State of Orissa v. Dhaniram Lohar (2004) 5 SCC 58 : (AIR 2004 SC 1794)] - The impugned orders were quashed as they did not contain reasons, violating the principles established in S. N. Mukherjee v. Union of India and State of Orissa v. Dhaniram Lohar.
Fact of the Case:
The petitioner, a private limited company, challenged impugned orders alleging fraud and forgery by the Bharat Sanchar nigam Limited (B. S. N. L.) resulting in cancellation of its registration certificate and blacklisting for three years. The impugned orders were found to be illegal due to lack of reasons, violating the requirement for recording reasons in administrative orders with civil consequences.
Finding of the Court:
The impugned orders were quashed, and the authority was directed to pass fresh orders after giving the petitioner an opportunity of hearing and addressing their objections.
Issues: Challenge to impugned orders alleging fraud and forgery, lack of reasons in the impugned orders, violation of the requirement for recording reasons in administrative orders with civil consequences.
Ratio Decidendi: The impugned orders were quashed due to the absence of reasons, violating the principles established in S. N. Mukherjee v. Union of India and State of Orissa v. Dhaniram Lohar.
Final Decision: The petition was allowed, and the impugned orders dated 25-3-2004 and 30-6-2004 were quashed. The authority was directed to pass fresh orders after giving the petitioner an opportunity of hearing and addressing their objections. No order as to costs.
( 2 ) THE petitioner has challenged the impugned orders dated 25-3-2004 (Annexure 9 to the petition) and 30-6-2004 (Annexure 14 to the petition ).
( 3 ) SINCE we are deciding the case on a purely legal point in our opinion it is not necessary for us to call for counter affidavit. We have heard learned counsel for the respondents.
( 4 ) THE petitioner is a private limited company registered under the Indian Companies act, and is primarily engaged in the manufacture of Fibre Optic Communication accessories.
( 5 ) ON 13-3-2002 the Bharat Sanchar nigam Limited respondent No. 2 (hereinafter called B. S. N. L.) floated a global tender for the supply of Fibre Distribution Management system (FDMS ). True copy of the tender notice dated 13-3-2002 is Annexure-1 to the writ petition.
( 6 ) UNDER the terms of the tender notice the supply of manufactured items was to be made as per the specifications given by the technical Communication Engineering Centre (TEC) established by the department of telecom, Government of India. The further requirement was that the bidders had to obtain a Type Approval Certificate in pursuant to the aforesaid tender notice. The petitioner submitted its bid and the tender was opened by the B. S. N. L. on 30-7-2002.
( 7 ) THE petitioners bid was accepted and. a purchase order was issued on 8-5-2003, and it executed the contract. On the basis of that contract further order has to be placed. It is alleged that due to certain lobby against the petitioner the impugned orders have been passed.
( 8 ) WE have carefully perused the impugned orders dated 25-3-2004 and 30-6-2004, and we are of the opinion that the impugned orders are illegal and are liable to be set aside on the short point that they do not contain reasons.
( 9 ) THE impugned order dated 25-3-2004 states : "dear Sir, with reference to the above captioned registration certificate, we have received several letters of complaint informing us of fraud and forgery committed by you : from b. S. N. L. , Lucknow, Jaipur and Bhopal and also manipulation in the contents of the said certificate and thereby preparation of forged documents with the intent to gain undue advantage. Your permanent registration certificate as stated above stands cancelled and M/s. Veekay Connectors (P) Ltd. is blacklisted for a period of three years with immediate effect. The original certificate under Single point Registration Certificate must be returned to this officer immediately. Further use of the aforesaid certificate is strictly prohibited and use of it in any manner whatsoever will be dealt as per law. "
( 10 ) A perusal of the impugned orders dated 25-3-2004 shows that it refers to certain complaint of fraud and forgery alleged to be committed by the petitioner, and manipulation in the contents of the certificate and preparation of forged documents with the intent to gain undue advantage. It is only an allegation but not the reasons. In the second paragraph of the said letter dated 25-3-2004 it is stated that the petitioners permanent registration certificate stands cancelled and it is blacklisted for three years. Thus the impugned order certainly has civil consequences.
( 11 ) THE petitioner has stated in paragraphs 44 to 47 of the petition that it was not given opportunity of hearing before passing the impugned order dated 25-3-2004. Since we have not called for counter affidavit we are not giving a decision on the point whether opportunity of hearing was given to the petitioner before passing the impugned order dated 25-3-2004. However, even assuming that opportunity of hearing was given yet the order dated 25-3-2004 is illegal because it does not contain reasons. It is well settled that before passing an order which has civil consequences
REFERRED TO : State of Orissa v. Dhaniram Lohar
Raj Kishore Jha v. State of Bihar
Pavanendra Narin Verma v. SGPGI of Medical Sciences
S. N. Mukherjee v. Union of India
Union of Industries v. G. T. C. Industries
State Govt. Houseless Harijan Employees Association v. State of Karnataka
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