Blacklisting entails serious civil consequences and cannot be imposed without strict adherence to the principles of natural justice, specifically a show cause notice. However, judicial review in contractual matters like tender cancellation is limited unless arbitrariness or mala fides are established.

Order on Board

Per Ramesh Sinha, Chief Justice

1. Heard Mr. Adarsh Patel, learned counsel for the petitioner appearing through virtual mode and Mr. Amit Singh, Advocate. Also heard Mr. Praveen Das. Addl. Advocate General as well as Mr. Pankaj Agrawal, learned counsel for Respondent No. 2.

2. The present writ petition has been preferred under Article 226 of the Constitution of India calling in question the legality, validity and propriety of the order dated 31.12.2025 passed by Respondent No. 2, whereby the tender bearing No. 177070 dated 06.10.2025 has been cancelled, the petitioner has been debarred/blacklisted for a period of one year, and the Fixed Deposit Receipt (FDR) amounting to Rs. 1,50,000/- submitted by the petitioner has been forfeited.

3. The present petition has been filed by the petitioner seeking the following reliefs:-

10.1 To issue a writ of certiorari and to quash and set aside the order dt. 31.12.2025 (Annexure-P/4) passed by Respondent no. 2 by which the tender allotted in favor of the petitioner has been- cancelled and blacklisting/debard for a period of one year has been directed.

10.2 To issue a writ of mandamus to direct the respondent No.2 allowing the petitioner to continue with the work and to adjust the additional performance bank guarantee with the outstanding dues.

10.3 To issue a writ of mandamus and to direct the respondent no. 2 to consider the pending representation submitted by the petitioner and pass a reasoned order.

10.4 Any other suitable relief deemed fit in the facts and circumstances of the case may also kindly be granted together with the cost of this Petition.”

4. The brief facts of the case as emerges from the pleadings of the petition are that, the Petitioner Company, a duly incorporated entity engaged in execution of public infrastructure and road construction works, through its Director, challenging the arbitrary and illegal action of Respondent No. 2 in cancelling the tender, forfeiting security, and debarring/blacklisting the Petitioner for a period of one year. The Respondent No. 2 had issued NIT No. 117/15 FC/NAPANI/2025 dated 06.10.2025 inviting bids for road repair and BT topping works, pursuant to which the Petitioner participated in accordance with the prescribed tender conditions and was declared the L-1 bidder at 21.35% below SOR. Subsequently, while issuing the Letter of Acceptance, the Petitioner was directed to deposit an additional performance guarantee of Rs. 24,17,550/-, however, instead of refusing compliance, the Petitioner made a bona fide request for adjustment of the said amount against its admitted outstanding dues of Rs. 1,64,40,496.90/- payable by the Respondents under a prior agreement. Despite such reasonable request and without issuing any show cause notice, granting opportunity of hearing, or considering the adjustment request, the Respondent No. 2 passed the impugned order dated 31.12.2025 cancelling the tender, forfeiting the FDR of Rs. 1,50,000/- and debarring/blacklisting the Petitioner for one year. The Petitioner immediately submitted a detailed representation dated 03.01.2026 seeking reconsideration, highlighting that no loss was caused to the Corporation and that the request was bona fide, however, the same was not considered or decided by a reasoned order. The impugned action, passed in violation o