Failure to disclose prior debarments in a tender is grounds for blacklisting, emphasizing the importance of transparency and integrity in procurement processes.

JUDGMENT

SHAJI P. CHALY, J This writ appeal is filed by the petitioners in W.P.(C) No.

30910 of 2018 challenging the judgment dated 19.12.2018, whereby the learned single Judge dismissed the writ petition, thus upholding the order passed by the Medical Corporation of India blacklisting the appellant on account of the suppression of material facts while submitting the contract in the instant case, which was affirmed by the Government in an appeal preferred by the appellant.

2. Brief material facts for the disposal of the writ appeal are as follows:

Appellant, a pharmaceutical company, submitted its tender for the supply of pharmaceutical drugs to the second respondent. Kerala Medical Services Corporation Ltd. (KMSCL) i.e., the second respondent blacklisted the appellant for the reason that Gujarat Medical Services Corporation (GMSCL) and Haryana Medical Services Corporation (HMSCL) had debarred the appellant from participating in their tenders for three years. GMSCL passed a debarring order for the reason that the information given by the appellant in respect of one of the drugs for which the appellant had submitted tender was not in terms of the notice inviting tender. Appellant has a case that it had not produced any forged/fabricated/false documents. However, the said mistake was an inadvertent one. So also, according to the appellant, in the impugned order passed by the Medical Corporation of India, proper reasons are not assigned so as to understand the case put forth against the appellant which prevented the appellant from making appropriate objections to the same. Eventhough the said aspect was pointed out before the State Government, the State Government also overlooked the said contention put forth by the appellant. The learned single Judge, without taking into account the said submission made in the writ petition, has arrived at the conclusion that the orders passed by the KMSCL and the State Government were in accordance with law and therefore, no interference as sought for by the appellant was required. It is also submitted that eventhough the appellant has put forth the contentions before the learned single Judge in respect of the proportionality principle on the basis of the blacklisting awarded against the appellant for a period of three years, the learned single Judge has not answered the said question, even though a reference in regard to the contention was made in the judgment. It is thus, raising the following grounds that this writ appeal is preferred:

i. Order of HMSCL was unauthorised, null and void and therefore had no legal effect. The petitioners filed appeal before the Hon'ble Supreme Court against the judgments of the High Courts confirming the orders of HMSCL and GMSCL and the same is pending.

ii. As on the date of execution of the Contract for the supply of 10 items to the second respondent for the year 2017-2018 order of HMSCL was not in existence. Therefore, there was no suppression or concealment of the said order while submitting the tender to the second respondent.

iii. The order of GMSCL is not in relation to any product in respect of which the appellant had entered into contract agreement for supply of drugs to the second respondent for the year 2017-2018. Intention of clause 5.2.7 is not to blacklist/debar a firm based blacklisting/debarring of the firm by another agency in respect of another product.

iv. Clause 5.2.7 does not empower the second respondent to terminate the contract based on an order of another agency debarring the firm from participating in the tender.

v. Blacklisting is a harsh and drastic measure and should not be resorted to except where there is cogent and compelling reasons. The debarring order of GMSCL is not for the reason of submitting any forged/false/fabricated document for stating false data that, too in relation to a product which the appellant had not quoted for supply of drugs to the second respondent.

vi. Clause 5.2.7 of the tender condition has no application to the