In contractual matters, judicial review under Article 226 is limited to the decision-making process. Where termination of a commercial contract is grounded in documented breach of safety protocols and supported by applicable contractual stipulations, the court will not substitute its own view for that of the administration.

1. The present writ petition under Article 226 of the Constitution of India has been filed by the petitioner-firm assailing the order dated 14.10.2024 (Annexure-11) passed by the Senior Divisional Commercial Manager, Ratlam, Western Railway, whereby Contract Agreement No. CA 11 RTM Wagon Cleaning-1 dated 29.09.2023, awarded to the petitioner-firm, was terminated and the security deposit amounting to Rs. 5,05,000/- furnished by the petitioner-firm was forfeited.

2. Briefly stated, the facts giving rise to the present writ petition are that the petitioner-firm is a Limited Liability Partnership firm duly registered under the GST Act and holding a Permanent Account Number. The respondent authorities issued an advertisement dated 09.04.2023 inviting bids for cleaning of all types of goods trains and disposal/sale of raw material. The petitioner-firm, being eligible, participated in the bidding process and was awarded the contract through an e-auction held on 29.09.2023. Consequently, a contract agreement was executed on 30.09.2023 for a period of three years, commencing from 04.11.2023 to 03.11.2026, for cleaning of wagons and disposal of material in the specified area.

3. It is the case of the petitioner-firm that during execution of the contract, a communication dated 12.12.2023 was issued by the respondents alleging certain irregularities in the cleaning of BOX-N wagons, and a penalty of Rs. 2,02,000/- was imposed. The petitioner-firm submitted a reply dated 18.12.2023 (Annexure-6) denying the allegations and explaining the practical difficulties in cleaning such wagons, inter alia, stating that the wagons were filled with clinker and, due to communication gaps, certain wagons remained unclean. Despite the said reply, the respondents reiterated the demand for penalty vide communication dated 19.12.2023 (Annexure-7).

4. Thereafter, a show cause notice dated 24.06.2024 (Annexure-8) was issued alleging that the petitioner-firm has failed to remove raw material from the tracks within the stipulated time and was using tractor-trolleys between railway lines, thereby posing safety risks. The petitioner-firm submitted a detailed reply dated 29.06.2024 (Annexure-8), explaining that adequate manpower and machinery had been deployed and that delays, if any, occurred due to operational constraints such as continuous placement of wagons and limited access for removal of material. It was also stated that the use of tractors was necessary for execution of the work.

5. A communication dated 08.07.2024 was thereafter issued by the respondents advising strict adherence to contractual conditions. According to the petitioner-firm, the earlier issues stood resolved and no further action was warranted. However, the impugned order dated 14.10.2024 (Annexure-11) came to be passed, whereby the contract was terminated with immediate effect and the security deposit was forfeited.

6. Aggrieved by the said termination order dated 14.10.2024 (Annexure-11), the petitioner-firm submitted a representation/ appeal dated 17.10.2024 (Annexure-12), which came to be rejected on 25.10.2024 without due consideration. Despite the pendency of the said representation, the respondents initiated steps for a fresh tender process for the same work.

7. Learned counsel for the petitioner-firm submits that the impugned order dated 14.10.2024 (Annexure-11) is arbitrary, illegal, and violative of the principles of natural justice, inasmuch as no adequate opportunity of hearin