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Quashes Three-Year of S S Corporation Over Dues Without Hearing
The has set aside a three-year order against , a contractor for the in Udaipur, holding that the violated fundamental by imposing the ban without issuing a proper or granting a hearing. Justice Anoop Kumar Dhand, presiding over a single-judge bench, quashed the order passed by the , on .
A Case of Skipped Steps: The Order
The dispute arose from a tender for operating golf carts at the . emerged as the successful bidder and was awarded the contract. However, the company failed to clear certain outstanding dues despite receiving multiple notices from the . Rather than issuing a specific warning that non-payment could lead to from future tenders, the department directly passed an order the firm for three years from all departmental procurement processes.
Natural Justice Takes Center Stage
Appearing for the petitioner, counsels and argued that the was passed without any prior informing the contractor of the proposed action. They relied on the 's ruling in and , as well as a recent order of the , to stress that without an is a .
Opposing the petition, the respondents' counsel, (appearing with AAG ), submitted that multiple notices had already been issued demanding payment of dues, and that , empowered the department to debar defaulting contractors. They cited and in support.
What the Court Said
Examining the records, Justice Dhand observed that while the department had indeed issued several notices for payment, none of them contained any assertion that failure to comply would result in
or
from future tenders.
"The instant case is a clear case of violation of the
, wherein prior to passing of the order of
, the petitioner was not afforded any
,"
the court noted.
Drawing from the five-judge Constitution Bench decision in
, the court reiterated that
"no
can be passed against a person without granting an
."
It further quoted
to emphasize that a
includes being informed of the precise allegations and the proposed consequences. The court underscored:
"The
i.e.
has several facets, two of them being (a) notice of the case to be issued and (b) grant of due opportunity to explain oneself."
The Final Verdict
Holding the
unsustainable, the court quashed the
and granted the respondents liberty to issue a
clearly specifying the allegations.
"In the event, such a notice is issued by the respondents to the petitioner, it is expected from the respondents to consider the reply, so filed by the petitioner pursuant thereto and pass appropriate orders, strictly in accordance with law, after providing due
to the petitioner,"
the judgment concluded.
The ruling reaffirms that repeated demands for payment cannot substitute for a specific warning of and that administrative bodies must scrupulously follow natural justice before imposing penal consequences like .
