Excerpt
In this case, a dispute arose regarding a blacklisting order issued by Rajasthan Rajya Sahakari Upbhokta Sangh Limited (‘CONFED’) against Mohan Traders on the allegation that they were deriving double benefit using deceit.
Brief Facts
M/S Mohan Traders were awarded a contract to provide grain and pulses by Rajasthan Rajya Shikari Upbhokta Sangh Limited (‘CONFED’) on 13.7.16 which was valid up to 15.7.17. On 25.7.17, a notice was received by the Appellants to clarify the allegations against them that they were befooling the Respondents by presenting 13 Bills for Challans twice to derive double benefit. The Appellant in response submitted an explanation for the same on 11.7.17. Thereafter, the term of the contract was extended up to 15.10.17 and subsequently, on 2.1.19, a certificate of satisfactory completion of supply in terms of the contract was issued to the Appellant by the Managing Director, CONFED. Then on the back of the Appellant on 17.10.19, a Blacklisting Order was issued by CONFED. The Blacklisting Order was challenged via a Writ. The Single-Judge Bench dismissed the appeal on the ground of the availability of alternative remedies.
Contentions
R.M Lodha, the Counsel for Appellants, contended that the Single-Judge Bench erred in passing the order by bringing the attention of the Court on Section 38 of the Rajasthan Transparency in Public Procurement Act, 2012 (for short “RTPP Act”) and focused on the aspect that the Section provided appeal only in case of the early bidding process, not after the contract had been conferred on to the bidder. The next contention of Mr Lodha was that the Order passed by the Respondents is violative of the principles of Natural Justice as the Appellant had not been given a hearing before the passing of the Blacklisting Order
Mr Dhanpat Chaudhary contended that the Order passed by the Respondents under Section 43 of the RTPP Act is appealable under Section 38 of the Act so the Single-Judge Bench was correct in its judgment of dismissing the Writ Petition on the ground of availability of alternative remedy.
Court’s Decision
The Court set aside the decision of the Single-Judge Bench and an appeal was allowed. The Blacklisting Order of CONFED was also quashed. The Court negatived the contention that Writ jurisdiction could not be invoked if alternative remedies were available. The Court stated that the discretionary power of the Court could be invoked keeping in mind the facts and circumstances of a particular case. The Court observed the rule of issuing Writs in case of availability of remedies was not a rule of compulsion, rather it was the rule of discretion. The Court to further their reasoning invoked the decision of the Supreme Court in A.V.Venkateswaran, Collector of Customs, Bombay vs. Ram Chand Sobhraj Wadhwani & Anr. that ruled that a party who applied for the issue of a high prerogative Writ should before he approached the Court, had exhausted the remedies open to it under the law and it did not bar the jurisdiction of the High Court to entertain the petition or to deal with it, but it is rather, a rule which Courts had laid down for the exercise of their discretion.
The Court ruled that principles of Natural Justice were not adhered to, by the Respondents and it was observed by the Court that Blacklisting Orders could not be considered to be exceptional circumstances where rules could be cordoned off. The Court in its reasoning relied on the decision of Supreme Court in Raghunath Thakur vs. State of Bihar & Ors. where it was ruled that “blacklisting any person in respect of business ventures had civil consequences for future business of the person concerned and therefore, even if the rules did not express so, it was an elementary principle of Natural Justice that parties affected by any Order should have right of being heard and making a representation against the Order.
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