Allowed

Smt Priyanka Dubey v. State of Up and 2 Others

Allahabad HC9 Jul 2024WRIC/16171/2024

Case brief

AI extract

What is this about?

This High Court set aside an impugned order that cancelled the petitioner's speedboat running licence and blacklisted her indefinitely without holding a hearing. The court held that blacklisting is a drastic remedy requiring strict adherence to natural justice principles.

What did the court decide?

Impugned order dated 11.03.2024 passed by respondent no. 03 cancelling licence and blacklisting petitioner was quashed and set aside.

Smt Priyanka Dubey vs State of Up and 2… — Pension and Retirement Benefits | Allahabad HC (2024)

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Neutral Citation No. - 2024:AHC:131070-DB

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Court No. - 29

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Case :- WRIT - C No. - 16171 of 2024 Petitioner :- Smt Priyanka Dubey Respondent :- State Of Up And 2 Others Counsel for Petitioner :- Atul Kumar Shahi Counsel for Respondent :- C.S.C.,Narendra Pratap Singh

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Hon'ble Mahesh Chandra Tripathi,J. Hon'ble Prashant Kumar,J.

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Heard Sri Anoop Trivedi, learned Senior Advocate assisted by Sri Atul Kumar Shahi, learned counsel for the petitioner, Sri R.M. Upadhyay, learned Additional Chief Standing Counsel for the State-respondent no.1 and Sri Narendra Pratap Singh, learned counsel for respondent nos.2 and 3-Gorakhpur Development Authority.

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The instant writ petition is preferred inter alia with the following relief :-

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"(i) Issue an appropriate writ, order or direction in the nature of certiorari quashing the impugned order dated 11.03.2024 passed by respondent no.03 (annexed as Annexure No.01)."

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The record reflects that Gorakhpur Development Authority (in short 'G.D.A.') had floated a scheme under the Ramgarh Tal Project and accorded licence in favour of the petitioner qua Platform No.06, in front of Water Sports Complex for running of Speedboad at Naya Savera situated in Ramgarh Tal, Gorakhpur for which an agreement was executed between the parties on 19.02.2020 and by means of letter dated 22.02.202o issued by the Secretary, G.D.A., the petitioner was authorized to run speedboat at the allotted place. Petitioner's boat allegedly collided with a Shikara boat due to which tourists fell in the lake and pursuant thereto, Secretary, G.D.A. called for an explanation from the petitioner vide letter dated 25.01.2021. Petitioner submitted her explanation on 27.01.2021 wherein it was indicated that the alleged accident took place on account of sudden stopping of Shikara Boat in the way of petitioner's speedboat and all the tourists were rescued through other boats of the petitioner. In pursuance of petitioner's application dated 22.07.2022, she was allowed to run speedboat from Platform no.1 instead of Platform no.6. Thereafter, vide letter dated 02.12.2023, she was again required to run her speedboat from Platform no.6, but she unauthorizedly continued to run Speedboat as well as Jet-Ski Water-Craft and Tourist Motorboat from Platform No.1, despite she was not authorized to do the same.

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It is claimed that the petitioner was again informed to ensure running of her speedboat only from Platform no.6, otherwise her licence will be cancelled, but she still continued to run her speedboat as well as Jet-Ski Water-Craft and Tourist Motorboat from Platform no.1. Even though, initially the petitioner was

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orally instructed not to run Speedboat as well as Jet-Ski Water-Craft in contravention of the terms and conditions of the lease agreement but she did not pay any heed to the instructions and continued to violate the terms and conditions of the lease agreement.

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Finally, vide order dated 11.03.2024 petitioner's licence has been cancelled and her entire deposit was also forfeited by same impugned order. She has also been blacklisted. In this backdrop, learned Senior Advocate appearing on behalf of the petitioner states that the impugned order is per se illegal and the same is hit by the principles of natural justice as no opportunity was accorded to the petitioner while passing the impugned order. He has placed reliance on judgments passed by Hon'ble Apex Court in the matters of Erusian Equipment and Chemicals Ltd. vs. State of West Bengal and another, (1975) 1 SCC 70 and UMC Technologies (P) Ltd. vs. Food Corporation of India and another, (2021) 2 SCC 551 wherein the Court has held that before blacklisting an opportunity is to be accorded. He further submits that by the impugned order, not only the licence of the petitioner was cancelled but she has also been blacklisted. In view of the factual situation that the impugned order is hit by principles of natural justice, the same is liable to be set aside.

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Per contra, learned counsel for respondent-G.D.A. vehemently opposed the writ petition placing reliance on agreement, wherein, in case there is any dispute, the petitioner has efficacious remedy to approach the appropriate authority. Moreover, in case, the petitioner has got an efficacious remedy to press relief before the appropriate authority, the petitioner may approach the concerned authority for redressal of her grievances.

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Heard rival submissions of learned counsel for the parties and perused the record.

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We have occasion to peruse the impugned order and we find that the said order has been passed straightaway without according any opportunity to the petitioner. While passing the impugned order, not only the licence of the petitioner was cancelled, but at the same time, the petitioner was also blacklisted without specifying any time period, in other words for an indefinite period.

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Recently, a three Judges' Bench of the Apex Court in the case of The Blue Dreamz Advertising Pvt. Ltd. and another vs. Kolkata Municipal Corporation and others, 2024 INSC 589 has held as under :-

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"22. Blacklisting has always been viewed by this Court as a drastic remedy and the orders passed have been subjected to rigorous scrutiny. In Erusian Equipment & Chemicals Ltd. vs State of West Bengal & Anr. (1975) 1 SCC 70, this Court observed that

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"20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains. The fact that a disability is created by the order of blacklisting indicates that the relevant authority is to have an objective satisfaction...."

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23. In Mr. B.S.N. Joshi (supra), this Court held that

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"41. ... When a contractor is blacklisted by a department he is debarred from obtaining a contract, but in terms of the notice inviting tender when a tenderer is declared to be a defaulter, he may not get any contract at all. It may have to wind up its business. The same would, thus, have a disastrous effect on him. Whether a person defaults in making payment or not would depend upon the context in which the allegations are made as also the relevant statute operating in the field. When a demand is made, if the person concerned raises a bona fide dispute in regard to the claim, so long as the dispute is not resolved, he may not be declared to be defaulter." (Emphasis supplied)

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24. This Court in Kulja Industries Ltd. (supra) after setting out the legal position governing blacklisting/debarment in USA and UK held that:

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"25. Suffice it to say that "debarment" is recognised and often used as an effective method for disciplining deviant suppliers/contractors who may have committed acts of omission and commission or frauds including misrepresentations, falsification of records and other breaches of the regulations under which such contracts were allotted. What is notable is that the "debarment" is never permanent and the period of debarment would invariably depend upon the nature of the offence committed by the erring contractor.

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26. In the case at hand according to the respondent BSNL, the appellant had fraudulently withdrawn a huge amount of money which was not due to it in collusion and conspiracy with the officials of the respondent Corporation. Even so permanent debarment from future contracts for all times to come may sound too harsh and heavy a punishment to be considered reasonable especially when (a) the appellant is supplying bulk of its manufactured products to the respondent BSNL, and (b) the excess amount received by it has already been paid back."

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26. In other words, where the case is of an ordinary breach of contract and the explanation offered by the person concerned raises a bona fide dispute, blacklisting/debarment as a penalty ought not to be resorted to. Debarring a person albeit for a certain number of years tantamounts to civil death inasmuch as the said person is commercially ostracized resulting in serious consequences for the person and those who are employed by him."

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In view of the order passed by Hon'ble Apex Court in catena of decisions including the matters of Erusian Equipment's case (supra) , UMC Technologies's case (supra) and The Blue Dreamz Advertising Pvt. Ltd.'s case (supra) , the law is well settled that before blacklisting an opportunity has to be accorded to the person, who is being blacklisted and as such, the impugned order is hit by the principles of natural justice and is unsustainable in the eyes of law. Accordingly, impugned order dated 11.03.2024 is hereby set aside and the matter is relegated to the concerned authority to proceed strictly in accordance with law.

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With the aforesaid observations, the instant writ petition is disposed of.

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Order Date :- 13.8.2024 Manish Himwan

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Digitally signed by :- MANISH HIMWAN High Court of Judicature at Allahabad

Smt Priyanka Dubey v. State of Up and 2 Others

Case brief

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Smt Priyanka Dubey v. State of Up and 2 Others

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