Allowed¶28

M/S Jay Anand Food Industries Thr. Its Manager v. State of Maharashtra and Anr.

Bombay HC7 Feb 2025WP/1059/2024

Case brief

AI extract

What is this about?

FCI e-auction debarment; OMSS (D) Wheat-URS tender Clause 10(K); show cause notice one-year debarment expiring 24.06.2022; impugned order 30.01.2024 set aside beyond one year; writ allowed; EMD refund subject to criminal case outcome; FIR CR 274/2020 Panvel City Police Station; Essential Commodities Act ss. 3 and 7; seizure of 270 MT rice and 43 MT wheat with FCI logo; Bombay High Court WP 1059 of 2024, decided 05.05.2025, per M. S. Karnik, J.

What did the court decide?

Writ petition allowed; impugned order dated 30th January 2024 set aside insofar as it extends debarment beyond 24th June 2022; refund of EMD made subject to outcome of criminal proceedings. ¶28

M/S Jay Anand Food Industries Thr. Its Manager vs State of Maharashtra and Anr. — Bombay HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

Writ petition allowed; impugned order dated 30th January 2024 set aside insofar as it extends debarment beyond 24th June 2022; refund of EMD made subject to outcome of criminal proceedings.

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Issue for consideration

Whether the impugned order dated 30th January 2024 debarring the petitioner from participating in future e-auctions with the FCI till the outcome of the criminal case pending at Panvel Court is justified when the show cause notice contemplated debarment only for a period of one year, which expired on 24th June 2022. +1 more

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Court's answer

The impugned order dated 30th January 2024 debarring the petitioner from participating in future e-auction with the FCI till the outcome of the criminal case is unjustified and is set aside insofar as it extends beyond the period of one year, i.e., from 24th June 2022, as contemplated in the show cause notice, whose one-year period expired on 24th June 2022.

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Ratio / Principle

Refund of the EMD amount to the petitioner will be subject to the outcome of the criminal proceedings pending against the petitioner.

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Detailed headnote1 paragraphs

Bombay High Court (Alok Aradhe, CJ. and M. S. Karnik, J.; order per M. S. Karnik, J.), Writ Petition No. 1059 of 2024, decided 5 May 2025: The petitioner, an FCI-empanelled purchaser of wheat under OMSS (D), was debarred by FCI order dated 30th January 2024 from future e-auctions till the outcome of a criminal case (FIR CR No. 274 of 2020, Panvel City Police Station, under ss. 3 and 7 of the Essential Commodities Act) arising from seizure of rice and wheat bearing the FCI logo. Holding that the show cause notice dated 25th June 2021 contemplated debarment only for one year, which period expired on 24th June 2022, the Court held the impugned order unjustified and set it aside insofar as it extended beyond that one-year period. The writ petition was allowed, with the Court directing that refund of EMD remains subject to the outcome of the criminal proceedings.

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24-WP.1059.2024.doc

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Jvs.

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION

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WRIT PETITION NO. 1059 OF 2024

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Digitally signed by JAYANT JAYANT VISHWANATH VISHWANATH SALUNKE SALUNKE Date: 2025.05.06 00:42:52 +0530

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M/s. Jay Anand Food Industries } Petitioner

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versus

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State of Maharashtra & Anr. } Respondents

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Mr. Ashutosh M. Kulkarni with Mr. Vaibhav Gaikwad i/b. Mr. Raviraj Paramane for petitioner.

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Mr. O. A. Chandurkar, Additional Government Pleader with Ms. G. R. Raghuwanshi, AGP for respondent no. 1.

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Mr. Hafeezur Rahman with Mr.Prathamesh Waghmare for respondent no. 2.

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CORAM: ALOK ARADHE, CJ. & M. S. KARNIK, J. DATE: MAY 5, 2025

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ORDER: (Per M. S. Karnik, J.)

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1. Heard learned counsel for the parties.

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2. By the notice inviting tender dated 31^st July 2020, the Food Corporation of India (FCI) invited bids from empanelled traders/bulk consumers of Wheat-URS under OMSS (D) lying at various depots under the FCI for sale of Wheat-FAQ, Wheat-URS and Rice Grade ‘A’ through e-auction. Relevant to the controversy in the writ petition is Clause 10(K) of the tender notice, which reads thus: -

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“10(K) The Wheat-URS so purchased from FCI under OMSS through e auction will be utilized domestically and shall not be exported by the bidder. If the bidder violates any of the terms and conditions of the empanelment or found to be furnishing any wrong/false information at any stage, then in addition to forfeiture of EMD, bidder will be debarred from

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¶18

24-WP.1059.2024.doc

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participating in future tenders floated by fCI for disposal of foodgrains and coarse grains for a period of one year.”

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3. The petitioner M/s. Jay Anand Food Industries, a proprietary concern, is engaged in the business of manufacturing wheat flour and rice sorting and polishing. The petitioner has registered itself with empanelment with FCI for purchase of food grains under Open Market Sale SchemeDomestic (OMSS-D) Scheme since 2017. On 31^st March 2020, the petitioner was declared highest bidder for 100 MT of Wheat and was awarded the auction by the FCI.

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4. In a raid conducted by the Supply Department at one Palak Ration Godown on 1^st August 2020 it was found that a rationing rice is illegally stocked there, which was meant for public distribution. On the same day, an FIR bearing CR No. 274 of 2020 was registered at Panvel City Police Station under section 3 and 7 of the Essential Commodities Act, 1995. During the course of investigation, the investigating officer of Panvel City Police Station visited the processing plant of the petitioner. They noticed 270 MT of rice and 43 MT of wheat packed in the jute gunny bags depicting the logo of FCI. The rice and wheat were seized by police by drawing panchanama dated 2^nd August 2020. 5. Suffice it to observe that a show cause notice was issued by the FCI to the petitioner on 25^th June 2021 calling upon the petitioner to submit an innocence certificate from the Panvel City Police Station, otherwise the petitioner would be debarred from participating in the future auction to be held by FCI for one year.

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6. Learned counsel for the petitioner raised a dispute about the service of notice. In any case, what we find from the

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¶24

24-WP.1059.2024.doc

¶25

impugned order dated 30^th January 2024, which is at page 118 of the paper book, is that in view of the ongoing criminal case pending at Panvel Court, the FCI has debarred the petitioner from participating in future e-auction with the FCI till the outcome of the case.

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7. Learned counsel for the FCI submitted that serious allegations have been made against the petitioner in the criminal case pending in the Panvel Court. It is submitted that till such time the criminal case is decided, question of granting any relief to the petitioner does not arise.

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8. In our considered opinion, the impugned order dated 30^th January 2024 debarring the petitioner from participating in future e-auction with the FCI till outcome of the criminal case is unjustified. Vide the show-cause notice, the petitioner was debarred from participating in future tenders for a period of one year. That period of one year expired on 24^th June 2022. In this view of the matter, we have no hesitation to set aside the impugned order dated 30^th January 2024 insofar as it extends beyond the period of one year, i.e., from 24^th June 2022 as contemplated in the show-cause notice.

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9. The writ petition is, accordingly, allowed in the aforesaid terms.

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10. We make it clear that refund of EMD amount will be subject to outcome of the criminal proceedings pending against the petitioner.

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(M. S. KARNIK, J.) (CHIEF JUSTICE)

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M/S Jay Anand Food Industries Thr. Its Manager v. State of Maharashtra and Anr.

Case brief

What is this about?

What did the court decide?

M/S Jay Anand Food Industries Thr. Its Manager v. State of Maharashtra and Anr.

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

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