Disposed

Era Infra Engineering Limited v. Union of India & Ors.

Delhi HC10 Mar 2025W.P.(C)/3001/2025

Case brief

AI extract

What is this about?

A contractor challenged a show cause notice and debarment notice issued over defects arising during a defect liability period, arguing natural justice violations and that post-resolution-plan liabilities could not be imposed. The debarment notice was set aside with directions to issue a fresh notice and pass a reasoned order after hearing.

What did the court decide?

Impugned debarment notice set aside; respondent no.3 directed to issue fresh show cause notice and pass reasoned order after affording hearing.

Era Infra Engineering Limited Vs Union of India… — Public Procurement and Tenders | Delhi HC (2025)

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$~72

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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- W.P.(C) 3001/2025 & CM APPL. 14171/2025

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ERA INFRA ENGINEERING LIMITED .....Petitioner

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Through: Mr. Dayan Krishnan, Sr. Adv. alongwith Ms. Nishtha Kaura, Ms. Zinnea Mehta, Ms. Manusha Gupta, Advocates.

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versus

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UNION OF INDIA & ORS. .....Respondents Through: Mr. Ashish Dixit, CGSC for UoI alongwith Mr. Rakesh Roshan, and Ms. Hemlata, DM (Legal) HITES, Mr. Shivam Tiwari, Ms. Urmila Sharma and Ms. Deepika Kalra, Advocates. Mr. Tarun Johri and Mr. Ankur Gupta, Advocates for R2 and R3.

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CORAM:

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HON'BLE MR. JUSTICE SACHIN DATTA

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CM APPL. 14172/2025 - Exemption CM APPL. 14173/2025 - Exemption

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Allowed, subject to all just exceptions.

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Applications stand disposed of.

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W.P.(C) 3001/2025

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The present petition impugns a show cause notice dated 13.02.2025 (hereinafter ‘ the impugned show cause notice ’) issued by the respondent no.2 to the petitioner followed by a Debarment Notice dated 27.02.2025 (hereinafter ‘ the impugned debarment notice ’).

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This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/03/2025 at 11:41:57

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Broadly, three contentions have been made by the learned senior counsel for the petitioner. Firstly, it is contended that the impugned debarment order is cryptic, non-speaking and does not deal with the elaborate response of the petitioner to the show cause notice.

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It is pointed out that the response to the show cause notice elaborately deals with the factual background of the matter, right from the commencement of the defect liability period. It is contended that the petitioner has fully rectified all the defects which arose during the said defect liability period. Reference was made to the letter dated 02.11.2022 issued by the concerned Sub-Divisional Engineer, Electrical Sub Division No.3, Public Work Department, which affirms this aspect.

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Secondly, it is contended that the impugned debarment notice has been passed without affording any opportunity of hearing to the petitioner resulting in denial of principles of natural justice. 7. Lastly, it is contended that the impugned order is in the teeth of the judgment of Supreme Court in case of Ghanshyam Mishra v. Edelweiss Asset Reconstruction Co. Ltd. (2021) 9 SCC 657 and the judgment of this Court in M. Tech Developers Private Limited v. National Faceless Assessment Centre & Anr. 2024 SCC OnLine Del 2276, in terms of which, the successful resolution applicant cannot be foisted with any liability/ies other than those which are specified and factored in the resolution plan itself. He submits that the present management of the petitioner took charge of the petitioner on 20.09.2024 pursuant to the resolution plan being approved by the National Company Law Tribunal (NCLT), Delhi vide order dated 11.06.2024. It is submitted that the allegations in the impugned show cause notice are for the period much prior thereto.

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/03/2025 at 11:41:57

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Issue notice.

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Learned counsel, as aforesaid, accepts notice on behalf of the respondents.

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Learned counsel for the respondent nos. 2 and 3 fairly submits that the impugned debarment notice has been passed without affording an opportunity of hearing to the petitioner. He submits that the respondents shall re-examine the matter and pass a a fresh order considering all aspects of the matter, including the contentions raised by the petitioner in this petition.

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In the circumstances, the impugned debarment notice is set aside. The respondent no. 3 is directed to issue a fresh show cause notice to the petitioner and pass a reasoned order thereon after affording an opportunity of hearing to the petitioner, andin accordance with law.

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The present petition stands disposed of in the above terms.

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It is made clear that this order shall not be construed as an expression of opinion of this Court on the merits of the contentions of the respective counsel for the parties.

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SACHIN DATTA, J

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MARCH 10, 2025/ at

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/03/2025 at 11:41:57

Era Infra Engineering Limited v. Union of India & Ors.

Case brief

What is this about?

What did the court decide?

Era Infra Engineering Limited v. Union of India & Ors.

Case brief

What is this about?

What did the court decide?

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