Quashed

M/S Quest Laboratories Pvt. Ltd, v. the Additional Director

Karnataka HC18 Sept 2013WP/4617/2013

Case brief

AI extract

What is this about?

The Court, on a writ petition, quashed an order blacklisting a petitioner for supplying sub-standard drugs due to absence of a show-cause notice and hearing, applying Raghunath Thakur case principle. Liberty was reserved to issue such notice.

What did the court decide?

The impugned order dated 18.10.2012 blacklisting the petitioner is quashed. Liberty is reserved to issue appropriate show cause notice.

M/S Quest Laboratories Pvt. Ltd, Vs the… — Public Procurement and Tenders | Karnataka HC (2013)

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IN THE HIGH COURT OF KARNATAKA AT BANGALORE

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DATED THIS THE 18^TH DAY OF SEPTEMBER 2013

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BEFORE

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THE HON’BLE MR. JUSTICE A S BOPANNA WRIT PETITION No.4617/2013 (GM-TEN)

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BETWEEN:

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M/S QUEST LABORATORIES PVT. LTD, NO.P-62, OMKAR MARG GANDHINAGARA, INDORE-453 112 REP. BY ITS DIRECTOR SMT. KAVITHA SABARWAL W/O ANIL SABARWAL.

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SMT. KAVITA SABARWAL W/O ANIL SABARWAL, DIRECTOR, AGED 39 YEARS, M/S QUEST LABORATORIES PVT, LTD. NO.P-62, OMKAR MARG GANDHINAGARA, INDORE-453 112. ... PETITIONERS

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(BY SRI CHANDRASHEKAR & SRI A N RADHA KRISHNA, ADVS.)

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AND:

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THE ADDITIONAL DIRECTOR KARNATAKA STATE DRUGS LOGISTIC & WAREHOUSING SOCIETY #1, DR.SIDDAIAH PURANIK ROAD, KHB COLONY, MAGADI ROAD, BENGALURU-560 079 ... RESPONDENT

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(BY SMT. M C NAGASHREE, GA )

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, WITH A PRAYER TO QUASH THE ORDER DATED 18.10.12 PASSED BY RESPONDENT VIDE ANNX-G.

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THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING :

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O R D E R

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The petitioners are before this Court assailing the order dated 18.10.2012 (Annexure-G).

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The case of the petitioners are that they had responded to the tender notification dated 18.07.2011 floated by the respondent. Out of the total items for which bids were indented, the petitioner had offered his bid in respect of four items of drugs to be supplied to the respondent. In that regard, the bid was finalised and the parties had entered into an agreement dated 29.11.2012 as at Annexure-B to the petition. The necessary requirements were completed and based on the order placed, the supplies were also made by the petitioner. It is in that regard, the respondent has presently initiated the impugned action of blacklisting the petitioner on the allegation that certain quantity of drugs supplied by the petitioner were of sub-standard quality. The black-listing is for a period of five years from the date of commencing from the date of order.

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The petitioner claiming to be aggrieved by the

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same has assailed the same on several grounds. Firstly, it is contended that the impugned order black listing the petitioner is passed without opportunity to the petitioner. That apart the petitioner also seeks to contend that in any event, the action was not justified inasmuch as the allegation that the drugs supplied by the petitioner were of sub-standard quality has not been established in accordance with law and the correspondence would indicate that during transit, there could have been certain damage to the package which should have been taken note by the respondent.

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The respondents have filed their objection statement and have sought to justify their action. A perusal of the objection statement would indicate that though the transaction between the petitioners and the respondent has been admitted, the same once again refers to the drugs supplied by the petitioner being not of standard quality and in that regard, the respondent contends that as per the tender condition No.30 as well as

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the terms agreed between the parties under the

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agreement provide for black listing and therefore, the action has been taken. Insofar as providing opportunity, it is contended that a notice dated 10.09.2012 was issued and since there was no reply even after about 85 days, the present action has been taken.

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In the light of the rival contentions, though contentions with regard to the quality of the drugs supplied has been adverted to wherein the petitioners contend that the supply made was as per the requirement and the respondent contend that the supply made was not of standard quality, what is necessary to be noticed at this

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juncture is as to whether the impugned action for black listing the petitioner has been taken by the respondent after providing opportunity to the petitioner. As noticed from the objection statement, though it is contended that a notice dated 10.09.2012 was issued, the Annexures produced along with the document does not refer to such notice nor has any material been placed on record to indicate that such notice had been served on the petitioner.

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Be that as it may, what is also necessary to be

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noticed is that the very impugned order dated 18.10.2012 at Annexure-G though makes reference to the tender notification and the meeting of the Tender accepting authority, there is no reference whatsoever to the alleged show cause notice that was said to have been issued nor does the course of the order disclose that a notice had been issued and the petitioner had failed to reply to the same. When the order by itself does not contain the same, the action of the respondents in stating so in the objections statement cannot be of any consequence.

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Hence, at the outset, I find that the action taken by the respondent is without opportunity to the petitioner. In this regard, reference to the decision of the Hon'ble Supreme Court in the case of Raghunath Thakur vs. State of Bihar and others [(1989)1 SCC 229] would make the position of law very clear that such action of black listing cannot be done without affording opportunity of hearing to the affected party.

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Therefore, on the sole ground, the impugned order dated 18.10.2012 would not be sustainable. The

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same is accordingly quashed. Liberty is reserved to the respondent to issue appropriate show cause notice, obtain justification from the petitioners and thereafter pass appropriate orders in accordance with law. The contention of the petitioners on all aspects of the matter are left open to be urged in reply to the show cause notice that is to be issued by the respondents or if the same becomes necessary for consideration in any other proceedings.

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In terms of the above, the petition stands disposed of.

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Sd/JUDGE

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akc/bms

M/S Quest Laboratories Pvt. Ltd, v. the Additional Director

Case brief

What is this about?

What did the court decide?

M/S Quest Laboratories Pvt. Ltd, v. the Additional Director

Case brief

What is this about?

What did the court decide?

What the court decided

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