Partly allowed

Sri Pruthviraj B v. the Managing Director

Karnataka HC25 Oct 2024WP/1024/2017

Case brief

AI extract

What is this about?

Contractor blacklisted for five years with forfeiture of EMD and security deposit over alleged illegal timber transportation. Court held the driver statements relied on were never furnished for rebuttal or cross-examination, and involvement was not established on concrete evidence; order set aside and matter remitted for fresh reconsideration.

What did the court decide?

Order dated 29.03.2016 blacklisting petitioner set aside; matter remitted to respondent No.3 for fresh reconsideration after granting sufficient opportunity.

Sri Pruthviraj B Vs the Managing Director — Writ and Judicial Review | Karnataka HC (2024)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 25^TH DAY OF OCTOBER, 2024

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BEFORE

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THE HON'BLE MR. JUSTICE K. V. ARAVIND

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WRIT PETITION No.1024/2017 (GM-FOR)

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BETWEEN:

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1 . SRI PRUTHVIRAJ B., S/O LATE S. A. BYRAPPA, AGED ABOUT 46 YEARS, R/AT M/S MARUTHI ENTERPRISES, No. 4/8, JAKKASANDRA VILLAGE, OPPOSITE MARUTHI WEIGH BRIDGE, KUNIGAL MAIN ROAD, NELAMANGALA , BANGALORE - 562123.

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...PETITIONER

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(BY SRI SUYOG HERALE, ADVOCATE)

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AND:

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1 . THE MANAGING DIRECTOR, KARNATAKA FOREST DEVELOPMENT CORPORATION, 'VANA VIKASA' 18^TH CROSS, MALLESHWARAM, BENGALURU - 560003.

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2 . THE EXECUTIVE DIRECTOR, KARNATAKA FOREST DEVELOPMENT CORPORATION, SHIMOGA ZONE, SHIMOGA-577201,

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KARNATAKA STATE.

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3 . THE DIVISIONAL MANAGER, KARNATAKA FOREST DEVELOPMENT CORPORATION, No.C-43, ITI COLONY, SOUTH ZONE, DOORAVANI NAGAR, OLD MADRAS ROAD,

K. R. PURAM,

BENGALURU - 560016.

4 . THE DEPUTY CONSERVATOR OF FORESTS AND REGIONAL MANAGER (RMP), M/S KARNATAKA STATE FOREST INDUSTRIES CORPORATION, RMP UNIT, "VANA VIKASA" , 18^TH CROSS, MALLESHWARAM, BENGALURU - 560003.

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…RESPONDENTS

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(BY MS. ANANYA RAI, ADVOCATE FOR SRI M.V. CHARATI, ADVOCATE FOR R1 TO R4)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATED 29.3.2016 PASSED BY THE R-3 VIDE ANNEXURE-A AND ALL FURTHER PROCEEDINGS PURSUANT THERETO.

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THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:

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CORAM: HON'BLE MR. JUSTICE K. V. ARAVIND

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C.A.V. ORDER

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The instant writ petition challenging the order dated 29.03.2016 passed by respondent No.3 in No.KAAAAANINI: VIVYA:BNG.V.MARATA:EMD:2015-16/1223, Annexure-A.

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Heard Sri Suyog Herele, learned counsel for the petitioner and Ms. Ananya Rai, learned counsel for Sri M.V. Charati, learned counsel for respondent Nos.1 to 4.

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The petitioner is a contractor engaged in cutting and transporting timber/wood. The petitioner participated in the e- procurement tender published on 05.05.2015 and was declared the successful bidder. The respondent corporation executed the agreement on 28.07.2015. The tender period was extended.

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Respondent No.3 issued a show cause notice dated 01.03.2016 requiring the petitioner to explain why he should not be blacklisted. The show cause notice was based on the statements of drivers of two lorries seized carrying Eucalyptus with bark wood without authorization. The show cause notice is under the premise that the seized lorries and the wood belonged to the petitioner and such illegal transportation was at his instance.

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4.1 The petitioner filed a reply to the show cause notice denying all the allegations.

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Respondent No.3, by order dated 29.03.2016, passed an order blacklisting the petitioner for a period of five years or till further orders and also forfeiting the Earnest Money Deposit (EMD) and Security Deposit.

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Sri Suyog Herele, learned counsel appearing for the petitioner, submits that the petitioner is a reputed contractor carrying on the work in the transportation of wood for many years. There are no instances of any illegality against the petitioner. It is submitted that the show cause notice is based on the statements of the lorry drivers. The statements of the drivers relied on to issue show cause notice are not provided to the petitioner to rebut the same. It is submitted that upon perusal of the statements of the lorry drivers, it is not evident that the lorries belonged to the petitioner and such illegal transportation was at the instance of the petitioner. It is further submitted that the impugned order seriously prejudiced the petitioner's right to conduct business. The order of blacklisting has a severe consequence on the petitioner participating in any tender process. The order impugned violates principles of natural justice as no personal hearing is provided.

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Ms. Ananya Rai, learned counsel for Sri M V Charati, learned counsel for respondents Nos.1 to 4, submits that the petitioner was granted a fair opportunity through a detailed show cause notice. The petitioner has given a vague technical reply. The petitioner has not attempted to provide any explanation to the allegations made in the show cause notice except denying the

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allegations. The statements of the drivers and further enquiry revealed that the transportation of wood was at the instance of the petitioner and the same is illegal. It is submitted that unless the statute provides for a personal hearing, the petitioner having been granted an opportunity to submit his reply, the order impugned will not suffer from any irregularities.

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Learned counsel for the respondents relied on the following judgments to contend that unless the statute provides for personal hearing, the same cannot be extended merely on being asked. It is submitted that sufficient opportunity to file a reply would comply with the requirement of fair opportunity and principles of justice.

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(i) The State of Maharashtra and others vs. Lok

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Shikshan Sanstha and others,

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(AIR 1973 SC 588);

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(ii) Union of India vs. Jyoti Prakash Mitter,

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(AIR 1971 SC 1093);

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(iii) Union of India and another vs. M/s. Jesus

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Sales Corporation, (AIR 1996 SC 1509); and

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(iv) Daffodills Pharmaceuticals Limited and

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another vs. State of Uttar Pradesh and

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another [(2020) 18 SCC 550].

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Heard learned counsel for the parties and perused writ papers.

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The petitioner is a contractor and was awarded the contract to cut and transport the wood. The petitioner was visited with show cause notice to forfeit EMD and Security Deposit and to blacklist the petitioner. The show cause notice is based on the statements of the lorry drivers. From the statements, it is inferred that the lorries loaded with wood belong to the petitioner and that the illegal transportation of wood was done at the instruction of the petitioner.

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The show cause notice refers to severe allegations. The consequence of the allegations would seriously prejudice the petitioner in carrying on the business, and the blacklisting would be a denial of opportunity to carry on the business, which is nothing but a civil death. The action of blacklisting being severe, the same should be arrived at on evidence, not on the probabilities.

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It is a settled position that any evidence, oral or documentary, proposed to be used against a person is to be provided to such person for rebuttal. The present case entirely depends upon the statements of the lorry drivers. There is no evidence on record that the statements were provided to the petitioner for rebuttal. If the statements were provided, the petitioner has an opportunity to cross-examine the lorry drivers. The perusal of the statements of drivers available on record would prima facie indicate that the statements would not directly involve the petitioner. The statements refer to the instruction of the petitioner's agent. The statements of the lorry drivers cannot be considered as conclusive proof of evidence unless put to test of cross-examination. The statements must be proved with corroborative evidence, which is unavailable in the present case. In such circumstances, it cannot be held that the opportunity to file a reply to the show cause notice is sufficient.

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The order impugned is to be set aside only on limited grounds. Firstly, the show cause notice has not provided the statements of the lorry drivers, which is the basis. Though there is an indication of using the statements against the petitioner, the statements were not provided to the petitioner for rebuttal. It is a settled position that the evidence proposed to be used against a

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person should be provided with such evidence for rebuttal. Once the statements are provided, the petitioner has the right of crossexamination. In the present case, the above exercise and compliance is conspicuously absent. Secondly, on prima facie consideration of the statements of the lorry drivers, the petitioner's involvement in the alleged cutting and removal of timber is not available, which needs further enquiry and investigation. The order impugned is silent on any further enquiry and investigation to corroborate the statements of the lorry drivers with other conclusive evidence. Thirdly, blacklisting of the petitioner has a severe consequence which needs to be dealt with not on probabilities but with concrete evidence. In the present case, the enquiry/investigation conducted by the respondents to conclude blacklisting the petitioner is not sufficient. The blacklisting has the effect of deprival of the right to carry on the business; once deprived, it would result in civil death.

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The judgments relied on by learned counsel for the respondents are not dealt with as the Court has not examined the requirement of a personal hearing in view of the reasons mentioned earlier.

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In light of the above discussion and analysis, the order

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impugned is not sustainable. Hence, the following order;

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Order

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(i) The writ petition is allowed in-part.

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(ii) The order dated 29.03.2016 passed by respondent

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No.3 in No.KAAAAANINI:VIVYA:BNG.V.MARATA:

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EMD:2015-16/1223, Annexure-A, is set aside.

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(iii) The matter is remitted to respondent No.3 to reconsider afresh after granting sufficient opportunity and on the observations made herein-above.

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The Court has not expressed any opinion on the merits.

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Sd/-

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(K. V. ARAVIND) JUDGE

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Sri Pruthviraj B v. the Managing Director

Case brief

What is this about?

What did the court decide?

Sri Pruthviraj B v. the Managing Director

Case brief

What is this about?

What did the court decide?

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