M/s Meco Technologies Pvt. Ltd. Vs The Singareni Colleries Company Limited

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132521

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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TUESDAY, THE SEVENTH DAY OF JANUARY TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HON'BLE MRS JUSTICE SUREPALLI NANDA

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WR|T^pETITION NO: 36885 OF 2024

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Between:

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M/s Meco Technolooies pvt. Ltd.,_ Head Office at H.No.4_4, Rajiv Vihar, Near XA::il| Xi:f,,.sff,^i.no,."^{r'i"gJi 'Bii"ii;,,,"i'nl"tti$"ir, si,t",'+gbtijo,"ril,j tii"i,,}

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...PETITIONER

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AND

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The Sinqareni Collieries .C^ompany Limited, Rep. by its Chairman and Managing Director, Sinareni Bhjia^l nEijii Hirr.,'ilyoerabao.

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The Siinqareni Collieries goTp.qny Limited, Rep. by its Generat l/anaoer ( Civit ), Korhasudem, ehaaradiiKo[hrsd;il DL"t"ri"t

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3 The Deputv Generar Manager.( civir ), o/o. Generar Manaqer ( civir ) co,ieries compa-n"y r_iirituJ'x6*,Ibijo#, Bhadradrikoth.asudeni

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8il!flrfll:r'

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...RESPONDENTS

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Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit fired therewith, the High court may be pleased to issue an appropriate writ, order or direction more particurarry one in the nature of wRrr oF MANDAMUS decraring the proceedings issued by the 2nd respondent vide Ref No. cRp/cVLrLfioot2s4r, Dr.2sro6t2o24 in debaring the petitioner from participating in the tenders of sccL for a period of one year with immediate effect without even considering the expranation submitted by the petitioner for invoking crause 20 0f the agreement wherein it was specificafiy mentioned that if any dispute arise between the parties the same should be

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settled before the arbitrator and without issuing further notice is nothing but illegal, arbitrary and abuse of process of raw, vioration of principres of naturar justice and set aside the orders passed by the 2nd respondent vide Ref No. CRPlCVLlLl700l2547 , Dt. 2StO6l2O24 in the interest of justice.

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lA NO:.1 OF 2024

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Petition under Section 15'1 cpc praying that in the crrcumstances stated in the affidavit fired in support of the petition, the High court may be preased to grant interim suspension of the orders passed by the 2nd respondent vide Ref No. cRP/cvL/L/7O0r2s4r, Dt. 2s.06.2024 pending disposar of the main writ petition.

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Counsel for the petitioner: SRI S. SURENDER REDDY

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Counsel for the Respondents: SRI p. SRI HARSHA REDDY, S.C. FOR SINGARENI COLLIERIES CO. LTD.

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The Court made the following: ORDER

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d

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HON'BLE MRS. JUSTICE SUREPALLT NANDA

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WRIT PETITION No.36885 ot 2024

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ORDER:

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Heard Sri S. Suredner Reddy, learned counsel appearing on behalf of the petitioner and Sri P. Sri Harsha Reddy, learned Standing Counsel for Singareni Collieries Company Ltd., appearing on behalf of respondents.

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The^petitioner approached the Court seekinq oraver as under:

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"...to issue an appropriate writ order or direction more particularly one in the nature of WRIT OF MANDAMUS declaring the proceedings issued by the 2nd respondent vide Ref. No.CRP/CVL/L/7OO/2547 dated 25/06/2024 in debarring the petitioner from participating in the tenders of SCCL for a period of one year with immediate effect without even considering the explanation submitted by the petitioner for invoking clause 20 of the agreement wherein it was specifically mentioned that if any dispute arises between the parties, the same should be settled before the arbitrator and without issuing further notice is nothing but illegal, arbitrary and abuse of process of law, violation of principles.of natural^justice aM set aside the orders passed by the 2nd respondent vlde Ref.

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wP 36885_2024 No.CRP/CVL/L /7OO/2547, Dated 25/06/2024 in the interest of justice and pass...,,.

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The case of the petitioner in brief is that the 2nd i-espondent issued E_procurement tender Notice No. CRP/CVL/ TN_69/ZO|7_2018 dated 02.03.2018 for a period of 3 years on EpC basis in SCCL Townships each at Ramakrishnapur. Mandamari of Mancherial District. pursuant to the said notification, the petitioner stood as highest bidder and the 2nd respondent had issued the work order and also entered into agreement on 28.06.2018. As per the work allotment order, the petitioner started execution of the work, there was a continuous obstruction from the respondents in completing the works and no coordination from their end and hence the petitioner was facing problems for completion of the work. The petitioner had addressed several letters dated 25.0L.2O2t, 04.02.2O2L and L2.02.2021 to the respondents to invoke clause 20 of the agreement and appoint a sole arbitrator but the respondents denied the said request. The respondents issued a tetter on OI.OL.2O24 for forfeiting of EMD and ESD amount. The 3.d respondent issued a show cause notice to the petitioner on 13.06.2024 asto why SCCL

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should not debar the petitioner from further participating in future tenders of SCCL and the petitioner submitted reply to the 2nd respondent on 20.06.2O24. The 2nd respondent issued proceedings dated 25.06.2024 debarring the petitioner from participating in the tenders of SCCL for a period of one year without considering the explanation dated 20.06.2024, illegally and unreasonably. Aggrieved by the same, the petitioner filed the present writ petition.

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It is the specific case of the petitioner that prior to the issuance of the impugned proceedings dated 25.06.2024 by the 2nd respondent to the petitioner, petitioner was not provided with an opportunity of personal hearing and the petitioner had been debarred from participating in the tenders of SCCL unilaterally, in clear violation of the principles of natural^justice, for a period of one year with immediate effect.

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P. Sri Harsha Reddy, Iearned Standing Counsel for Singareni Collieries Company Ltd., appearing on behalf of respondents brings on record the list of tenders and contends that the present impugned proceedings dated 25.06.2024 of the 2nd respondent herein is subsequent to the termination of

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5X', wP 36885 2024

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the contract^{ofthe petitionervide proceedings dated} 30.09.2023^{issued to the petitioner,and the petitionerwas} issued with^{a show causenotice dated 13'06'2024 and after} considering^{the petitioner's reply in pursuanceto the said} show cause^{notice dated13.06.2024,theimpugned} proceedings dated^{25.06.2024had been issued tothe} petitioner and therefore,^{it cannotbe said that the petitioner} was not^{provided with reasonableopportunity prior to the} issuance of^{the impugned proceedings dated 25'Q6'2O24 to} the^{petitionerby the 2nd respondent herein'}

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imouoned oroceedinqs^{dated 25.O6'2O24issued to the} oetitioner^{bv the 2nd resoondentherein as borne on} record clearlv^{indicatesthat the oetitioner had not been} provided with an oooortunitv^{of oersonal hearinoorior} to debarrano the^{Detitionerfrom Darticioatinoin the} tenders of^{SCCL for a oeriod of one vear with immediate} effect.

PERUSED THE RECORD

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wP i6885 20);

The Apex Court in its Judoment reoorted in 1975 (1) SCC Paqe 75 in ..Erusian Eouioment and Chemicals Ltd. v. State of West Benqal,,, at oaras 17 and 2O observed as under:

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"17 ...The activities of the Government have a public element and, therefore. there should be fairness and eoualitv, The State need not enter into any contract with anvone but if it does so, it must do so fairlv without discrimination and without unfair orocedure. Reoutation is a oart Blacklistinq tarnishes one,s reputation.

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2O. Blacklistino has the effect of oreventinq a person from the orivileoe and advantaqe of enterinq into lawful relationshio with the Government for ourooses of qains. The fact that a disabilitv is created bv the order of blacklistinq indicates that the retevant ooDortunitv to represent his case before he is put on the blacklist."

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wP. i6885-20);

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A. The Aoex Court in the Judoment reoorted in 1989 1 SCC Paqe 23O in "Raohunath Takur v. State of Bihar", at^para 4, observed as under:

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"4. Indisputably, no notice had been given to the appellant of the proposal of blacklisting the appellant. It was contended on behalf of the State Government that there was no requirement in the rule of giving any prior notice before blacklisting any person. Insofar as the contention that there is no requirement specifically of giving any notice is concerned, the respondent is right. But it is an imolied orinciple of the rule of law that anv order having civil consequence should be passed onlv after followino the princioles of natural justice. It has to be realised that blacklisting anv oerson in respect of business ventures has civil consequence for the Future business of the^person concerned in any event. Even if the rules do not express so. it is an elementarv orinciole of natural iustice that oarties affected bv anv order should have rioht of beino heard and makinq representations aoaanst the order. In that view of the mafter, the last oortion of the order insofar as it directs blacklistinq of the aooellant in resoect of future contracts, cannot

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wP 36885 2024

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aDDellan t be olaced in the blackliblackli future er the Collector is se

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in the blackliblackli in resoect er the Collector is se

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aside. So far as the cancellation of the bid of the appellant is concerned, that is not affected. This order wlll, however, not prevent the State Government or the appropriate authorities from taking any future steps for blacklisting the appellant if the Government is so entitled to do in accordance with law i.e. after giving the appellant due notice and an opportunity of making representation. After hearing the appellant, the State Government will be at liberty to pass any order in accordance with law indicating the reasons therefor. We, however, make it quite clear that we are not expressing any opinion on the correctness of otherwise of the allegations made against the appellant. The appeal is thus disposed of."

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The Aoex Court in the iudoment reported in (2O23) 6 SCC 1 in State Bank of India & Ors.. Vs. Raiesh Aqarwal & Ors., at oaras 85 and 86 observed as under:

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Fairness in action requires that procedures which permit impairment of fundamental rights ought to be just, fair, and reasonable. The principles of natura! justice have universal application and constitute an important facet

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"ll^{Tlr" princip} llilL;fl::';i*:-ft,fii.# ff Y" l'9^o,- "^{- ii' in t?rT:: L'^'- T,. :!"} *,:t'!;fii{,;if**i""#$# I [:.'.: ::^; t _'^;, -",,.^{#,.:li.""""r #?H.fl} *::,il,t"r,,T,^{j' "rI#*li:*ql,} i::#:rusTfl ii,ll'Jil,:'. n.:,":i -],ii"^{iiHI' "{i} fl i".:."^{jr:,,ff ;;**;?Td:;ffi} ,.!,':L-::,'";T.fld;'1: [1;+:r-r:u:**ffi #H:'{::i1.^{:i:.", jq :ru""; 1;} ;;il""l' ;,',t :l^..:i,.,i:. :f^{;ij ;,ii} :l

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wP i6885 2024

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decide such matter fairly and impartially." (emphasis supplied)

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In Cantonment Board v. Taramani Devi, a two Judge Bench of this Court held that the rule of audi alteram partem is a part of Article 14. Similarly, in DTC v. Mazdoor Congress, this Court observed that the rule of audi alteram partem enforces the equality clause in Article 14. The refo re, anv administrative action which violates the rule of audi alteram oartem is arbitrarv and violative of A icle L4."

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In "CANTONMENT BOARD v. TARAMANT pEVI,,, reoorted in (1992) Suoo (2) SCC oaqe 5Ot. a two-iudoe Bench of this Court held that the rule of audi alferam partem is a part of Article 14. Similarlv, in "DTC v. MAZDOOR CONGRESS" reoorted in (1991) Suoo (1) SCC 6OO, the Aoex Court observed that the rule of audi a/teram oartem enforces the eouatitv clause in Article 14. Therefore, anv administrative action which violates the rule ol audi alteram oartem is arbit.rarv and violative of Article 14.

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Takino into consideration:

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wP -16885 2024

a) The submissions put forth by the learned counsel appearing on behalf of the petitioner and learned Standing Counsel appearing on behalf of respondents and,

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b) The impugned proceedings vide Ref. No.CRp/ CVL/L/7OO/2547, dated 25.06.2(,24 of the 2,"d respondent which clearly as borne on record indicates that no opportunity of personal hearing had been provided to the petationer prior to the issuance of impugned proceedings dated 25.016.2024 to the petitioner by the 2nd respondent, debarring the petitioner from participating in the tenders of SCCL for a period of one year with rmmediate effec!

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c) The views of the Apex Court in the judgments (referred to and extracted above) i.e.,

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(,) L97S (t) sCC pase 7s (ii) 1989 I SCC Pas;23o ([,)(2023) 6 SCC 1 (iv)(1992) Supp (2) SCC page 5O1,

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The writ petitaon is allowed and the impugned proceedings vide Ref. No.cRp/cvll/L/7Oo/2547, dated

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wP 36E85 2024

25.06.2024 issued by the respondent No.2 is set aside. It is however, observed that it is open to the respondent No.2 to proceed against the petationer in accordance to law, in conformity with the principles of natural justice by providing an opportunity of personal hearing to the petitioner. However, there shall be no order as to costs.

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Miscellaneous petitions, if any, pending in this Writ Petition, shall stand closed.

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Ass,ssPI$iYR?68+iiR

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