Bombay High Court
Anchor Offshore Services Ltd. ... vs Oil And Natural Gas Corporation ... on 2 March, 2016
Bench: S.C. Dharmadhikari
WP3264-15-ANCHOR OFFSHORE-FINAL.DOC
Shephali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION (L) NO. 3264 OF 2015
ANCHOR OFFSHORE SERVICES LTD
(AOSL),
a Company incorporated under the Companies
Act, 1956, having its registered office at Hico
House, Gr. Flr. 771, Pt. Satavalekar Marg,
Moghul Lane, Mahim, Mumbai 400 016 ...Petitioner
Versus
1 OIL & NATURAL GAS
COPORATION LTD.,
a Public Limited Company having its
registered office at Jeevan Bharathi
Bharathi Tower-II, Indira Chowk, New
Delhi 110001 and also having its Mumbai
Region Office at MH Asset, 801, 8th
Floor, Vasundhara Bhavan, Bandra (E),
Mumbai 400 051
2 MR. RAJESH KAKKAR,
Executive Director-Asset Manger,
Mumbai High Asset & Key Executive,
Oil & Natural Gas corporation Ltd., 4th
Floor, Q4 NBP Green Heights, BKC,
Bandra (E), Mumbai 400 051
3 MR. S. JACOB,
GM (M), Inquiry Officer,
Oil & Natural Gas Corporation Ltd.,
504, 11-High Building Bandra-Sion Link
Road, Mumbai 400 017
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4 MR. J. K. BODHA,
GGM, Chief-Legal Services,
Oil & Natural Gas Corporation Ltd.,
9th Floor, Core-4, Scope Minar, Laxmi
Nagar, Delhi 110 092
5 MR. M. S. RAZA KHAN
Group General Manager (MM),
Incharge-Materials Management, MH
Asset, Mumbai Region, 3rd Floor, Q3,
NBP Green Heights, BKC, Bandra (E),
Mumbai 400 051
6 UNION OF INDIA
Through the Ministry of Law and
Justice, Aaykar Bhavan, Mumbai 400 020
7 STATE OF MAHARASHTRA
Through Government Pleader's Office,
High Court, Bombay ...Respondents
A PPEARANCES
FOR THE PETITIONER Mr. Viraag Tulzapurkar, Senior
Counsel, a/w Mrs. Anita
Castelino, Mrs. Alisha Lambay,
Mr. Vikas K. Singh, i/b M/s.
Lambay & Co.
FOR THE RESPONDENTS Mr. Kevic Setalvad, Senior Advocate,
NOS. 1 TO 5 a/w Ms. Daisy Dubash, Mr. J. P.
Kapadia, Mr. O. Mohandas, i/b
M/s. Little & Co.
FOR THE RESPONDENT NO. 6 Mr. D. P. Singh
FOR THE RESPONDENT NO. 7 Mr. H. S. Venegaonkar, AGP.
CORAM : S.C. Dharmadhikari
& G.S.Patel, JJ.
RESERVED ON : 5th January 2016
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PRONOUNCED ON : 2nd March 2016
JUDGMENT: (Per G.S. Patel, J.)
1. Rule. Respondents waive service. By consent, Rule is made
returnable forthwith and the Petition is taken up for hearing and
disposal. We have heard Mr. Tulzapurkar, learned Senior Counsel
for the Petitioner and Mr. Setalvad, learned Senior Counsel for
Respondents Nos. 1 to 5. We have considered their respective
submissions and, with their assistance, the material on record.
2.
The challenge in this Writ Petition brought under Article 226
of the Constitution of India is to what is effectively a blacklisting
order dated 5th November 2015 passed by the 2nd Respondent, the
Executive Director of the 1st Respondent, the Oil and Natural Gas
Corporation Limited ("ONGC"). By this order1 the Petitioner
("Anchor") has been banned from all business dealings with
ONGC for two years. The ostensible reason for this ban is that
Anchor allegedly violated an "Integrity Pact", a formal and binding
contract between Anchor and ONGC. The impugned order in terms
states that no tender inquiry is to be issued to Anchor or any of its
allied concerns, partners, associates, directors or proprietors for any
ongoing or future tenders during the period of the ban.
3. The additional prayer added by an amendment is that the
provisions of Section 3[3] of the Integrity Pact be struck down and
be held not to be binding on the Petitioners.
Exhibit "A", pages 86 to 87A
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4. Mr. Tulzapurkar places his challenge on three principal
grounds: first, that there has been a breach of principles of natural
justice, in that ONGC considered material behind Anchor's back
and never disclosed this material to it nor gave it an opportunity of
dealing with that material; second, that contrary to ONGC's own
manual, which has a clause requiring reasons to be given, and
though this is also a mandate of the law whether or not the manual
contains such a provision, the impugned order is entirely
unreasoned; and third, that there is a material misdirection in regard
to the relevant clauses of the Integrity Pact.
5.
We believe it is necessary, for a clearer understanding of the
subsequent events and their implications and ramifications, to set
out the background of Anchor's case. This is a company that, for
the last three decades or so, has done a considerable volume of
business with ONGC in the supply, installation and commissioning
of various kinds of equipment used in oil and gas production at
ONGC's various sites. Anchor's services and business offerings
include the operation, repair and maintenance of such equipment.
Anchor employs about 300 skilled and qualified technicians and
engineers. For the last eight years, Anchor says, being the lowest
bidder and having acquired a reputation for excellence for the
quality of its services, it has been awarded contract for the operation
and maintenance of Offshore Cranes installed on ONGC's various
offshore production platforms. Anchor has discharged its
contractual obligations successfully, demonstrating an average crane
availability of about 98% as against ONGC's benchmark of 95%.
Anchor claims that there has, as a result, been no oil and gas
production loss from any of these offshore platforms attributable to
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the want of any crane supplied or installed by it. Anchor's record is
untarnished.
6. An Operations and Maintenance ("O&M") Contract for
Offshore Cranes was awarded by ONGC to Anchor against a global
tender. This was for a three year period from 18th June 2011 to 17th
June 2014. The contract inter alia required the execution of an
"Integrity Pact" with ONGC.2 This was required to ensure
transparency and fairness during the tendering process and during
the execution of the contract, a mandate in compliance with anti-
corruption laws.
7. Under the contract, Anchor was responsible for ensuring the
uninterrupted operation of the cranes in question with a minimum
crane availability of 95%. Failure to do so would result in heavy
penalties and recovery by ONGC. Consequently, to ensure the
uninterrupted operation of offshore cranes, their timely repair and
ongoing maintenance were critical. This in turn required the ready
availability of spare parts. For this reason, the tender required the
successful bidder to have in place a MoU in a format prescribed by
ONGC with the Original Equipments Manufacturers ("OEMs") of
the manufacturers of cranes. The O&M contract bound the Anchor
to procure spare parts from ONGC's designated OEMs if called on
by ONGC. In the contract in question, there were about 28 cranes
of 'Patriot' and 'Nautilus' makes. Their spare parts could be
procured only from their respect OEMs, viz., Patriot and Nautilus,
or their authorised licensees in India. The manufacturers of the
Patriot cranes advised the Petitioners to approach the exclusive
Exhibit "B" pages 88-93
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licensees in India. At the relevant time, one G&T Oil States
Industries Pvt Ltd ("GTOSI") was the exclusive licensee in India
of the 'Patriot' and 'Nautilus' makes of cranes. GTOSI was a joint
venture of G&T Oil Field and Offshore Service Pvt. Ltd. ("GTO")
and a Singapore-based company, Oil States Industries (Asia) Pte.
Limited. It seems that the promoter-Chairman of GTO, one Mr.
Savera, was previously the Executive Chairman of GTOSI.
8. The Petitioner forwarded a draft MoU to GTOSI, the joint
venture. This draft was in terms of the one prescribed by ONGC as
part of the tender. GTOSI did not accept the draft in the form that it
was sent. It demanded changes and alterations. Anchor, in order to
save time, accepted these and the MoU was executed on 3rd
October 2011,3 about five months after the award of the ONGC
O&M contract. At that time it seems that ONGC was separately
already facing a problem of timely delivery of spare parts from
GTOSI. Anchor claims that on 21st October 2011, i.e., within a few
days from entering into the MoU, Anchor sent a copy of the MoU to
ONGC and informed ONGC that the 7% discount offered by
GTOSI on the supply of spare parts to ONGC would be passed on
to ONGC. There is a great deal of controversy about this letter.
9. During the pendency of the MoU, it seems that two sheave
pins of a particular Nautilus crane failed. ONGC demanded that
Anchor procure these pins and repair the crane on a priority basis.
Anchor sought and received a quotation from GTOSI and sent it on
to ONGC. In the meantime ONGC had independently called for a
quotation from GTOSI for the supply of these very two sheave pins
Exhibit "F", pp. 116-121.
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and GTOSI quoted the very same price. There was thus no price
differential between the quotation obtained by Anchor and that
given to ONGC directly. Anchor paid an amount of Rs.2,79,196.88
as the basic cost of these sheave pins to GTOSI. They were
reimbursed an amount of Rs. 2,76,648/-. Anchor therefore claims to
have suffered a small loss of about Rs. 2,540/-. Although the MoU
between Anchor and GTOSI required that GTOSI give Anchor a 7%
commission, no such commission was ever in fact paid. There was,
therefore, no commission to pass on to ONGC in respect of the
supply of two sheave pins. There was also no material advantage to
Anchor in the supply of these sheave pins. It is not in dispute that
there was only a single order in respect of these two sheave pins. It
is also common ground that this was only spare parts requirement
involving GTOSI during the entirety of the O&M contract's tenure.
10. The O&M contract was successfully completed on 17th June
2014. There was no complaint against Anchor throughout the
duration of this O&M contract.
11. Anchor claims that today all of its hard-won reputation is
jeopardized only on account of an entirely false representation made
by GTOSI to ONGC's Independent External Monitor ("IEM"). It
is not mere coincidence, Mr. Tulzapurkar says, that GTOSI's so-
called 'complaint' came to be made only in May 2014 when the
principal contract between ONGC and Anchor had neared the end
of its three-year term, and again in July 2014 after the O&M
Contract had ended. Ex-facie, Mr. Tulzapurkar submits, the
complaint is frivolous. It is also not coincidence, according to Mr.
Tulzapurkar, that the GTOSI joint venture ended in 2014, and that
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since then GTO has been independently vying for tenders for these
O&M contracts for offshore cranes and for other ONGC contracts.
GTOSI alleged the MoU to be illicit and illegal and violative of the
Integrity Pact. Yet GTOSI itself, through the very same Mr. Savera,
signed that very MoU against which it now makes allegations. It
took no action on it till very nearly the end of the contractual term.
Indeed, even the form of the MoU was one suggested by GTOSI
itself, and made changes to the form in the ONGC-prescribed
format sent by Anchor.
12. Anchor says that GTO's intentions are self-serving,
motivated and mala fide. It seeks to displace Anchor from the
bidding or tendering field. Rather than seeing these actions of GTO
for what they were, viz., an attempt to take down Anchor and
supplant GTO itself in Anchor's place as a direct competitor,
ONGC has, on completely incorrect, unsubstantiated, untenable
and frivolous grounds preferred to target Anchor alone and to lend
untenable credence to the allegations made by GTO.
13. The Integrity Pact that Anchor was required to sign binds it to
terms and conditions. Those set out in Sections 2 and 3 are relevant
for our purposes.
"Section 2 -- Commitment of the
Bidder/Contractor
(1) The Bidder / Contractor commits itself
to take all measures necessary to prevent
corruption. He commits himself to observe
the following principles during his
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participation in the tender process and
during the contract execution.
1. The Bidder / Contractor will not,
directly or through any other person
or firm, offer, promise or give to any
of the Principal's employees involved
in the tender process or the execution
of the contract or to any third person
anyh material or immaterial benefit
which he/she is not legally entitled
to, in order to obtain in exchange any
advantge of any kind whatsoever during
the tender process or during
execution of the contract.
the
2. ...
3. The Bidder / Contractor will not
commit any offence under the relevant
Anit-corruption laws of India;
further, the Bidder / Contractor will
not use improperly, for the purposes
of competition or personal gain, or
pass on to others, any information or
document provided by the Principal as
part of the business relationship,
regarding plans, technical proposals
and business details, including
information contained or transmitted
electronically.
Section 3 -- Disqualification from tender
process and exclusion from future
contracts:
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If the Bidder, before contract award has
committed a transgression through a
violation of Section 2 or in any other form
such as to put his reliability or
credibility as Bidder into question, the
Principal is entitled to disqualify the
Bidder from the tender process or to
terminate the contract, if already signed,
for such reason.
(1) If the Bidder/Contractor has committed
a transgression through a violation of
Section 2 such as to put his reliability or
credibility into question, the Principal is
entitled also to exclude the
Bidder/Contractor from future contract
award processes. The imposition and
duration of the exclusion will be
determined by the severity of the
transgression. The severity will be
determined by the circumstances of the
case, in particular the number of
transgressions, the position of the
transgressors within the company hierarchy
of the Bidder and the amount of the damage.
The exclusion will be imposed for a minimum
of 6 months and maximum of 3 years.
(2) A transgression is considered to have
occurred, if the Principal after due
consideration of the available evidence,
concludes that no reasonable doubt is
possible.
(3) The Bidder accepts and undertakes to
respect and uphold the Principal's absolute
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right to resort to and impose such
exclusion and further accepts and
undertakes not to challenge or question
such exclusion on any ground, including the
lack of any hearing before the decision to
resort to such exclusion is taken. This
undertaking is given freely and after
obtaining independent legal advice.
(4) If the Bidder/Contractor can prove
that he has restored/recouped the damage
caused by him and has installed a suitable
corruption prevention system, the Principal
may revoke the exclusion prematurely."
(Emphasis added)
14. Clause 15.1 of the O&M contract expressly permits the
payment of a commission but this is only in respect of foreign
bidders. It states that ONGC would prefer to deal directly with
manufacturers and principals abroad but should they decide to have
their representatives, agents or consultants in India and pay
commission for their services, this should be a bare minimum. This
clause is referenced only to indicate that the payment of a
commission by an OEM is not in and of itself obnoxious.
15. Clauses 9.1 and 9.2 of the contract, Annexure "2" relate to
the supply of spare parts for the O&M contract in relation to
Offshore Cranes. They read:
"Clause 9.1: Contractor shall bring to the
notice of the ONGC's Representative of
respective platform responsible for
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executing the contract, the spares
requirement for carrying our maintenance at
Offshore Platforms. The spares shall be
provided by ONGC from its inventory.
However, if requisite spares are not
available with ONGC but are essential for
carrying out the maintenance (e.g.
attending breakdown maintenance),
CONTRACTOR shall arrange the same on the
request of ONGC.
Clause 9.2: ONGC at its discretion shall
ask CONTRACTOR in writing to procure and
supply the spares from the Packagers /
OEM / OES / Licensee / Exclusive Supply-
Service Centres and pay the CONTRACTOR, the
landed cost plus 7.5% of the basic value of
the items indicated in the invoice of the
supplier towards procurement, local
transportation, handling and service
charges."
16. One of the tender requirements was specifically that Anchor
needed to have an MoU with the OEMs in place in a format
prescribed by ONGC. This is not disputed by Mr. Setalvad, who
points out that Clause 9.1(b)(ii)4 read with the Bid Evaluation
Criteria5 and the prescribed form6 references and specifies the
proforma of the required MoU. This is specifically set out in Clause
1.1(a)(2)(i) of the Bid Evaluation Criteria. It is also to be noted that
the names 'Nautilus' and 'Patriot' appear in these documents.
Page 352
Page 580 and 581
Page 400
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Consequently, Anchor approached all five crane
manufacturers/OEMs to have MoUs put in place. Anchor procured
four of the five MoUs according to the prescribed format. The fifth,
with GTOSI, could not be put in place immediately.
17. Paragraph 4(xvi) of the Petition says:
"(xvi) In this context, it is also
important to mention here that in the past,
ONGC has accepted similar agreement of the
foreign supplier/contractor with their
Indian representative after the award of
Contract / Order. Therefore, the
Petitioners did not notice any abnormality
or unusuality while executing the said
Agreement dated 03.10.2011 with M/s. G & T
Oil States Industries Pvt. Ltd. (GTOSI),
New Delhi as the same was duly brought to
the notice of ONGC."
There is no denial or traverse of this averment in any Affidavit filed
by ONGC.
18. All four of the other MoUs were duly submitted by Anchor to
ONGC, and there is no dispute about this. This is a matter that
assumes critical importance: for, it is today Anchor's case that in the
routine course, as it had done for the other four MoUs with OEMs,
it forwarded to ONGC a copy of its MoU with GTOSI. ONGC
accepts that it received copies of the four OEM MoUs, but denies
ever receiving the MoU with GTOSI. The entire case seems to us to
hinge on this one solitary issue.
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19. At this stage, we must make reference to certain clauses of the
MoU, because Mr. Setalvad also attempted a submission that
irrespective of whether or not there was any advantage obtained or
retained by Anchor, the very existence of these clauses in the
Anchor-GTOSI MoU was an Integrity Pact violation. Certain
clauses of this MoU are important.
"1. RESPONSIBILITIES OF ANCHOR:
1.1 To use its best efforts to develop the
business for and in the interest of the
Vendor by generating the maximum possible
requirement for the Qualifying Products and
Qualifying Services to support the
execution of the Contract by ANCHOR.
1.2 To furnish to the VENDOR, in a prompt
and efficient manner, all inquiries
received by ANCHOR from ONGC for the
Qualifying Products and/or Qualifying
Services.
1.3 ANCHOR will issue all Purchase Orders
in respect of the Qualifying Products and
Qualifying Services duly supported by a
workable At Sight Letter of Credit
established in favour of the VENDOR for the
Purchase Order/Work Order value. It is
agreed to by and between the Parties that
the supply of the Qualifying Products would
be made on a FOB Port of Export or Basis in
case of imported items and on an ex-Works
basis for local supplies.
2. SALES COMMISSION
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2.1 In cases when Order is placed on the
VENDOR by ANCHOR
In consideration of the services to be
performed by ANCHOR, VENDOR agrees to
pay Sales Commission at the rate
described below, for all orders for
Qualifying Products and Qualifying
Services accepted by the VENDOR,
emanating out of the Contract and
substantiated by a copy of the
requirements submitted by the ANCHOR
to the ONGC representative, per the
provisions of para 9.1 of
Contract. The Sales Commission will be
the
calculated based on the net invoice
value namely ex-Works/ex-Warehouse
(invoice value, which shall not
include transportation, packing
shipping, handling and similar charges
and all taxes and customs duties). The
Sales Commission percentage payable by
the VENDOR to ANCHOR will be 7% (seven
percent) on the net invoice price, as
explained hereinabove. The Sales
Commission payable will be subject to
deduction of withholding tax and other
taxes as may be applicable.
2.2 In cases when Order placed on the
VENDOR by ONGC Directly
The same percentage of the net invoice
value (as mentioned in the para 2.1
hereinabove) of Sales Commission will
be paid to ANCHOR by the VENDOR in the
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event of ONGC placing an Order on the
VENDOR, emanating directly from the
Contract and that which ANCHOR
substantiates by making available a
copy of the requirement submitted by
ANCHOR to the ONGC representative, per
the provisions of para 9.1 of the
Contract, establishing clearly that
the sales/potential sales are as a
result of ANCHOR's efforts.
The VENDOR will issue a Credit Note
for the Sales Commission amount
corresponding to each invoice. The
Sales Commission will be paid by the
VENDOR to ANCHOR, on a pro-rata basis
within 15 days from the date of the
physical receipt of payment by the
VENDOR against a specific Purchase
Order.
It is recognized by both the parties
that in some instances ONGC shall
place an order on the VENDOR for
enhanced quantities than the
requirement submitted by ANCHOR to
ONGC, in such specific instance(s) the
VENDOR shall in good faith and on it
being satisfied that these enhanced
quantities are emanating from the
requirement submitted by ANCHOR to
ONGC and as a direct result of
ANCHOR's efforts, consider such
enhanced quantities as Qualifying
Products and eligible for Sales
Commission.
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2.3 Notwithstanding the above, it is
clearly understood between the Vendor and
ANCHOR that in the event the VENDOR
receives any Orders directly from ONGC
solely due to its efforts, no Sales
Commission will be either payable or be due
on paid to ANCHOR. In the interest of
ensuring clarity, it is stated that any
Order for spares / sub-assemblies /
components of the Products that is not
supported by a copy of the written
requirement, other than to the instances
referenced in para 2.2 above, submitted by
ANCHOR to the ONGC representative, per the
provisions of para 9.1 of the Contracts,
will not be considered as Qualifying
products.
4. TERM:
4.1 This Agreement will remain in effect
through-out the Contract period between
ANCHOR and ONGC, as referenced
hereinabove."
20. We come now to the most important document in this entire
dispute. This is the covering letter dated 21st October 2011 sent by
Anchor to ONGC forwarding the Anchor-GTOSI MoU.7 It bears a
reference number AOSL/127/2011/ONGC. The emphasized reference
or identification number is crucial. It is signed by one Pramod
Mishra on behalf of Anchor. The letter produced shows an oval
stamp with a crenellated border at its foot indicating its receipt by
ONGC on 21st October 2011.
Exhibit "G" page 122
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21. On 28th August 2014, an officer of ONGC put up a working
paper in regard to allegations of malpractices that had apparently by
then already been made against Anchor in relation to the Integrity
Pact and the O&M contract in question. This had been referred for a
legal opinion. The working paper of 28th August 2014 8 references
the MoU between Anchor and GTOSI. The complaint made by
GTOSI was of 28th May 2014. No copy of this complaint had been
sent to Anchor. The relevant portions of this working paper read
thus:
"The scrutiny of the facts of the case on
the basis of the relevant provisions of the
Integrity Pact may reveal that M/s. Anchor
by virtue of the fact that it has entered
into the Agreement dated 3rd October 2011
with M/s. G&T whereunder they are entitled
to Sales Commission under Clause no. 2
thereof, has improperly for the purpose of
personal gain passed on to M/s. G&T
information provided in ONGC's Contract.
The very fact that the said Agreement dated
3rd October 2011 was entered into by M/s.
Anchor behind the back of ONGC, may reflect
the lack of transparency and fairness on
the part of M/s. Anchor which are bedrocks
of the Integrity Pact and were required to
be observed by the parties to the Integrity
Pact.
However, it is not clear from the record as
available in the file whether the said
personal gain which might have accrued to
Record page 894-895
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M/s. Anchor by virtue of their entitlement
for Sales Commission under Clause 2 of the
said Agreement has been passed on to ONGC
or not. Should the same has been disclosed
and passed on to ONGC without delay; the
question of personal gain may not arise.
However, the fact of improper use of the
information or document provided by the
Principal to M/s. Anchor would remain
unchanged and undisputed."
22. As a starting point of the action against Anchor, this is vital. It
points to two things. First, the need for disclosure. This is, as it
turns out, pivotal to the entire case. Second, the question of
commission and whether this was passed on. As we have noted,
there being no evidence of any commission having been received by
Anchor, no issue ever arose of it being withheld or not passed on.
This, therefore, leaves only the first question of whether or not the
MoU was disclosed to ONGC. This document also makes it clear
that having an MoU that provides for commission is not in and of
itself anathema to the O&M Contract or the Integrity Pact.
23. This working paper was followed a few months later by a
another note dated 10th December 2014 in which an opinion was
expressed that Anchor was in violation of the Integrity Pact on
certain grounds. Paragraphs 3(a) and (b) of this document indicate
that the principal cause of concern at that time was that Anchor had
obtained some benefit to which it was not entitled. 9
Record page 915-916
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24. On 19th February 2015, a Show Cause Notice was issued to
Anchor.10 The Show Cause Notice sets out twelve questions or
statements and calls for Anchor's responses to each. Question No. 1
makes it clear that the complaint emanated from GTOSI. This was
allegedly done by a letter dated 28th May 2014 and another letter
16th July 2014. There also appears to have been a meeting between
the representatives of GTOSI and ONGC on 9th July 2014. Portions
of GTOSI's two letters dated 28th May 2014 and 16th July 2014 are
quoted. In the first, GTOSI apparently alleged that their MoU,
execution of which with Anchor GTOSI did not deny, was noticed
to be in 'clear conflict' with ONGC's interest, and that on realising
this, "unilaterally" and "most immediately" GTOSI cancelled the
MoU with Anchor. The submission to ONGC was that penal
provision should be invited against Anchor for having violated the
Integrity Pact. Pausing for a moment, it is to be noted that this
statement is demonstrably incorrect. There was in fact no
cancellation of the MoU at any time, let alone most immediately.
The timing of this complaint is also most curious. It will be
remembered that the O&M contract between ONGC and Anchor
was for a three year period from 18th June 2011 to 17th June 2014.
GTOSI's complaint was, therefore, barely a month before the end of
the principal contract, with which the MoU was coterminus. There
was no question therefore of any "immediate" cancellation by
GTOSI of its MoU with Anchor. GTOSI waited till the end of the
contract before making any complaint to ONGC. It is hardly likely to
suppose that GTOSI awoke to this realisation of illegality, one that it
claims was glaring, only after three years.
Exhibit "N" page 174 to 177
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25. The second letter from GTOSI, also quoted in the Show
Cause Notices, is perhaps even more interesting. The allegation
made in this in terms is that ONGC would, as a result of the MoU
between Anchor and GTOSI, have had to pay more for spares and
assemblies; that Anchor would have directly benefited by receiving
commissions; and thus would have deprived the entire tendering
and contract process of transparency. Once again, GTOSI invited
punitive action. This allegation, too, is clearly without basis, since
there was no benefit at all to Anchor, no commission ever having
been paid. Indeed, as Anchor points out, far from receiving any
benefit, it suffered a small loss.
26. Thus, the antecedent facts show that there was absolutely no
basis for GTOSI's complaint at all. But these were early days in the
unfolding of events, and ONGC called on Anchor to submit a
detailed response to these allegations and to explain why it should
not be banned by ONGC for violations of the Integrity Pact.
27. Questions 6, 7, 8 and 9 of this Show Cause Notice are
material. They read:
"Q.6 As per agreement, the vendor will
issue a credit note for the sales
commission amount corresponding to each
invoice issued by G&T Oil States
Industries. Please confirm if any such
credit advice/note has been issued by M/s.
G&T Oil State for the supply of sheave pins
against invoice no. GTOSI 4702/11-12/INV
005 dated 1.11.11
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Q.7 Vide letter no.
AOSL/127/2011/ONGC dt 21/10/2011 addressed
to GM (MM), ONGC, you had indicated that
sales commission @ 7.0% received from M/s.
G&T Oil States Industries shall be passed
on to ONGC by M/s. Anchor. Please indicate
details of any such commission amount
passed on to ONGC in this regard.
Q.8 ONGC has purchased spares worth
Rs. 56,59,053/- vide PO No. 4010058933 dtd.
3.6.11 directly from M/s. G&T Oil States
Industries. As per the agreement executed
with M/s. G&T Oil States Industries, 7%
commission was to be paid by M/s. G&T to
M/s. Anchor. Is there any commission
payment received by you as sales commission
against the above referred direct purchase
made by ONGC.
Q.9 Your Letter No.
AOSL/127/2011/ONGC dtd. 21.10.11 appears to
have been delivered to office of GM(MM) as
per the seal affixed on the body of the
letter. Please confirm the mode of delivery
of the letter. If delivered directly,
please give the name of the person who
delivered the said letter.
28. Clearly, therefore, ONGC's concern was principally whether
any commission had been received from GTOSI and had remained
to be passed on to ONGC by Anchor (Questions 7 & 8). A
subsidiary query raised in question 9 was as to the mode of delivery
of Anchor's letter dated 21st October 2011 by which a copy of the
MoU was sent on to ONGC.
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29. On 17th March 2015, Anchor replied to this Show Cause
Notice.11 This is a substantial reply. It deals with every aspect of the
Show Cause Notice. In the course of this Reply to the Show Cause
Notice, Anchor pointed out, inter alia, that it had in fact received no
commission in the procurement of the two sheave pins, the only
spare parts in question in its MoU with GTOSI, and that there was,
therefore, no question of either passing on or withholding any
commission. It also drew ONGC's attention to the conduct of
GTOSI and expressed an apprehension that the complaint against
Anchor was motivated and mala fide. The allegations made by
GTOSI in its complaint, including that the MoU had been
terminated, were specifically denied. Questions 7 and 8 related to
the issue of commission. Both were thus answered. Anchor
specifically dealt with Question 9 regarding the delivery of Anchor's
letter dated 21st October 2011 forwarding a copy of the Anchor-
GTOSI MoU. This issue was also addressed in Anchor's Reply. 12
Anchor pointed out that at least five of its personnel regularly
visited ONGC's offices at Vasudhara Bhavan and at 11-High for
official work related to various projects. During these visits they
regularly carried and brought back letters to and from ONGC. Since
the letter in question was by this time three years old, it would be
difficult to recollect exactly the person who had hand delivered the
letter. Nonetheless Anchor confirmed that as per its record the
letter in question was delivered to the office of GM (MM) at
Vasudhara Bhavan on 21st October 2011 and an acknowledgement
had been obtained on an office copy of it.
Exhibit "P", pages 179 to 213
Record p. 209.
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30. About eight days after this Reply to the Show Cause Notice,
on 25th March 2015, ONGC's Inquiry Officer, the 3rd Respondent,
submitted his Inquiry Report.13 We have carefully considered this
Report. It appears to us to have been thorough, measured and
careful. The Inquiry Officer's findings are set out in paragraph 9.1
of the Report.14 He concluded that there was no conclusive proof of
collusion between Anchor and GTOSI. He noted that there were
four other MoUs executed by Anchor with third parties in the
ONGC-prescribed format. He also noted that during the period of
contracts, spares were required to be obtained by Anchor only once,
and that there was no evidence that Anchor had received any
commission against this order for spares. He also noted that even
assuming that there was any commission, any possible benefit to
Anchor was a paltry Rs. 19,543/-, utterly negligible relative to the
value of the contract. More importantly, the Inquiry Officer noted
the complete failure of GTO to submit any evidence to substantiate
its allegations, viz., that it had paid commission to Anchor; that
there was collusion between Anchor and other crane manufacturers;
and that GTO had revoked or cancelled its MoU with Anchor. The
Report notes specifically that GTO was provided with ample
opportunity to substantiate its allegations but that it failed to do so.
The Inquiry Officer found, and, in our view, quite correctly, that
GTO's allegations could not be said to have been proved beyond
reasonable doubt; that it was not possible to conclude that the MoU
between Anchor and GTOSI was executed with the sole intention of
defrauding ONGC for Anchor's undue benefit or personal gain; and
that there was simply no material to prove any benefit to Anchor
Exhibit "18", Pp. 950-980
Pp.979-978
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itself. The Inquiry Officer concluded, therefore, that it would not be
appropriate to consider banning Anchor based on the allegations
made by GTOSI, which had itself signed the contentious MoU. The
Report noted that for the last three decades Anchor had delivered
satisfactory services without any such incident or allegation ever
having been made and, therefore, recommended that Anchor should
not be considered for a ban.
31. We should have thought that matters should have rested at
that. Instead, it is at this point that they took a decidedly odd turn. It
seems that two months later on 21st May 2015, the Chief Legal
Services of ONGC 'disagreed' with the Inquiry Report, 15 and,
specifically, disagreed that any benefit of doubt should be afforded
to Anchor. For the first time, it seems to have been alleged or
contended that Anchor's covering letter of 21st October 2011
forwarding the MoU was never received by ONGC. It was also now
contended that the stamp or seal on the receipted copy produced by
Anchor was not of "MH asset", the relevant office of ONGC. It is
difficult to resist the prima facie conclusion that this Legal Officer
seems to have been more than somewhat peeved by the Inquiry
Report being so completely against the earlier prima facie opinion
expressed by his office on 5th September 201416 and 10th December
2014.17 The result was that the Inquiry Officer was directed to re-
examine the matter and reconsider his recommendations.
Exhibit "20", P. 982
Pp.894-896
P. 915
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32. It was pursuant to this that a second Report came to be
submitted on 22nd June 2015.18 The second Inquiry Report is by the
same officer who made the first Inquiry Report, the 3rd Respondent.
Strangely, this Report marks a complete volte face from the first
Inquiry Report. Without any further hearing, the same Inquiry
Officer seems now to have concluded that there was in fact a
probable violation of the Integrity Pact and that Anchor ought to be
banned or blacklisted from future contracts of ONGC for a period of
two years.
33. It seems that shortly thereafter, on 13th July 2015, 19 a view
was expressed that since the Inquiry Officer's second report of 22nd
June 2015 (recommending a two year blacklisting of Anchor) was so
different from his previous recommendation, it would have been
advisable to give Anchor another opportunity "to enquire about the
person who delivered their letter dated 21st October 2011 to ONGC
and to whom". Thus, it is now apparent that the only issue on which
the entire matter seemed to turn was delivery of Anchor's covering
letter dated 21st October 2011 forwarding a copy of the MoU, and
that this was now being completely denied by the ONGC.
34. There then followed, most peculiarly, a third Report dated 7th
September 2015 of the same Inquiry Officer. 20 In this Report, the
Inquiry Officer now referred to additional material received from
the dak receiving officials of ONGC's department in question,
particularly one Mr. Madhu H. Gulabani and one Mr. Vijay Pagare.
Exhibit "22", Pp. 984-989
Exhibit "24", P. 991
Exhibit "26", Pp. 993-999
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At this time and at this hearing Anchor also submitted additional
documents including a forensic examination of the
acknowledgement stamp on the covering letter from Truth Labs,
Hyderabad. This forensic report confirmed the authenticity and
veracity of the stamp. Anchor contends that the additional material
relied upon by the Inquiry Officer, viz., the statements of the two
ONGC staff, was never in fact supplied to Anchor. It is on this basis
that the Inquiry Officer now concluded that Anchor was unable to
prove submission of its letter dated 21st October 2011 to ONGC. It
is an admitted position21 that the Inquiry Officer in this third round
did in fact consider this additional material.
35. It is important to note that, in his conclusions in the third
Inquiry Report, the Inquiry Officer noted that there were in fact two
letters of 21st October 2011. These bore distinct reference numbers.
One had a reference No. 127; this is the letter in question
forwarding a copy of the MoU between Anchor and GTOSI. The
second is a letter with reference No. 121 by which Anchor
forwarded a copy of an extended Performance Bank Guarantee
required by the contract. Before the Inquiry Officer, Anchor also
produced ten letters showing the same stamp of acknowledgement
as was seen on its covering letter dated 21st October 2011
forwarding the MoU. A reference is made in the third Inquiry
Report to a dak register.
36. It is on this basis that the impugned order came to be passed. 22
Mr. Tulzapurkar submits and, in our view, quite correctly, that the
Affidavit in Reply, Paragraph 39, P. 321-322
P. 87
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impugned order is completely devoid of reasons. This is despite the
fact that the ONGC's own internal manual and procedures 23 require
that reasons be given. In fairness, Mr. Setalvad does not dispute that
even according to ONGC's internal processes where there is a
disputed question of fact, the benefit of doubt must indeed be given
to the party in question. Further, we note that the Integrity Pact's
Section 3(2) requires proof 'beyond reasonable doubt'.
37. We have no difficulty accepting Mr. Setalvad's contention
that the ONGC has sufficient power, in its hierarchical processes, to
review or reappraise or reconsider any given report. 24 This is part of
ONGC's internal procedures and systems. Mr. Setalvad however
attempted a justification of the blacklisting by inviting our attention
to Clauses 2.1 and 2.3 of the MoU and contrasting these with
Sections 2(1)(1) and (2)(1)(3) of the Integrity Pact. We have set out
those clauses earlier. Clause 2 of the MoU deals with Sales
Commissions. Clause 2.1 says, in substance, that when an order is
placed on GTOSI by Anchor, a certain sales commission of 7% of the
net invoice price is payable. Then Clause 2.2 says the same
commission is to be paid where an order is placed directly by ONGC
on GTOSI. Clause 2.3, which begins with a non-obstante provision,
sets out an understanding that should GTOSI receive an order from
ONGC directly, then no commission would be payable to Anchor.
Section 2(1)(1) of the Integrity Pact prohibits Anchor from, in any
P. 938
Afcons Infrastructure Limited & Ors v Oil & Natural Gas Corporation Ltd.
& Ors., 2013 (7) ALL M.R. 527. This involved a challenge to a decision
during a tendering or bidding process. The High Court Division Bench
cited the Supreme Court decision in Ratnagiri Gas & Power Pvt Ltd v
RDS Projects Ltd., (2013) 1 SCC 524.
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manner, passing on any benefit whatever to any person who is not
entitled to it. But this is a prohibition that is caveated, for what is
forbidden is passing on any benefit (a) to a person who is not entitled
to it; and (b) it must be in order to obtain in exchange any advantage
of any kind during the tender process or contract execution. Mr.
Setalvad was quite unable to demonstrate from any material on
record what benefit could reasonably be said to have been obtained
by a person not entitled to it and how this could possibly be said to
have been done by Anchor to derive any undue advantage at any
stage. Indeed, the record seems to us to point to the fact that
Anchor received no commission at all against the solitary order for
replacement Sheave Pins. None was available to pass on to ONGC,
and none was withheld. To the contrary, it seems that Anchor paid
for the Sheave Pins fully but received a reimbursement in a lesser
amount.
38. We noted Mr. Setalvad's statement that the Integrity Pact
does not in and of itself prohibit an agreement for commission as is
found in this MoU. In other words, such an MoU is not absolutely
barred. The only question, as Mr. Setalvad himself places it, is
whether or not the MoU was in fact disclosed, for the need of such a
disclosure cannot possibly be denied.
39. We are also, in our view, not concerned with the actual merits
of the case or an examination of whether or not there is in fact a
violation of the integrity pact. Our concern is more fundamental.
This is as it must be in the exercise of our jurisdiction and discretion
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under Article 226 of the Constitution of India: we are concerned
with the decision-making process.25
40. Having regard to the trajectory of this complaint, the ensuing
inquiry and its culmination in the impugned order of blacklisting, it
is clear that the heart of the dispute is not so much the content or
wording of any particular clause in the MoU or in the integrity pact
but whether or not Anchor's letter of 21st October 2011 (Reference
No. 127) was in fact delivered or not, i.e., whether that MoU
between Anchor and GTO was disclosed as it was required to be, to
ONGC. It is in this context that Mr. Setalvad attempted a
submission in defence of the third Inquiry Report and the impugned
order that Anchor had not been able to establish conclusively
delivery of its covering letter of 21st October 2011 (Reference No.
127). Here again, we must note that we are not concerned with an
examination of the merits of even this dispute or of actual proof. It is
common ground that if on any reasonable evaluation of the case, it is
not established beyond reasonable doubt that the letter in question
was not delivered, then the benefit of doubt must be given to
Anchor.
41. In addressing this, therefore, we are tasked with surveying
ONGC's denial of receipt of this letter and what Anchor was able to
demonstrate to refute that denial. Mr. Tulzapurkar first takes up
ONGC's dak register.26 This is a handwritten volume noting
documents delivered to ONGC's office in question. It is ordered by
UEE Electrical Engineers P. Ltd. v Delhi Development Authority & Ors.,
2005 (81) DRJ 256 (DB)
Exhibit "30", Pp. 1022-1024
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date. Incoming documents are assigned consecutive serial numbers
in the first column. The second column shows the name of the party
sending the letter or communication. The third column shows the
reference number and the date. The pages for 21st October 2011 27
show two entries against Anchor's name. These are at Serial Nos. 15
and 26. Anchor's name is clearly shown in the second column. The
difficulty is in the third column. Against both entries, the reference
number is the same: AOSL/121/2011/ONGC. This corresponds to
the reference number on Anchor's other letter of 21st October 2011,
the one by which Anchor forwarded the original Performance Bank
Guarantee with an extended validity. The dak register does not show
the reference number of Anchor's letter of 21st October 2011
(Reference No. 127) forwarding a copy of the MoU. It is on this
basis that Mr. Setalwad submits that ONGC was correct in its
submission that Anchor's covering letter forwarding the MoU was
never delivered to ONGC.
42. Without examining the other material that Mr. Tulzapurkar
has produced, and to which we will advert immediately hereafter,
this answer from Mr. Setalvad appears to us to be self-contradictory.
It does not commend itself to us in the least. It is indeed surprising
that ONGC could effectively contend that it had erroneously
entered the same letter from Anchor twice. This can only mean that
the very document on which ONGC bases its claim of non-delivery
is inherently unreliable: again, the issue of benefit of doubt. There is
nothing to show that Anchor sent the same letter (Reference No.
121) regarding the Performance Bank Guarantee twice on that day;
nobody suggests this. The explanation that comes from ONGC that
Pp. 1023-1024
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there are frequently such mistakes is in itself further reason to afford
a benefit of doubt to Anchor. It can hardly provide a sustainable
resist for an order of blacklisting. It is impossible from this
document to turn the tables on Anchor and to contend, as ONGC
does, that Anchor has failed to 'conclusively' prove delivery of its
covering letter forwarding the MoU.
43. But that is not the limit of the material that Mr. Tulzapurkar's
clients were able to marshal in support of their contentions. They
also adduced copies of several other letters from them to ONGC of
different dates with a similar oval stamp with a serrated border. 28
They also produced documents sent to ONGC by other parties
evidencing a similar stamp.29 In addition, Anchor produced a
forensic report showing that the stamp and seal on the office copies
of these letters were genuine. It appears that ONGC actually had at
the relevant time two different stamps: the oval one with the
serrated border that was applied to office copies of letters to indicate
acknowledgement and, on the inward originals, a round stamp.
44. In the face of all this, we find it difficult to accept Mr.
Setalvad's submission that all of these 17 or more documents are
forged and fabricated. This seems to us to be an argument of
desperation. There is no doubt that Anchor has a track record of at
least three decades in serving ONGC. There is no reason why it
would suddenly resort to any such convoluted and large scale
fabrication or forgery, especially when it has, at the end of the day,
suffered some loss and gained no benefit at all. ONGC's demand
Pp. 256-266, 1043, 1047, 1049, 1050, 1052, 1054
Pp. 1044
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that Anchor should identify precisely the person who delivered the
letter several years later is ex facie unreasonable.
45. What Mr. Setalvad's argument also overlooks is material to
show that one of the persons, Mr. Vijay Pagare, himself has said 30
that the oval stamp seen on the delivery-acknowledged letters was
used till 2014. The other person from ONGC whose statement was
used, Ms. Gulabani, however said31 that only a round seal was used
and never an oval seal. This appears to be incorrect, for there is also
material to indicate32 that the oval seal was withdrawn only much
later.
46. In addition, there is the factor that the correspondence on
record33 between Anchor and GTOSI indicates that the current
format of the MoU, i.e., the format in which it was finally executed
was one that was desired by GTOSI itself. ONGC seems to have lost
sight of this although this was placed before it not once but twice.
47. ONGC has also surprisingly completely overlooked the role
of GTOSI in this entire matter. The first Inquiry Report clearly
established that despite several opportunities GTOSI has failed to
establish any of its allegations against Anchor. ONGC also
overlooked the fact that there are patent contradictions in GTO's
own complaint. The most startling one is that GTO, itself a
signatory to the MoU, claimed that the MoU was illegal, i.e., that
P. 1004
P. 1003
P. 1030
Pp. 101-110
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itself was a party to the illegality. This allegation was made only at
the end of the O&M contract in question. GTO's allegation that it
had terminated the MoU immediately is demonstrably false. There
was never any such termination or cancellation and none is shown to
us from the record. There is also material to indicate that Oil States
Industries (India) Pvt. Ltd., a breakaway partner of GTOSI, told the
Inquiry Officer that it had no knowledge of this agreement and no
approval or permission of the directors of the Board of GTOSI had
been taken before taken entering into MoU in question. The second
strut of GTOSI's complaint, viz., that Anchor received benefit, is
also demonstrated to be incorrect.
48. In this view of the matter, it is indeed most surprising ONGC
should have so wholly accepted such a spurious and specious
complaint, one without any substance at all, despite these
overwhelming contradictions and despite the categorical finding in
the first Inquiry Report. Mr. Tulzapurkar's submission that all of
this from GTO is entirely motivated and self-serving is a submission
that at least prima facie appears to be correct. We cannot fathom how
ONGC could have allowed itself to be swayed or taken in by such a
motivated complaint from an interested party. We are also unable to
appreciate why no inquiry seems to have been made against GTOSI
and why they have been given so complete an exoneration.
Procedurally, it seems to us that the entire process was vitiated.
49. Mr. Tulzapurkar submits that mala fides are writ large on the
face of the record. It is true that the record has several perplexing
inflexion points. There is, to begin with, a strongly worded prima
facie opinion, based on virtually nothing. This was quite correctly
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held in the first Inquiry Report to be insubstantial. This was almost
immediately followed by an insistence on a re-examination. To be
sure, that is a course that is permissible, but it must be for cogent
reason. We find none, other than this entirely untenable insistence
on proving delivery of a three year old letter in circumstances that
hardly redound to ONGC's credit. This re-evaluation resulted in a
full-scale somersault in the final conclusion, and then the impugned
order is passed without recording reasons. In all this, the fact that
the complaint has not been proved seems to have been ignored. Also
overlooked is the role of GTOSI in dictating the terms of the MoU,
waiting till the eleventh hour to assail it, and then failing to adduce a
shred of evidence in support of its allegations. Yet GTOSI seems
not to have earned ONGC's ire. In the bargain, ONGC proceeded
to rely on material that was not made available to Anchor. It is for
this reason that Mr. Tulzapurkar says that if this process was not in
fact triggered by some senior legal officer having felt slighted, then
the only alternative explanation is one that suggests itself and is
simply unspeakable. We refrain from expressing any opinion on this,
for it is sufficient for our purposes to note only that at every stage,
and as correctly noted in the first Inquiry Report, the matter was not
free from reasonable doubt; and the benefit of that doubt ought to
have been given to Anchor. The only question, as we have noted, is
about the disclosure of the covering letter of the MoU. On this
aspect of the matter, given the material on record produced by
Anchor, it is impossible to reasonably conclude that the case against
Anchor was established beyond reasonable doubt or that Anchor
was not entitled to the benefit of doubt. We must also note that
Section 3(2) of the Integrity Pact specifically states that no
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transgression is to be said to have occurred if there is reasonable
doubt.
50. The impugned order is itself unreasoned. The Supreme
Court has repeatedly emphasized the need for reasons to be
recorded by administrative authorities: see S. N. Mukherjee v Union
of India.34 This is inter alia because such decisions are subject to
judicial review, one that is rendered impossible in the absence of
reasons. Moreover, a reasoned order excludes (or at least reduces)
chances of arbitrariness and ensures fairness in the decision-making
process. This is necessary even for such administrative decisions
that are not subject to appeal, revision or judicial review. A party is
entitled to know the basis of the decision, and this, the Supreme
Court says, is a third principle of natural justice, in addition to the
classical rules of audi alteram partem and the rule against bias. The
entire objective is to prevent the miscarriage of justice. In Indian Oil
Corporation Ltd v SPS Engineering Ltd,35 a Division Bench of the
Delhi High Court had before it a case of blacklisting. Here again, the
order was unreasoned. Citing inter alia the Supreme Court decision
in S. N. Mukherjee, the impugned order was set aside.
51. In Gorkha Security Services v Government of NCT of Delhi &
Ors.,36 the Supreme Court had before it an appeal that raised a
question of the form and content of a show cause notice in a
proposal for blacklisting. There was no dispute that such a show
cause notice is in fact necessary in such cases. Terming blacklisting
(1990) 4 SCC 594
128 (2006) DLT 417
(2014) 9 SCC 105
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as civil death and stigmatic, the Supreme Court observed that the
issue in law is not such as to the necessity of such a notice but of its
contents. The notice must be precise. The noticee must know
exactly the case set against him and which he must meet. The
nature of the action proposed must be spelt out. In other words, the
notice must set out the particular grounds and the action or penalty
proposed should the noticee not be able to convincingly answer
those grounds. In the case at hand, we are constrained to note that
there is no finding at all against Anchor under Section 2(1)(1) of the
Integrity Pact, i.e., of it having promised or given to any third person
any undue benefit to which such person was not entitled in order to
obtain any advantage. As to Section 2(1)(3), we do not see how this
could have been said to have been violated by Anchor at any stage by
execution of its MoU with GTOSI. This is also not a case of a
violation of the principles of natural justice with no prejudicial
effect. To the contrary, the prejudice to Anchor, an entity that has
served ONGC without blemish for thirty years, is manifest.
52. We are not in this judgment suggesting that ONGC does not
have the power to blacklist. It does. This power need not even be
statutory. The power, however, must be exercised within the
constraints of law and in a manner that is legally tenable and cannot
withstand judicial scrutiny. In other words, the only legal limitation
on the exercise of this power is that the State, through any of its
instrumentalities, must act fairly and rationally without in any way
being arbitrary.37
Patel Engineering Ltd. v Union of India & Anr., (2012) 11 SCC 257
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53. We do not think that the decision of a learned single Judge of
the Gujarat High Court in Asif Enterprises v ONGC Ltd & Ors.,38
cited by Mr. Setalvad, has any application at all to the facts of the
case before us. There was no factual dispute in that case about the
forgery of the bank guarantee in question. It was in that particular
context that the learned single Judge held that the inquiry and final
order were not vitiated only on account of a lack of a personal
hearing. That, as the Supreme Court has said, in Patel Engineering
and Gorkha Security Services, is not invariably fatal. We are also not
impressed by Mr. Setalvad's reliance on the decision of a Division
Bench of this Court in Madhukar G. Wagh v Union of India.39 That
was a case of in-service misconduct, not a matter of blacklisting of
contractor in a tendered contract.
54. It is impossible to sustain the impugned order. We do not
think it is necessary to enter into any larger question of the validity
of Section 3(3) of the Integrity Pact. In a given case, a mere want of
a personal hearing may not vitiate an order that is otherwise
unimpeachable.
55. In view of the foregoing, the impugned order dated 5th
November 2015, Exhibit "A"40 is quashed and set aside. The
Petition is made absolute in terms of prayer clause (i), which reads
thus:
"(i) this Hon'ble Court be pleased to issue a
Writ in the nature of Certiorari or any
AIR 2002 Guj 264
2010 112 (8) Bom. L. R. 3620
Pp. 86-87
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other appropriate Writ, and/or direction
or order in the nature of Certiorari
against Respondent Nos. 1 and 2 for a
Writ in the nature of Certiorari or any
other appropriate Writ, and/or direction
interalia calling for the records of the
entire proceedings relating to the
representation made by M/s. G&T Oilfield
Offshore Services Pvt. Ltd. (GTO) before
the External Independent Monitors (IEM),
ONGC and to the Inquiry Officer and the
enquiry conducted by the Inquiry Officer
pursuant thereto and after examining the
validity, legality and propriety of the
purported Order No. MR/MM/MH/SCON/O&M
crane/81/GT/ 2010-11 dated November 05,
2015 of the Respondent No. 2, the same
be quashed and set aside;
56. There will be no order as to costs.
(G. S. Patel, J.) (S. C. Dharmadhikari, J.)
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