M.K. Mathulla vs N.N. Wanchoo And Anr.
1970 Latest Caselaw 12 Del

JUDGMENT

Hardayal Hardy, J.

1. The petitioner Mr. M. K. Mathulla is a Chartered Accountant. Befoe he was selected by the Union Public Service Commission in 1951 for the post of Controller of Accounts, Fetilizers Project, Sindri, he had held officer for 12 years as Assistant and Deputy Controller of Accounts and ultimately Controller of Accountsin Tata Iron and Steel Company Jamshedpur and from 1948 to 1951 as Chief Executive Officer in Air India. After working for about three years in Sindri Fetilizers and Chemicals Limited his services were taken on loan by Government of India in the then Ministry of Production where he ws first appointed as Officer on special Duty and later made ex-officio Joint Secretary.

2. From 1st March, 1956 he was appoined Managing Directory of Hindustan Machine Tools Limited Bagalore where he claims to have made a tremendous success of his job by transferring an undertaking that had shown a loss of Rs. 60 lakhs into a floruishing concern which began to make profits rising to Rs. 3 crores per annum and paid a dividend of 10 per cent per annum for 5 years in succession. He also claims that by imaginative planning, reorganisation and utilisation of full production capacity of the undertaking he succeeded in launching on a programme of expansion whereby four more machine tool fctories, one in bangalore, the other in Pinjore (Punjab), the thrid in Kalamassery (Kerala) and the fourth in Hyderabad were established, two of these factories are claimed to have been built from internal resources of the parent undertaking without any additional investment of capital by the Government or external resources.

3. The petitioner also alleges that the services in the development and profitables expansion of machine tools industry and precision instruments industry won him the appreciation of Shri Jawaharlal Nehru and then Minister of Commerce and Industry late Shri Lal Bahadur Shastri and Shri Manubhai Shah. In recognition of his distinguished servies to the country he was awarded Padma Shri in 1959 and the Hindustan Machine Tooks (HMT) won the Presidential Award for the best managed public undertaking.

4. He states that as he would have ordinarily retired on completing the age of 55 in the year 1962, he requested the Government in 1961 to allow him to return to the private sectoy and start a small tool factory of hisown with foreign collaboration. He therefore put up a scheme for collaboration with a 100% State-owned West German concern, Messrs Fritz Werner, for this purpose.

5. A letter dated 7-4-1961 addressed to the petitioner by the then Minister of Industries Shri Mnubhai Shah shows that in view of the petitioner's direct connection with Hmt and the likelihood of his connection with that position for many more years, the Minster did not favor the petitioner's association with any such enterprize and therefore declined to accommodate him. It however appears that while disfavoring the petitioner's direct association with such a venture, the Minister made what would appear to be a most impolitic suggestion that the petitioner might ask any of his friends or some other persons known to him to take up such a venture with Messrs. Fritz Werner of Germany.

6. An application was therefore made for grant of a license to establish a new industrial undertaking under Section 11 of the Industries Act, 1951 for manufacuring machine tools by Fritz Werner in partnership with the petitioner's brother Shri K. M.Thomas at Bangalore. A letter dated June 8, 1961, addressed by the petitioner to Shri D. Sandilya, Joint Secretary to the Government of India in the Ministry of Commerce and Inudstry shows that the application was pursued by the petitione who made a special reference to the suggestion made by the Hon'ble Minister while at the same time disclosing that the Indian partner of the foreign collaborators was the petitioner's own brother.

7. With effect from 10th June, 1961 the petitioner also became Chairman of the Board of Directors of Hmt inaddition to his duties as Managing Directors of the company. This appointment he contained to hold till 1st of March, 1964 when he was appointed a Director and non-executive Chairman to preside over the meetings of the Board of Directors of the company until further orders.

8. The private venture which was styled as Bharat Fritz Werner Private Limited had meanwhile been set up and commenced production sometime after the petitioner handed over charge as Managing Director of Hmt to his successor, At the end of 1964, the petitioner served his connection with Hmt even as its non-executive Chairman.

9. The petitioner alleges that in 1954-55 during negotiations with the Russian delegation for establishment of a steel plant at Bhilai, he as a Joint Secretary in the Ministry of Production advocaed that a capacity of one million tons was more viable. This ran counter to the views of Mr. T. T. Krishnamachari who was for restricting the capacity of the Bhillai plant to 1/2 million tons on the ground that there was no demand in the country for a million ton plant. Almost three weeks thereafter the Ministry of Commerce and Industry with the backing of its Minister Mr. T. T. Krishnamachari recommended to the Cabinet for acceptance a proposal from Tatas to expand their steel capacity from one millon tons to two million tons. The petitioner prepared a note in which he argued that the country would benefit financially and would save foreign exchange if instead of enhancing the capacity of the private sector plant of Tatas the capaicy of the proposed public sector undertaking was increased. This further antagonised Mr. T. T. Krishnamachari.

10. The petitioner further alleges that besides Mr. T. T. Krishnamachari certain other officers of the Indian Civil Services Cadre were also opposed to any outsider occupying a high post in the industrial sphere of the Government which they wanted to retain for men of their cadre.

11. The petitioner states that after his release from Government he assumed charimanship of Bharat Fritz Werner which did extremely well and was able to organize itself as a very efficient engineering unit within a short time. But in 1965 reports reached him that some sort of investigation was being conducted by the Special Police Establishment, Company Law Department and the Minsitry of Finance (Directorate of Foreign Exchange) regarding him. Mr. T. T. Krishnamachari was then Finance Minister, Government of India. In the circumstances, the petitioner and his family felt constrained to sell their interest to Brila Group in June, 1966.

12. In February, 1967, the petitioner came to know that in Decermber, 1966 Shri N. N. Wanchoo, Secretary to the Government of India, Ministry of Industrial Development and Company Aggairs, who has been impleaed in the petition as respondent No. 1, had issued a confidential circular letter to all the Secretaries and Departmental heads of Central and State Governments in which it was alleged that the petitioner had shown special favor to Bharat Fritz Werner Private Limited as Chairman of Hmt and although there was not enough evidence to take legal action against the petitioner his conduct was viewed as one not befitting his office and that it had been decided that he shoulf not be nominated to any Board in which the Government had any interest.

13. In December, 1967, there were also questions in Parliament to the effect that investigations had revealed that the petitioner had shown some favors to Messrs Bharat Fritz Werner Private Limited Bangalore in reply to which Mr. Fakhruddin Ali Ahmed, Minister for Industrial Development and Company Affairs, stated that although the evidence was not sufficient to sustian any charge against the petitioner administrative action had nevertheless been taken.

14. The petitioner thereupon addressed a representation and also had an interview with the Minister concerned wherein he pleaded for withdrawal of the offending letter. During the course of the interview he was informed that action had been taken by the Central Vigilance Commission and that if the petitioner made any representation the same would be forwarded to the Commission and the latter would also be asked to give him a hearing. The Minister however expressed his inability to withdraw the circular letter.

15. On 22nd November, 1968 the petitioner moved this Court by filing a petition under Article 226 of the Constitution challenging the legality of the Government's action in issuing the circular letter of which a copy was annexed to the petition as Annexure D.

16. The main grounds onwhich Government's action has been assailed in the petition are that by issuing the impuged circular letter the Government has imposed a blanket ban on his nomination and appointment to any office of profit under the Central and State Government or in any of the public undertakings of these Governments, that this amounts to infringement of his fundamental rights under Articles 14, 16, 19 and 21 of the Constitution, that at no stage before action was taken against him was he given any opportunity of hearing to show cause against the proposed action and that the action is mala fide and is the outcome of malice and ill-will which Mr. T. T. Krishnamachari had against him and the hostility of some of the members of the Indian Civil Services, notably Mr. N. Subramaniam, I.C.S. Addl. Secretary in the then department of Heavy Engineering.

17. The petitioner has also averred that although the circular letter was marked "Confidential" its contents were made known far and wide and led to his giving up his claim for over Rupees six lakhs against Birlas, apart from seriously undermining his personal and professional reputation without any lawful excuse

18. In the reply affidavit filed by Shri N. N. Wanchoo some of the tall claims made by the petitioner about his performance and activities have been characterised as highly exaggerated and there is an attempt to belittle his importance but it cannot be denied that even after making due allowance for exaggeration, by and large the petitioner's performance as Managing Director of Hmt is deserving of praise. The allegations of malice and ill-will on the part of Mr. T.T.Krishnamachari and hostility on the part of I.C.S. officers of the Government have however been denied and it is asserted that action was taken against the petitioner as a result of inquiries made by the Central Bureau of Investigation in consultation with the Central Vigilance Commission in accordance with the procedure outlined in the relevant resolution of the Ministry of Home Affairs, Government of India, relating to the scheme of Central Vigilance Commission. The affidavit also mentions briefly certain instance of favors which the petitioner was alleged to have shown to the private company and had led to the administrative action to which exception has been taken by him. The petitioner's allegation that no opportunity of showing cause or of hearing was given to him before the impugned letter was issued, has not been controverter. On the other hand, a straight defense that no such notice or opportunity was necessary has been taken. It is pleaded that association of members with Boards of Government undertakings is a prerogative of the President and Government has a right to include or exclude any individual for this purpose. The petitioner has no such right, fundamental or legal, to be nominated to any such Board. It is further pleaded that the action taken by the Government being an administrative act is not subject to challenge in a petition under Article 226 of the Constitution and it is contended that this Court will not go into the correctness or incorrectness of facts leading to the issue of the impugned letter and reasons for issue of the same and therefore the petition challenging the decision of the Government to issue the circular-letter is not maintainable. The correctness of the copy of the impugned circular letter has also been denied and it is stated that whosoever placed the said copy in the hands of the petitioner or by whatsoever means the petitioner had managed to procure the same its possession was surreptitious and unauthorised. After the respondent's affidavit in reply to the petition was filed the petitione filed a rejoinder-affidavit controverting the facts and contention raised in the respondent's affidavit with special emphasis on the allegations of favoritism made against him. He also moved an application for summoning and inspection of the records containing material on which the allegations of favoritism and the inquiry made by the C.B. I. As made in the counter-affidavits filed by respondent No. 1 were based. The application was however opposed by the respondents in respect of the documents relating to the preliminary and final reports of the Central Bureau of Investigation on the ground that they related to the affairs of the State. A claim for privilege was also made in respect of those and certain other documents.

19. No separate orders were however passed by the Bench hearing that application and it was directed that the same should be listed for hearing along with the main petition. Meanwhile the petitioner also filed a rejoinder affidavit followed by an application for summoning Shri N. N. Wanchoo for cross-examination. No orders were passed on that application as well and it was directed that the same should also be considered at the hearing of the main petition. The Government also filed an additional affidavit controvertin some of the facts in the petitoiner's rejoinder affidavit and re-asserted or elaborated certain other averments.

20. When the petition finally came up for hearing before us no serious attempt was made by Mr. C. K. Daphtary, learned counsel for the petitioner, to challenge the Government's claim for privilege nor was the petitioner's application for summoning Shri N. N. Wanchoo for cross-examiantion pressed. Mr. Daphtary also submitted at the very commencement of his arguments that although he did not wish to give up the petitioner's attack on the gound of mala fide he did not propose to address us on that point unless he failed to carry the Court with him on the question of infringement of fundamental rights under Arts. 14, 16, 19 and 21 of the Constitution and violation of rules of natural justice.

21. Mr. Dapthary also did not rightly address any argument on the correctness or otherwise of the allegations of favoritism made against the petitioner as any such argument would have been completely out of place.

22. After hearing the learned counsel for the parties we indicated that it was not necessary for Mr. Daphtary to go into the question of mala fides as we were inclined to agree with him that there had been gross violation of rules of natural justice inasmuch as the impugned letter had been issued by respondent No. 1 without the petitioner having been afforded any haring either by the Minister concerned or the Central Vigilance Commission in consultation with whom the said circular is claimed to have been issued.

23. As the copy of the impugned letter filed by the petitioner was found to be incorrect, Mr. C. B. Aggarwala, learned counsel for the respondents rightly accepted our suggestion to produce the certified copyof the original letter together with the list of officers and organisations to whom it had been sent.

24. All further argument therefore proceeded on the basis of the certified copy as prodcued by Mr. Aggarwala. The circular letter which is addressed to all Secretaries, Special Secretaries to the Government of India contains an endorsement at the foot to the effect that its copy is forwarded to the Chief Secretaries of the State Governments and Government of Union Territories with the request that action similar to that in paragraphs 2 and 3 may be taken in relation to organisation and undertakings of the said Governments. The circular letter is dated the 22nd December, 1966, is marked "Confidential" and reads as under:-

"Dear Shri

During an investigation of certain allegations against M/s. Bharat Fritz Werner Ltd. Bangalore, a firm in the private sector engaged in the manufacture of machine tools it was found that Shri M. K. Mathullah, when he was Chairman and Managing Director, Hindustan Machine Tools Ltd., had shown some undue favors to the private firm in question. On relinquishing his Chairmanship of Hindustan Machine Tools, Bangalore, Shri Mathullah took up the Chairmanship of the Private firm, M/s. Bharat Fritz Werner Ltd. On examination of the evidence available, it was found that while there was insufficient evidence to take more positive action against Shri Mathullah, his conduct in the affair did not conform to the standard of probity expected of an officer of his standing.

"2. In all the circumstances of the case, it has, therefore, been decided in consultation with the Central Vigilance Commission that it would be inappropriate for Shri M. K. Mathullah to be associated with any organisations (Committees, Boards etc.) of the Government of India or Public Undertaking controlled by the Government of India.

"3. I would accordingly request that the above may be borne in mind while constituting new Boards Committee etc., and also while reconstituting any of the Committees/Boards etc. On which Shri Mathullah may have been nominated in the past.

Yours sincerely,        Sd/-. N. N. Wanchoo."

We will now deal with the arguments that have been addressed by the learned counsel for the parties and our reasons for the conclusion arrived at by us.

25. The first contention urged by Mr. Daphtary is that ex facie the impugned letter not only brands the petitioner as a dishonest man but also prevents his being associated in future with any organisations of the Government of India or public undertakings controlled by the Government and requests the State Governments and the Governments of Union Territories to take similar action in relation to the organisations and undertakings of these Governments. It is not disputed by the respondents that the petitioner was not given any opportunity of being heard and meeting or explaining the allegations made against him either at the stage of inquiry by the Central Bureau of Investigation or the Central Vigilance Commission or by the Government before respondent No. 1 issued the impugned letter. It is true that the action taken by the respondent is administrative in character but he submits it is no longer in doubt that even an administrative order which involves civil consequences must be made consistently with the rules of natural justice after informing the person concerned of the evidence in support thereof and after giving him an opportunity of being heard and meeting or explaining that evidence. Reliance for the argument is placed on two decisions of the Supreme Court in State of Orissa v. Dr. (Miss) Binapani Dei, and A. K. Kraipak v. Union of India

26. There is a great deal of force in the submission made by the learned counsel. A bare reading of the impugned letter makes it plain that it imputes lack of honesty to the petitioner and accuses him of abuse of official position in showing undue favors to a private firm when he was holding the office of Managing Director and Chairman of a public undertaking, particularly to a firm of which he himself became chairman immediately after he relinquished his connection with the public undertaking. The petitioner is admittedly a chartered accountant of some standing in his profession. He has held positoins of responsibility and trust and only in private sector undertakings but also in a public undertaking where but for the alleged lapse, his performance, even after making due allowance for exaggeration is not negligible. To say of such a man that his conduct as reflected by the undue favors shown by him to a private firm did not conform to the standard of probity expected of an officer of his standing is nothing short of declaring that he had abused the confidence and trust that had been reposed in him by the Government.

27. The impropriety of his conduct is made to stand in high relief by what is stated in the second paragraph that action has been taken against him in consultation with the Central Vigilance Commission whose principal function, it is well known is to undertake inquiries into complaints of corruption, misconduct, lack of integrity and other kinds of malpractices or misdemeanours on the part of public servants including officers employed in connection with corporate central undertakings.

28. It will also be seen that although the words used in the second paragraph are that "it would be inappropriate for Shri M. K. Mathullah to be associated with any organisations (Committees, Boards etc) of the Government of India republic undertakings controlled by the Government of India", the term "associated" is one of wide import. The use of the word "etc." After "Committees, Boards" also indicates that the petitioner's association is sought to be barred notmerely in respect of his nomination to any committees or boards constituted by the Government of India but also in respect of all avenues of employment in any organisations of the Government of India or public undertakings controlled by the Government of India. The range of action is not merely within the confines of organisations and undertakings of the Government of India but it is extended to the organisations and undertakings of State Governments and Governments of Union Territories which too have been requested to take similar action in respect of the petitioner.

29. We fail to see what other object could the authors of the impugned letter have had in view if it was not to impose a blanket ban on the petitioner's employment to any office of profit under the State.

30. It is a matter of common knowledge that with the passing of every day the economy of the nation is likely to be geared to an increasing expansion of public sector. We already have scores of statutory and government controlled corporations. All these corporations have their Boards of Directors and Chairman who are to be appointed either by the Central Government or the State Government concerned. Then there are government companies as defined in Section 617 of the Companies Act, 1956. According to that section the expression "government company" means any company in which not less than 51% of the paid-up, share capital is held by the Central Government or by any State Government or Governments or partly by the Central Government and party by one or more State Governments and includes a company which is a subsidiary of a company as thus defined. Under Section 619(2) the Auditor of Government company can only be appointed or re-appointed by the Central Government on the advice of the Comptroller and Auditor General of India. Scores of such companies have been established all over the country. If effect is given to the impugned letter the petitioner's association with any such companies which look to government for all kinds of facilities in these days of controls, licenses and permits are likely to fight shy of offering any position of responsibility to the petitioner.

31. It was argued on behalf of the respondents that the circular merely states that it was inappropriate that the petitioner should be associated with any committees or boards of such undertakings or companies. The restriction, if any, was in the matter of his nomination to such committees and boards etc., and there was no ban as such to his appointment as an Auditor or in any other capacity. The argument appears to us to be completely devoid of substance. We fail to see how any reasonable Minister of the Government or the Comptroller and Auditor General of India would ever accord approval to the appointment of the petitioner as an Auditor of any such company when his nomination as a member of the committee or board relating to such company has been declared by the Government to be inappropriate.

32. We are therefore convinced that the impugned letter involves adverse civil consequence for the petitione and as such it could only be issued consistently with the rulesof natural justice after the petitione had been informed of the evidence against him and after giving him an opportunity of being heard and meeting or explaining such evidence. When we say this, we do not at all wish to be understood as laying down that there should have been a full-fleged inquiry of the type envisaged under Article 311 of the Constitution or under any other service rules relating to disciplinary action against public servants. What is required is that the authority competent to take such actionshould act fairly and with due regard to the minimum requirements of rules of natural justice in that the authority should have the person concerned a hearing after informing him about the nature of the evidence against him in order that he may be able to meet or explain such evidence.

33. Mr. Aggarwala, learned counsel for the respondents next argued that the petitioner had no right to be nominated to any committee or board of a government organisation nor had he any right to be appointed to any office under the government. The association of persons with boards or committees of government undertakings, it was urged, is a prerogative of the President and government has a right to include or exclude any individual for this purpose. The government as an employer has as much right to pick and choose persons for employment as any other employer and nobody can claim to have any right to be chosen or appointed. He also urged that the petitioner having accepted employment under the government gave it the right to evluate and appraise his performance and if on making such appraisement the Government after fully informing itself by means of an inquiry held by an agency like the Central Bureau of Investigation and consulting a high level commission, decided to issue a confidential circular to Secretaries of its own ministries and the Chief Secretaries of the governments of States and Union Territories about its opinion its action can scarcely be regarded as arbitrary nor can it be subjected to judicial review.

34. Mr. Aggarwala further argued that in the circumstances, the object of the circular ws merely to protect public interest in regard to public undertakings and not to punish the petitioner in any manner.

35. According to Mr. Aggarwala only two points arose for consideration, first whether the matter relates to an affair of State and secondly whether the action was inspired by malice. If the matter relates to an affair of State then the impugned letter being an official communication made by one officer of State to another in the course of official duty is absolutely privileged and cannot be made the subject-matter of any action in Court and the Court is boudn to refuse to allow any inquiry as to the malice of the Official to proceed. On the other hand if the matter does not relate to an affair of State then on grounds of public policy or the general welfare of society the law afords protection on certain occasions to persons who acting in good faith and without any indirect or improper motive, make statements about another which are in fact untrue and defamatory. Such occsions are called occasions of qualified privilege. In that case it is for the defendant to prove the facts and circumstances which establish that the occasion was privileged. If he does so, the burden of showing actual or express malice rests on the plaintiff.

36. Relying upon a decision of Roche, J., in M. Isaacs and Sons Ltd., v. Cook, (1925) 2 Kb 391, Mr. Aggarwala contended that the fact that the communication relates to commercial matters does not itself preclude it from being one relating to State matters, which, as was held by the Supreme Court in the State of Punjab v. Sodhi Sukhdev Singh, are identical with "affairs of State" mentioned in Section 123 of the Evidence Act.

37. There can be no doubt that so far as action for libel is concerned, respondent No. 1 can claim completely immunity against the same for the communication is undoubtedly an official communication relating to affair of State and is therefore absolutely privileged. The question in the present case is however entirely different. It is true tht it is not for us to say as to how far the opinion formed by the Government is justified on the material in its position. It is also true that if the petitioner has in fact acted in the manner alleged in the impugned letter he can hardly except any sympathy from any quarter. But the question is whether he should have been heard before he was condemned. It is not of libel that he complains of. In a case of libel the remedy of the aggrieved person is generally to bring an action for damages and in some cases to ask for interdict before the actual publication of the libel. In such a case, the defense of absolute or qualified privilege may be a complete answer to the plaintiff's case, but the petitioner's case is that the action taken against him has infringed his fundamental rights guaranteed under Articles 14, 16, 19 and 21 of the Constitution.

38. We agree with Mr. Aggarwala that the petitioner has neither a right to be nominated to any committee or board nor has he any right to apointment to any office of profit under the Government. It is true that every citize has a right to carry on his avocation, but the right to work does not mean that a person has also a right to exact work or to force himself on another for employment. This applies as much to employment under the State as to employment under a private employer. What then is the extent of this right? In our view, the only right that the Constitution guarantees a citizen under Article 19(1)(g) is that he has a right to practice any profession or to carry on any avocation trade or business subject to such reasonable restrictions on the exercise of that right as may be imposed by the State in the interest of the general public. This includes the right to remain open for employment or to be available to offer oneself for employment. The extent of the right lies in the right to offer oneself and the right to be considered for employment. It is open to the State to say it shall not employ dishonest men. It is also open to the State to say who and by what means the question as to whether a person is honest or dishonest should be decided, but when it makes such a provision it has to do consistently with the requirements of Articel 14 of the Constitution and that necessitates that before a citizen is condemned and debarred from exercising that right to be considered for employment he must be heard. The question is not one for merely laying doen qualifications for employment as Mr. Aggarwala tried to make out, for it is not disputed that the State can prescribe qualifications. But just as no citizen shall on grounds only of religion, race, caste, sex, descent, place of birth, residence or any of them, be ineligible for, or discriminated against in respect of any employment or office under the State as laid down in Article 16(2) of the Constitution in much the same way the right of equality of opportunity guaranteed under Article 16(1) postulates that a citizen shall not be debarred from being considered for employment or appointment to an office under the State by an ex parte finding arrived at against him by a functionary of the State that he has been found dihonest and as such the door of such employment or appintment shall remain shut in his face. Before the door is slammed against him he has a right to be heard. That is about the only right which the petitioner can legitimately claim and to that we see no valid defense.

39. In that view of the matter the reference made by Mr. Aggarwala to a decision of Vaidialingam, J., in K. M. Sugatha Prasad v. State of Kerala, where it was held that the nature of the materials to be collected and the satisfaction to be arrived at about the character and antecedents of a person are entirely matters for the appointing authority, can be of no assistance to the argument of the learned counsel. That was a case relating to the termination of the petitioners' officiating services as teachers in the Education Department of the State and it was in that context that one of the questions raised before the learned Judges was whether the State Government was bound to disclose the grounds on the basis of which it had come to the conclusion that the character and antecedents of each of those petitioners were not such as to make them eligible for appointment to service under the State. Dealing with that contention it was held that there was no fundamental right to be continued in the employment of the State and that a party could not claim that the termintion of his services by the State amounted to an infringement of any constitutional right when no question of violation of Article 311 was raised.

40. No help can also be derived by Mr. Aggarwala from the majority decision of Kerala High Court in V. Punnen Thomas v. State of Kerala, (FB) which runs counter to a Division Bench judgment of this Court in K.G. Khosla and Co., v. Union of India, (Civil Writ Petn. No. 477 of 1968, D/- 7-10-1968 (Delhi)) to which one of us (T.V. R. Tatachari, J.) was a party. The decision of K.G. Khosla and Co., C. W. P. No. 477 of 1968, D/- 7-10-1968 (Delhi) was followed by S. Rangarajan, J., in Mahaveer Hat Manufacturing Co., v. Union of India, 1969 Delhi Lt 566 and is more in consonance with the minority view of Mathew, J., of Kerala High Court. All three were cases of black-listing and were no doubt decided on their own facts but the ratio of the decision in the case of K.G. Khosla and Co., is fully applicable to the present case and we agree with the same.

41. The result is that the petition is allowed and the respondents are directed to withdraw the impugned circular letter. This will however in no way prejudice the right of the Government to take whether administrative action it lawfully takes against the petitioner after giving him a hearing and an opportunity to know and meet the evidence on which the proposed action may be taken. The petitioner will also have his costs which are assessed at Rs. 500.

42. Petition allowed.