Orissa High Court
Shri Artatran Bhuyan vs State Of Odisha And Others .... Opposite ... on 24 July, 2025
Author: Murahari Sri Raman
Bench: Murahari Sri Raman
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No. 37383 of 2021
Shri Artatran Bhuyan .... Petitioner
-Versus-
State of Odisha and others .... Opposite Parties
Advocates appeared in this case:
For Petitioner : Mr. Gouri Mohan Rath, Advocate
For Opposite Parties : Ms. Aishwarya Dash,
Additional Standing Counsel
CORAM:
HON' BLE THE CHIEF JUSTICE
AND
HON'BLE MR. JUSTICE MURAHARI SRI RAMAN
JUDGMENT
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Date of Hearing : 17th July, 2025
Date of Judgment : 24th July, 2025
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HARISH TANDON, CJ.
1. The writ petition is at the behest of a blacklisted contractor
challenging the order dated 10th August, 2021 passed by the Chief
Engineer (Mechanical), Water Resources, Odisha by which he was
debarred from participating in any future tender for a period of
five years from the date of the said order.
2. The writ petition contains the narration of the facts and is
primarily founded upon an assertion that the authorities proceeded
with the pre-determined mind as the petitioner flagged several
misdeeds against the officials in dealing with the tenders floated
from time to time by the said department and also acted contrary to
the provisions relatable to blacklisting of a contractor contained in
Odisha Public Works Department Code ("OPWD Code").
3. The genesis of the initiation of a show cause notice
originated on an incident of entering into the office premises of the
Mechanical Division beyond the office hours at 7.15 P.M. by the
proprietor of M/s. Urmila Steel Fabrication and an attempt to
snatch away some important online tender papers from the
estimator of the said division by the said proprietor. Immediately
an FIR was registered on 25th March, 2021 in Nayapalli Police
Station reporting the aforesaid incident of 24th March, 2021 and
the investigation was undertaken by the Investigating Officer after
verifying the truthfulness of the statements contained in the said
FIR on the basis of the CCTV footage. The Investigating Officer
submitted the charge sheet and the said matter is still pending
before the jurisdictional Court.
4. A preliminary inquiry was conducted and a show cause
notice was issued to the petitioner on 22nd April, 2021, but instead
of filing a response, the petitioner approached this Court by filing
W.P.(C) No. 16786 of 2021 challenging the said show cause
notice being not in conformity with the provisions relating to
blacklisting of a contractor contained in OPWD Code. This Court
refused to interfere with the said show cause notice and dismissed
the said writ petition. Since no reply was filed, the proposal was
forwarded to the Government for initiating a process for
blacklisting of the petitioner on perceived misbehavior/threatening
the departmental supervisory officer while he was discharging his
duties and finalizing the tender process.
5. After getting the approval, a further show cause notice was
issued on 16th July, 2021 seeking reply from the petitioner as to
why he should not be blacklisted. The petitioner responded to the
said 2nd show cause notice and took a specific plea that the
initiation of a proceeding for blacklisting is tainted with malice
being an outcome of several complaints having lodged against the
officials of their misdeeds in relation to several contracts. It was
further highlighted that the proceeding against some of the
officials were also initiated, but no final decision has been taken
thereupon. It is further indicated in the said reply that the CCTV
footage would reveal the truth and, therefore, the same is required
to be provided to the petitioner. Apart from the same, the report of
the preliminary inquiry which formed the basis of the initiation of
the said proceeding and the recording of the statements of several
persons should also be forwarded to the petitioner, so that the
comprehensive reply can also be made.
6. Instead of submitting all the documents to the petitioner,
the proceeding for blacklisting the petitioner was proceeded with
and the impugned order was passed on the basis of the statements
of seven numbers of co-employees. The order impugned reveals
that the petitioner obstructed the staff to discharge their public
duties and tried to forcibly peruse the financial documents in
respect of different participants of the tender and also misbehaved
with several employees which is found to be true as the charge
sheet was submitted by the Investing Officer after investigation on
the basis of an FIR lodged against the petitioner.
7. The counsel for the petitioner vociferously submitted that
the impugned order of blacklisting against the petitioner for a
period of five years from the date of the said order, i.e. 10 th
August, 2021 is an act of malice founded upon the earlier
complaints made against the officials of the said department in
awarding the contracts to several persons and, therefore, the order,
blacklisting the petitioner, is liable to be quashed and set aside. It
is fervently submitted that the order impugned in the writ petition
is an outcome of a pre-determined mind and in blatant violation of
the principles of natural justice as the documents which is relied
upon by the authority in passing the impugned order was never
supplied to the petitioner despite a request having made in this
regard. It is thus submitted that debarment from participating in a
future tender not only deprives a person an opportunity to
participate in a public contract, but involves serious civil
consequences amounting to civil death and, therefore, the
authorities ought to have followed not only the provisions of the
OPWD Code, but also the principle of natural justice, which in the
instant case is apparently lacking.
8. Per contra, the Additional Standing Counsel submitted that
because of the serious misdeeds of the petitioner beyond the office
hours, i.e. 7.15 P.M. on 24th March, 2021, the proceeding for
blacklisting the petitioner was initiated following all the
procedures provided in the OPWD Code and, therefore, the order
impugned in the instant writ petitioner does not suffer from any
infirmity and/or illegality. It is further submitted that the
authorities followed the principles of natural justice upon issuing a
show cause notice to the petitioner inviting his reply to the alleged
misdeed and the response to the said show cause was not found
satisfactory on the basis of the materials available to the
authorities. It is strenuously argued that once the recourses to the
provisions of OPWD Code in issuing the show cause notice is
undertaken by the authority and the reply was given by such
contractor, it fulfills the principle of natural justice as held by the
apex Court in the case of State of Odisha and others vs. Panda
Infraproject Limited reported in (2022) 4 SCC 393. It is further
submitted that the impugned order reflects the elaborate reasons
and, therefore, the plea of pre-determined mind is unsustainable.
To buttress the aforesaid submission, reliance is placed upon the
judgment of the apex Court in the case of Grosons
Pharmaceuticals (P) Ltd. vs. State of U.P. and others, reported in
(2001) 8 SCC 604. The counsel for the State further relies upon
the investigation done by the Investigating Officer on the FIR
having lodged for the incident happened on 24th March, 2021
wherein the Investigating Officer has found the ingredients under
the charging sections and submitted the charge sheet before the
jurisdictional Court for trial, which would corroborate the misdeed
of the petitioner in threatening the officers and interfering in
discharging their official duties. It is thus submitted that no case
for interference is warranted in the instant case.
9. On the backdrop of the aforesaid facts emerged from the
record, the point involved in the instant writ petition is whether the
order dated 10th August, 2021 issued by the authority warrants
interference having not only violative of the principles of natural
justice, but also departed from the provisions relatable thereto for
the blacklisting contained in OPWD Code.
10. It is beyond cavil of doubt that a fundamental principle
embraced in a civilized jurisprudence is that a person cannot be
condemned nor can be affected by any action without affording a
reasonable opportunity to defend himself. The person against
whom any action is taken affecting his right is entitled to know the
reason for initiation of such proceeding, so that an adequate
opportunity is given to him to respond. It is, therefore, essential to
issue a notice containing the grounds on which the authority
intended to proceed against the person with clarity, precision and
explicit as an ambiguous narration of grounds is regarded as denial
of an opportunity. The aforementioned principles assume greater
importance in the context of blacklisting of a person as it invites
not only civil death, but debarment of a person an opportunity to
participate in the matter of a public contract. In this regard, the
Courts of the country have highlighted the implied principle of
rule of law that every order having an impact on civil
consequences should adhere to the principles of natural justice. It
is thus an elementary principle of natural justice that a party who
suffers the adverse consequences of deprivation to participate in
public contract is afforded with adequate and reasonable
opportunity to defend.
11. Once the statutory provisions are placed for blacklisting of
a person or in other words debarment from participating in a
contractual field with the Government or its instrumentalities, the
strict adherence thereto should be ensured. Therefore, the notice to
show cause must clearly and explicitly contain the incident, which
led to the initiation of the proceeding in pursuit of blacklisting a
person from participating in a future tender. One of the cardinal
principles in this regard is an adequate opportunity to defend
should not only be ensured, but seems to be ensured by providing
all the materials which forms the foundation of misdeeds or
misbehavior or an act contemplated in the statutory provision.
12. In Grosons Pharmaceuticals (P) Ltd. (supra), the apex
Court was considering a case where the contractor who was
engaged in a small scale industry of manufacturing and selling
drugs was found to have committed several irregularities and the
vigilance report corroborated the same. The show cause notice was
issued and adequate opportunity to defend was provided and the
challenge was made on the ground of non-adherence of the
principles of natural justice. The challenge was further founded
upon the non-speaking order, which was found by the apex Court
untenable on the facts discerned from the record in the following
paragraphs.
"2. Learned counsel appearing for the appellant, urged
that seeing the nature and seriousness of the order passed
against the appellant, the respondent ought to have
supplied all the materials on the basis of which the
charges contained in the show cause notice were based
along with show cause notice and in the absence of supply
of materials, the order impugned is against the principles
of natural justice. We do not find any merit in this
contention. Admittedly, the appellant has only contractual
relationship with the State government and the said
relationship is not governed by any statutory Rules. There
is no statutory rule which requires that an approved
contractor cannot be blacklisted without giving an
opportunity of show cause. It is true that an order
blacklisting an approved contractor results in civil
consequences and in such a situation in the absence of
statutory rules, the only requirement of law while passing
such an order was to observe the principle of audi alteram
partem which is one of the facet of the principles of
natural justice. The contention that it was incumbent upon
the respondent to have supplied the material on the basis
of which the charges against the appellant were based was
not the requirement of principle of audi alteram partem. It
was sufficient requirement of law that an opportunity of
show cause was given to the appellant before it was
blacklisted. It is not disputed that in the present case, the
appellant was given an opportunity to show cause and he
did reply to the show cause which was duly considered by
the State Government. We are, therefore, of the view that
that the procedure adopted by the respondent while
blacklisting the appellant was in conformity with the
principles of natural justice.
3. It was then urged that the impugned order
blacklisting the appellant does not contain any reasons
and, therefore, the order is invalid. We do not find any
merit in the submission. The High Court summoned the
entire record and found that elaborate reasons were
recorded by the State Government while passing the order
blacklisting the appellant. The High Court further
recorded a positive finding that the State Government has
passed the impugned order after recording elaborate
reasons and summary of which is contained in the
impugned order."
13. In the case of Panda Infraproject Limited (supra), the
order of blacklisting debarring the participant in a bid for any work
undertaken by the Government of Odisha for an indefinite period
was challenged by the contractor on two-fold grounds. Firstly,
there was a violation of the principles of natural justice and
secondly, the permanent debarment offended the principle of
proportionality. In the said given case, the contractor was awarded
a contract for construction of a flyover over the railway level
crossing and a ten-metre slab of the flyover collapsed at the level
crossing, which resulted in loss of one life and the injuries to 11
other persons. A high-level inquiry was conducted and a
committee in the comprehensive report found that the said
contractor did not submit the formwork design and adopted his
own arrangement, which led the collapse of a junk from the under-
construction flyover. The report further revealed that the quality
assurance has not been maintained in terms of the codes and
manuals as well as agreement and a lot of discrepancies in the
workmanship were found. A show-cause notice was issued, which
was duly replied by the contractor and ultimately, the contractor
was blacklisted with immediate effect for rest of his life.
13.1. The apex Court, in the backdrop of the gravity of a
misdeed, held that an order of blacklisting after service of show-
cause notice and reply duly filed meets the requirement of the
natural justice and, therefore, it cannot be perceived that the
authorities proceeded with predetermined mind. However, the
apex Court on the doctrine of proportionality held that the
blacklisting for rest of the period or permanently is too harsh and
reduced the period of blacklisting to five years from the date of the
order of blacklisting.
13.2. The law enunciated in the above report exposits that before
a person is blacklisted, he must be afforded an opportunity of
hearing, being a fundamental principle of natural justice and the
period of blacklisting must be judged in a rational and reasonable
manner in commensurate with the charges leveled against the
contractor. The debarment to participate in a public contract
permanently is against the doctrine of proportionality as no person
would be deprived of or be subjected to prejudice for all time to
come.
14. Blacklisting of a contractor has an impact on the privilege
and advantage of entering into a lawful relationship with the
Government or its instrumentality for his livelihood in the form of
a gain. It is an ardent duty of the Government to ensure a fair,
transparent and reasonable action by giving a person an adequate
opportunity to represent its case. It is a solemn duty of the
Government while making a public procurement for constructing a
social and economic infrastructure for a systematic growth at all
levels and, therefore, a person, who is found to have indulged in
unethical practices or done some misdeeds, tantamounting to a
misconduct, the blacklisting is one of the effective tools to
eliminate such defiant bidders from the selection process. It further
ensures to inculcate a sense of discipline by putting a sanction on
the firms from trading and entering into the public contracts.
Although such powers are inhere and ingrained into the
Government or its officials, it also brings a greater responsibility
in adhering to the principle of fair play, providing an equal
opportunity to defend and above all, maintain the proportionality
in awarding the tenure of debarment in commensurate with the
misdeed/misconduct of the contractor.
15. On the doctrine of proportionality, the judgment of the
apex Court in case of Coimbatore District Central Cooperative
Bank vs. Coimbatore District Central Cooperative Bank
Employees Association reported in (2007) 4 SCC 669 can be
gainfully applied wherein it is held that though the doctrine of
proportionality is a principle of the administrative law, but that
does not give unhindered power to the authorities to use a 'sledge-
hammer to crack a nut'. It is further highlighted that the
punishment should not be too extreme than the gravity of crime as
the writ court seldom interferes with the imposition of penalty in
the form of blacklisting provided the method or a manner in which
a decision-maker has ordered his priorities in reaching a
conclusion or arriving at a decision.
16. It is to be borne in mind that the order of blacklisting not
only causes prejudice to the commercial person in praesenti but
have a dent to carry for all time to come having a resultant effect
of a civil death.
17. Precisely for such reason, the apex Court in case of Panda
Infraproject Limited (supra) reduced the period of blacklisting
having found opposed to the doctrine of proportionality despite the
grave and serious lapses found against the contractor and reduced
the same to five years with an avowed object of avoiding the
permanent civil death in a commercial field.
18. Although in the instant case, the blacklisting is for a
definite duration i.e. five years, but there is no fetter on the part of
the Court to apply the doctrine of proportionality apart from the
principles of natural justice to be adhered to. The narration of facts
as adumbrated hereinbefore does not create any ambiguity in our
mind that the contractor was served with the copy of the show-
cause notice and adequate opportunity to file reply was afforded to
him. In fact, the reply was given disclosing several material facts
relating to the misdeeds of the officials against whom he blew the
whistle and action has been taken by the higher official being the
outcome of the present misconduct. The CCTV footage put at the
relevant portion of the office and the statements of seven persons
were duly recorded, which leads to impeccable evidence that the
petitioner entered into the office and left the same. A plea was
taken that reliance was put on the CCTV footage and the
statements of seven persons, which were never supplied to the
petitioner, tantamount to violation of the principles of natural
justice, the authority did not accept the same and solely on the
basis of the facts, passed an order of blacklisting for a period of
five years.
18.1 In Panda Infraproject Limited (supra), the apex Court
ruled out the plea of natural justice, the moment the show-cause
notice was given and adequate opportunity to give reply was
afforded. Going by the ratio as laid down in the said report, we do
not find that the challenge on the ground of violation of the
principles of natural justice is sustainable. However, we find some
discrepancies in the charge sheet submitted by the investigating
officer on the basis of an FIR lodged by the officials, the copies
thereof have been heavily relied upon by the contesting opposite
parties so far as the time of entering into the office and leaving the
same. The show-cause discloses that the petitioner entered at
around 7.15 P.M. after the official hours and tried to snatch away
some important online tender paper files from the estimators and
also misbehaved with them. On the other hand, the charge sheet
discloses that the CCTV footage revealed that the petitioner
entered into the office at 6.53 P.M. on 24th March, 2021 and left
the same at 6.55 P.M. Such being the discrepancies noticed as no
CCTV was installed inside the office room, we cannot rule out the
allegation of misconduct having allegedly committed within two
minutes inside the office room.
18.2 Based upon the discrepancies, we feel that imposition of
debarment for a period of five years is too harsh and offends the
doctrine of proportionality. Nearly four-year period has elapsed
when the matter is pending before this Court and, therefore, we
feel that it would cause a greater hardship if the order of
blacklisting is allowed to operate a full period of five years. The
petitioner has already been deprived to participate in any tender
from the date of the order of blacklisting until the date of this
Judgment, which in our opinion, has percolated a message in the
petitioner a sense of responsibility and to maintain an orderly
behavior while dealing with the Government officials.
19. On Ex debito justitiae, we set aside the remaining period of
blacklisting taking into account that the said order of blacklisting
shall be operative till the date of this judgment.
20. Accordingly, the writ petition is disposed of. No order as
to costs.
I agree.
(M.S. Raman) (Harish Tandon)
Judge Chief Justice
Arun Mishra/M. Panda
Location: High Court of Orissa, Cuttack
