Tripura High Court
Iritty Spices vs Tripura Rehabilitation Plantation ... on 13 March, 2024
Author: Arindam Lodh
Bench: Arindam Lodh
Page 1 of 10
HIGH COURT OF TRIPURA
AGARTALA
WP(C) No.10 of 2024
Iritty Spices
....Petitioner(s)
Versus
Tripura Rehabilitation Plantation Corporation Ltd. and Ors.
....Respondent(s)
For Petitioner(s) : Mr. T.D. Majumder, Sr. Advocate
Mr. T. Halam, Advocate
Mr. D. Kalai, Advocate
For Respondent(s) : Mr. D. Bhattacharya, Sr. Advocate
Mr. S. Saha, Advocate
HON'BLE THE CHIEF JUSTICE MR. APARESH KUMAR SINGH
HON'BLE MR. JUSTICE ARINDAM LODH
ORDER
13.03.2024
Heard Mr. T.D. Majumder, learned senior counsel appearing for
the petitioner and Mr. D. Bhattacharya, learned senior counsel appearing for
the respondent.
A sale order was issued in favour of the petitioner on 22.12.2023
(Annexure-3) upon being successful tenderer in the NIT dated 14.12.2023 for
sale of dried rubber sheets. He was asked to deposit total amount of
Rs.1,49,73,000/- as full payment against the lots mentioned in the sale order
for 3(three) enumerated categories of sheet rubber. After making the deposit
of Rs.1,22,85,000/- only vide Annexure-6, the delivery orders were issued for
2(two) categories; (i) RSS-5 Grade Sheet Rubber-20,000kgs and (ii) RSS
Ungraded Rubber Sheet-60,000kgs.
The petitioner lifted 30,000kgs of RSS Ungraded Rubber Sheet
as invoice was limited for this class of sheet rubber only (Annexure-5 dated
22.12.2023). Since further delivery orders were not being issued, the
petitioner inquired from the respondents office and came to know that a fresh
NIT has been issued on 29.12.2023 and the sale order had been cancelled on
28.12.2023. The petitioner claimed to have made a representation on
27.12.2023 (Annexure-7 to the writ petition) which remained unattended. The
copy of the cancellation order was issued only on 05.01.2024. The petitioner
approached this Court with a grievance that no reason for cancellation of the
sale order has been communicated. The respondents have issued a fresh NIT
within 15 days of the previous NIT. The impugned cancellation order is bad in
law as it is without any reason and without any opportunity to the petitioner to
show cause. The petitioner has suffered because of the arbitrary action of the
respondents even after depositing substantial amount of money for taking the
delivery orders of the specified category of grade rubber sheets.
When the matter was taken up on 10.01.2024, this Court after
noticing the case of the petitioner directed learned GA to seek instruction
from respondents no.1 and 2. This Court also restrained the respondents from
issuing delivery orders in respect of the remaining quantum of the specified
category of grade rubber sheets as per the sale order dated 22.12.2023 in
favour of any other person. The respondents no.1 and 2 thereafter filed a
counter affidavit. Statements were made therein that the sale order dated
22.12.2023 was cancelled by the Chairman-TRPC on 22.12.2023 but the
relevant order was issued on 28.12.2023 which is Annexure-9 to the writ
petition. However, this Court observed that the copy of the decision taken by
the Chairman-TRPC has not been brought on record. Annexure-9 is only an
intimation of the cancellation and does not contain any reason. Thereafter,
time was granted to the learned senior counsel for the respondents no.1 and 2
to file further affidavit. The petitioner has filed rejoinder to that. An additional
affidavit has been filed by the respondents no.1 and 2 thereafter.
In paragraph 2, it has been stated therein that a meeting was held on
22.12.2023 at about 8:30 p.m. i.e. the day when the sale order was favoured to
the petitioner and others regarding the entire tender issue. A decision
regarding cancellation of sale order was taken by the tendering authority and
the same was informed by Assistant Manager (Marketing) in the night after
the decision in the meeting over phone as he was away from head quarter at
Guwahati to Go-down In-Charge of the TRPC Ltd. 23rd to 25th of December
were holidays. The formal letter was issued to all successful tenderers on
28.12.2023 regarding cancellation of the sale order dated 22.12.2023 under
the signature of the Assistant Manager (Marketing) after due approval from
the higher authorities. The cancellation of the tender process was made for
protecting interest of the Corporation. It has been further stated that the sale
order was issued by the Assistant Manager (Marketing) wherein flaws were
detected in it and had error, as no lot numbers were mentioned which could
have created audit issues. The cancellation order dated 28.12.2023 was made
within the terms and conditions of the contract. Re-tender has been done for
betterment of the Corporation. The re-tender was again recalled. This
additional affidavit filed pursuant to the order dated 07.02.2024 also failed to
enclose the decision of the Chairman-TRPC/the competent authority to cancel
the order. Learned senior counsel for the respondents no.1 and 2 submits that
the decision to cancel has been taken at the competent level and in the interest
of the Corporation. The remaining balance deposited by the petitioner totaling
Rs.86,39,100/- has been refunded to the petitioner on 05.01.2024 itself.
Learned counsel for the respondent has placed reliance on South Delhi
Municipal Corporation vs. Ravinder Kumar and Anr, reported in (2015) 15
SCC 545 in support of his submission that no allegation of mala fide has been
made and substantiated for interference by this Court under Article 226 of the
Constitution of India. Therefore, the issue raised in the instant writ petition
has been rendered academic. It may be disposed of as infructuous.
Learned senior counsel for the petitioner submits that the
impugned order deserves to be interfered as it is not only arbitrary but in
violation of natural justice. No reasons for cancellation have been indicated.
No violation of the terms and conditions of the tender or sale order have either
been indicated. The respondents no.1 and 2 are State instrumentalities whose
action should conform to reason. If the order is not interfered with, the
concerned respondents would be further emboldened to act at their whims and
fancies.
Learned senior counsel for the petitioner has placed reliance
upon a decision of the Apex Court in State of Uttar Pradesh vs. Sudhir
Kumar Singh and Ors. reported in (2021) 19 SCC 706.
We have considered the submissions of learned counsel for the
parties and taken note of the pleadings. Upon conferring anxious
consideration to the rival submissions of the parties and after close scrutiny of
the pleadings and relevant documents placed on record and also on perusal of
the judgments cited at the bar, we are inclined to interfere with the impugned
order of cancellation (Annexure-9) for the following reasons:
(i) the Annexure-9 dated 28.12.2023 is only a communication
by the Assistant Manager (Marketing) for the cancellation
of the sale order;
(ii) No order of the competent authority has been produced
before the Court despite specific direction to that effect;
(iii) In the absence of the order of cancellation this Court has
been precluded from examining reasons for cancellation
under powers of judicial review whether if it satisfies the
test of Wednesbury reasonableness and whether the order
is arbitrary or irrational?
(iv) Reasons are the soul of an order as held in the case of M/S
Kranti Associates Private Limited & Anr vs. Masood
Ahmed Khan & Ors., reported in (2010) 9 SCC 496.
(i) The decision to cancel the sale order has been taken on the
same date on which the sale order was issued i.e.
22.12.2023 as per the statements made in the counter
affidavit of respondents no.1 and 2 and also the intimation
dated 28.12.2023 issued by the Assistant Manager
(Marketing). However, no notice or opportunity to show
cause was given to the petitioner to explain as to any
alleged infraction of the terms and conditions of the tender
or the sale order.
Therefore, the order of cancellation if any, though not on record
suffers from violation of principles of audi alteram partem. The decision has
entailed adverse consequences upon the petitioner who had made deposit of
Rs.1,22,85,000/- for lifting of specified quantity of sheet grade rubber and
against which he was allowed to lift only 30,000 metric tons of sheet grade
rubber. Therefore, the compliance of principles of natural justice by a show
cause notice upon the petitioner before such cancellation was a sine qua non.
In this regard, reliance is placed upon the decision rendered by
the Apex Court in the case of Sudhir Kumar Singh (supra) paragraphs 26 &
36 in particular, which are reproduced hereunder:
"26. It may be added that every case in which a citizen/person knocks at the
doors of the writ court for breach of his or its fundamental rights is a matter
which contains a "public law element", as opposed to a case which is
concerned only with breach of contract and damages flowing therefrom.
Whenever a plea of breach of natural justice is made against the State, the
said plea, if found sustainable, sounds in constitutional law as arbitrary State
action, which attracts the provisions of Article 14 of the Constitution of India
-- see Nawabkhan Abbaskhan v. State of Gujarat [Nawabkhan Abbaskhan v.
State of Gujarat, (1974) 2 SCC 121 : 1974 SCC (Cri) 467] , para 7. The
present case is, therefore, a case which involves a "public law element" in
that the petitioner (Respondent 1 before us) who knocked at the doors of the
writ court alleged breach of the audi alteram partem rule, as the entire
proceedings leading to cancellation of the tender, together with the
cancellation itself, were done on an ex parte appraisal of the facts behind his
back.
.......
36. What is important to note is that it is the court or tribunal which must
determine whether or not prejudice has been caused, and not the authority on
an ex parte appraisal of the facts. This has been well-explained in a later
judgment, namely, Dharampal Satyapal Ltd. v. CCE [Dharampal Satyapal
Ltd. v. CCE, (2015) 8 SCC 519] , in which, after setting out a number of
judgments, this Court concluded : (SCC pp. 538-41, paras 38-40 & 42-45)
"38. But that is not the end of the matter. While the law on the principle
of audi alteram partem has progressed in the manner mentioned above,
at the same time, the courts have also repeatedly remarked that the
principles of natural justice are very flexible principles. They cannot be
applied in any straitjacket formula. It all depends upon the kind of
functions performed and to the extent to which a person is likely to be
affected. For this reason, certain exceptions to the aforesaid principles
have been invoked under certain circumstances. For example, the
courts have held that it would be sufficient to allow a person to make a
representation and oral hearing may not be necessary in all cases,
though in some matters, depending upon the nature of the case, not only
full-fledged oral hearing but even cross-examination of witnesses is
treated as a necessary concomitant of the principles of natural justice.
Likewise, in service matters relating to major punishment by way of
disciplinary action, the requirement is very strict and full-fledged
opportunity is envisaged under the statutory rules as well. On the other
hand, in those cases where there is an admission of charge, even when
no such formal inquiry is held, the punishment based on such admission
is upheld. It is for this reason, in certain circumstances, even post-
decisional hearing is held to be permissible. Further, the courts have
held that under certain circumstances principles of natural justice may
even be excluded by reason of diverse factors like time, place, the
apprehended danger and so on.
39. We are not concerned with these aspects in the present case as the
issue relates to giving of notice before taking action. While emphasising
that the principles of natural justice cannot be applied in straitjacket
formula, the aforesaid instances are given. We have highlighted the
jurisprudential basis of adhering to the principles of natural justice
which are grounded on the doctrine of procedural fairness , accuracy
of outcome leading to general social goals, etc. Nevertheless, there may
be situations wherein for some reason--perhaps because the evidence
against the individual is thought to be utterly compelling--it is felt that
a fair hearing "would make no difference"--meaning that a hearing
would not change the ultimate conclusion reached by the decision-
maker--then no legal duty to supply a hearing arises. Such an approach
was endorsed by Lord Wilberforce in Malloch v. Aberdeen Corpn.
[Malloch v. Aberdeen Corpn., (1971) 1 WLR 1578 (HL)] , who said that
: (WLR p. 1595)
„... A breach of procedure ... cannot give [rise to] a remedy in the
courts, unless behind it there is something of substance which has been
lost by the failure. The court does not act in vain.‟
Relying on these comments, Brandon L.J. opined in Cinnamond v.
British Airports Authority [Cinnamond v. British Airports Authority,
(1980) 1 WLR 582 (CA)] that : (WLR p. 593)
„... no one can complain of not being given an opportunity to make
representations if such an opportunity would have availed him nothing.‟
In such situations, fair procedures appear to serve no purpose since the
right" result can be secured without according such treatment to the
individual.
40. In this behalf, we need to notice one other exception which has been
carved out to the aforesaid principle by the courts. Even if it is found by
the court that there is a violation of principles of natural justice, the
courts have held that it may not be necessary to strike down the action
and refer the matter back to the authorities to take fresh decision after
complying with the procedural requirement in those cases where non-
grant of hearing has not caused any prejudice to the person against
whom the action is taken. Therefore, every violation of a facet of
natural justice may not lead to the conclusion that the order passed is
always null and void. The validity of the order has to be decided on the
touchstone of "prejudice". The ultimate test is always the same viz. the
test of prejudice or the test of fair hearing.
***
42. So far so good. However, an important question posed by Mr
Sorabjee is as to whether it is open to the authority, which has to take a
decision, to dispense with the requirement of the principles of natural
justice on the ground that affording such an opportunity will not make
any difference? To put it otherwise, can the administrative authority
dispense with the requirement of issuing notice by itself deciding that no
prejudice will be caused to the person against whom the action is
contemplated? Answer has to be in the negative. It is not permissible for
the authority to jump over the compliance of the principles of natural
justice on the ground that even if hearing had been provided it would
have served no useful purpose. The opportunity of hearing will serve the
purpose or not has to be considered at a later stage and such things
cannot be presumed by the authority. This was so held by the English
Court way back in the year 1943 in General Medical Council v.
Spackman [General Medical Council v. Spackman, 1943 AC 627 (HL)]
. This Court also spoke in the same language in Board of High School
and Intermediate Education v. Chitra Srivastava [Board of High School
and Intermediate Education v. Chitra Srivastava, (1970) 1 SCC 121] ,
as is apparent from the following words : (SCC p. 123, para 7)
„7. The learned counsel for the appellant, Mr C.B. Agarwala, contends
that the facts are not in dispute and it is further clear that no useful
purpose would have been served if the Board had served a show-cause
notice on the petitioner. He says that in view of these circumstances it
was not necessary for the Board to have issued a show-cause notice. We
are unable to accept this contention. Whether a duty arises in a
particular case to issue a show-cause notice before inflicting a penalty
does not depend on the authority's satisfaction that the person to be
penalised has no defence but on the nature of the order proposed to be
passed.‟
43. In view of the aforesaid enunciation of law, Mr Sorabjee may also
be right in his submission that it was not open for the authority to
dispense with the requirement of principles of natural justice on the
presumption that no prejudice is going to be caused to the appellant
since the judgment in R.C. Tobacco [R.C. Tobacco (P) Ltd. v. Union of
India, (2005) 7 SCC 725] had closed all the windows for the appellant.
44. At the same time, it cannot be denied that as far as courts are
concerned, they are empowered to consider as to whether any purpose
would be served in remanding the case keeping in mind whether any
prejudice is caused to the person against whom the action is taken. This
was so clarified in ECIL [ECIL v. B. Karunakar, (1993) 4 SCC 727 :
1993 SCC (L&S) 1184] itself in the following words : (SCC p. 758, para
31)
„31. Hence, in all cases where the enquiry officer's report is not
furnished to the delinquent employee in the disciplinary proceedings,
the courts and tribunals should cause the copy of the report to be
furnished to the aggrieved employee if he has not already secured it
before coming to the court/tribunal and given the employee an
opportunity to show how his or her case was prejudiced because of the
non-supply of the report. If after hearing the parties, the court/tribunal
comes to the conclusion that the non-supply of the report would have
made no difference to the ultimate findings and the punishment given,
the court/tribunal should not interfere with the order of punishment. The
court/tribunal should not mechanically set aside the order of
punishment on the ground that the report was not furnished as is
regrettably being done at present. The courts should avoid resorting to
short cuts. Since it is the courts/tribunals which will apply their judicial
mind to the question and give their reasons for setting aside or not
setting aside the order of punishment (and not any internal appellate or
revisional authority), there would be neither a breach of the principles
of natural justice nor a denial of the reasonable opportunity. It is only if
the court/tribunal finds that the furnishing of the report would have
made a difference to the result in the case that it should set aside the
order of punishment."
(emphasis supplied)
A plea has been raised on behalf of respondents no.1 and 2 that
no case of mala fide has made out on behalf of the petitioner calling for
interference in the order of cancellation relying upon the decision of the Apex
Court in the case of South Delhi Municipal Corporation (supra). The
decision is however not applicable as the facts of the said decision are
distinguishable. The Apex Court had the occasion to examine cancellation of
the tender notice in that case and not the concluded sale order or agreement
issued after finalization of the tender process. The cancellation of sale order in
the present case is arbitrary and in violation of principles of natural justice.
This Court in exercise of its power of judicial review is therefore inclined to
interfere in such arbitrary actions of the respondent authorities who are
instrumentalities of the State.
It however appears that after cancellation of the sale order the
balance amount remaining in the name of the petitioner to the tune of
Rs.86,39,100/- has been refunded on 05.01.2024. We are not informed as to
whether the interim stay on the lifting of the remaining amount of graded
sheet rubber had been adhered to or not. In case, the remaining lots of graded
sheet rubber under the sale order dated 22.12.2023 has not been lifted, the
respondents could allow the petitioner to lift it upon deposit of the requisite
amount of money refunded to him. Otherwise, respondents could undertake
fresh calculation of the amount which requires to be refunded to the petitioner
if any, over and above the amount of Rs.86,39,100/- earlier refunded on
05.01.2024.
However, the cancellation of the sale order cannot be upheld in
the eye of law for the aforesaid reasons. It is accordingly set aside.
This exercise be completed within a period of 4(four) weeks from
the date of receipt of a copy of this order.
The writ petition is allowed in the manner and to the extent
indicated here-in-above. Pending application(s), if any, also stand disposed of.
(ARINDAM LODH, J) (APARESH KUMAR SINGH, CJ)
Snigdha
SAIKAT Digitally signed
by SAIKAT KAR
KAR Date: 2024.03.20
14:53:03 +05'30'
