Allahabad High Court
M/S Pooja Jaiswal A Proprietorship Form ... vs Food Corporation Of India New Delhi ... on 20 February, 2023
Bench: Sangeeta Chandra, Manish Kumar
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH ?A.F.R. Court No. - 3 Case :- WRIT - C No. - 1349 of 2023 Petitioner :- M/S Pooja Jaiswal A Proprietorship Form Lko. Thru. Sole Proprietor Pooja Jaiswal Respondent :- Food Corporation Of India New Delhi Thru. Managing Director And Others Counsel for Petitioner :- Shobhit Mohan Shukla,Nitesh Kumar Mishra Counsel for Respondent :- Shikhar Anand Hon'ble Mrs. Sangeeta Chandra,J.
Hon'ble Manish Kumar,J.
(Oral)
1. Heard Sri J.N. Mathur, learned Senior Advocate, assisted by Sri Shobhit Mohan Shukla, learned counsel for the petitioner and Sri Shikhar Anand, learned counsel for the respondent.
2. This petition has been filed with the following main relief:-
"(i) Issue a writ, order or direction in the nature of certiorari quashing the impugned order dated 19.01.2023 passed by opposite party no.3 General Manager (R) Food Corporation of India, T.C./3, Vibhuti Khand, Gomti Nagar, Lucknow as contained in Annexure No.1 to the writ petition so far as it relates to blacklisting of the petitioner for a period of three years'
(ii) to issue a writ, order or direction in the nature of mandamus commanding the opposite parties not to give effect to the impugned order dated 19.01.2023 passed by opposite party no.3 General Manager (R) Food Corporation of India, T.C/3, Vibhuti Khand, Gomti Nagar, Lucknow, as contained in Annexure No.1 to the writ petition so far as it relates to blacklisting of the petitioner for a period of three years'
(iii) to issue a writ, order or direction in the nature of Certiorari quashing the impugned Show Cause Notice 08.11.2021 as contained in Annexure No.2 to the writ petition.
(iv) to issue a writ, order or direction in the nature of Mandamus commanding the opposite parties not to give effect to the impugned Show Cause Notice 08.11.2021 as contained in Annexure No.8 to the writ petition."
3. Learned Senior counsel has fairly stated that he does not wish to press prayer nos.3 and 4 relating to the challenge made to the show-cause notice dated 8.11.2021, in so far as it relates all other penalties except blacklisting.
4. It has been argued by learned counsel for the petitioner that petitioner is a Proprietorship Firm dealing with handling and transport of food grains. The Food Corporation of India invited a handling and transport contract tender through tender notice issued on 19.08.2020 for Lakhimpur and on 26.11.20204 for Sitapur and Chhilwaria in District Gonda.
5. The petitioner applied in the aforesaid tender and was declared successful. The contract was awarded to the petitioner. It appears that a complaint was made by one Sri Sanjeev Kumar Trivedi on 26.03.2021 against the petitioner alleging that one M/s Veena Traders was appointed as contractor for Lambhua Centre in District Sultanpur under the RFC Ayodhya Division in the year 2018?19 and for the left over period of 2019?2020. One truck of M/s Veena Traders was allegedly caught by the police black marketing PDS stock at Lambhua and an F.I.R was registered on 22.01.2020 against M/s Veena Traders. The RFC Ayodhya by an order dated 27.05.2020 forfeited the security deposit of M/s Veena Traders and debarred it from participating in any tender of RFC for one year i.e. for the year 2020?2021. The petitioner being a partner of such Firm had concealed this fact while participating in the tenders for the year 2020?2021.
6. A copy of the complaint was never given to the petitioner. On 08.11.2021, a notice was issued by the respondents mentioning that such a complaint had been received from one Sri Sanjeev Kumar Trivedi and that the petitioner being partner of M/s Veena Traders, which was blacklisted by RFC Ayodhya, did not mention in the application form that such blacklisting was done.
7. A preliminary enquiry had been made from the office of the Sub-Registrar Lucknow, where it was found that in the partnership deed dated 29.11.2016, the petitioner's name was mentioned as one of the partners of M/s Veena Traders. Therefore, it was prima facie concluded that the petitioner had not revealed the correct facts as is required under the MTF Appendix 1 point no. 7. Consequently, the petitioner needed to show cause within seven days of receipt of such notice as to why action under Clause 13 of the MTF may not be taken against her.
8. The petitioner replied to the said show-cause notice, wherein she stated that the petitioner M/s Pooja Jaiswal had entered into a partnership deed with M/s Veena Traders, executed on 29.11.2016, but such M/s Veena Traders was never blacklisted. The RFC Ayodhya Mandal has blacklisted another unregistered Firm by the name of M/s Veena Transport, of which the petitioner was not a partner. The petitioner was a partner of the registered Firm M/s Veena Traders. As the petitioner's Firm was not blacklisted, there was no requirement for her to indicate that there was any blacklisting of the said Firm while applying for the contract. Moreover, the blacklisting that was done by the RFC Ayodhya has been recalled by RFC, Ayodhya Mandal after filing of the writ petition at Allahabad. Due to wrong decisions/ order of the RFC Ayodhya, the petitioner could not be allowed to suffer as it would be against the principles of natural justice and that the petitioner had been found eligible and had fulfilled all the terms and conditions and was doing the work of handling and transport to the full satisfaction of all authorities and without complaint.
9. The reply of the petitioner has not been considered in the right spirit and the impugned order dated 19.01.2023 has been passed by the respondent no.3 by which several penalties have been imposed upon the petitioner, including that of blacklisting from participating in any future tender of the Corporation for the period of three years, by relying upon material that was collected behind the back of the petitioner.
10. In response to the preliminary objection raised by the learned counsel for the respondent that the petitioner has a remedy of approaching the Grievance Redressal Committee under Clause 18 of the Contract Agreement and, thereafter, in case, she is still dissatisfied, she may approach the competent Civil Court, which according to the counsel for the respondents has been considered by this Court in a Coordinate Bench decision in Veena Transport Company through its Proprietor versus Food Corporation of India and others, reported in 2017 SCC Online All 2875. Learned counsel for the respondent has placed reliance upon paragraphs 13 to 16 of the said judgement, where Clause 18 of the tender document has been referred to, and it has been opined by the Court that under Section 9 of the C.P.C., the Courts are competent to try all Civil Suits unless barred by law. The Court of competent jurisdiction relating to tender matters would be the Civil Court and not the High Court, as the High Court under Article 226 of the Constitution exercises discretionary extraordinary jurisdiction, which is also evident from the observations of the Supreme Court made in paragraph-13 of the judgement in the case of State of Kerala versus M.K. Jose; Civil Appeal No. 6085 of 2015.
11. Learned counsel for the petitioner, on the other hand, has argued that it is evident from the language of the show-cause notice issued to the petitioner that the respondents had, prima facie, expressed an opinion that the petitioner was a member of a partnership Firm, which had been blacklisted and the petitioner had not disclosed the fact while submitting her bid document, which was clearly a concealment and misrepresentation on her part.
12. It has been argued that in the order impugned, a reference has been made to a letter issued on 14.09.2021 by the RFC Ayodhya Division, wherein in response to the query made by the respondent no.3, it had come out that there were four partners in M/s Veena Traders, but Mrs Pooja Jaiswal was not a partner of such Firm which was debarred for one year.
13. Learned counsel for the petitioner has also drawn the attention of this Court to the reply submitted earlier also by the RFC Ayodhya dated 16.10.2020 i.e. even before the Award of contract, mentioning the names of partners of M/s Veena Traders as Abhishek Jaiswal, Nanuram Jaiswal, Shabban and Jagdish Singh.
14. It is the case of the petitioner that the respondents have made an inference against the petitioner only because her husband and her father-in-law were partners in the Firm that had been blacklisted, that the petitioner had knowledge of such blacklisting and should have disclosed the same while submitting the bid document. Whereas the case of the petitioner has not been considered at all and that there were infact two Firms, one unregistered Firm by the name of M/s Veena Transport, which was blacklisted by RFC Ayodhya, and another a registered Firm which was initially constituted in 2003 and of which the petitioner became partner in 2016, which had not been blacklisted.
15. Also, an inference has been drawn against the petitioner on the account of the fact that the address of the Firm which was blacklisted is given as 9/1054, Indira Nagar Lucknow, which was also the office of M/s Pooja Jaiswal Proprietorship Firm as mentioned in her own documents.
16. The respondent after referring to the fact that petitioner's relatives, including her husband were members of the blacklisted partnership Firm and that it operated from the same address as that of the petitioner's Firm, inferred that she cannot be considered to be disconnected with the aforesaid Firm which was blacklisted. The respondents have observed that no reason had been assigned by the contractor to show as to why two separate partnership Firms were being kept in existence at the same address and also with the same name. It was for the petitioner to establish that the partnership Firm of 2015 was a separate entity from the partnership Firm of 2016, of which the petitioner was a partner, and both Firms had no concern with each other.
17. Learned counsel appearing on behalf of the petitioner has submitted that in the impugned order, the respondents had gone much beyond the subject matter of the enquiry that was initially proposed against the petitioner and considered various sections of Partnership Act as well, to come to a conclusion that the unregistered Firm could not have filed any writ petition/ litigation, and, therefore, it could only be said that the Contractor i.e. the petitioner was trying to mislead the respondents in alleging that there are two Firms, one unregistered firm constituted in the year 2015 which was blacklisted, and another a registered firm constituted in 2016, of which the petitioner was a partner, but which had not been blacklisted at all. Such was not the subject matter of the enquiry at all as is evident from the language of the show-cause notice dated 08.11.2021. The show-cause notice dated 08.11.2021 had stated that the petitioner was a partner of M/s Veena Traders which had been blacklisted in January, 2020 by RFC Ayodhya and, therefore, she was duty bound to indicate such fact while submitting her bid documents. Hence, there was concealment on her part which invited penalties under Clause 13 of the Tender Document.
18. Learned counsel for the respondent, on the other hand, has tried to convince this Court on the equities and on the improbabilities also of the two Firms operating, one unregistered Firm of 2015 and the other registered Firm constituted in 2016 having almost the same partners except the petitioner. The unregistered Firm being blacklisted and being incompetent to file any litigation challenging such blacklisting under Section 69 of the Partnership Act, yet filing writ petitions and getting such blacklisting orders cancelled in such litigation.
19. It has been argued by learned counsel for the respondent that specific finding has been recorded by the respondents in paragraph-11, 12, 13 & 14 of the impugned order to the effect that the petitioner's husband Sri A.K. Jaiswal represented M/s Veena Traders before the Investigation Committee on 27.11.2020 and had been representing it through Special Power of Attorney in all matters before the Corporation, and also before the Court, without making any distinction between the Firm of 2015 and Firm constituted in 2016, and has submitted partnership deed of 2015 along with the Firms Registration Certificate carrying Registration No. 186980, and there was primarily no distinction apart from the distinction sought to be asserted by Mrs. Pooja Jaiswal in the two Firms.
20. As Sri A.K. Jaiswal was the husband of Mrs. Pooja Jaiswal and the dominating partner in all the partnership Firms and that Mrs Pooja Jaiswal had not submitted any justification as to why more than one partnership Firm with exactly the same address office as well as almost the same partners was kept in existence, (one un-registered Firm of 2015 and another registered Firm of 2016), and that as per Section 69 of the Partnership Act, an unregistered firm cannot maintain legal proceedings before any legal forum including the High Court. Therefore, the only inference which could be drawn was that either the registered Firm was blacklisted and would have invoked legal proceedings, or there existed only one partnership Firm in the name & style of M/s Veena Traders and the alleged facts of registered/ unregistered firms were used as and when required by the members thereof, before the Authorities. Hence, the distinction sought to be drawn by the petitioner could not be accepted. Learned counsel for the respondent- Corporation has also pointed out that there is one more reply from the RFC Ayodhya, which is awaited to another letter sent to it, as it has been mentioned in paragraph-9 of the order impugned.
21. This Court has carefully considered the language of the show-cause notice dated 08.11.2021. It being a short one, is being quoted hereinbelow for facility:-
"????? ?? ???? ?-?????? ?? ?? ?? ?? ?? ?? ??????? ??? ?? ?? ?? ?? ?? ????????? ??? ?? ? ?? ????? ?? ??????? ????? ???? ?? ???? ???? ????? ???? ???? ?????? ???? 2020-21 ??? ???? ???? ??? ??????? ???? ??? ??? ?? ??????? ??? ???? ????? ?? ?? ?? ???????? ??? ???? ??????? ?? ?????? ??????? ??? ?? ?? ?? M/s ???? ???????? ???? ?? ????? 2020 ??? RFC, ??????? ???? ?????? ???? ???? ??? ???? ??? ??, ?? ??????? ???? ?? ?????? ?? ?? ?????? ???? ???????? ??? ???????? ???? ??? Appendix-1 ?? ????? - 7 ?? ???? ????? ?????? ???? ?? ???? ????? ??? ??, ????? ???? ?????????? ????????, ???? ?? ?? ??? ????? ??????????? ??? ?? ?????????? ???? ?? ?????? ?????? ?? ??? ?? ?? ??? ?????? 29.11.2016 ?? ?????? ?? M/s ???? ???????? ???? ??? ??????? ???? ??? ???? ????????? ?? ????? ???, ?? ?????? MTF ?? Appendix-I ?? ????? 7 ??? ???? ????? ?? ?????? ?? - ?????? ??? ??, ?? ?? MTF ??? ??????? ?????????? ?? ?????? ??????? ?? ?
???? ???? ?? ???? ?? ?????? ?? ?? ????? ???? ???? ?? ?? ???? ????? MTF Clause 13 ?? ?????? ???????? ????? ? ?? ??? ?07 ????????? ?? ????? ???? ?????? ???? ?? ???? ?????"
22. It is apparent that the allegation against the petitioner was that she was a member of a partnership firm by the name of M/s Veena Traders, which had been blacklisted by the RFC Ayodhya in January, 2020. However, the own documents of the respondents i.e. letter dated 16.10.2020 and letter dated 14.09.2021, which have been mentioned in the orders impugned as have been sent from the office of the RFC Ayodhya, had confirmed the names of only four partners and Mrs. Pooja Jaiswal was not one of the partners of such firm.
23. This Court is of the considered opinion that the subject matter of enquiry was limited only to the question as posed in the show-cause notice given to the petitioner, and only as to whether the petitioner was or was not a partner of the firm that was blacklisted in January, 2020 by the RFC Ayodhya. This infact was also the purport of the complaint made by some private person against the petitioner. Clearly the petitioner was not a partner of the firm which was blacklisted and, therefore, the respondent no.3 went beyond the subject matter mentioned in the show-cause notice and made observations on the basis of material collected behind the back of the petitioner to draw an unnecessary inference that since the husband of the petitioner was a partner of the blacklisted firm and it was operating from the same address, she had knowledge of such blacklisting, and therefore, could not have participated without indicating such blacklisting in the bid document.
24. It is also evident from the order impugned that the enquiry whether the Firm of which the petitioner is a partner was blacklisted is still going on, as information regarding the same is still awaited from RFC Ayodhya Division.
25. This Court was also led through the tender document and Appendix-1 Point No.7 thereof, by the counsel for the parties and also Clause 4 which mentions the disqualification condition. Clause 4 (a) of the tender document mentions that ineligibility may arise out of any of the clauses as mentioned or by incurring of any disqualification in any capacity whatsoever (even as proprietor, partner in another firm, or as Director of a company etc). The petitioner was not a partner of the firm which was blacklisted, therefore, there was no question of disclosure by the petitioner of any such blacklisting. The action on the petitioner appears to us as clearly in violation of principles of rationality and proportionality, and in contravention of principles of natural justice, which according to the Hon'ble Supreme Court have been recognized as reasons on which an action can be held to be coming within the scope of judicial review in writ jurisdiction.
26. Hon'ble Supreme Court in the case of Kulja Industries Ltd. Vs. Chief General Manager, Western Telecom Project, Bharat Sanchar Nigam Limited reported in (2014) 14 SCC 731 has held that the decision of black listing is subject to judicial review when the same is taken by the State or any of its instrumentalities not only on the touchstone of principle of natural justice but also on the doctrine of proportionality.
27. Hon'ble Apex Court in the case of U.M.C. Technologies Private Limited Vs. Food Corporation of India and another reported in 2021 2 SCC 551 has held that first principle of Civil Jurisprudence is that the person against whom any action is sought to be taken or whose right or interest are being affected should be given a reasonable opportunity to defend himself. The basic principle of natural justice is that before adjudication starts, the authority concerned should give to the affected party a notice of the case against him so that he can defend himself. Such notice should be adequate and the grounds necessitating action and the penalty/action proposed should be mentioned specifically and unambiguously, as the black listing lead to Civil Death of a person hence, strict adherence of the principle of natural justice should be made whenever a entity is sought to be black listed and relied upon its judgment in the case of Gorkha Security Services Vs. State (N.C.T. of Delhi) 2014 9 SCC 105, wherein the following observations were made:-
"16. It is a common case of the parties that the blacklisting has to be preceded by a show-cause notice. Law in this regard is firmly grounded and does not even demand much amplification. The necessity of compliance with the principles of natural justice by giving the opportunity to the person against whom action of blacklisting is sought to be taken has a valid and solid rationale behind it. With blacklisting, many civil and/or evil consequences follow. It is described as "civil death" of a person who is foisted with the order of blacklisting. Such an order is stigmatic in nature and debars such a person from participating in government tenders which means precluding him from the award of government contracts"
28. It has further been held that show-cause notice is to make the noticee understand the precise case set up against him which he has to meet. This would require the statement of imputations detailing out the alleged breaches and defaults he has committeed, so that he gets an opportunity to rebut the same.
29. In the show cause notice allegation was specific but the impugned order has been passed by considering the things which were not mentioned in the show cause notice, which amounts to order passed without providing opportunity of hearing to the petitioner.
30. In the light of above, in the present case admittedly, the show-cause notice was issued against the petitioner with a specific imputation of charge but impugned order has been passed on the material which is not the part of imputation alleged against the petitioner in the show cause notice, as has already been discussed hereinabove. Hence, it is held that no opportunity was provided to the petitioner. The impugned order is in contravention of the principle of natural justice and liable to be set aside on this ground alone.
31. This Court therefore sets aside the order dated 19.01.2023 in so far as it relates to blacklisting of the petitioner for a period of three years and debarring the petitioner's Firm from entering into the contract for the said period with the Corporation.
32. The writ petition stands allowed to this extent. However, the respondents are at liberty to initiate proceedings against the petitioner in accordance with law.
Order Date :- 20.2.2023 Rahul