Orissa High Court
M/S Lallooji And Sons vs State Of Odisha And Others ..... ... on 19 May, 2022
Author: B.R. Sarangi
Bench: B.R. Sarangi
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P (C) No. 11524 of 2022
M/s Lallooji and Sons, Gujarat and ..... Petitioners
another
Mr. Pinaki Mishra, Sr. Adv. along with
Mr. Ashok. Panigrahi, Advocate
Vs.
State of Odisha and others ..... Opposite Parties
Mr. T. Pattnaik, ASC
CORAM:
DR. JUSTICE B.R. SARANGI
MISS JUSTICE SAVITRI RATHO
ORDER
19.05.2022 W.P.(C) No. 11524 of 2022 And I.A. No. 5992 of 2022 Order No. This matter is taken up through hybrid mode.
02.
2. Heard Mr. Pinaki Mishra, learned Senior Counsel appearing along with Mr. Ashok Panigrahi, learned counsel for the petitioners and Mr. T. Pattnaik, learned Addl. Standing Counsel for the State-opposite parties.
3. Mr. Pinaki Mishra, learned Senior Counsel appearing for the petitioners vehemently contended that the reasons for blacklisting the contractor cannot be applicable to the petitioners. If the order impugned would be looked into, it has been referred to clause-7.1.2 of the RFP. Clause-7 deals with penalty and clause- 7.1.2 envisages that bidder shall be blacklisted from bidding for any contract/tender/EoI/RFP with department of Tourism, Government of Odisha for a period of 3 years. It is contended that clause-7.1 provides that failure in fulfillment of performance, as Page 1 of 4 indicated in Clause 6.1 and 6.2, shall warrant imposition of penalty under clauses-7.1.1 and 7.1.2 and, as such, there is no termination of contract in terms of clause-6.1 or 6.2. Clause-6 deals with termination of the contract, clause-6.1 provides that in case of deficiency or non-fulfillment of obligations as per the scope of work, DoT shall serve a notice to the concerned operator to rectify/fulfil the obligations within a period 3 days to cure defect, failing which DoT shall be at the liberty to execute the work through any other agency at the cost of the operator, in addition to the right of DoT to cancel the contract. Similarly, clause-6.2 provides that DoT reserves the right to terminate the agreement in case of deficiency in services or poor performance of the operator for any subsequent years, for which DoT shall intimate the operator by June of corresponding year. In this respect, the view of DoT about the performance is final and binding. It is contended that the petitioner cannot come within the purview of clauses-6.1 and 6.2, as it has been declared ineligible for consideration for award of contract. If clause-6.1 and 6.2 apply to the petitioner, then it will come under the purview of clause- 7.1.2. Thereby, the order impugned in Annexure-23 blacklisting the petitioners for a period of two years, instead of the maximum blacklisting period of three years, is without any application of mind by the authority. It is further contended that if the petitioner has already been ineligible, imposition of penalty of blacklisting it under clause-7.1.2, cannot sustain in the eye of law, as it has been already outsted from the term of agreement. To substantiate his contention, he has relied upon the judgment of the apex Court in Page 2 of 4 the case of Vetindia Pharmaceuticals Limited v. State of Uttar Pradesh, (2021) 1 SCC 804.
4. Mr. T. Pattnaik, learned Addl. Standing Counsel appearing for the State-opposite parties contended that even though there was no agreement with the petitioner-contractor and it has been declared as ineligible, but the authority has got inherent power to blacklist the petitioner-contractor. It is contended that the petitioner-contractor having misrepresented the authority twice, the order of blacklisting has been passed in consonance with clause-7.1.2 and, as such, the State has inherent power to impose such penalty. To substantiate his contention, he has relied upon the judgment of the apex Court in the case of Patel Engineering Limited v. Union of India, (2012) 11 SCC 257. It is contended that in the aforesaid case, the petitioner-contractor was selected and though it had not entered into a contract, but it was blacklisted and, as such, that order has been executed because of the fact that the authority has got inherent power to blacklist the contractor.
5. Having heard learned counsel for the parties and after going through the records, it appears that there is distinction between the facts of the case of Patel Engineering Limited (supra) vis-à-vis present case. In Patel Engineering Limited (supra), the petitioner, who was selected by the authority, declined to enter into contract, for which the authority blacklisted him, which is within the realm of the authority, whereas in the present case, the petitioner has been thrown out from the contract, as it was not found eligible and, therefore, the petitioner is out of contract itself. In that case, whether the authority can exercise inherent power to blacklist the Page 3 of 4 petitioner pursuant to clause 7.1.2 or not, Mr. T. Pattnaik, learned Addl. Standing Counsel seeks time to assist the Court by making further research in the matter by the next date.
6. List this matter on 28.06.2022.
7. As an interim measure, it is directed that no coercive action shall be taken against the petitioners because of blacklisting order under Annexure-23 dated 28.04.2022, till the next date.
Issue urgent certified copy as per rules.
(DR. B.R. SARANGI) JUDGE Ashok/Bichi (SAVITRI RATHO) JUDGE Page 4 of 4