Simplified Explanation of the Judgment
The Patna High Court has struck down an indefinite blacklisting order issued by the Patna District Magistrate against a firm engaged in public relations and media work, holding that the action violated the principles of natural justice and ignored binding judicial precedent.
The petitioner, a sole proprietorship firm, participated in a government tender process under Bid No. P.R.-2355 Jila 22-23. The firm’s bid was accompanied by earnest money as required. On 23 July 2022, the District Magistrate, Patna, issued Memo No. 1538/Nazo0, ordering:
- Forfeiture of the petitioner’s earnest money.
- Indefinite blacklisting of the firm (sine die).
- Circulation of the blacklisting information to all concerned departments.
The firm challenged the order before the High Court, claiming:
- No opportunity to be heard was given before passing the order.
- The action was taken in an arbitrary and random manner.
- The blacklisting order amounted to a permanent professional ban, without any reasoning or justification.
- The order violated Articles 14 and 19(1)(g) of the Constitution, which protect equality before law and the right to trade or profession.
The Court examined the order and found:
- Violation of Natural Justice – The order was passed without giving the petitioner an opportunity to present their case.
- Lack of Reasoning – No plausible explanation was provided for imposing such a severe penalty.
- Non-compliance with Precedent – The decision ignored an earlier ruling in Raman Kumar Singh vs. Bihar State Food and Civil Supplies Corporation Ltd. (CWJC No. 16989 of 2017, dated 20 February 2018), where indefinite blacklisting had been quashed.
- Failure to Apply Proportionality – The principle that punishment must be proportionate to the alleged misconduct was not considered.
- Civil and Penal Consequences – Blacklisting affects livelihood and reputation, and therefore demands strict procedural safeguards.
On these grounds alone, the Court quashed and set aside the 23 July 2022 order of the District Magistrate, Patna. The ruling reinstated the petitioner’s eligibility to participate in future tenders and removed the indefinite ban.
Significance or Implication of the Judgment
This judgment strengthens safeguards against arbitrary blacklisting by public authorities. It makes clear that:
- Show cause notices and hearings are mandatory before such decisions.
- Orders with no reasoning cannot withstand judicial scrutiny.
- Indefinite blacklisting is generally disproportionate and unlawful.
- Government authorities must follow binding High Court rulings in similar matters.
- The principle of proportionality must guide all punitive administrative actions.
For contractors, agencies, and professionals dealing with the government, the case is a reminder to contest any blacklisting that is passed without due process. For administrative authorities, it is a caution against taking hasty punitive measures without ensuring legal compliance.
Legal Issue(s) Decided and the Court’s Decision
- Whether an authority can blacklist a firm indefinitely without prior notice or reasoning.
Decision: No. It violates natural justice and proportionality principles. - Whether previous High Court rulings on blacklisting bind authorities in similar cases.
Decision: Yes. Ignoring precedent is impermissible.
Judgments Referred by Parties
- Raman Kumar Singh vs. Bihar State Food and Civil Supplies Corporation Ltd., CWJC No. 16989 of 2017 (20.02.2018)
Judgments Relied Upon or Cited by Court
- Raman Kumar Singh vs. Bihar State Food and Civil Supplies Corporation Ltd., CWJC No. 16989 of 2017
Case Title
M/s Madhup Info Solutions vs. The State of Bihar & Ors.
Case Number
Civil Writ Jurisdiction Case No. 12312 of 2022
Coram and Names of Judges
Hon’ble the Chief Justice Sanjay Karol
Hon’ble Mr. Justice Satyavrat Verma
Names of Advocates and Who They Appeared For
For the Petitioner: Mr. P.K. Shahi, Sr. Advocate; Mr. Mrityunjay Kumar, Advocate
For the Respondents: Mr. S.K. Mandal, SC-3
Link to Judgment
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