VFPL ASIPL JV Company and JRT NKBPL JV V. Union of India and Mahanadi Coalfields Limited

WP(C)/14114/2020

AI Insights

The case involves two writ petitions filed by joint venture companies (petitioners) against the Union of India and Mahanadi Coalfields Limited (MCL), challenging the banning orders issued by MCL. The petitioners argued that the bans were unjustified and based on misinterpretations of their contractual performance and the data provided by MCL. The court examined the compliance with natural justice in the issuance of the bans and the correctness of the data and interpretations used by MCL to justify the bans. The court found that the bans were not justified based on the evidence and legal principles, leading to the quashing of the orders.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 698938 (HC-CUTTACK)
• Appeal Type: Others
• Pronouncement Date: 15-10-2020
• Assessment Year: misc
• Other Referred Cases: Mohinder Singh Gill v. the Chief election Commissioner, New Delhi, Kulja Industries Limited v. Chief General Manager, Western Telecom Project Bharat Sanchar Nigam Limited, Bhagat Ram v. State of Himachal Pradesh, Zonal Manager, Central Bank of India v. Devi Ispat Limited, Premier Printing Press v. State of Rajasthan, Union of India v. Tantia Construction Pvt. Ltd., Medipol Pharmaceutical India Pvt. Ltd. v. Post Graduate Institute of Medical Education & Research, Raja Anand v. State of Uttar Pradesh, State of Madhya Pradesh v. D.K. Jadav, Muljibhai Patel v. Nandlal Khodidas Barot, Thansingh Nathmal v. Superintendent of Taxes, Collector of Monghyr v. Keshav Prasad, Kanak v. U.P. Avas Evam Vikas Parishad, Sanjay Kumar Shukla v. Bharat Petroleum Corporation Limited, Mahanadi Coalfields Limited v. Dhansar Engineer Company Private Limited, Union of India v. T.R. Varma, Ram and Shyam Company v. State of Haryana, Champalal v. CIT, West Bengal, State of Tripura v. Manoranjan Chakraborty, Union of India v. P.D. Yadav, Dhansar Engineering Company Private Limited v. Mahanadi Coalfields Limited
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: P K PARHI; S D DAS
• Assessee Lawyers: A K PARIJA; A MOHANTY
• Keywords: Arbitration clause; Contractual Obligation; Debarment; Natural Justice; Writ petition

Judgement Text

"IN THE HIGH COURT OF JUDICATURE FOR ORISSA AT CUTTACK D.B. Writ Petition (Civil) No. 12475 of 2020 & D.B. Writ Petition (Civil) No. 14114 of 2020 AFR D.B. Writ Petition (Civil) No.12475 of 2020 M/s. VFPL ASIPL JV Company and another ..… Petitioners -Versus - Union of India and others ….. Opp. Parties D.B. Writ Petition (Civil) 14114 of 2020 M/s. JRT NKBPL JV and another ..… Petitioners -Versus - Union of India and others ….. Opp. Parties Advocate(s) who appeared in these cases by video conferencing mode:- For Petitioners : Mr. A. K. Parija, Sr. Advocate along with M/s. S.P. Sarangi, P.K. Dash and A. Behera, Advocates [in W.P.(C) No.12457/2020] Mr. A. Mohanty, Sr. Advocate Along with M/s. D.K. Das, T. Patnaik, V. Mohapatra and S.K. Sahu, Advocates [in W.P.(C) No. 14114 of 2020] For Opp. Parties : Mr. P.K. Parhi, Asst. Solicitor General of India [for O.P. No.1-Union of India in both the cases] 2 Mr. S.D Das, Sr. Advocate along with M/s. D. Mohanty, A. Mishra, B. P. Panda and D. Behera, Advocates [for O.Ps. No. 2 to 4-MCL in both the cases HONOURABLE THE CHIEF JUSTICE MR. MOHAMMAD RAFIQ AND HONOURABLE DR. JUSTICE B.R. SARANGI J U D G M E N T ------------------------------------------------------------------------------ Date of hearing : 07.10.2020 :: Date of Judgment : 15.10.2020 ------------------------------------------------------------------------------ Per: Dr. B.R. Sarangi, J. W.P.(C) No. 12475 of 2020 has been filed by a joint venture company-petitioner no.1 represented through its Project Manager-petitioner no.2 seeking following reliefs:- “(i) issue a Writ and/or Writs to show cause as to why the impugned order dated 29.04.2020 passed by the Opposite Party No.3 vide Annexure-10 shall not be quashed and if the Opposite Parties fail to show cause to show or show insufficient cause make the said Rule absolute; (ii) to pass any other or further order (s) as deemed just and proper in the facts and circumstances of the case.” 3 Similarly, W.P.(C) No. 14114 of 2020 has been filed by a joint venture company-petitioner no.1 represented through its Manager and Authorized Signatory-petitioner no.2 seeking following relief: “(a) Rule Nisi calling upon the Opposite Parties to show cause as to why the impugned order dated 07.05.2020 (Annexure-15) issued to the Petitioners debarring them from participating in future tenders of Mahanadi Coalfields Limited for a period of one year should not be quashed and/or set aside and if the opposite parties fail to show cause or show insufficient cause, make the rule absolute.” 2. The factual matrix of W.P.(C) No. 12475 of 2020, in a nutshell, is that petitioner no.1 is a joint venture company. It was formed by M/s. Vikash Fasteners Pvt. Ltd., having its registered office at Diamond Prestige, Room No. 310, AJC Bose Road, Kolkata, West Bengal, and M/s. Aloke Steels Industries Pvt. Ltd., having its registered office at opposite Ashok Cinema, Ranchi Road, Marar, Ramgarh Cant., Jharkhand. Petitioner no.1’s registered office is situated near P.N. Bank, Main Road, Ramgarh Cat.-829122, Dist.-Ramgarh, Jharkhand. Petitioner no.2 4 has been duly authorized to present the writ petition before this Court. 2.1 Pursuant to e-tender notice issued on 18.01.2018 by the General Manager (CMC) of Mahanadi Coalfields Limited (MCL) inviting online bids from eligible bidders with Digital Signature Certificate (DSC), petitioner no.1, having satisfied the eligibility criteria and complied the conditions stipulated in the e-tender notice, submitted its bid along with others. After due scrutiny, petitioner no.1, having come out successful, its letter of acceptance was issued on 31.03.2018 in Annexure-3 holding that the competent authority has accepted its offer, after reverse auction, against NIT-763(RT) dated 18.01.2018 in accordance with detailed NIT provisions. Accordingly, the work order was issued on 10.04.2018 for “Extraction of Coal/Coal measures strata by deploying Surface Miner on hiring basis, mechanical transfer of the same in Tipping Trucks and transportation of the same from SM Face to different destination inclusive of effective water spraying from dust suppression, dozing of 5 Face/Siding/Stocks etc. and grading maintenance of roads etc. of Kaniha OCP, Kahina Area (NIT-763 (RT) Dtd. 18.01.18”. Thereafter, an agreement named as “articles of agreement” was executed on 27.06.2018 between petitioner no.1 and MCL. A deed of indemnity was also executed on 26.08.2018, which includes conditions of contract, general terms and conditions and also special terms and conditions for transport contract and pre- contract integrity pact with required documents as prescribed in Annexure-I-mandate form for electronic fund transfer/internet banking payment, Annexure-II-bank guarantee for performance security, Annexure-III-bank guarantee for release of retention money/bid security deducted @ 5% from running bill, Annexure-IV-joint venture/consortium agreement, Annexure-V-undertaking, Annexure-VI- Affidavit, Annexure-VII- letter head of bidder (as enrolled online on e-procurement portal of Coal India Ltd., and Annexure-VII- letter head of bidder (as enrolled online on e-procurement portal of Coal India Ltd.). 6 2.2 After executing the above agreement, petitioner no.1 was discharging its obligation. During the period from May, 2018 to March, 2020, petitioner no.1 was required to extract 3,37,28,540 MT of coal and transport the same, but there was alleged shortfall of only 11,01,914.12 MT or 3.27% attributable to petitioner no.1. As the same were for reasons beyond the control of petitioner no.1 and, as such, the same was to be condoned by MCL on payment of penalty on a monthly basis under clause-6.2 of the agreement. The petitioner no.1 received a show cause notice from MCL on 04.04.2020 wherein it is shown that since there was a shortfall of 1,98,46,915.02 MT or 58.86% of coal production, the petitioner no.1 was required to show cause as to why it shall not be banned from participating in future tender of MCL. The said show cause notice was received by petitioner no.1 on 05.04.2020. At the relevant point of time, as the office was not functioning due to restriction on account of COVID-19, petitioner no.1 sought time on 15.04.2020 to file reply to the show cause, which was rejected. Subsequently on 7 21.04.2020, petitioner no.1 filed show cause reply stating inter alia that MCL has already deducted/withheld penalty for the alleged shortfall in production due to petitioner no.1’s fault on a monthly basis and, as such, the alleged shortfall, if any, had occurred on account of reasons beyond the control of the petitioner and admittedly, shortfall attributable to the petitioner is only 3.27 % of the scope of work. On 29.04.2020, reply given to the notice of show cause by petitioner no.1 was rejected by a cryptic order stating that the same was found to be unsatisfactory by the competent authority. Consequentially, the order impugned was passed on 29.04.2020 in Annexure-10 banning the business of petitioner no.1 in MCL for a period of one year contending that petitioner no.1 has performed only 41.14% as against the assigned target as per NIT/agreement at Kaniha OCP and there was no initiative on its part to meet the shortfall of targeted production. Therefore, in the interest of MCL, there was no option but to ban petitioner no.1 and partners of the joint 8 venture from participation in future tenders of MCL, for a period of one year. Hence this writ petition. 3. The factual matrix of W.P.(C) No.14114 of 2020, in a short compass, is that petitioner no.1 is a joint venture company. It was formed taking into a unit of M/s Jalaram Transport and M/s NK Bhojani Private Limited. Its registered office is situated at S-2A/42, 43 and 44, Mancheswar, Bhubaneswar. The opposite party-MCL issued an e-tender notice on 19.09.2017 in Annexure-2 inviting online tender from eligible bidders having digital signature certificate (DSC) authorized by Controller of Certifying Authority (CCA), Govt. of India in respect of the work “Hiring of HEMM (Shovel, Tipper, Drill, Drozer etc.) for transportation of materials in various strata including drilling, excavation, dumping, spreading, dozing and other allied works in specified areas for dumping for exposing various coal seams from surface, down to seam-II Boa at Kaniha OCP as per the instructions of Project Officer/Management of Kaniha OCP, Kaniha Area for a total quantity of 9 41.40 Million Cum.” The estimated cost of the work was Rs.282,92,70,164/- and period of completion of the work was 1095 days. Petitioner no.1, pursuant to the said NIT, submitted its bid as per the procedure mentioned in the NIT documents. It was emerged as successful bidder and accordingly a letter of acceptance vide Annexure-3 dated 27.12.2017 was issued for a total sum of Rs.307,67,61,122.40/- (including GST) and consequentially work order dated 03.01.2018 was issued. Thereafter, an agreement was executed on 26.04.2018 vide Annexure-6. The petitioner vide letter dated 20.04.2018 requested for providing encumbrance free land for working of engaged fleets and for engagement of new fleets to achieve the target and accordingly deployment of equipments under NIT-118 was there. Thereafter, by letter dated 01.05.2018, petitioner no.1 intimated to opposite party-MCL with regard to scarcity of OB for working of fleets engaged under NIT-118, but the same has not been adhered to. Thereafter, petitioner no.1 on 14.05.2018 intimated the Project Officer, Kaniha OCP with regard to 10 stoppage of work from 15.05.2018 under NIT-118 and also stated that petitioner no.1 was not in a position to operate the existing fleets and unable to achieve the existing capacity of OB and thus it had no option except to stop engagement of the fleet from 1st shift of 15.05.2018. In response to the same, on 16.05.2018 vide Annexure-10 communication was made from opposite party-MCL to petitioner no.1 requesting to start removal of OB which had been stopped from the morning of 15.05.2018 and cooperate the management with a view not for one day but for long term business. On receipt of such letter, petitioner no.1 intimated the Project Officer, Kaniha OCP, vide letter dated 17.05.2018 under Annexure-11 series, requesting to provide adequate land both for working and dumping for continuity of work without any hindrance. Again on 21.05.2018, petitioner no.1 intimated the opposite party- MCL that due to restricted dumping site, which is one of the major constraints for the contract, the opposite party- MCL may look into the matter and give necessary instruction to provide adequate land both for working and 11 dumping for continuity of work without any hindrance. Thereafter, correspondences went on between petitioner no.1 and opposite party-MCL seeking cooperation in all respect to carry out the contract work. But, all on a sudden, on 20.02.2020 a show cause notice of banning the business with MCL for a period of three years was issued alleging that sufficient land free from any encroachment was made available to petitioner no.1 for the work from December, 2019 but it failed to deploy required number of equipments as per NIT. After long persuasions, petitioner no.1 deployed only five numbers of excavators and, as such, its performance was unsatisfactory. More so, several letters were issued to improve performance and also to deploy sufficient numbers of equipments to achieve the mutually agreed quantity. Thereby, petitioner no.1 was called upon to show cause why it should not be banned for doing any business with MCL for a period of three years. In response to such show cause notice, petitioner no.1 submitted its reply on 03.03.2020. Thereafter, the order of banning of business of petitioner no.1 and its partners- 12 joint venture company with MCL for a period of one year has been passed by the Director (Tech/OP) MCL vide Annexure-15 dated 07.05.2020 stating inter alia that petitioner no.1 failed to deploy required machines which resulted in poor performance and, as such, it had performed only 23.29% of assigned target as per NIT/agreement at Kaniha OCP and there was no initiative on its part to meet the shortfall of targeted production. Therefore, in the interest of MCL, there was no option but to ban petitioner no.1 and its partners from participation in future tenders of MCL for a period of one year. Hence this writ petition. 4. Although both the writ petitions arise out of two different tender call notices, but their cause of action and principles of law, which are to be considered and decided, being similar, with the consent of learned counsel for the parties, both the writ petitions were heard together and are disposed of by this common judgment. 13 5. Mr. A.K. Parija, learned Senior Counsel appearing along with Mr. A. Behera, learned counsel for the petitioners in W.P.(C) No.12475 of 2020 contended that there is no disputed questions of facts involved in this writ petition. Rather the petitioners admit the figures, as enumerated in the impugned order dated 29.04.2020 in Annexure-10, and they do not dispute such position and on the basis of admitted calculation given by the opposite parties, no case is made out against petitioner no.1 so as to impose ban for a period of 12 months. It is also contended that admittedly the agreement contains the arbitration clause, but that itself cannot dislodge the petitioners to approach this Court invoking its extra-ordinary jurisdiction under Article 226 of the Constitution of India, as the petitioners have a strong case in their favour. Meaning thereby, the petitioner no.1, having been banned/debarred from participating any other bids of MCL for a period of one year, out of which four months have already passed, serious prejudice has been caused and, therefore, there is no other efficacious remedy than to approach this Court 14 invoking extraordinary jurisdiction, instead of resorting to alternative remedy of arbitration available in the agreement. If at all the petitioners resort to arbitration and in the event they succeed, with the lapse of time the period of one year banning will expire, and in such event it will cast a stigma on petitioner no.1 disentitling it to participate in the tender process of the MCL, which will also cause prejudice to the petitioners. Therefore, the petitioners have a right to approach this Court, instead of availing alternative remedy as provided in the agreement itself, just to get efficacious remedy under law. From the chart contained in the impugned order dated 29.04.2020, it reveals that petitioner no.1 had performed only 41.14 % of the agreed quantity as per the NIT, that is to say defaulted to the tune of 58.86% and that itself is contrary to the very same chart wherein it has been indicated that the default due to the fault of petitioner no.1 is only 3.27% of the agreed quantity as per the NIT. As per the statement, out of the agreed quantity 3,37,18,540 tonnes or 100%, 1,38,71,625 tonnes or 41.14% has been 15 achieved and only 11,01,914 tonnes or 3.27% default is attributable to petitioner no.1 and 1,87,45,001 tonnes or 55.59% default is attributable to MCL. It is contended in other words, the total shortfall in production of 1,98,46,915 tonnes, 94.45% is attributable to the opposite parties and only 5.55% is attributable to petitioner no.1. It is further contended that petitioner no.1 was not allowed to do the sanctioned quantity of work for the default of MCL, as would be evident from the chart and as such, no breach can be attributed to petitioner no.1 on this score. It is further contended that the allegation made that petitioner no.1 failed to deploy adequate equipment as per the NIT, that itself is not correct in view of the fact that the default attributable to petitioner no.1 is only 3.27% which is meager one and thereby it shows that the adequate equipment had been deployed by it at the site. As such, the quantity of hindrance free work site provided by the opposite parties reduced substantially. Therefore, the issue of reduced deployment of equipment becomes wholly irrelevant. It is further contended that after passing the 16 debarment order on 29.04.2020, vide e-mail dated 08.06.2020, revoked the debarment order but subsequently opposite party no.2 issued a cryptic order on 06.07.2020 to petitioner no.1 debarring it again from participating in the tender of MCL even though petitioner no.1 was protected by interim order passed by this Court on 04.06.2020 after hearing learned counsel for the petitioners and opposite party MCL. It is further contended that debarring petitioner no.1 from participating in the tenders for a period of one year, pursuant to impugned order dated 29.04.2020, has been passed without affording reasonable opportunity of hearing to the petitioners. Merely issuing notice of show-cause to the petitioners cannot justify compliance of the principles of natural justice rather due to non-grant of opportunity of hearing the order impugned suffers from violation of principles of natural justice and thereby can be declared as non-est in the eye of law. It is further contended that the opposite parties filed their counter affidavit on 03.06.2020. Taking into 17 consideration the contentions raised in the said counter affidavit and after hearing learned counsel for the opposite parties, this Court passed interim order on 04.06.2020. But subsequently, an additional counter affidavit was filed on 03.07.2020 justifying the action taken by the opposite parties by providing a chart stating therein that petitioner no.1 has achieved 92.64% as opposed to 41.14% as alleged in the impugned order and the default on its account is a meager 7.36%. The said chart also indicates that only 44.4% hindrance free quantity of work was provided to petitioner no.1, that means the opposite parties defaulted to the tune of 55.6% of the targeted quantity. By way of filing additional affidavit, the opposite parties have tried to justify the impugned order, which is not permissible under the law, because the impugned order itself will justify the action taken against petitioner no.1. It is further contended that the debarment of petitioner no.1 from participating in the tender of the MCL for a period of one year is hit by Wednesbury’s principles of unreasonableness and as such the same is disproportionate. More particularly, the order 18 impugned suffers from the vice of non-application of mind. It is further contended that when the opposite parties have already levied penalty for shortfall of performance, the debarment of petitioner no.1 for a period of one year from participating in the tenders of MCL for self-same cause of action amounts to double jeopardy. It is further contended that the order impugned is de hors the agreement between the parties and thereby the same has to be revoked as the principles of natural justice have not been complied with. To substantiate his contentions, learned Senior Counsel appearing for the petitioners has relied upon Mohinder Singh Gill v. the Chief election Commissioner, New Delhi, (1978) 1 SCC 405; Kulja Industries Limited v. Chief General Manager, Western Telecom Project Bharat Sanchar Nigam Limited, (2014) 14 SCC 731; Bhagat Ram v. State of Himachal Pradesh, (1983) 2 SCC 442; Zonal Manager, Central Bank of India v. Devi Ispat Limited, (2010) 11 SCC 186; Premier Printing Press v. State of Rajasthan, 2017 (3) CDR 1644 (Rajasthan); Union of India v. Tantia 19 Construction Pvt. Ltd.(2011) 5 SCC 697; and Medipol Pharmaceutical India Pvt. Ltd. v. Post Graduate Institute of Medical Education & Research (C.A. No.2903 of 2020 arising out of SLP(C) No.26349 of 2019 decided on 05.08.2020) reported in MANU/SC/0585/2020. 6. Mr. Asok Mohanty, learned Sr. Counsel appearing along with Mr. V. Mohapatra, learned counsel for the petitioners in W.P.(C) No.14114 of 2020 at the outset adopted the arguments advanced by Mr. A.K. Parija, learned Sr. Counsel appearing for the petitioners in W.P.(C) No.12475 of 2020 and contended that there are no disputed facts in the present proceeding and the petitioners are relying on the documents, letters, certificates and orders issued and admitted by the MCL to demonstrate the palpable illegality in the order impugned. It is contended that the impugned order dated 07.05.2020 in Annexure-15 suffers from non-application of mind. It is further submitted that MCL has proceeded to debar petitioner no.1 on a finding that it is solely accountable for the entire shortfall of 76.71% when actually their own 20 documents and records relied on in the impugned order speak starkly to the contrary. It is further contended that in paragraph-2 of the impugned order, MCL has relied on a chart from which it is evident that the total shortfall was 2,26,68,508.78 tonnes from total agreed quantity of 2,95,51,000 tonnes for over burden removal which amounts to a total shortfall of 76.71% of the said agreed quantity. It is further contended that out of the said shortfall of 2,26,68,508.78 tonnes, the shortfall attributable to petitioner no.1 is only 7,90,883 tonnes as per MCL’s own admission and records and, as such, the same is recorded under column titled “shortfall due to contractor’s fault” in the chart, which comes to only 2.67% of the total shortfall, while MCL itself is responsible for the balance 74.04% as against total shortfall of 76.71%. In fact, the shortfall of 74.04% by MCL amounts to 96.5% of the total shortfall percentage of 76.71% whereas petitioner no.1 is responsible for only 3.5%. It is contended that due to shortfall of 76.71% of agreed quantity, banning order has been imposed on petitioner no.1 which is absolutely 21 misconceived one. If at all any shortfall would taken into consideration, it would be only 2.67% of the total shortfall, as per MCL’s own record and, as such, MCL is accountable for remaining 74.04%. Therefore, basing upon such shortfall, the so called banning on petitioner no.1 cannot sustain in the eye of law. It is further contended that the opposite party-MCL has tried to improve the case by justifying the impugned order by way of filing counter affidavit on 01.07.2020 which is not permissible. As such, the order impugned should disclose reasons for such banning and subsequent clarification by supplementing and supplanting to the order impugned cannot sustain in the eye of law. It is further contended that the opposite party-MCL has pleaded in the counter affidavit that petitioner no.1 has executed 89.69% of the hindrance-free target and the shortfall by petitioner no.1 is 2.67% from available hindrance free quantity. It was also re-affirmed that petitioner no.1 is not at all responsible for the entire 76.71% of the agreed quantity on the basis of which it has been banned for a period of one year. 22 It is further contended that it has been alleged that petitioner no.1 failed to deploy entire fleet of equipment as per the NIT, which itself was non-application of mind, when the correspondences which have been enclosed to the writ petition clearly indicate that time and again petitioner no.1 sought cooperation from the opposite party-MCL to provide sufficient hindrance free cutting area, dumping area and separate haul roads in east and west side of the mine. Due to non-cooperation of opposite party- MCL by not providing hindrance free area, the shortfall which has been alleged as 2.67% being meager one, the imposition of ban for one year from participating in any tender is too harsh and disproportionate. It is further contended that by way of counter affidavit, the opposite parties have tried to improve their case by justifying the impugned order and also tried to fill up the lacunae and, as such, the order so passed is without complying the principles of natural justice and thus cannot sustain. It is further contended that banning petitioner no.1 for one year is hit by Wednesbury’s principles of unreasonableness, as 23 it is wholly disproportionate and amounts to double punishment, though penalty for shortfall in performance has been levied by the opposite parties. It is further contended that the order impugned is de hors the agreement and thereby cannot sustain. It is contended that the writ petition is maintainable even though alternative remedy, by way of arbitration in the agreement, is available. It is contended that the reliance placed on the judgments by Mr. A.K. Parija, learned Senior Counsel appearing for the petitioners in W.P.(C) No.12475 of 2020 shall be applicable to the present case and, therefore, the petitioners are refrained from repeating the said judgments. 7. Mr. P.K. Parhi, learned Asst. Solicitor General appearing for Union of India contended that since the dispute in both the matters is between the petitioners vis- à-vis MCL, Union of India has no reply to submit. 8. Mr. S.D. Das, learned Senior Counsel appearing along with Mr. D. Mohanty, learned counsel for 24 MCL raised a preliminary objection contending that in view of involvement of complicated and disputed questions of facts in both the writ petitions the same cannot be adjudicated in a proceeding under Article 226 of the Constitution of India. It is further contended that clause- 13-A General Terms & Conditions of the contract under NIT-763 (RT) provides for settlement of disputes through arbitration and the petitioners in both the writ petitions have also given consent regarding settlement of dispute through arbitration, in that case, due to availability of alternative remedy, both the writ petitions are to be dismissed. It is further contended that as per the undertaking given pursuant to the condition stipulated in the NIT, since there was gross violation, the action has been taken for banning petitioner no.1 in both the writ petitions for a period of one year. Thereby, no illegality or irregularity has been committed by passing the orders impugned in both the writ petitions. It is further contended that as per clause- 8(C) the required capacity of fleet to be deployed daily for 25 execution of work. As such, the petitioner no.1 in both the writ petitions were duty bound to make available the total equivalent capacity of equipments on daily basis. The same having not been deployed, they defaulted in carrying out such conditions, leading to cause loss to the State exchequer in terms of royalty. It is further contended that petitioner no.1 in both the writ petitions had been given adequate opportunity by communicating letters to increase deployment of machineries and achieve the targeted quantity, to which they had not given any heed. Similarly, to the show cause notices issued, the replies given by petitioner no.1 in both the writ petitions being not satisfactory, the orders impugned were passed. Thereby, no illegality or irregularity has been committed by the authority in passing such orders. It is further contended that petitioner no.1 in both the writ petitions are liable to pay penalty in terms of clause-6.2 of the General Terms and Conditions of the NIT, but the same is without prejudice to any other right and remedy available under law to MCL on account of such 26 breach. It is further contended that due to shortfall in performance by petitioner no.1 in W.P.(C) No.12475 of 2020 from hindrance free area though the quantity appears to be a meager 7.36%, however, the loss to MCL on account of such shortfall is Rs. 66,00,02,481.32 and loss of royalty to the Government is Rs.12,99,92,367.97, whereas the total penalty which has been recovered under clause-6.2 is merely Rs.94,17,381.80. Similarly, the shortfall in performance by petitioner no.1 in W.P.(C) No.14114 of 2020 from hindrance free area though the quantity appears to be a meager 10.31%, however, the loss to MCL on account of such shortfall is Rs. 39.07 crores and loss of royalty to the Government is Rs.7.55 crores, whereas the total penalty which has been recovered under clause-6.2 is merely Rs.88,77,973.00. The entire action has been taken resorting to clause-9 of the undertaking. Thereby, no illegality or irregularity has been committed so as to cause interference by this Court. As such, the writ petitions are to be dismissed both on the ground of maintainability and also on merits. 27 To substantiate his contention he has relied upon the judgments of the apex Court in Sanjay Kumar Shukla v. Bharat Petroleum Corporation Limited, (2014) 3 SCC 493 and Mahanadi Coalfields Limited v. Dhansar Engineer Company Private Limited, (2016) 10 SCC 571. 9. This Court heard Mr. A.K. Parija, learned Senior counsel appearing along with Mr. A. Behera, learned counsel for the petitioners in W.P.(C) No.12475 of 2020; Mr. A. Mohanty, learned Senior Counsel appearing along with Mr. V. Mohapatra, learned counsel for the petitioners in W.P.(C) No. 14114 of 2020; Mr. P.K. Parhi, learned Asst. Solicitor General appearing for Union of India in both the writ petitions; and Mr. S.D. Das, learned Senior Counsel appearing along with Mr. D. Mohanty for MCL in both the writ petitions by virtual mode. Pleadings having been exchanged, with the consent of learned counsel for the parties, both the writ petitions are being disposed of finally at the stage of admission, keeping in view the fact that petitioner no.1 in both the writ petitions have been 28 banned for a period of one year, out of which four months have already passed and with the passage of remaining time the writ petitions will become infructuous and the banning itself will remain as a stigma on them. 10. Before appreciating the factual and legal aspects involved in both the writ petitions, this Court deems it proper to refer to the various clauses of the agreement, which are relevant for the purpose of deciding both the cases. “8. Eligibility Criteria : xx xx xx C. Fleet Requirement : The bidder is required to give an undertaking in the form of an Affidavit in the prescribed format to deploy the following matching equipment/Tippers/Pay-Loaders either owned or hired. Types of Fleet /Equipment Measure of Capacity Unit of Capacity Minimum Capacity required for each fleet/equipment Total Equivalent Capacity required to be deployed daily for execution of work Surface Miner Cutting Width mm 3000 26990 Cum/day Pay Loader Power HP 112 2800 Tipper Carrying capacity Kg. 14000 21,00,000 Dozer Power HP 410 2050 Grader Power HP 280 1120 Water Tanker Carrying capacity Litre 8000 160000” 29 “6. TIME FOR COMPLETION OF CONTRACT – EXTENSION THEREOF, DEFAULTS & COMPENSATION FOR DELAY: xx xx xx 6.2 In the event of the contractor’s failure to comply with the required progress in terms of the agreed time and progress chart or to complete the work and clear the site on or before the date of completion of contract or extended date of completion, he shall without prejudice to any other right or remedy available under the law to the company on account of such breach, shall become liable to pay for penalty as under: (a) If the average daily progress of work during the calendar months is less than the stipulated rate indicated in the detailed tender notice, penalty as detailed below will be levied. (i) If the average daily progress of work executed during the calendar month is more than 80% and less than 100 % of stipulated rate of progress, penalty equal to 10% of the contract value of the short fall in work shall be levied. (ii) If the average daily progress of work executed during the calendar month is less than 80% of stipulated rate, penalty equal to 20% of contract value of the short fall in work shall be levied. The aggregate of the penalties so levied shall not exceed 10% of the total contract value. Penalties will be calculated every month and withheld. The contractor shall be allowed to make up the shortfall in the succeeding three months within the stipulated time of completion. Once the shortfall is fully made up the so withheld penalty will be released.” “9. TERMINATION, SUSPENSION, CANCELLATION & FORECLOSURE OF CONTRACT. xx xx xx 30 9.2. On cancellation of the contract or on termination of the contract, the Engineer-in-charge shall have powers: (a) to take possession of the site and carry out balance work through any other agency. (b) after giving notice to the contractor to measure up the work of the contractor and to take such whole or the balance or part thereof, as shall be unexecuted out of his hands and to give it to another contractor or take up departmentally, to complete the work. The contractor whole contract is terminated shall not be allowed to participate in future bidding for period of minimum twelve months. In such an event, the contract shall be liable for loss/damage suffered by the employer because of action under this clause and to compensate for this loss or damage, the employer shall be entitled to recover higher of the following: (i) Forfeiture of security deposit comprising of performance guarantee and retention money and additional performance security, if any, at disposal of the employer. Or (ii) 20% of value of incomplete work. The value of the incomplete work shall be calculated for the items and quantities remaining incomplete (as per provision of agreement) at the agreement rates including price variation as applicable on the date, when notice in writing for termination of work was issued to the contractor. It is being clarified that the above liability is over and above the penalties payable by the contractor on account of shortfall in quantities as per provision of clause 6. The amount to be recovered from the contractor as determined above, shall, without prejudice to any other right or remedy available to the employer as 31 per law or as per agreement, will be recovered from any money due to the contractor on any account or under any other contract and in the event of any shortfall, the contractor shall be liable to pay the same within 30 days. In case of failure to pay the same the amount shall be debt payable In the event of above course being adopted by the Engineer-in-charge, the contractor shall have no claim to compensation for any loss sustained by him by reasons of his having purchased materials, equipments or entered into agreement or made advances on any account or with a view to the execution of work or performance of the contract. And in case action is taken under any provision aforesaid, the contractor shall not be entitled to recover or to be paid any sum for any work thereof or actually performed under this contract unless and until the engineer-in-charge has certified in writing the performance of such work and value payable in respect thereof and he shall only be entitled to be paid the value so certified. The need for determination of the amount of recovery of any extra cost/expenditure or of any loss/damage suffered by the company shall not be however arise in the case of termination of the contract for death/demise of the contractor as stated in 9.1(d).” “13. SETTLEMENT OF DISPUTES xx xx xx 13A. Settlement of Disputes through Arbitration If the parties fail to resolve the disputes/differences by in house mechanism, then, depending on the position of the case, eight the employer/owner or the contractor shall give notice to other party to refer the matter to arbitration instead of directly approaching Court. The contractor shall, however, be entitled to invoke arbitration clause only after exhausting the remedy available under the clause 12. 32 In case of parties other than Govt. agencies the redressal of disputes/differences shall be sought through Sole Arbitration as under. Sole Arbitration: In the event of any question, dispute or difference arising under these terms & conditions or any condition contained in this contract or interpretation of the terms of, or in connection with this Contract (except as to any matter the decision of which is specially provided for by these conditions), the same shall be referred to the sole arbitration of a person, appointed to be the arbitrator by the Competent Authority of CIL/CMD of Subsidiary Company (as the case may be). The award of the arbitrator shall be final and binding on the parties of this Contract.” “SPECIAL TERMS AND CONDITIONS FOR THE WORK OF DEPLOYMENT OF SURFACE MINERS IN DIFFERENT OCPs/OCMs OF MCL. xx xx xx 8.0 DEFAULT AND PENALTY 8.1 LOSS OR DAMAGE Any loss or any expenditure for damages incurred by company will be recoverable from the contractor whether fully or partly if such expenditure for damages have been caused either directly or indirectly due to any negligence or failure on the part of the contractor. 8.2 ADDITIONAL PENALTY CLAUSE: For failure to produce size coal as per NIT (100 mm size), the contractor shall also be liable for penalty at the rate of 10% of the awarded rate for such over size quantity. The maximum penalty including all the penalties will remain 10% of the contract value as per Clause 6.2. 33 8.3 WAIVAL OF PENALTY The company may at its sole discretion waive the payment of penalty in full or the part on request received from the contractor depending the merit of the case if the entire work is completed within the date as specified in the contract or within extended period approved without imposing penalty.” SPECIAL TERMS & CONDITIONS FOR TRANSPORT CONTRACT. UNDERTAKING OF LETTER HEAD OF BIDDER UNDERTAKING I/We,…………………………………….., Partner/Legal Attorney, Authorized Representative of Sri/Smt. M/s………………………………(Name of bidder), solemnly declare that : 1. I/we am/are submitting Bid for the work …………………………………………. Against NIT No/Tender ID…………………… Dated ……………….. and I/We offer to execute the work in accordance with all the terms, conditions and provisions of the bid. 2. I/We will deploy the matching Equipments/ Tippers/ Pay-Loaders as detailed in the NIT either Owned or Hired, if the work is awarded to me/us. 3. Myself /Our Partners/ directors don’t has/have any relative as employee of Mahanadi Fields Limited. 4. All information furnished by me/us on-line in respect of fulfillment of eligibility criteria and qualification information on this Bid is complete, correct and true. 5. All copy of documents credentials and documents submitted along with this Bid are genuine, authentic, true and valid. 6. I/We hereby authorize department to seek references/clarifications from our Bankers. 34 7. We hereby undertake that we shall register and obtain license from the competent authority under the contract labour (Regulation & Abolition Act) as relevant, if applicable. 8. *I/We have not been banned or delisted by any Govt., or Quasi Govt. Agencies or PSUs (In case of JV, all partners are covered). Or 9. If any information and document submitted is found to be false/incorrect at any time, department may cancel my/Bid and action as deemed fit may be taken against me/us, including termination of the contract, forfeiture of all dues including Earnest Money and banning/delisting of our firm and all partners of the firm etc.” 11. At this stage, it is worthwhile to quote the orders impugned in both the writ petitions. The order dated 29.04.2020 in Annexure-10, which has been impugned in W.P.(C) No. 12475 of 2020, reads as follows:- “To 1) M/s. VFPL ASIPL JV COMPANY, Near P. N. Bank, Main Road, Ramgarh Cantt. -829122, Dist: Ramgarh (Jharkhand), e-Mail Id: jiplsales@ gmail.com. 2) M/s. Vikash Fastners Private Limited, At Diamond Prestige, Room No. 310, AJC Bose Road, Kolkata, West Bengal e-Mail Id: [e-mail] 3) M/s. Aloke Steels Industries Private Limited, At Opposite Ashok cinema, Ranchi Road, Marar, Ramgarh Cantt., Jharkhand e-Mai] Id: [e-mail] 35 Sub : Banning of Business of your Company and Partners of your Joint Venture Company in MCL for a period of one year. Ref:-1. MCL/SBP/GM(CMC)NIT-763(RT)/2018/1020 Dated 18.01.2018 2. LOA No. MCL/SBP/GM(CMC)NIT-763 (RT)/2018 /1215 Dated 31.03.2018 3. Work order No. MCL/GM(KA)/Mining NlT-763 (RT)/2018/18 Dated 10.04.2018. 4. Show Cause Notice for Banning of Business vide letter No. MCL/GM(KA)/Mining NIT-763 (RT)/ 2020/993 Dated 04.04.2020 5. Your reply to the Show Cause Notice vide letter under reference No. VFPL ASIPL/2020-21/01 Dated 21.04.2020. 1. You have been awarded the work of Extraction of Coal/Coal measure strata by deploying Surface Miner on hiring basis, mechanical transfer of the same in Tipping Trucks and transportation of the same from SM Face to different destinations inclusive of effective water spraying for dust suppression, dozing of Faces/Sidings/Stocks etc. and grading/maintenance of roads etc. of Kaniha OCP, Kaniha Area. [NIT-763(RT) Dated 18.01.2018] vide Letter of Acceptance under reference No. MCL/SBP/GM(CMC)/MT- 763(RT)/2018/1215 Dated 31.03.2018 of General Manager(CMC), MCL and Work Order No. MCL/GM(KA)/Mining/MT-763(RT)/2018/18 Dated 10.04.2018 of Kaniha Area. 2. Whereas you have executed only 13.87 MT of Coal at Kaniha OCP, Kaniha Area against a target of 33.72 MT for the period from May-2018 to March-2020, i.e. only 41.14%. Month-wise performance of our Com an under NIT-763 R Dated 18.01.2018 from May-2018 to March-2020 is as under :- Sl No Month Agreed Qty (Tonnes) Achieved Qty (Tonnes) Total Shortfall (Tonnes) Shortfall due to contracto r’s fault (Tonnes) Penalty amount deducted/w ithheld (in Rs) 1. May-18 1518340 220181.64 1298158.36 0 0.00 2. Jun-18 1441800 468066.49 973733.51 3800 23070.00 3. Jul-18 1489860 571877.16 917982.84 4067 27450.00 36 4. Aug-18 1489860 389727.24 1100132.76 0 0.00 5. Sept-18 1441800 554596.23 887203.77 0 0.00 6. Oct-18 1489860 655147.72 834712.28 8775 65330.00 7. Nov-18 1441800 694042.97 747757.03 1200 9605.00 8. Dec-18 1489860 612881.48 876978.52 25302.5 188377.00 9. Jan-19 1489860 675993.13 813866.87 15000 106410.00 10. Feb-19 1345680 565289.98 780390.02 10000 70940.00 11. Mar-19 1489860 930501.53 559358.47 51500 347573.50 12. Apr-19 1441800 520501.26 921298.74 22700 153202.30 13. May-19 1489860 615869.92 873990.08 6500 43868.50 14. Jun-19 1441800 601453.15 840346.85 19000 128231.00 15. Jul-19 1489860 400324.43 1089535.57 50500 340824.50 16. Aug-19 1489860 269722.74 1220137.26 0 0.00 17. Sept-19 1441800 248773.32 1193026.68 3000 20247.00 18. Oct-19 1489860 456024.96 1033835.04 25500 172100.00 19. Nov-19 1441800 508346.29 933453.71 94537 585184.00 20. Dec-19 1489860 852938.11 636921.89 32500 201175.00 21. Jan-20 1489860 903302.56 586557.44 157412.2 974382.00 22. Feb-20 1393740 980342.76 413397.24 312386.23 4216589.00 23. Mar-20 1489860 1175719.91 314140.09 258234.19 1742823.00 Total 33718540 13871624.98 19846915.02 1101914.12 9417381.80 3. Whereas you did not deploy sufficient equipment as specified in the MT-763(RT), the month-wise deployment of equipment by you vis-a-vis equipment to be deployed as per NIT-763(RT) Dated 18.01.2018 is as under: Sl. No. Month No. of S/ Miner s as per NIT No. of S/ Miner s Depl. P/L as per NIT (Equival ent Capacit y) In HP Depl. Of P/L (Equival ent Capacit y) in HP Tippers as per NIT (Equival ent Capacit y) in Te Depl. Of Tippers (Equival ent Capacit y) in Te Dozers as per NIT (Equival ent Capacit y) in HP Depl of Dozers (Equival ent Capacit y) in HP Grade rs as per NIT (Equiv alent Capac ity) in HP Depl. of Graders (Equival ent Capacit y) in HP Water Tankers as per NIT (Equival ent Capacit y in KL Depl. OF Waters Tanker (Equival ent Capacit y) in KL 1 May-18 5 1 2800 800 2100 466 2050 840 1120 280 160 60 2 Jun-18 5 3 2800 1200 2100 1418 2050 1680 1120 280 160 60 3 Jul-18 5 3 2800 1200 2100 1418 2050 1680 1120 280 160 60 4 Aug-18 5 3 2800 1200 2100 1418 2050 1680 1120 280 160 60 5 Sep-18 5 3 2800 1200 2100 1418 2050 1680 1120 280 160 60 6 Oct-18 5 3 2800 1600 2100 1418 2050 1680 1120 280 160 60 7 Nov-18 5 3 2800 1600 2100 1418 2050 1680 1120 280 160 60 8 Dec-18 5 3 2800 1600 2100 1195 2050 1680 1120 280 160 60 37 9 Jan-19 5 3 2800 1600 2100 1114 2050 1680 1120 280 160 60 10 Feb-19 5 3 2800 2000 2100 1317 2050 1260 1120 280 160 60 11 Mar-19 5 3 2800 2000 2100 1398 2050 1680 1120 280 160 60 12 Apr-19 5 3 2800 2000 2100 1398 2050 1680 1120 280 160 60 13 May-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 14 Jun-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 15 Jul-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 16 Aug-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 17 Sep-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 18 Oct-19 5 3 2800 2000 2100 1418 2050 1680 1120 280 160 60 19 Nov-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 20 Dec-19 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 21 Jan-20 5 3 2800 2000 2100 1418 2050 1260 1120 280 160 60 22 Feb-20 5 4 2800 2200 2100 1580 2050 1260 1120 280 160 60 23 Mar-20 5 4 2800 2400 2100 1722 2050 1260 1120 280 160 60 4. Whereas you have been consistently performing poorly since the beginning of the Contract under NIT- 763(RT) Dated 18.01.2018 at Kaniha OCP, Kaniha Area. In spite of you being given sufficient opportunities to execute the agreed quantity as per terms and conditions of Agreement and also given several letters to improve the performance and to deploy sufficient equipment as per NIT, you did not deploy sufficient equipment as per NIT resulting in poor performance of Coal Production at Kaniha OCP, Kaniha Area. 5. Whereas 21 days Show Cause Notice for Banning of Business of your Company and all Partners of your Joint Venture Company for a period of 03 years was issued by General Manager, Kaniha Area vide letter under reference No. MCL/GM(KA)/ Mining/NIT- 763(RT) /2020/ 993 Dated 04.M.2020. Your reply to the Show Cause Notice vide letter under reference No. VFPL ASIPL/ 2020-21, /01 Dated 27.04.2020 has been found to be unsatisfactory by the Competent Authority. 6. Whereas MCL has incurred a huge irreparable loss due to poor performance by you. Your consistent poor performance shows that you are likely to severely impair production capacity of our company if allowed to do business with MCL in future. The estimated loss during 2019-20 is around 66 crores and also loss of royalty to Govt. exchequer comes to around Rs. 13 Crore. Despite the repeated remainders, you failed to deploy required machines which have resulted in poor performance. You have performed only 41.1,4% of assigned target as per MT /agreement at Kaniha OCP. There was no initiative on your part to meet the shortfall 38 of targeted production. Therefore, in the interest of MCL, there is no option but to ban you and Partners of your Joint Venture from participation in future tenders of MCL, for a period of 1 year. In view of the above, M/s. VFPL ASIPL JV Company and its constituent Partners of Joint Venture are banned for a period of one year from participating in future tenders of MCL. Ban will come into force from the date of issue of this letter.” Similarly, the order dated 17.05.2020 in Annexure-15, which has been impugned in W.P.(C) No. 14114 of 2020, reads as follows:- “To 1) M/s. JRT NKBPL JV, CMD Chowk,Link Road, Bilaspur (C.G.), e-Mail Id : jrtnkbpljv @ gmail.com 2) M/s. Jalaram Transport, CMD Chowk, Link Road, Bilaspur (C.G.) 3. M/s. N.K. Bhojani Pvt. Ltd. S-2/A-42, 43, 44. Mahcheswar Industrial Estate, Bhubaneswar, Odisha- 751010. Sub : Banning of Business of your Company and Partners of your Joint Venture Company in MCL for a period of one year. Ref:- 1.NIT No. MCL/SBP/GM(CMC)NIT-118/2017/ 611 Dated 19.09.2017 2.LOA No. MCL/SBP/GM(CMC)NIT-118/ 2017/935 Dated 23.12.2017. 3.Work order No. MCL/GM(KA)/Mining NlT- 118/2018/469 Dated 03.01.2018. 4.Show Cause Notice for Banning of Business vide letter No. MCL/GM(KA)/Min/ NIT- 118/2020/952 Dated 20.02.2020 5.Your reply to the Show Cause Notice vide letter under reference No. JN(JV) K.OCP/NIT- 118/2019-20 Dated 03.03.2020. 39 1. You were awarded the work of awarded the work of Hiring the HEMM (Shovel, Tipper, Drill, Dozer etc.) for transfer & transportation of materials in various strata including drilling, excavation, dumping, spreading, dozing and other alied work in specified areas for dumping for exposing various coal seams from surface, down to seam II Boa at Kaniha OCP as per the instructions of Project Officer/ Management of Kaniha OCP, Kaniha Area for a quantity of 41.40 MCum for a period of 1095 days (Quantity Per day = 37,808 Cum/day), amounting to Rs.307,67,61,122.40 (including GST @ 18%) (NIT-118 dated 19.09.2017) vide Letter of Acceptance under reference No. MCL/SBP/GM(CMC) NIT-118/2017/935 Dated 23.12.2017 of General Manager (CMC), MCL and Work Order No. MCL/GM (KA)/ Mining/NIT-118/2018/469 Dated 03.01.2018 of Kaniha Area. The period of Contract is from 22.01.2018 to 20.01.2021. 2. Whereas you have executed only 6.88 MCum of OB Removal of Kaniha OCP , Kaniha Area against a target of 29.55 MCum for the period from January-2018 to March-2020 i.e. only 23.29 %. Month wise performance of your Company under NIT-118 Dated19.09.2017 from January-2018 to March-2020 is as under:- Sl. No. Month Agreed Qty (Tonnes) Achieved Qty (Tonnes) Total Shortfall (Tonnes) Shortfall due to Contractor’s (Tonnes) Penalty amount deducted withheld (in Rs.) 1. Jan-18 40000 33800.10 6199.00 0 0 2. Feb-18 336000 179535.93 156464.07 0 0 3. Mar-18 868000 198647.01 669352.99 0 0 4. Apr-18 1005000 189663.27 815336.73 0 0 5. May-18 1085000 99615.58 985384.42 0 0 6. Jun-18 1050000 206792.08 843207.92 0 0 7. Jul-18 992000 177199.42 814800.58 0 0 8. Aug-18 992000 147639.97 844360.03 0 0 9. Sep-18 1140000 183480.73 956519.27 2300 15514 10. Oct-18 1209000 280206.68 928793.32 39393 265706 11. Nov-18 1240000 301769.19 938230.81 27173 183282 12. Dec-18 1240000 389324.14 850675.86 66620 449352 13. Jan-19 1240000 348792.88 891207.12 14550 98140 14. Feb-19 1176000 237412.10 938587.90 0 0 15. Mar-19 1395000 411163.24 983836.76 0 0 16. Apr-19 1260000 248279.27 1011720.73 0 0 17. May-19 1302000 375339.49 926660.51 0 0 18. Jun-19 1200000 274287.75 925712.25 0 0 19. Jul-19 1085000 169154.21 915845.79 0 0 40 20. Aug-19 1085000 0.00 1085000.00 0 0 21. Sep-19 1140000 145089.64 994910.36 0 0 22. Oct-19 1178000 204408.50 973591.50 0 0 23. Nov-19 1200000 404081.47 795918.53 0 0 24. Dec-19 1240000 422844.25 817155.75 8000 53960 25. Jan-20 1240000 475038.53 764961.47 263847 3559296 26. Feb-20 1218000 431164.75 786835.25 261500 3527635 27. Mar-20 1395000 347761.04 1047238.96 107500 725088 Total 29551000 6882491.22 22668508.78 790883 8877973 3. Whereas you did not deploy sufficient equipment as specified in the NIT-118, Dated 19.09.2047, the month-wise deployment of equipment by you vis-à- vis equipment to be deployed as per NIT-118 IS AS UNDER:- Sl. No. Month Shovels as per NIT (Equivalent Capacity) in Cum. Deployment of Shovels (Equipment capacity) in Cum. Tippers as per NIT (Equivalent Capacity) in Cum. Deployment of Tippers (Equipment capacity) in Cum.) 1. Jan-18 50.40 6.2 782.73 140 2. Feb-18 50.40 9.3 782.73 210 3. Mar-18 50.40 9.3 782.73 210 4. Apr-18 50.40 12.4 782.73 257 5. May-18 50.40 9.3 782.73 163 6. Jun-18 50.40 9.3 782.73 163 7. Jul-18 50.40 9.3 782.73 163 8. Aug-18 50.40 9.3 782.73 163 9. Sep-18 50.40 9.3 782.73 163 10. Oct-18 50.40 9.3 782.73 163 11. Nov-18 50.40 12.4 782.73 268 12. Dec-18 50.40 12.4 782.73 268 13. Jan-19 50.40 15.5 782.73 326 14. Feb-19 50.40 12.4 782.73 268 15. Mar-19 50.40 15.5 782.73 326 16. Apr-19 50.40 12.4 782.73 268 17. May-19 50.40 12.4 782.73 268 18. Jun-19 50.40 12.4 782.73 268 19. Jul-19 50.40 12.4 782.73 268 20. Aug-19 50.40 0 782.73 0 21. Sep-19 50.40 12.4 782.73 268 22. Oct-19 50.40 12.4 782.73 268 23. Nov-19 50.40 15.2 782.73 303 24. Dec-19 50.40 15.2 782.73 303 25. Jan-20 50.40 15.2 782.73 303 41 26. Feb-20 50.40 15.2 782.73 303 27. Mar-20 50.40 15.2 782.73 303 4. Whereas you have been consistently performing poorly since the beginning of the contract under NIT-118 dated 19.09.2017 at Kaniha OCP, Kaniha. Inspite of you being given sufficient opportunities to execute the agreed quantity as per terms and conditions of Agreement and also given several letters to improve the performance and to deploy sufficient equipment as per NIT, you did not deploy sufficient equipment as per NIT resulting in poor performance of OB Removal, leading to less exposure of coal at Kaniha OCP, Kaniha Area and huge loss to MCL. 5. Whereas a 21 days Show Cause Notice for Banning of Business of your Company and all Partners of your Joint Venture Company for a period of 3 years was issued by General Manager, Kaniha Area vide letter under reference No.MCL/GM(KA)/Min/NIT-118/ 2020952 dated 20.02.2020. Your reply to the Show Cause Notice vide letter under reference No. JN(JV)/K.OCP/NIT-118/2019-20/291 dated 03.03.2020 has been found to be unsatisfactory by the Competent Authority. 6. Whereas MCL has incurred a huge irreparable loss due to poor performance by you. Your consistent poor performance shows that you are likely to severely impair production capacity of our company if allowed to do business with MCL in future. The estimated loss during 2019-20 is around Rs.39 crores and also loss of royalty to Govt. exchequer comes to around Rs.7 crores. Despite the repeated reminders, you failed to deploy required machines which have resulted in poor performance. You have performed only 23.29% of assigned target as per NIT/agreement at Kaniha OCP. There was no initiative on your part to meet the shortfall of targeted production. Therefore, in the interest of MCL, there is no option but to ban you and partners of your Joint Venture from participation in future tenders of MCL, for a period of 1 year. In view of the above, M/s JRT NKBPL JV and its constituent partners of Joint Venture, M/s Jalaram Transport and M/s N.K. Bhojani Pvt. Ltd., are banned for a period of one year from participating in future tenders of MCL. Ban will 42 come into force from the date of issue of this order.” 12. In view of the facts and circumstances, as delineated above, this Court proceeded to decide both the cases taking into consideration the factual and legal matrix involved in W.P.(C) No.12475 of 2020, which take care of the arguments and submissions made in W.P.(C) No.14114 of 2020 also, and accordingly following issues are framed to decide both the cases. (i) whether the writ petitions are maintainable? (ii) whether the orders impugned have been passed in compliance of the principles of natural justice? and (iii) whether the impugned action banning petitioner no.1 in both the writ petitions for a period of one year from participating in future tenders of MCL is in conformity with the provisions of law or not? 43 13. Issue No.(i): Whether the writ petitions are maintainable? A preliminary objection was raised by Mr. S.D. Das, learned Senior Counsel appearing for MCL that both the writ petitions involve disputed questions of facts and, therefore, the same are liable to be dismissed. Mr. A.K. Parija, learned Senior Counsel appearing for the petitioners in W.P.(C) No.12475 of 2020 and Mr. Asok Mohanty, learned Senior Counsel appearing for the petitioners in W.P.(C) No.14114 of 2020 unequivocally and solemnly stated that they are relying upon the documents filed by the opposite parties basing upon which the impugned orders of banning have been passed against petitioner no.1 in both the writ petitions and as such, they are not relying upon any other documents save and except the documents relied upon by the opposite party-MCL and also they are not disputing the figures mentioned in the orders impugned. Thereby, the allegation of disputed questions of facts does not arise. 44 14. In Raja Anand v. State of Uttar Pradesh, AIR 1967 SC 1081, relying upon the judgment in White and Collins v. Minister of Health (1939) 2 KB 838, the apex Court held that where the jurisdiction of an administrative authority depends upon a preliminary findings of facts, the High Court is entitled in a writ proceeding to determine upon its independent judgment whether or not the finding of facts is correct. 15. In State of Madhya Pradesh v. D.K. Jadav, AIR 1968 SC 1186, the apex Court held that when the jurisdiction of an administrative authority depends on preliminary findings of fact, the High Court can go into the correctness of the same under Article 226. 16. In Muljibhai Patel v. Nandlal Khodidas Barot, AIR 1974 SC 2105 , the apex Court held that the High Court is not deprived of its jurisdiction to entertain a petition under Article 226 of the Constitution merely in considering the petitioner’s right to relief, question of facts at fault to be determined. The High Court has jurisdiction 45 to try issues both to facts and law when the petitioner raised complex question of facts which may for their determination require oral evidence to be taken and on that account the High Court is of the view that dispute should not appropriately be tried in the writ petition, the High Court may decline to try the writ petition. It is the discretion of the High Court to exercise on sound and in conformity with judicial principle. 17. As has been contended by learned Senior Counsel appearing for the petitioners in both the writ petitions that they rely upon the documents filed by the opposite parties depending on preliminary finding of facts, the correctness of which can be examined by invoking jurisdiction under Article 226 of the Constitution of India, and thereby the contention was raised that the disputed questions of facts are involved cannot have justification. As such, this Court is justified to entertain the writ petitions. 46 18. Another objection was raised that due to availability of alternative remedy under clause-13-A of the agreement, the petitioners can resort to arbitration, instead of approaching this Court by way of filing the writ petitions, therefore, seeks for dismissal of the same. 19. In Thansingh Nathmal v. Superintendent of Taxes, AIR 1964 SC 1419, the apex Court held as follows:- “The bar of alternative remedy has been a rule of self imposed limitation- a rule of policy, convenience and discretion, rather than a rule of law. The Constitution (Forty-second Amendment) Act, 1976 had, however, placed a bar on the jurisdiction of the High Courts to entertain certain petitions if any other remedy for redress was provided for by or under any other law for the time being in force. However, the bar imposed by Forty Second Amendment was removed by the Constitution (Forty Forth Amendment) Act 1978. But the existence of an alternative remedy has always been regarded as one of the factors which a High Court is required to bear in mind while exercising its discretionary power under this Article.” “The jurisdiction of the High Court under Article 226 of the Constitution is couched in wide terms and the exercise thereof is not subject to any restriction … But the exercise of the jurisdiction is discretionary; it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction demands that it will ordinarily be exercised subject to certain well imposed limitations. Resort to that jurisdiction is not intended as an alternative remedy of relief which may be obtained in a suit or other mode prescribed 47 by the statute. Ordinarily, the court will not entertain a petition for a writ under Article 226 where the petitioner has an alternative remedy, which without being unduly onerous, provides an equally efficacious remedy …The High Court does not therefore act as a court of appeal against the decision of a court or tribunal to correct errors of fact, and does not by assuming jurisdiction under Article 226 trench upon an alternative remedy provided by a statute for obtaining relief. Where it is open to the aggrieved petitioner to move another tribunal or even itself in another jurisdiction for obtaining redress in the matter provided by a statute, the High Court normally will not permit by entertaining under Article 226 of the Constitution the machinery created by the statute to be bypassed and leave the party applying to it to seek resort to that machinery so set up.” 20. In Collector of Monghyr v. Keshav Prasad, AIR 1962 SC 1694, the apex Court held that despite the existence of an alternative remedy, it is within the jurisdiction and discretion of the High Court to grant relief under Article 226 of the Constitution of India. Similar view has also been taken by the apex Court in Zila Parishad, Moradabad v. Kundan Sugar Mill, AIR 1968 SC 98. 21. Needless to mention here that after the petitioners filed their writ petitions, opposite parties have filed their counter affidavits and to that the petitioners 48 have filed their rejoinder affidavits and on that basis arguments were advanced on merits. As such, the parties have invoked jurisdiction of this Court and thereby the objection raised that the writ petitions are not maintainable due to availability of alternative remedy cannot sustain in the eye of law. 22. In Kanak v. U.P. Avas Evam Vikas Parishad, AIR 2003 SC 3894, the apex Court held that once a writ petition is entertained, the respondent files a counter- affidavit and the matter is argued on merit; it would be too late in the day to contend that the writ petitioner should have availed of the alternative remedy. 23. In State of Tripura v. Manoranjan Chakraborty, (2001) 10 SC 740, the apex Court held that if gross injustice is done and it can be shown that for good reason the Court should interfere, then notwithstanding the alternative remedy which may be available by way of appeal or revision, a Writ Court can in an appropriate case exercise its jurisdiction to do substantial justice. 49 24. In Union of India v. T.R. Varma, AIR 1957 SC 882, the apex Court held that existence of an alternative remedy does not affect the jurisdiction of the Court to issue writ. 25. In Ram and Shyam Company v. State of Haryana, AIR 1985 SC 1147, the apex Court held that an alternative remedy must be effective. An appeal in all cases cannot be said to provide in all situations, where power to grant lease was exercised formally by authority set up under the Rule, but effectively and for all purposes by the Chief Minister of the State, an appeal to State Government would be ineffective and writ petition in such case maintainable. 26. The apex Court in Champalal v. CIT, West Bengal, AIR 1970 SC 645, while considering the case under the Income Tax Act, held that where the party feeling aggrieved by an authority under the Income-tax Act has an adequate alternative remedy which he may resort to against the improper action of the authority and if he 50 does not avail himself of that remedy, the High Court will require a strong case to be made out for entertaining a petition for writ. 27. In Zonal Manager, Central Bank of India mentioned supra, the apex Court held that mandamus can be issued in contractual matters and in paragraph- 28 of the said judgment, the apex Court held as under:- “28. It is clear that (a) in the contract if there is a clause for arbitration, normally, a writ court should not invoke its jurisdiction; (b) the existence of effective alternative remedy provided in the contract itself is a good ground to decline to exercise its extraordinary jurisdiction under Article 226; and (c) if the instrumentality of the State acts contrary to the public good, public interest, unfairly, unjustly, unreasonably discriminatory and violative of Article 14 of the Constitution of India in its contractual or statutory obligation, writ petition would be maintainable. However, a legal right must exist and corresponding legal duty on the part of the State and if any action on the part of the State is wholly unfair or arbitrary, writ courts can exercise their power. In the light of the legal position, writ petition is maintainable even in contractual matters, in the circumstances mentioned in the earlier paragraphs.” 51 Therefore, it remains no longer res integra that if instrumentality of the State acts contrary to the public good, public interest unfairly, unjustly, unreasonably, discriminatory and violative of Article 14 of the Constitution of India in its contractual or statutory obligation, the writ petition would be maintainable. 28. In Union of India v State of Haryana, (2000) 10 SCC 482, the apex Court has added one more exception to the rule of alternative remedy, namely, the writ petition can be entertained despite alternative remedy if the question raised is purely legal one, there being no dispute on facts. 29. In Premier Printing Press (supra), one of us (Mr. Mohammad Rafiq, CJ), while sitting singly in Rajasthan High Court, taking into consideration various judgments of the apex Court laid down the principle that even if there is availability of alternative remedy, this Court can exercise power under Article 52 226 of Constitution of India. Paragraph-25 of the said judgment reads as follows: “25. There are thus these seven well recognized exceptions to the rule of alternative remedy, which can be culled out from the afore discussed judgments of the Supreme Court, firstly where the writ petition has been filed for enforcement of fundamental rights; secondly where there has been violation of principle of natural justice; thirdly where the order of proceedings is wholly without jurisdiction; fourthly where the vires of any Act is under challenge; fifthly where availing of alternative remedy subjects a person to very lengthy proceedings and unnecessary harassment; sixthly where the writ petition can be entertained despite alternative remedy if the question raised is purely legal one, there being no dispute on facts and seventhly, where State or its intermediary in a contractual matter acts against public good/interest unjustly, unfairly and arbitrarily.” 30. In Union of India v Tantia Construction Ltd., (2011) 5 SCC 697, the apex Court in paragraphs- 33 and 34 held as follows:- “33. Apart from the above, even on the question of maintainability of the writ petition on account of the arbitration clause included in the agreement between the parties, it is now well established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr Chakraborty would clearly indicate that the 53 constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution. 34. We endorse the view of the High Court that notwithstanding the provisions relating to the arbitration clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the writ petition filed on behalf of the respondent Company. We, therefore, see no reason to interfere with the views expressed by the High Court on the maintainability of the writ petition and also on its merits.” 31. On the basis of the factual matrix of the case available on record, if the petitioners are not disputing the documents and figures mentioned therein and rather they rely on the same, in the event of relegating them to resort to the arbitration clause mentioned in the agreement that will be prejudicial to their interest, inasmuch as the banning period is for 12 months and in the meantime four months having been already elapsed, for the remaining period if the dispute is not decided and the petitioners are not allowed to participate in bid process of MCL, grave injustice will be caused to them. As such, the petitioners 54 have made out a strong case in their favour so as to invoke jurisdiction under Article 226 of the Constitution of India. More particularly, in the event the petitioners are relegated to resort to the arbitration clause in the name of availing alternative remedy, it may not have any effect as because the time period of conclusion of arbitration proceeding is not in the hands of the petitioners. Thereby, if the banning period of one year expires and the petitioners are debarred from participating in future bids of MCL, it will be a stigma for them, for which grave prejudice will be caused to them. Therefore, the only remedy available for the petitioners at last is to invoke jurisdiction of Article 226 of the Constitution of India, which is an efficacious one. As such, Mr. A.K. Parija, learned Senior Counsel appearing for the petitioners emphatically stated that the petitioners have got efficacious remedy to invoke extraordinary jurisdiction of this Court, even though there is available of alternative remedy of arbitration under clause-13-A of the agreement. 55 32. The word “efficacious” is adjective according to Grammar and its noun is “efficacy”. The word “efficacy” is derived from Latin word “efficacie” which means capacity to produce results. The word ‘efficacious’ accordingly means able to produce the intended effect or result. 33. In Abdul Sammad v. Executive Committee of the Marigaon Mahkuma Parishad, AIR 1981 Gau. 15, the Gauhati High Court held that it is well-known that the meaning of the term “efficacious” is “able to produce the intended result”. It is, therefore, held that the preliminary objection raised by the opposite parties with regard to maintainability of the writ petition is hereby negatived and as such, this Court held that the writ petitions are maintainable and issue no.(i) is accordingly answered in affirmative. 34. Issue no.(ii): Whether the orders impugned have been passed in compliance of the principles of natural justice? 56 Learned Senior Counsel appearing in both the writ petitions strenuously urged that there was non- compliance of principles of natural justice while passing the orders impugned, which was disputed by learned Senior Counsel appearing for opposite party-MCL. But on perusal of the records, it appears that a notice of show cause was issued on 04.04.2020 in Annexure-6 banning the petitioners in W.P.(C) No.12475 of 2020 and due to COVID-19 pandemic, petitioner no.1, vide letter dated 15.04.2020 sought time to file show cause notice, but subsequently on 21.04.2020 it filed reply to notice of show cause. On 29.04.2020, without affording any opportunity of hearing, the order impugned has been passed banning petitioner no.1 from carrying on business for a period of one year. Similarly, in W.P.(C) No. 14114 of 2020, show cause notice was issued on 20.02.2020 under Annexure- 13 and petitioner no.1 submitted reply on 03.03.2020 under Annexure-14 and order impugned has been passed without affording any opportunity of hearing on 07.05.2020 vide Annexure-15 banning petitioner no.1 for 57 one year. As such, nothing has been placed on record, except by filing counter affidavit by the opposite parties indicating that after reply was filed they have given opportunity of hearing to petitioner no.1. Mere calling upon to file show cause and compliance thereof by filing reply cannot construe compliance of principles of natural justice, because it can be said to be an empty formality unless adequate opportunity is given to the petitioners. 35. The soul of natural justice is ‘fair play in action’ In HK (An Infant) in re, 1967 1 All ER 226 (DC), Lord Parker, CJ, preferred to describe natural justice as ‘a duty to act fairly’. In Fairmount Investments Ltd. v. Secy of State for Environment, 1976 2 All ER 865 (HL), Lord Russel of Killowen somewhat picturesquely described natural justice as ‘a fair crack of the whip’ In R. v. Secy. Of State for Home Affairs, ex p. Hosenball, Geoffrey Lane, LJ, 1977 3 All ER 452 (DC & 58 CA), preferred the homely phrase ‘common fairness’ in defining natural justice. 36. A.K. Kraipak and others v. Union of India, AIR 1970 SC 150= (1969) 2 SCC 262, is a landmark in the growth of this doctrine. Speaking for the Constitution Bench, Hegde,J. observed thus: “If the purpose of the rules of natural justice is to prevent miscarriage of justice one fails to see why those rules should be made inapplicable to administrative enquiries. Often times it is not easy to draw the line that demarcates administrative enquiries from quasi-judicial enquiries. Enquiries which were considered administrative at one time are now being considered as quasi-judicial in character. Arriving at a just decision is the aim of both quasi-judicial enquiries as well as administrative enquiries. An unjust decision in an administrative enquiry may have far reaching effect than a decision in a quasi-judicial enquiry”. In Maneka Gandhi v. Union of India, AIR 1978 SC 597 = (1978) 1 SCC 248, law has done further blooming of this concept. This decision has established beyond doubt that even in an administrative proceeding 59 involving civil consequences doctrine of natural justice must be held to be applicable. 37. In Swadeshi Cotton Mills v. Union of India, AIR 1981 SC 818, the meaning of ‘natural justice’ came for consideration before the apex Court and the apex Court observed as follows:- “The phrase is not capable of a static and precise definition. It cannot be imprisoned in the straight-jacket of a cast-iron formula. Historically, “natural justice” has been used in a way “which implies the existence of moral principles of self evident and unarguable truth”. “Natural justice” by Paul Jackson, 2nd Ed., page-1. In course of time, judges nurtured in the traditions of British jurisprudence, often invoked it in conjuction with a reference to “equity and good conscience”. Legal experts of earlier generations did not draw any distinction between “natural justice” and “natural law”. “Natural justice” was considered as “that part of natural law which relates to the administration of justice.” 38. In Basudeo Tiwary v Sido Kanhu University and others (1998) 8 SCC 194, the apex Court held that natural justice is an antithesis of arbitrariness. It, therefore, follows that audi alteram partem, which is facet of natural justice is a requirement of Art.14. 60 39. In Nagarjuna Construction Company Limited v. Government of Andhra Pradesh, (2008) 16 SCC 276, the apex Court held as follows: “The rule of law demands that the power to determine questions affecting rights of citizens would impose the limitation that the power should be exercised in conformity with the principles of natural justice. Thus, whenever a man’s rights are affected by decisions taken under statutory powers, the court would presume the existence of a duty to observe the rules of natural justice. It is important to note in this context the normal rule that whenever it is necessary to ensure against the failure of justice, the principles of natural justice must be read into a provision. Such a course is not permissible where the rule excludes expressly or by necessary intendment, the application of the principles of natural justice, but in that event, the validity of that rule may fall for consideration.” 40. The apex Court in Uma Nath Panday and others v State of U.P. and others, AIR 2009 SC 2375, held that natural justice is the essence of fair adjudication, deeply rooted in tradition and conscience, to be ranked as fundamental. The purpose of following the principles of natural justice is the prevention of miscarriage of justice. 61 41. In Mysore Urban Development Authority by its Commissioner v. Veer Kumar Jain, (2010) 5 SCC 791, the apex Court held in paragraphs 17, 18 and 19, being relevant are extracted hereunder:- “17. We may refer to some of the decisions of this Court having a bearing on the issue. In S.L. Kapoor v. Jagmohan [(1980) 4 SCC 379] this Court rather rigidly and sternly observed: (SCC p. 395, para 24) “24. … In our view the principles of natural justice know of no exclusionary rule dependent on whether it would have made any difference if natural justice had been observed. The non-observance of natural justice is itself prejudice to any man and proof of prejudice independently of proof of denial of natural justice is unnecessary. It ill comes from a person who has denied justice that the person who has been denied justice is not prejudiced.” 18. In State Bank of Patiala v. S.K. Sharma [(1996) 3 SCC 364 : 1996 SCC (L&S) 717] this Court stated that the aforesaid observation should be understood in the context of the facts of that case and in the light of the subsequent Constitution Bench judgment in ECIL v. B. Karunakar [(1993) 4 SCC 727 : 1993 SCC (L&S) 1184 : (1993) 25 ATC 704] and C.B. Gautam v. Union of India [(1993) 1 SCC 78] . This Court observed: (S.K. Sharma case [(1996) 3 SCC 364 : 1996 SCC (L&S) 717] , SCC pp. 385 & 391, paras 28 & 33) “28. The decisions cited above make one thing clear viz. principles of natural justice cannot be reduced to any hard-and-fast formulae. As said in Russell v. Duke of Norfolk [(1949) 1 All ER 109 (CA)] way back in 1949, these principles cannot be put in a straitjacket. Their applicability depends upon the context and the facts and 62 circumstances of each case. (See Mohinder Singh Gill v. Chief Election Commr. [(1978) 1 SCC 405] .) The objective is to ensure a fair hearing, a fair deal, to the person whose rights are going to be affected. *** 33. (6) While applying the rule of audi alteram partem (the primary principle of natural justice) the court/tribunal/authority must always bear in mind the ultimate and overriding objective underlying the said rule viz. to ensure a fair hearing and to ensure that there is no failure of justice. It is this objective which should guide them in applying the rule to varying situations that arise before them.” 19. Ensuring that there is no failure of justice is as important as ensuring that there is a fair hearing before an adverse order is made. This Court in Roshan Deen v. Preeti Lal [(2002) 1 SCC 100 : 2002 SCC (L&S) 97] held: (SCC p. 106, para 12) “12. … Time and again this Court has reminded that the power conferred on the High Court under Articles 226 and 227 of the Constitution is to advance justice and not to thwart it (vide State of U.P. v. District Judge, Unnao [(1984) 2 SCC 673] ). The very purpose of such constitutional powers being conferred on the High Courts is that no man should be subjected to injustice by violating the law. The lookout of the High Court is, therefore, not merely to pick out any error of law through an academic angle but to see whether injustice has resulted on account of any erroneous interpretation of law. If justice became the by-product of an erroneous view of law the High Court is not expected to erase such justice in the name of correcting the error of law.” 63 42. In Jayendra Vishnu Thakur v. State of Maharashtra and another, (2009) 7 SCC 104, the apex Court in paragraph-57 held as follows:- “57. Mr Naphade would submit that the appellant did not suffer any prejudice. We do not agree. Infringement of such a valuable right itself causes prejudice. In S.L. Kapoor v. Jagmohan[ (1980) 4 SCC 379] this Court clearly held: (SCC p. 395, para 24) “24. … In our view the principles of natural justice know of no exclusionary rule dependent on whether it would have made any difference if natural justice had been observed. The non-observance of natural justice is itself prejudice to any man and proof of prejudice independently of proof of denial of natural justice is unnecessary. It ill comes from a person who has denied justice that the person who has been denied justice is not prejudiced.” 43. Natural justice, another name of which is common sense justice, is the name of those principles which constitute the minimum requirement of justice and without adherence to which justice would be a travesty. Natural justice accordingly stands for that “fundamental quality of fairness which being adopted, justice not only be done but also appears to be done”. 64 44. In view of the foregoing factual and legal discussions, it can be safely said that the principle which constitutes the minimum requirement of justice, without adhering there to, would be a travesty. Applying the above settled position of law to the present context, this Court arrives at the conclusion that there was non-compliance of principles of natural justice while passing the orders impugned and, as such, the minimum requirement of principles of natural justice having not been complied with, the issue no.(ii) is answered against opposite parties no.2 to 4-MCL. 45. Issue No.(iii): Whether the impugned action banning petitioner no.1 in both the writ petitions for a period of one year from participating in future tenders of MCL is in conformity with the provisions of law or not? Before delving into this issue, a reference to the chart contained in paragraph-2 of the impugned order dated 29.04.2020 in W.P.(C) No.12475 of 2020 is to be made which reads as under:- 65 Sl No Month Agreed Qty Achieved Qty Total Shortfall Shortfall due to contractor’ s fault (Tonnes) Penalty amount deducted/wit hheld (in Rs) 1. May-18 1518340 220181.64 1298158.36 0 0.00 2. Jun-18 1441800 468066.49 973733.51 3800 23070.00 3. Jul-18 1489860 571877.16 917982.84 4067 27450.00 4. Aug-18 1489860 389727.24 1100132.76 0 0.00 5. Sept-18 1441800 554596.23 997203.77 0 0.00 6. Oct-18 1489860 655147.72 834712.28 8775 65330.00 7. Nov-18 1441800 694042.97 747757.03 1200 9605.00 8. Dec-18 1489860 612881.48 876978.52 25302.5 188377.00 9. Jan-19 1489860 675993.13 813866.87 15000 106410.00 10. Feb-19 1345680 565289.98 780390.02 10000 70940.00 11. Mar-19 1489860 930501.53 559358.47 51500 347573.50 12. Apr-19 1441800 520501.26 921298.74 22700 153202.30 13. May-19 1489860 615869.92 873990.08 6500 43868.50 14. Jun-19 1441800 601453.15 840346.85 19000 128231.00 15. Jul-19 1489860 400324.43 1089535.57 50500 340824.50 16. Aug-19 1489860 269722.74 1220137.26 0 0.00 17. Sept-19 1441800 248773.32 1193026.68 3000 20247.00 18. Oct-19 1489860 456024.96 1033835.04 25500 172100.00 19. Nov-19 1441800 508346.29 933453.71 94537 585184.00 20. Dec-19 1489860 852938.11 636921.89 32500 201175.00 21. Jan-20 1489860 903302.56 586557.44 157412.2 974382.00 22. Feb-20 1393740 980342.76 413397.24 312386.23 4216589.00 23. Mar-20 1489860 1175719.91 314140.09 258234.19 1742823.00 Total 33718540 13871624.98 19846915.02 1101914.12 9417381.80 On the basis of such chart, allegations were made that petitioner no.1 had defaulted since inception, which itself is contrary to the data available on record. It is contended that the allegation that petitioner no.1 has performed only 41.14% pursuant to agreed quantity and solely responsible 66 for the balance shortfall of 58.56% is also contrary to such chart. If consideration will be made to the figures available in the chart, it would be evident that the default due to fault of petitioner no.1 was only 3.27% of the agreed quantity as per the NIT. The impugned order itself indicates that petitioner no.1 has performed only 41.14% of the agreed quantity and is solely responsible for balance 58.56%. But from the chart itself, it would be evident that petitioner no.1 is only responsible for 3.27% and not 58.56% (balance of 41.14%). Such calculation has been arrived at in the additional written notes submitted on behalf of the petitioners which are extracted below:- “11,01,914 tonnes (Shortfall due to Contractor’s fault; column 6) x 100 = 3.27% 3,37,18,540 tonnes (Agreed Quantity; Column 3)” 46. The opposite party-MCL has debarred petitioner no.1, vide impugned order dated 29.04.2020, which is solely based upon the finding that it “…..performed only 41.14% of assigned quantity as per NIT/agreement at Kaniha OCP…….” As such, the said order has been passed 67 on the premise that the entire shortfall of 1,98,46,915 tonnes or 58.56% was attributable to petitioner no.1. More so, the figures stated in the impugned order clearly show that the shortfall on the part of petitioner no.1 is only 3.27%. Thereby, the allegation of performance of only 41.14% of the agreed quantity is an outcome of non- application of mind and, as such, hit by Articles 14 and 19(1)(g) of the Constitution of India. In the additional affidavit filed by opposite parties no.2 to 4, the shortfall against hindrance free quantity has been mentioned as follows:- “Month Monthly Target as per Mutually agreed Time &progress chart (tes) Hindrance free quantity Achievement (Tes) Shortfall quantity (Tes) against the HINDRACE FREE Quantity (due to fault of Contractor Apr-18 28480 0 0 May-18 1489860 220181.64 220181.64 Jun-18 1441800 471866.49 468066.49 3800 Jul-18 1489860 515944.16 571877.16 4067 Aug-18 1489860 389727.24 389727.24 Sept-18 1441800 554596.23 554596.23 Oct-18 1489860 663922.72 655147.72 8775 Nov-18 1441800 695242.97 694042.97 1200 Dec-18 1489860 638183.98 612881.48 15302.5 Jan-19 1489860 690993.13 675993.13 15000 Feb-19 1345680 575289.98 565289.98 10000 March-19 1489860 982001.53 930501.53 51500 April-19 1441800 543201.26 520501.26 22700 68 May-19 1489860 622369.92 615869.92 6500 Jun-19 1441800 620453.15 601453.15 19000 Jul-19 1489860 450824.43 400324.43 50500 Aug-19 1489860 269722.74 269722.74 Sept-19 1441800 251773.32 248773.32 3000 Oct-19 1489860 481524.96 456024.96 25500 Nov-19 1441800 602883.29 508346.29 94537 Dec-19 1489860 885438.11 852938.11 32500 Jan-20 1489860 1060714.16 903302.56 157412.2 Feb-20 1393740 1292728.99 980342.76 312386.23 March-20 1489860 1433954.1 1175719.91 258234.19 Total- 33718540 14973539.1 13871624.98 1101914.12 Total shortfall 41.14 Achieved against Hindrance free qtnty 92.64 Shortfall by contractor from Hindrance free quantity 7.36” 47. On perusal of the aforesaid chart, where the shortfall against hindrance free quantity has been prescribed, it would be seen that opposite parties have provided hindrance free site of only 1,49,73,539 tonnes, out of agreed quantity of 3,37,18,540 tonnes, i.e., hindrance free site to the tune of only 44.4%. Such calculation has been arrived at in the additional written notes submitted on behalf of the petitioners which is extracted below:- “1,49,73,539 tonnes (Hindrance free quantity; column 3) x 100 = 44.4% 3,37,18,540 tonnes (Agreed Quantity; Column 1)” 69 48. In view of such calculation, when MCL itself could make available only 44.4% of the agreed quantity of work for removal, the question of deployment of entire fleet for removal of the total agreed quantity is irrelevant. It is also contended in the additional affidavit that the opposite parties have already deducted penalty of Rs.94,17,381/- towards shortfall of 11,01,914,12 tonnes or 3.27% of the assigned target. As such, when penalty for shortfall in performance has already been levied by the opposite parties, imposition of further punishment of debarment amounts to double jeopardy. 49. In Union of India v. P.D. Yadav, (2002) 1 SCC 405, the apex Court held that the ‘doctrine of double jeopardy’ is a protection against prosecution twice for the same offence. 50. Clause-9.2 of the agreement between the parties provides that “the contractor whose contract is terminated shall not be allowed to participate in future bidding for period of minimum twelve months.” Therefore, debarring 70 petitioner no.1 from participating in the future tenders of MCL for a period of one year squarely falls under the stipulation of clause-9.2. It is undisputed that petitioner no.1 is still working at the Kaniha OCP and, as such, the agreement between the parties has not been terminated. Therefore, the pre-condition for banning petitioner no.1 having not been satisfied, the order impugned is de hors the agreement between the parties. The order of banning, being arbitrary and unjust, can be subjected to judicial review before the writ Court exercising powers under Article 226 of Constitution of India. 51. In Medipol Pharmaceutical India Pvt. Ltd. mentioned supra, the apex Court in paragraph-19 held as follows:- “19. Even the second facet of the scrutiny which the blacklisting order must suffer is no longer res integra. The decisions of this Court in Radhakrishna Agarwal v. State of Bihar [(1977) 3 SCC 457 : (1977) 3 SCR 249] ; E.P. Royappa v. State of T.N. [(1974) 4 SCC 3 : 1974 SCC (L&S) 165] ; Maneka Gandhi v. Union of India [(1978) 1 SCC 248] ; Ajay Hasia v. Khalid Mujib Sehravardi [(1981) 1 SCC 722 : 1981 SCC (L&S) 258] ; Ramana Dayaram Shetty v. International Airport Authority of India [(1979) 3 SCC 489] and Dwarkadas 71 Marfatia and Sons v. Port of Bombay [(1989) 3 SCC 293] have ruled against arbitrariness and discrimination in every matter that is subject to judicial review before a writ court exercising powers under Article 226 or Article 32 of the Constitution.” 52. A contention was raised by the opposite parties that the order impugned dated 29.04.2020 has been passed exclusively under the power available to the management of MCL under clause-6.2 of the General Terms and Conditions (GTC) read with clause-9 of the undertaking submitted by petitioner no.1 along with the bid. The undertaking annexed as Annexure-V to the Pre- Contract Integrity Pact is meant for consideration of the documents at the time of submission of bid and, as such, the language implied in clause-9 clearly indicates that if any information and document submitted is found to be false/incorrect at any time, department may cancel the bid and action as deemed fit may be taken against the bidder, including termination of the contract, forfeiture of all dues including, earnest money and banning/delisting of the firm and all partners of the firm etc. The order impugned 72 does not reflect that any of the documents filed by petitioner no.1 was found to be false or incorrect, rather the information which has been furnished by way of chart, is a creation of the opposite parties. Therefore, banning petitioner no.1 for a period of twelve months invoking clause-9 of the undertaking is absolutely misconceived one and, as such, the said undertaking is required for the bidder at the time of bidding. More so, if at all clause-9 is to apply, then the authority has to come to a conclusion that the information and documents submitted are found to be false or incorrect. But nothing to that effect has been placed on record, especially in the counter affidavit filed on behalf of the opposite party-MCL. However, in the additional counter affidavit filed by the opposite party- MCL, a new case has been made out contrary to impugned order and the earlier counter affidavit filed by them and, as such, tried to justify the action taken by the authority concerned in passing the order impugned. The reasons so assigned subsequently in the additional counter affidavit justifying the impugned order cannot be taken into 73 consideration, in view of the law laid down by the apex Court in Mohindor Singh Gill mentioned supra, which has been referred to in Shree Ganesh Construction v. State of Orissa, 2016 (II) OLR 237, in paragraphs 7 and 8 this Court held as follows:- “7. In the counter affidavit filed, the reasons have been assigned, which are not available in the impugned order of cancellation filed before this Court in Annexure-4 dated 5.2.2016. More so, while cancelling the tender, the principles of natural justice have not been complied with. It is well settled principle of law laid down by the Apex Court in Mohinder Singh Gill and another v. The Chief Election Commissioner, New Delhi and others, AIR 1978 SC 851 that : “When a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise an order bad in the beginning may by the time it comes to Court on account of a challenge, get validated by additional grounds later brought out.” 8. In Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16, the Apex Court held as follows : “Public orders publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, 74 or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the acting and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. Orders are not like old wine becoming better as they grow older.” Similar view has also been taken by the apex Court in Bhikubhai Vitlabhai Patel v. State of Gujurat, (2008) 4 SCC 144. 53. On perusal of the impugned order, it appears that petitioner no.1 was not allowed to do the sanctioned quantity of work for the default of MCL, which is evident from the following chart:- Total Agreed Quantity Achieved Quantity Total Shortfall Shortfall due to Petitioners’ fault Shortfall due to fault of Opposite Parties In tonnes 3,37,18,540 1,38,71,625 1,98,46,915 11,01,914 1,87,45,000 As a percentage 100% 41.14% 58.86% 3.27% 55.59% 75 Ratio of shortfall attributed to Opposite Parties : shortfall attributed to Petitioners 94.45% : 5.55% As it appears from the impugned order, allegations have been made that petitioner no.1 has not deployed adequate equipment as per NIT, but the same is not correct, rather the calculation arrived at by the MCL clearly indicates that petitioner no.1 has deployed adequate equipment to cater to hindrance free work made available by MCL at Kaniha OCP and, as such, petitioner no.1 has defaulted only 3.27%, which itself shows that adequate equipments had been deployed by it at the site. Since the quantity of hindrance free work provided by the opposite party-MCL reduced substantially, the issue of reduced deployment of equipment becomes irrelevant. 54. While entertaining this writ petition, this Court passed interim order on 04.06.2020 to the following effect:- “We have heard Mr. Ashok Parija, learned Senior Counsel appearing along with Mr. S.P. Sarangi, learned counsel for the petitioners and Mr. 76 Debraj Mohanty, learned counsel for the respondents on the prayer for interim relief. Mr. Ashok Parija, learned Senior Counsel submitted that even from the impugned order Anenxure-10 dated 29.04.2010, by which the petitioner-company has been banned from participating in future tenders of the respondents for one year, it would appear that out of total shortfall of 19846915.02 MT, which is approximately 58% of the total agreed quantity, the shortfall due to contractor’s fault has been found to be only 1101914.12 MT, which constitutes mere 3.27% of the total shortfall. The conclusion recorded by the opposite party in the impugned order that the petitioner-company has been consistently rendering poor performance from the beginning of the contract, is also not substantiated from their own order, which is evident from para 2 of the impugned order showing that as against agreed quantity of 33718540MT, the maximum of the total shortfall i.e. 13871624 MT, constituting approximately 55% was attributable to the opposite parties themselves as against negligible quantity of 1101914 MT of that (3.27%) to the petitioner- company. As regards the allegation, that the petitioner-company has not deployed sufficient equipment as specified in NIT, learned Senior Counsel submitted that this too is an unfounded statement, because the petitioner-company could achieve 42% of the agreed quantity only because it deployed the equipments required for that much quantity. When the remaining shortfall of approximately 58% of total agreed quantity, was attributable to the opposite parties, it cannot be said that it could not be achieved because of lack of equipment. The petitioner-company, apart from the present contract, is also satisfactorily executing five other contracts with opposite party no.2. It is submitted that the opposite parties are floating new tenders on 10th, 11th and 16th of June of 2020. The impugned order has been passed without due application of mind despite all these aspects explained in details by the petitioner-company in their reply to show cause notice. Debarment for one year on touchstone of Wednesbury’s principles of unreasonableness is on given facts wholly 77 disproportionate. It would cause grave prejudice to petitioner-company if it is not allowed to participate in these three tenders and remedy of arbitration cannot undo that wrong. Mr. Debraj Mohanty, learned counsel for the opposite parties submitted that the petitioner- company failed to achieve the target of agreed quantity despite several letters addressed to it and because of its poor performance the opposite party department has suffered enormous loss. The petitioner-company was duly given show cause notice, its reply was considered and thereafter the impugned order of debarment of one year has been passed. It is argued that the petitioner has alternative efficacious remedy of arbitration as per Clause 13A of the General Terms of the Contract. In response to the query of the Court to explain the statement contained in the impugned order that as against total shortfall of 19846915.02 MT (58% of the total agreed quantity), when only 1101914.12, (3.27%) of the total quantity is attributed to the petitioner- company, and the maximum quantity of shortfall is attributable to the petitioner-company, how can it be held consistently performing poor in respect of the period from May-2018 till March-2020, even going by month-wise datas, the learned counsel for the opposite parties could not give any satisfactory answer. Taking into consideration the rival submissions and the materials on record, we are inclined to hold that in view of what has been mentioned in the impugned order itself, the petitioner has been able to make out a prima facie case for grant of appropriate interim relief. In order however to balance equities in the facts of the case, we direct that the impugned order shall remain stayed to the limited extent qua only three tenders which are going to be floated on 10th, 11th and 16th June, 2020, to allow the petitioner-company to participate therein with a further direction that the opposite parties shall be free to open the bid and if any other bidder is found to be L-1 in respect of all or any of the three bids, the opposite parties may award contract to it/them. In case however the petitioner is not found to be L-1 in any one of them, 78 the contract may not be awarded to it, subject to any further order that may be passed by this Court. Considering the fact that the order of debarment has been passed for one year, matter deserves to be heard and disposed of finally at an early date. The writ petition is therefore ordered to be listed on 3rd July, 2020 for final disposal. The parties are required to submit their written argument with supporting case laws on or before 3rd July, 2020. The matter to come up for final argument on 3rd July, 2020.” When interim order dated 04.06.2020, which was passed after hearing learned counsel for the parties, was in operation, opposite party-MCL sent the e-mail dated 08.06.2020 that debarment of petitioner no.1 from participating in the tenders of MCL had been revoked. Vide e-mail dated 06.07.2020, opposite party no.2 again debarred petitioner no.1 from participating in tenders of MCL and, as such, the subsequent order dated 06.07.2020 was passed without complying the principles of natural justice. 55. In the additional counter affidavit filed on 03.07.2020, opposite parties no.2 to 4 in paragraph-5 have stated as follows:- 79 “5. That the deponent most humbly and respectfully submits that except 04 months out of the total 23 months till March 2020, during the execution of the work, the petitioners have not executed l00% of the mutually agreed hindrance free quantity which ultimately causes loss to the management of MCL to a tune of Rs.66 crores, & Rs. 13 crores to the state and Central Govt. in form of ROYALTY. The quantum of loss to MCL, State exchequer and Central Govt. is shown below: Shortfall Quantity 1101914.12 Profit on coal @ 598.96 per tone Rs.660002481.32 Basic price of Coal @ 842.64 per Tone Royalty @ t4% on Basic price Rs.129992367.97 Loss to MCL Rs.660002481.32 (Around 66 Crores) Loss to Govt. Rs.129992367.97 (Around 13 Crores) xxx xxx xxx” On perusal of the facts mentioned in the impugned order dated 29.04.2020 read with additional affidavit dated 03.07.2020, it is clearly discernible that the impugned banning order has been passed primarily due to losses suffered by MCL on account of which the production capacity of MCL was severely impaired. It is not the petitioner no.1 but the MCL which is responsible for impairing the production capacity, since MCL is responsible for more than 94% of the total shortfall (or 80 55.6% of the total targeted quantity). Banning of petitioner no.1 as a consequence of shortfall of only 3.27% in performance, as is evident from the impugned order, can be construed to be unreasonable and wholly disproportionate to the findings. Even if the contention raised in the additional affidavit dated 03.07.2020 would be taken into consideration, the shortfall in performance was only 4.36% and, as such, on that score also banning of petitioner no.1 can be construed to be unreasonable. Even though the right of petitioner no.1 is in the nature of a contractual right, the manner in which the impugned decision has been taken by the MCL, which is a State within the meaning of Article 12 of the Constitution, is subject to judicial review on the touchstone of fairness, relevance, natural justice, non-discrimination, equality and proportionality. 56. In Kulja Industries Limited (supra), the apex Court held in paragraphs 17, 18, 19 and 20 as follows:- “17. That apart, the power to blacklist a contractor whether the contract be for supply of material or equipment or for the execution of any other work 81 whatsoever is in our opinion inherent in the party allotting the contract. There is no need for any such power being specifically conferred by statute or reserved by contractor. That is because “blacklisting” simply signifies a business decision by which the party affected by the breach decides not to enter into any contractual relationship with the party committing the breach. Between two private parties the right to take any such decision is absolute and untrammelled by any constraints whatsoever. The freedom to contract or not to contract is unqualified in the case of private parties. But any such decision is subject to judicial review when the same is taken by the State or any of its instrumentalities. This implies that any such decision will be open to scrutiny not only on the touchstone of the principles of natural justice but also on the doctrine of proportionality. A fair hearing to the party being blacklisted thus becomes an essential precondition for a proper exercise of the power and a valid order of blacklisting made pursuant thereto. The order itself being reasonable, fair and proportionate to the gravity of the offence is similarly examinable by a writ court. 18. The legal position on the subject is settled by a long line of decisions rendered by this Court starting with Erusian Equipment & Chemicals Ltd. v. State of W.B. [(1975) 1 SCC 70] where this Court declared that blacklisting has the effect of preventing a person from entering into lawful relationship with the Government for purposes of gains and that the authority passing any such order was required to give a fair hearing before passing an order blacklisting a certain entity. This Court observed: (SCC p. 75, para 20) “20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains. The fact that a disability is created by the order of blacklisting indicates that the relevant authority is to have an objective satisfaction. Fundamentals of fair play require that the person concerned should be given an 82 opportunity to represent his case before he is put on the blacklist.” Subsequent decisions of this Court in Southern Painters v. Fertilizers & Chemicals Travancore Ltd. [1994 Supp (2) SCC 699 : AIR 1994 SC 1277] ; Patel Engg. Ltd. v. Union of India [(2012) 11 SCC 257 : (2013) 1 SCC (Civ) 445] ; B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd. [(2006) 11 SCC 548] ; Joseph Vilangandan v. Executive Engineer (PWD) [(1978) 3 SCC 36] among others have followed the ratio of that decision and applied the principle of audi alteram partem to the process that may eventually culminate in the blacklisting of a contractor. 19. Even the second facet of the scrutiny which the blacklisting order must suffer is no longer res integra. The decisions of this Court in Radhakrishna Agarwal v. State of Bihar [(1977) 3 SCC 457 : (1977) 3 SCR 249] ; E.P. Royappa v. State of T.N. [(1974) 4 SCC 3 : 1974 SCC (L&S) 165] ; Maneka Gandhi v. Union of India [(1978) 1 SCC 248] ; Ajay Hasia v. Khalid Mujib Sehravardi [(1981) 1 SCC 722 : 1981 SCC (L&S) 258] ; Ramana Dayaram Shetty v. International Airport Authority of India [(1979) 3 SCC 489] and Dwarkadas Marfatia and Sons v. Port of Bombay [(1989) 3 SCC 293] have ruled against arbitrariness and discrimination in every matter that is subject to judicial review before a writ court exercising powers under Article 226 or Article 32 of the Constitution. 20. It is also well settled that even though the right of the writ petitioner is in the nature of a contractual right, the manner, the method and the motive behind the decision of the authority whether or not to enter into a contract is subject to judicial review on the touchstone of fairness, relevance, natural justice, non-discrimination, equality and proportionality. All these considerations that go to determine whether the action is sustainable in law have been sanctified by judicial pronouncements of this Court and are of seminal importance in a system that is committed to the rule of law. We do 83 not consider it necessary to burden this judgment by a copious reference to the decisions on the subject. A reference to the following passage from the decision of this Court in Mahabir Auto Stores v. Indian Oil Corpn. [(1990) 3 SCC 752] should, in our view, suffice: (SCC pp. 760-61, para 12) “12. It is well settled that every action of the State or an instrumentality of the State in exercise of its executive power, must be informed by reason. In appropriate cases, actions uninformed by reason may be questioned as arbitrary in proceedings under Article 226 or Article 32 of the Constitution. Reliance in this connection may be placed on the observations of this Court in Radhakrishna Agarwal v. State of Bihar [(1977) 3 SCC 457 : (1977) 3 SCR 249] . … In case any right conferred on the citizens which is sought to be interfered, such action is subject to Article 14 of the Constitution, and must be reasonable and can be taken only upon lawful and relevant grounds of public interest. Where there is arbitrariness in State action of this type of entering or not entering into contracts, Article 14 springs up and judicial review strikes such an action down. Every action of the State executive authority must be subject to rule of law and must be informed by reason. So, whatever be the activity of the public authority, in such monopoly or semi-monopoly dealings, it should meet the test of Article 14 of the Constitution. If a governmental action even in the matters of entering or not entering into contracts, fails to satisfy the test of reasonableness, the same would be unreasonable. … It appears to us that rule of reason and rule against arbitrariness and discrimination, rules of fair play and natural justice are part of the rule of law applicable in situation or action by State instrumentality in dealing with citizens in a situation like the present one. Even though the rights of the citizens are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into a contract, are subject to judicial review on 84 the touchstone of relevance and reasonableness, fair play, natural justice, equality and non-discrimination in the type of the transactions and nature of the dealing as in the present case.” 57. In Sanjay Kumar Sukla (Supra), on which reliance was placed by the opposite party-MCL, the apex Court held that in a contractual matter, while exercising the power under judicial review, the Court should be vigilant against agitation of private disputes under writ jurisdiction when there is no improper exercise of power on the part of public authority concerned and as such, caution to be exercised while exercising extraordinary jurisdiction in contractual matters since serious consequences entail as result of entertainment of writ petition. This principle, as set out by the apex Court, is in dispute. But on the basis of the facts and circumstances of the instant case, the judgment in question cited by opposite parties no. 2 to 4 may not have any application, particularly when petitioner no.1, even after passing the banning order, has been allowed to discharge its contractual obligation by allowing it to perform the 85 contract with the opposite party-MCL in its interest and also in the interest of the State for augmentation of revenue. 58. Reliance was also placed on behalf of the opposite party-MCL on Dhansar Engineering Company Private Limited (supra), which was decided by the apex Court on the basis of the facts of that case, and the factual matrix of that case is different from that of the present one. 59. In view of such position, the order dated 29.04.2020, which has been marked as Annexure-10 to W.P.(C) No. 12745 of 2020, and order dated 07.05.2020, which has been marked as Annexure-15 to W.P.(C) No. 14114 of 2020, cannot sustain in the eye of law. The issue no.(iii) is answered accordingly. 60. In view of answers given hereinbefore to all the issues framed and by applying the same to the factual matrix of W.P.(C) No. 14114 of 2020, the order dated 29.04.2020 in Annexure-10 to W.P.(C) No. 12745 of 2020 86 and order dated 07.05.2020 in Annexure-15 to W.P.(C) No. 14114 of 2020 are liable to quashed and hereby quashed. In the result, both the writ petitions are allowed. No order to costs. As lock-down period is continuing for COVID- 19, learned counsel for the parties may utilize the soft copy of this judgment available in the High Court’s official website or print out thereof at par with certified copies in the manner prescribed vide Court’s Notice No.4587 dated 25.03.2020. (DR. B.R. SARANGI) (MOHAMMAD RAFIQ) JUDGE CHIEF JUSTICE G.D.Samal, APS/ A.K. Sethy, P.A./ A.K.J. Mohapatra, P.A./ A.K. Rana,Sr.Steno. "