M/s Prashant Poultry Private Limited v. State of Telangna

Order

This Writ Petition is hled seeking the following reliel "... declaring the action of the respondents, pa.rticularly respondent No.2 in issuing the proceedings bearing No.4879 / SNP-3/ 2024, dated 28.03.2025, by blacklisting the poultry firm of the petitioner i.e., M/s.Prashant poultry private Limited with immediate effect as being illegal, arbitrary, contrary to 1aw, violative of principles of natural justrce, withouL notrce and set aside the same and consequcntly direct respondents to rcceive and process the same as per the tender uploaded on the website of the respondent department dated 30.03.2025, inviting onirnc tenders for State Level Zonal Tender for procurement and suppll of Eggs (hen) as per the AGMARK specihcations and other processlng/grading conditions as rnentioned in the tender for a period of one year (April 2025 March, 2026) ro the beneficiaries under the flagship of Aro$/a Lakshmr and Supplementary Nutrition program for Zone,l,2,3, 4, 5,6 & 7, approve the tender subJect to tcrms oI tender conditions as per law .. _."

2l Heard Mr. E. Madan Mohan Rao, learned senior counsel, representing Sri M. Srinivas, learned counsel for the petitioner, and Iearned Advocate General appearing for the respondents. 3) l,earned senior counsel appearing for the petitioner has submitted that the petitioner has participated in State Level Zonal Tender for Procurement and Supply of trggs (Hen) along with other tenderers in the month of November, 2022 and tender has been approved in favour of the petitioner Company for a period of 2 years for Zone-6 (Charminar Zone). \ ( 2 PK, J W.P No.1lO34 of 2O2S Accordingly, r(spondcnts 2 and 3 entered into an agreement on

07.O2.2O23 witlr petitioner- Company for supply of eggs, as per the terms of the agreemcr t, lor a period of two years commencing from 01.03.2023 in the Districts of Medchal Malkajgiri, Ranga Reddv, Sangareddy and Vikarabad in 7,,>r'Lc-Vl Charminar. In pursuancc ther.of. the petitioner Company has t:cen suppll,ing the eggs as per the ternrs and conditions of thc agreemc rt without any delay. Lcarned senicr counsel lurthcr submitted that inspite of the petitioner Company nurjnraining quality and qr,rantitr'. llte rcspondcnts havc started issuing _.hou.causc notices to the petitiont'r Company from the bcginning itsetf, u,ith malafide inlention ald lor cxtraneous reasons, complainiug that the cggs supplied arc dclaveri and delivered at late hours anrl not in u,orking hours and that Lhe cggs are rotten and thc eggs are bcing suppliecl in the month end leading to THR distribution and the suppll, of quantity was 89%o instc:rd of 100,2,, though the petitioncr supplied as per rhc terms and condiLior-rs of the agreemcnt. 3 1) Learned s':nior counscl has further contended t,1at on one hand the respondents, continued to issue notices and on the othcr they receir,ed the supplies, till the end of expiry of contrr,lt by the end of February, 2025. Further, in spile receiving thc su1>ply, bills are not being paid and nearll'five months payment is duc fronr the Government. I 3 PK, J w.P.No.11O34 of 2025 While so, during first week of April, 2025, the petitioner was issued with the impugned proceedings dated 29.03.2025 referring to show cause notices earlier issued to the petitioner and stating that the petitioner lailed lo submit explanation to the said notices. Learned senior counsel has vehemently contended that vide impug-ned proceedings, the respondents have blacklisted the petitioner Company with immediate effect and barred from participating in the fu ture contracts, tenders, procurement proccss and immedialely on 30.03.2025 a fresh notiiication calling for tenders for the year 2025,2026 has been issued, in order to give contract to other tenderers matafidely and further without any notice proposing to blacklist, the impugned proceedings dated 28.03.2O25 are issued by respondent No.2, arbitrarily and in colourable exercise of power alrd contrary to the agreement. Further, during the period of agreement dated 07.02.2023, despite issuance of show cause notices, no action r,vas taken for either termination or imposition of penalty, as provided in paragraph V of the agreement.

3.2) Learned senior counsel has further contended that in the show cause notices, it was alleged about defauit in supply, delay, Iess quantity, smell, etc., but in none of the show cause notices, there was ally mention of threat of blacklisting not only to the petitioner but also to other contractors in other zones and said show cause notices were t. \ 4 PK, J W.l'No.11034 of 2O2S issued only f.r statistical purpose. Learned senior counsel further contended tha though similar show cause notices rvt:re issued to seven othcr approve( contractors of notification l2.Og.2O.ltl, but no actlon is takcn to blacktist erny of them but the petitioner al tne u,as blacklisted inspite of rec(iving supplies from the petitioner .i[ thc end of the contract anrl the same amounts to discrimination and lavoritism and therefore praye cl this Court to set aside the impugned order. Rcliance has been plirce d .n M ls.Et'usian Equipment q.nd. chemicats Ltd.. a. State of West Bengalt, Raghunath Thakur u. Stolte oJ Bihar2 and Gorkha Securitg Serpices v. Govt. Of NCT oJ Delhit. 4) Per colttr:r. the learned Advocate General has submitted that as thc pctitioncr uas I_l bidcler under the State-Levcl Z,,al .li:nder floated in Novcmber, 20 2,),, he u,as awarded the contract in Zor-te_(t lor supply of eggs (hen) su bj r,ct to compliance of tender terms. H owever, iLs bid for Zonc-7 wats rejectcd due to non_fulhllment of eligibilir_y. conclitions. The petitioner, ha|ing voluntarily executed the .rgrecment, dated 07.O2.2O23, rs rbidt: by the terms relating to suppl.r, grading, quality and delivery, rnclucri,g clause-V(7) thereof, which deals rvith Bracklisting and clause-Xl l,,hich deals with arbitration. Several complaints were ORDER WP.No.11034 of 2025 PARTLY ALLOWING THE WRIT PETITION, WITHOUT COSTS -.., ^-;,5 ill/ Lr' $