The High Court · 2024
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI (Civil Writ Jurisdiction) W.P(C) No. 5470 of 2023 Rudra Enterprises, a Proprietorship Firm having its office at Court Road, P.O. & P.S.-Deoghar, District- Deoghar being represented through its sole Proprietor namely Swapna Gupta, Aged about 45 years, wife of Sri Anand Kumar, Resident of Court Road in front of Nagar Nigam Office, P.O. & P.S. Deoghar, District- Deoghar. … … Petitioner 1. State of Jharkhand. Versus 2. Deputy Commissioner-cum-District Magistrate, Deoghar, P.O. & P.S. Deoghar, District- Deoghar. 3. District Public Relation Officer, Deoghar, P.O. & P.S. Deoghar, District- Deoghar. 4. Circle Officer, Devipur, P.O. & P.S. Devipur, District- Deoghar. … … Respondents ----- CORAM: HON’BLE THE ACTING CHIEF JUSTICE
Legal Reasoning
In the said writ proceeding, this Court interfered with the order dated 5th April 2023 and directed the Deputy Commissioner at Deoghar to pass a fresh order keeping in mind that no serious misdemeanour was committed by the petitioner-Enterprise. Consequent upon the direction by the writ Court, the Deputy Commissioner passed an order on 11th September 2023 putting the petitioner-Enterprise under blacklist for two years. 4. Mr. Atanu Banerjee, the learned counsel for the petitioner- Enterprise referred to the observation in W.P(C) No.2074 of 2023 to submit that the order of blacklisting of the petitioner-Enterprise for two years is onerous. On the other hand, Ms. Surabhi, the learned State counsel would submit that the quantum of punishment shall fall within the exclusive domain of the employer and unless it is demonstrated that the punishment so awarded is outrageous to the reasons the writ Court shall not interfere with the order of punishment. 5. The petitioner-Enterprise is operated by a woman entrepreneur. The total value of the subject contract was Rs.1,300/- for affixing one flex on the hoardings. The observation made by this Court in W.P(C) No. 2074 of 2023 that the nature of misdemeanour committed by the petitioner- Enterprise was not serious in nature is not contested by the State. This also needs a mention that the action taken by the respondent-Authority against the petitioner-Enterprise demonstrates hot-haste inasmuch as only three days’ time was granted to it when a show-cause notice was issued on 9th March 2023. On the second occasion, the respondent-Authority seems not to have even considered the explanation offered by the petitioner-Enterprise. 6. The writ Court exercising the powers under Article 226 of the Constitution of India cannot remain indifferent to the aforementioned aspects of the case. The respondent-Authority seems to have passed an order of blacklisting of the petitioner-Enterprise for two years overlooking the 2 W.P(C) No. 5470 of 2023 serious financial and civil consequences that shall visit the petitioner- Enterprise. The order of blacklisting dated 11th September 2023 has its effect from 5th April 2023 and now one year has passed since then. 7. In “Mahabir Auto Stores v. Indian Oil Corporation” (1990) 3 SCC 752 the Hon’ble Supreme Court held as under: “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 Radha Krishna Agarwal v. State of Bihar [(1977) 3 SCC 457] . It appears to us, at the outset, that in the facts and circumstances of the case, the respondent company IOC is an organ of the State or an instrumentality of the State as contemplated under Article 12 of the Constitution. The State acts in its executive power under Article 298 of the Constitution in entering or not entering in contracts with individual parties. Article 14 of the Constitution would be applicable to those exercises of power. Therefore, the action of State organ under Article 14 can be checked. See Radha Krishna Agarwal v. State of Bihar [(1977) 3 SCC 457] at p. 462, but Article 14 of the Constitution cannot and has not been construed as a charter for judicial review of State action after the contract has been entered into, to call upon the State to account for its actions in its manifold activities by stating reasons for such actions. In a situation of this nature certain activities of the respondent company which constituted State under Article 12 of the Constitution may be in certain circumstances subject to Article 14 of the Constitution in entering or not entering into contracts and must be reasonable and taken only upon lawful and relevant consideration; it depends upon facts and circumstances of a particular transaction whether hearing is necessary and reasons have to be stated. 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. In this connection reference may be made to E.P. Royappa v. State of Tamil Nadu [(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] , R.D. Shetty v. International Airport Authority of India [(1979) 3 SCC 489] and also Dwarkadas Marfatia and Sons v. Board of Trustees of the Port of Bombay [(1989) 3 SCC 293] . It appears to us that rule of reason and rule against arbitrariness and discrimination, rules of fair play and natural 3 W.P(C) No. 5470 of 2023 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 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.” 8. Having regard to the aforesaid facts and circumstances, the order dated 11th September 2023 is quashed. 9. W.P(C) No. 5470 of 2023 is allowed. (Shree Chandrashekhar, A.C.J.) (Navneet Kumar, J.) Sudhir/Vedanti 4 W.P(C) No. 5470 of 2023
Arguments
HON’BLE MR. JUSTICE NAVNEET KUMAR For the Petitioner For the State of Jharkhand -------- : Mr. Atanu Banerjee, Advocate Mr. Suman Kr. Ghosh, Advocate : Ms. Surabhi, AC to AAG II -------- 29th April 2024 Per, Shree Chandrashekhar, A.C.J. Rudra Enterprises is aggrieved by the order of blacklisting dated 11th September 2023. 2. Briefly stated, the petitioner-Enterprise was awarded the work of flex printing, affixing flexes on hoardings, manufacturing temporary hoardings and flex framing/repairing etc., pursuant to NIT dated 14th June 2022. On award of the work order dated 5th March 2023 for putting up flexes over old hoardings in ten blocks of Deoghar district, the petitioner- Enterprise started execution of the work and, as a proof thereof, took photographs with the geographical reference as per GPS latitude and longitude with Decimals and DMS references. The petitioner-Enterprise states that it uploaded and shared those photographs on 6th March 2023 on designated WhatsApp No. 9470128287. However, on an allegation that it had failed to put up flexes in the office complex of Circle-cum-Block Office at Devipur, a show-cause notice was issued to it on 9th March 2023 which remained unresponded. Consequently, the order of termination of the contract was issued on 11th March 2023 which was put to challenge in W.P(C) No. 2074 of 2023. 3.