1 2025:CGHC:15533 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 2045 of 2019 1 - DCM Shriram Limited (Its Unit M/s. Shriram Fertilizers And Chemicals) Having Its Office At Kirti Mahal Building, 4th Floor, 19, Rajendra Place, New Delhi 110008 And Having Its Registered Office At, 5th Floor, Kanchanjunga Building, 18 Barakhamba Road, New Delhi- 110001, Through Its Constituted Attorney Mr. Amarendra Kumar Rakesh (General Manager, Legal) ITS UNITS: 1. M/s Shriram Bioseed Genetics, United Agro Agency, Plot No. 4, Soni Vihar, Hirapur Road, Mahiba Bazar, Raipur., 2. M/s Shriram Fertilizers And Chemicals P-18, Kavita Nagar, Avanti Vihar Road, Raipur., District : Raipur, Chhattisgarh. ... Petitioner Versus 1 - The Managing Director C.G. Rajya Beej Evam Krishi Vikas Nigam Ltd., Raipur Chhattisgarh, District : Raipur, Chhattisgarh 2 - State Of Chhattisgarh Through Its Secretary, Department Of Agriculture, Secretariat Building, Raipur Chhattisgarh, District : Raipur, Chhattisgarh. ---- Respondents For Petitioner : Shri Manoj Paranjpe, Advocate. For Respondent No.1 : Shri Vinod Tiwari, Advocate. For Respondent/State : Shri Lav Sharma, P.L. Hon'ble Shri Justice Rakesh Mohan Pandey Order on Board 02.04.2025 Digitally signed by SMT NIRMALA RAO Date: 2025.04.08 10:57:42 +0530 -2- 1. Heard on admission. 2. The petitioner has filed this petition seeking the following relief(s):- “10.1 Call for the entire records pertaining to this case for perusal of this Hon'ble Court. 10.2 Quash the order no. H.O/CGBKBVN/RCO-53/ 2015- 16/2408 dated 05/07/2016 passed by the Respondent No.1. A Copy of order dated 05/07/2016 is filed herewith as ANNEXURE P-1. 10.3 Grant any other relief/order or direction, as this Hon'ble Court may deem fit and proper under the facts and in the circumstance of the case and in the interest of justice, along with cost of the proceedings.” 3. Learned counsel for the petitioner would submit that a rate contract was offered by respondent No.1 for the supply of hybrid paddy seeds for the year 2015-16. The petitioner participated in the said online rate contract offer and was declared a successful bidder. An agreement was entered into between the petitioner and respondent No.1 on 22.5.2015 & 28.5.2015. An objection was raised by the Auditor General stating that two sister concerns of the petitioner had participated in the same rate contract and there was a collusion. Consequently, respondent No.1 issued a show- cause notice to the petitioner, showing intention to pass an order of black-listing. The petitioner filed a reply and denied the contents of the show-cause notice. Thereafter, respondent No.1, vide order 3 dated 5.7.2016 black-listed the petitioner and its subsidiary companies for a period of five years. The authority concerned further observed that for future offers, the petitioner and its subsidiary companies would not be competent to participate. In para C of the impugned order, the authority also directed the cancellation of other contracts of the petitioner and its subsidiary companies and passed an order for recovery. 4. Learned counsel for the petitioner would submit that the order passed by respondent No.1 to the extent of black-listing, may be treated proper. He would further that the specified period of five years has already elapsed. He would contend that respondent No.1 has permanently debarred the petitioner and its subsidiary companies from participating in any bids. He would further contend that there were no allegations against the subsidiary companies of the petitioner but the order of recovery has been passed, and a direction has been issued to cancel all existing contracts. He would also contend that no notice was served on the sister concern of the petitioner and no opportunity was afforded. Thus, he would pray to quash the order dated 5.7.2016. 5. Learned counsel for the petitioner has placed reliance on the judgment passed by the Hon’ble Supreme Court in the matter of State of Odisha and Others vs. Panda Infraproject Limited and other connected case, reported in (2022) 4 SCC 393 and the judgment of the Coordinate Bench of this Court rendered in the -4- matter of M/s. Beejo Sheetal Seeds Pvt. Ltd., vs. Chhattisgarh Rajya Beej Avam Krishi Vikas Nigam Limited and Anr. in WP(C) No.1788 of 2019. 6. On the other hand, learned counsel for respondent No.1 would oppose the submissions made by Mr. Paranjpe. He would submit that there were serious allegations against the petitioner and its subsidiaries. He would contend that sufficient opportunity was afforded to the petitioner. He would also contend that the petitioner filed a reply to the show-cause notice and thereafter, a decision was taken by the Competent Authority. He would admit the fact that the period of five years has already passed from the date of the order. With regard to other penalties imposed on the petitioner, he would contend that looking to the conduct of the petitioner, those orders were passed by the authority concerned. 7. Learned counsel for the State would support the contention made by counsel for respondent No.1. 8. Heard learned counsel appearing for the respective parties and perused the documents present on the record. 9. A perusal of the show-cause notice dated 2.4.2016 would show that the explanation was sought from the petitioner with regard to the imposition of penalty of blacklisting on account of collusive bidding. No allegations were made against the subsidiary companies of the petitioner, and notices were not issued to them. 5 The order impugned would show that the petitioner/Company was blacklisted for a period of five years. Furthermore, the observation that the petitioner and its subsidiary companies would not be competent to participate in further offers appears to be erroneous, as no notice regarding the imposition of such a penalty was served to the petitioner. In para C of the impugned order, respondent No.1 canceled the contracts awarded to the subsidiary companies of the petitioner without affording them the opportunity of hearing and also passed an order for recovery, which appears to be unreasonable, unfair and violative of the principles of natural justice. 10. The Hon’ble Supreme Court, in the matter of Panda Infraproject Limited (supra), while dealing with a similar issue in paras 26, 28 & 29 held as follows:- “26. In Kulja Industries Ltd. v. Western Telecom Project BSNL, (2014) 14 SCC 731, this Court has observed that “debarment” is never permanent and the period of debarment would invariably depend upon the nature of the offence committed by the erring contractor. In the said decision this Court emphasised on prescribing guidelines by determining the period for which the blacklisting should be effective. It is observed and held by this Court that while determining the period for which the blacklisting should be effective, for the sake of objectivity and transparency it is required to formulate broad guidelines to be followed. It is further observed that different periods of debarment depending upon the gravity of the offences, violations and breaches may be prescribed by such guidelines. 28. Duration of blacklisting cannot be solely per offence. Seriousness of the lapse and the incident and/or gravity of commission and omission on the part -6- of the contractor which led to the incident should be the relevant considerations. In a given case, it may happen that the commission and omission is very grave and because of the serious lapse and/or negligence, a major incident would have taken place. In such a case, it may be the contractor’s first offence, in such a case, the period/duration of the blacklisting/banning can be more than three years. However, as the said guidelines are not under challenge, we rest the matter there and leave it to the State Government to suitably amend and/or modify the said office memorandum. However, what we have observed above can be a guide while determining the period of debarment/blacklisting. 29. In the instant case, it might be true that the offence was the first offence committed by the contractor. However, considering the seriousness of the matter that due to the omission and commission on the part of the contractor a serious incident had occurred as there was a collapse of a ten meter slab while constructing a flyover in which one person died and eleven others injured, as such the contractor does not deserve any leniency. However, to debar him permanently can be said to be too harsh a punishment. But considering the subsequent O.M. dated 26.11.2021 reproduced hereinabove (to which as such we do not agree as observed hereinabove), we are of the opinion that if the blacklisting is restricted to five years, it may be in the fitness of things.” 11. Taking into consideration the facts of the present case, the manner in which the impugned order has been passed by respondent No.1, and the law laid down by the Hon’ble Supreme Court and the Coordinate Bench of this Court, the impugned order No. H.O/CGBKBVN/RCO-53/2015-16/2408 dated 05/07/2016 is hereby quashed. The period of 5 years has already passed therefore the order of blacklisting has lost its efficacy. The petitioner and its subsidiaries shall be competent to participate in 7 future offers. The recovery, if any, made against the subsidiary companies of the petitioner shall be refunded to those companies forthwith. The order with regard to blacklisting and forfeiture of EMD shall remain intact. 12. With the aforesaid observation(s), the petition is disposed of at the admission stage itself. Sd/- (Rakesh Mohan Pandey) Judge Nimmi