1 2025:CGHC:38283 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 4106 of 2025 1 - M/s C B Patel Through- Partner Geeta Patel, W/o Hitesh Patel R/o E- 09 Malviya Nagar, Durg, P.S. Mohan Nagar, District- Durg, Chhattisgarh. ... Petitioner(s) versus 1 - Steel Authority Of India Limited, Ispat Bhawan, Lodhi Road, New Delhi 110003. 2 - Bhilai Steel Plant Through- Executive Director ( Hr ), Bhilai Steel Plant, Bhilai, District- Durg, Chhattisgarh. 3 - Bhilai Steel Plant Through- Executive Director ( O And M ), Bhilai, Steel Plant, Bhilai District- Durg, Chhattisgarh. ... Respondent(s) For Petitioner(s) : Mr. Shikhar Bhaktiyar, Advocate For Respondent(s) : Mr. Ashish Mittal on behalf of Mr. Ankit Singhal, Advocate Hon’ble Shri Justice Arvind Kumar Verma, Judge Order on Board 04/08/2025 1. By way of the present petition, the petitioner has prayed for the following reliefs: “10.1 That, this Hon’ble Court may kindly be pleased to issue a writ of certiorari, or any other 2 appropriate writ, order, or direction, quashing and setting aside the impugned order dated 17.06.2025 issued by the Respondent authorities, whereby the petitioner’s vendor code was blocked on the ground of reconstitution of the firm. 10.2 That this Hon’ble Court may kindly be pleased to direct the Respondent authorities to reinstate and restore the Petitioner’s vendor code as a partnership firm, together with its entire accumulated experience and eligibility, so as to enable the Petitioner” 2. The brief facts of the case is that the petitioner firm was initially established as a proprietorship and subsequently reconstituted into a partnership, with all requisite changes duly intimated and reflected in the records of both statutory authorities and the respondents, without any interruption to its business operations. Upon the demise of one of its partners and the induction of a new partner, the petitioner carried out all necessary statutory compliances, including those relating to GST registration, and promptly informed the respondents, who had previously recognized such changes and renewed the Vendor Code without objection during earlier transitions. Despite full disclosure and complaince, the respondents, by order dated 17.06.2025, treated the aforementioned change as a fundamental alteration of legal status and proceeded to block the Vendor Code, thereby completely debarring the 3 petitioner from participating in present and prospective contracts, without affording an opportunity of hearing or substantiating reasons. The Petitioner immediately clarified, through a detailed representation dated 19.06.2025, that the partnership firm had neither dissolved nor ceased to exist in law as a result of the said changes and that such an action by the Respondent authorities was manifestly contrary to the express provisions and settled construction of the Indian Partnership Act. Owing to the impugned order, the Petitioner firm has been subjected to undue financial distress, reputational loss, and imminent risk of closure, leaving it with no recourse but to approach this Hon’ble Court for urgent relief by way of setting aside the respondents’ authority and unsustainable action. 3. Learned counsel appearing for the petitioner submits that the instant petition is preferred against the arbitrary and unlawful action of the Respondent authorities in blocking the Petitioner firms’s Vendor Code- previously allotted and regularly renewed- on the alleged ground of reconstitution of the firm occasioned by the demise of one of its partners and consequent induction of another. The impugned action, embodied in order dated 17.06.2025, undermines the petitioner’s continuous business relationship with the respondents, disregarding the well-settled principles under the Indian Partnership Act which expressly contemplate the continuation of a partnership notwithstanding changes in its constitution, and further ignores the fact that all statutory and procedural requirements were scrupulously complied with by the petitioner throughout. 4. Learned counsel for the respondent argued that the partnership firm M/s 4 C.B. Patel was having only two partners and on account of death of one partner, the firm is deemed to be dissolved despite existence of clause which says otherwise. He further relied upon Mohd. Laiquiddin and Another Vs. Kamala Devi Misra (Died) By Lrs. And Others 2010 (2) SCC 407. 5. I have heard learned counsel for the respective parties at length and perused the record with utmost circumspection. 6. Annexure P/1 would reveal that respondent no. 3 had issued a letter dated 17.06.2025 alleging that since M/s. C.B. Patel is a partnership firm with only two partners, the death of either partner results in the dissolution of the partnership. Consequently, if the firm is reconstituted and registered, it will be treated as a new entity, and the previous registration as a service contractor cannot be maintained. Annexure P/4 is the GST registration certificate wherein clause 15 says that “On the death of any partner, the firm shall not stand dissolved but shall continue with surviving partners. However, if the surviving partners, so desire, may take legal heir of the deceased as incoming partner.” 7. Learned counsel for the petitioner tried to demonstrate that the petitioner firm is not a reconstituted firm but it is a continued firm with legal heir of the deceased as an incoming partner. Further, the learned counsel for the petitioner submits that he has already filed a representation before the concerned authority on 19.06.2025 which is still pending before the competent authority. 8. Considering the facts and circumstances of the case, in light of the arguments advanced by the learned counsel for the parties, be that as it 5 may, the petitioner has filed the representation before the competent authority therefore, the competent authority is directed to decide the representation of the petitioner dated 19.06.2025 in accordance with law, rules and regulations, expeditiously as soon as possible. 9. It is made clear that this Court has not expressed any opinion on the merits of the case. Sd/- (Arvind Kumar Verma) JUDGE Madhurima