CWP-17117 IN THE HIGH COURT OF PUNJAB AND HARYANA AT Reserved on 10.07.2026 M/S R.A. CONTRACTOR AND ANOTHER STATE OF HARYANA AND OTHERS CORAM: Present: SUVIR SEHGAL 1. was reserved, 17117-2026 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Reserved Pronounced on Uploaded on 2026 20.07.2026 21.07.2026 M/S R.A. CONTRACTOR AND ANOTHER VERSUS STATE OF HARYANA AND OTHERS CORAM: HON'BLE MR. JUSTICE SUVIR SEHGAL HON'BLE MR. JUSTICE DEEPINDER SINGH NALWA Mr. Edward Augustine George, Advocate and Mr. Shubham Malik, Advocate for the petitioners. Mr. Pankaj Middha, Addl. A.G., Haryana. Mr. Amit Khatkar, Advocate, for respondent No.3. Mr. R.K. Doon, Advocate, for respondent No.4. *** SUVIR SEHGAL, J. As is evident from order dated 10 was reserved, petitioners have restricted the prayers made in the -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-17117-2026 Whether only the operative part of the judgment is pronounced Whether the full judgment is pronounced Yes/No Yes/No M/S R.A. CONTRACTOR AND ANOTHER ...PETITIONERS VERSUS ...RESPONDENTS SUVIR SEHGAL DEEPINDER SINGH NALWA Mr. Edward Augustine George, Advocate and Mr. Shubham Malik, Advocate Mr. Pankaj Middha, Addl. A.G., Haryana. , dated 10.07.2026, whereby judgment restricted the prayers made in the writ the full judgment pronounced 2026, whereby judgment writ SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 petition. Petitioner certiorari for respondent and contract has been cancelled. 2. successful bidder overhauling, assembling and operation of all units of Cooperative Annexure P issued to made as pe successfully and satisfactorily completed the work and released. Coun of the mill during crushing season with petitioners deployed their staff as per petitioners submitted the bill as per terms and conditions of work payment was not disbursed. Coun respondent No.3 made a demand for illegal gratification refused to Director. the petitioners and made huge petitioner the Chief Chemist on 17 the Vigilance Department 17117-2026 Petitioners have confined the challenge certiorari for quashing order dated 06.05. respondent No.3, whereby both the petitioner and contract has been cancelled. Counsel for the petitioners successful bidders and were allotted overhauling, assembling and operation of all units of Cooperative Sugar Mills Limited vide Letter of Intent dated 23.08. Annexure P-2. According to the counsel, issued to petitioners on 11.09.2025 and made as per the schedule given therein successfully and satisfactorily completed the work and released. Counsel states that respondent No.3 decided to start the operation of the mill during crushing season with petitioners deployed their staff as per the requirement. petitioners submitted the bill as per terms and conditions of work payment was not disbursed. Counsel alleges that the Chief Chemist of espondent No.3 made a demand for illegal gratification refused to oblige him and rather reported the Counsel asserts that the Chief Chemist became inimical towards the petitioners and made huge deduction s. Counsel points out that petition the Chief Chemist on 17.02.2026, Annexure the Vigilance Department, Haryana who registered FIR No.6 dated -2- confined the challenge to issuance of a writ of .05.2026, Annexure P-22, passed by etitioner firms have been blacklisted petitioners states that the petitioners w work of dismantling, repairing, overhauling, assembling and operation of all units of 3500 TCD by Haryana Letter of Intent dated 23.08.2025, counsel, work order, Annexure P-3, was payment for work done was to be therein. Counsel asserts that petitioner successfully and satisfactorily completed the work and due payment was espondent No.3 decided to start the operation of the mill during crushing season with effect from 18.11.2025 and the requirement. Counsel states that petitioners submitted the bill as per terms and conditions of work order, l alleges that the Chief Chemist of espondent No.3 made a demand for illegal gratification, but petitioners oblige him and rather reported the matter to the Managing l asserts that the Chief Chemist became inimical towards deduction from the payment due to etitioner No.1 recorded the voice call of , Annexure P-17, and gave a complaint Haryana who registered FIR No.6 dated issuance of a writ of 2, passed by firms have been blacklisted were dismantling, repairing, Haryana 2025, was payment for work done was to be petitioners due payment was espondent No.3 decided to start the operation 2025 and l states that but l alleges that the Chief Chemist of but petitioners matter to the Managing l asserts that the Chief Chemist became inimical towards from the payment due to the voice call of and gave a complaint to Haryana who registered FIR No.6 dated SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 23.02.2026 under the provisions of the Prevention of Corruption Act as well as BNS, Anne handed. Coun Mill and petition Annexure states that impugned order dated and petitioner upon Gorkha Security Services (2014) 9 SC and others of blacklisting has harsh preceded with a show cause notice proposed to be taken against notice, Annexure have been years. 3. filing a response. during the were addressed to them to remove the deficiencies. It has been stated that Sugar Mill is a cooperative institution having jurisdiction of mill management and cane growers are 17117-2026 2026 under the provisions of the Prevention of Corruption Act as well Annexure P-18. He asserts that the Chief Chemist was caught red Counsel states that this agitated the Managing Director of the Sugar petitioners were served with a show cause notice dated 23 Annexure P-19, for blacklisting and termination of the contract. Coun states that without considering the explanation given by petitioner impugned order dated 06.05.2026, Annexure petitioners were blacklisted for a period of Gorkha Security Services Versus Govt SCC 105 as well as Ram Shovit and others, Law Finder Doc ID #2450654 of blacklisting has harsh consequences. preceded with a show cause notice, which must clearly specify the proposed to be taken against a contractor. It is his , Annexure P-19, is defective and on its basis, have been blacklisted and that too for an exceptionally long period of 5 Writ petition has been contested by respondents response. It has been asserted that various deficiencies were traced during the working period of petitioner addressed to them to remove the deficiencies. It has been stated that ill is a cooperative institution, which is engaged in sugar production having jurisdiction of District Rohtak. The mill management and cane growers are directly involved. -3- 2026 under the provisions of the Prevention of Corruption Act as well sserts that the Chief Chemist was caught red l states that this agitated the Managing Director of the Sugar served with a show cause notice dated 23.03.2026, termination of the contract. Coun without considering the explanation given by petitioner vide Annexure P-22, contract was cancelled blacklisted for a period of 5 years. Placing reliance ersus Govt. of NCT of Delhi and others Ram Shovit Yadav Versus The State of Bihar 450654, counsel has contended that order consequences. Such an order is required to be which must clearly specify the action . It is his argument that show cause defective and on its basis, petitioners could not for an exceptionally long period of 5 petition has been contested by respondents No.2 and 3 It has been asserted that various deficiencies were traced working period of petitioners and numerous communications addressed to them to remove the deficiencies. It has been stated that which is engaged in sugar production he stakes of the State Government, directly involved. There is a lot of 2026 under the provisions of the Prevention of Corruption Act as well sserts that the Chief Chemist was caught red l states that this agitated the Managing Director of the Sugar 2026, termination of the contract. Counsel vide 22, contract was cancelled Placing reliance NCT of Delhi and others he State of Bihar l has contended that order Such an order is required to be action that show cause could not for an exceptionally long period of 5 No.2 and 3 by It has been asserted that various deficiencies were traced and numerous communications addressed to them to remove the deficiencies. It has been stated that which is engaged in sugar production overnment, There is a lot of SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 pressure from various stakeholders for the timely sugarcane from farmers, production of sugar and other ancillary works. Counsel fo notice pointing was granted numerous opportunities for hearing, but they give a satisfactory response. performance parameters were fixed petitioner virtue of impugned order 4. submission referred to by them. 5. notice, Annexure P on its basis whether 6. the case law on the blacklisting a contractor. Supreme effect of preventing a into lawful relationship with the government must be pr principles of natural justice by giving an opportunity to the whom action of blacklisting is sought to be taken. There is a valid and rationale behind it as with every blackli 17117-2026 pressure from various stakeholders for the timely sugarcane from farmers, production of sugar and other ancillary works. l for respondents No.2 and 3 has argued that a detailed show cause notice pointing out the lacunae in the work was served upon granted numerous opportunities for hearing, but they give a satisfactory response. It is his performance parameters were fixed, which were to be s. However, the petitioners miserably failed to achieve them and by of impugned order, Annexure P-22, We have given our thoughtful consideration to the rival submissions of counsel for the parties as well as examined the documents referred to by them. The sole question to be determined is as to whether show cause nnexure P-19, can be said to have met the on its basis whether a blacklisting order could be issued. In Gorkha Security Services the case law on the necessity of a show cause notice as a prerequisite blacklisting a contractor. Supreme Court observed that blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the government preceded by a show cause notice. principles of natural justice by giving an opportunity to the whom action of blacklisting is sought to be taken. There is a valid and rationale behind it as with every blackli -4- pressure from various stakeholders for the timely procurement of the sugarcane from farmers, production of sugar and other ancillary works. 2 and 3 has argued that a detailed show cause in the work was served upon petitioners, who granted numerous opportunities for hearing, but they were not able to categoric case that six different which were to be achieved by miserably failed to achieve them and by 22, punitive action has been taken. thoughtful consideration to the rival parties as well as examined the documents determined is as to whether show cause ave met the requirements of law and a blacklisting order could be issued. ervices (supra), Supreme Court discussed necessity of a show cause notice as a prerequisite ourt observed that blacklisting has the person from the privilege and advantage of entering into lawful relationship with the government for the purpose of gains and it by a show cause notice. It is mandatory to comply with the principles of natural justice by giving an opportunity to the person against whom action of blacklisting is sought to be taken. There is a valid and solid rationale behind it as with every blacklisting many civil and or evil procurement of the sugarcane from farmers, production of sugar and other ancillary works. 2 and 3 has argued that a detailed show cause who were not able to categoric case that six different achieved by miserably failed to achieve them and by thoughtful consideration to the rival parties as well as examined the documents determined is as to whether show cause requirements of law and ourt discussed necessity of a show cause notice as a prerequisite for ourt observed that blacklisting has the person from the privilege and advantage of entering for the purpose of gains and it It is mandatory to comply with the against solid sting many civil and or evil SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 consequences follow. contractor, Supreme Court observed that such and debars a blacklisted person from participating in government which means precluding him from the award of government contracts. 7. stated that noticee aware of the allegations nature of action be stated, called for even if alleged deficiencies, etc. The relevant hereunder 17117-2026 consequences follow. Describing blacklisting as a contractor, Supreme Court observed that such and debars a blacklisted person from participating in government eans precluding him from the award of government contracts. Discussing the contents of a show cause notice, stated that underlying purpose behind serving aware of the allegations against him nature of action, which is proposed to be taken for such breach , so that noticee is able to point out that proposed action is not called for even if alleged deficiencies, etc. The relevant observations of the Supreme hereunder:- “21. The Central issue, however, pertains to the requirement of stating the action which is proposed to be taken. The fundamental purpose behind t Show Cause Notice is to make the noticee understand the precise case set up against him which he has to meet. This would require the statement of imputations detailing out the alleged breaches and defaults he has committed, so that he gets an opportunity to rebut the same. Another requirement, according to us, is the nature of action which is proposed to be taken for such a breach. That should also be stated so that the noticee is able to point out that proposed action is not warranted in the case, even if the defaults/breaches complained of are not satisfactorily explained. When it comes to black listing, this requirement becomes all the more imperative, having regard to the fact that it is harshest possible action. -5- Describing blacklisting as a “civil death” of a contractor, Supreme Court observed that such an order is stigmatic in nature and debars a blacklisted person from participating in government tenders eans precluding him from the award of government contracts. contents of a show cause notice, it has been purpose behind serving such a notice is to make the against him, which he has to meet. The which is proposed to be taken for such breach, should also so that noticee is able to point out that proposed action is not called for even if alleged deficiencies, etc. are not satisfactorily explained. upreme Court are reproduced The Central issue, however, pertains to the requirement of stating the action which is proposed to be taken. The fundamental purpose behind the serving of Show Cause Notice is to make the noticee understand the precise case set up against him which he has to meet. This would require the statement of imputations detailing out the alleged breaches and defaults he has committed, opportunity to rebut the same. Another requirement, according to us, is the nature of action which is proposed to be taken for such a breach. That should also be stated so that the noticee is able to point out that proposed action is not warranted in the given case, even if the defaults/breaches complained of are not satisfactorily explained. When it comes to black listing, this requirement becomes all the more imperative, having regard to the fact that it is harshest possible action.” of a order is stigmatic in nature tenders, it has been such a notice is to make the has to meet. The should also so that noticee is able to point out that proposed action is not are not satisfactorily explained. ourt are reproduced The Central issue, however, pertains to the requirement of stating the action which is proposed to be he serving of Show Cause Notice is to make the noticee understand the precise case set up against him which he has to meet. This would require the statement of imputations detailing out the alleged breaches and defaults he has committed, opportunity to rebut the same. Another requirement, according to us, is the nature of action which is proposed to be taken for such a breach. That should also be stated so that the noticee is able to point given case, even if the defaults/breaches complained of are not satisfactorily explained. When it comes to black listing, this requirement becomes all the more imperative, having SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 8. Court has held that before cause notice is required to be issued blacklisting as livelihood of a person is at failure to mention violates the 9. present case has to be examined in the light of the abov position. An examination of show cause notice it was mentioned that performance of the petitioner season has been unsatisfactory and in breach of the contractual obligations. A list of twenty cause as to why 10. period for which petitioners have been proposed to be absence, it cannot be said that petitioners had action proposed to be taken years by virtue of impugned order sustained on this short ground. 17117-2026 In Ram Shovit Yadav's case ourt has held that before blacklisting a person or a firm, cause notice is required to be issued, specifying the proposed period of blacklisting as livelihood of a person is at failure to mention proposed period of blacklisting in the show cause notice violates the principles of natural justice. The impugned show cause notice present case has to be examined in the light of the abov position. An examination of show cause notice was mentioned that performance of the petitioner season has been unsatisfactory and in breach of the contractual obligations. twenty lapses was given and petitioner cause as to why: “*your contract should not be *your firm should not b from participation in organization and other government operational nature.” It is evident from the above that there is no mention of period for which petitioners have been proposed to be it cannot be said that petitioners had action proposed to be taken against them. The debarment for a period of five years by virtue of impugned order, Annexure sustained on this short ground. -6- Yadav's case, a Division Bench of Patna H blacklisting a person or a firm, a detailed show specifying the proposed period of blacklisting as livelihood of a person is at stake. High Court clarified that proposed period of blacklisting in the show cause notice The impugned show cause notice, Annexure P-19, in the present case has to be examined in the light of the above-noted legal position. An examination of show cause notice, Annexure P-19, shows that was mentioned that performance of the petitioners during the crushing season has been unsatisfactory and in breach of the contractual obligations. petitioners were called upon to show your contract should not be terminated, and your firm should not be blacklisted/debar from participation in future contracts with this organization and other government bodies of similar from the above that there is no mention of period for which petitioners have been proposed to be blacklisted. In it cannot be said that petitioners had sufficient notice of punitive against them. The debarment for a period of five nnexure P-22, therefore, cannot be High a detailed show specifying the proposed period of clarified that proposed period of blacklisting in the show cause notice in the legal shows that during the crushing season has been unsatisfactory and in breach of the contractual obligations. called upon to show debarred future contracts with this bodies of similar the In its punitive against them. The debarment for a period of five cannot be SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-17117 11. 06.05.2026 petitioners, shall not be 12. 13. authority from taking any steps in accordance with law after giving petitioners a an opportunity of making a representation and opportuni 20.07.2026 sheetal 17117-2026 As a result of the above discussion, 2026, Annexure P-22, insofar as it pertains petitioners, is set aside. So far as the cancellation shall not be affected. Writ petition is disposed of. It is clarified that this order shall not authority from taking any steps in future for blacklisting the accordance with law after giving petitioners a an opportunity of making a representation and opportunity of hearing. (DEEPINDER SINGH NALWA 2026 Whether Speaking/reasoned Yes/No Whether Reportable Yes/No -7- result of the above discussion, impugned order dated insofar as it pertains to blacklisting of aside. So far as the cancellation of contract is concerned, It is clarified that this order shall not prevent the competent future for blacklisting the petitioners accordance with law after giving petitioners a proper show cause notice and an opportunity of making a representation and being affording with an (SUVIR SEHGAL) JUDGE DEEPINDER SINGH NALWA) JUDGE Yes/No Yes/No impugned order dated to blacklisting of of contract is concerned, it prevent the competent petitioners in proper show cause notice and with an ) SHEETAL 2026.07.21 16:29 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh