M/s Better Power Services Pvt. Ltd vs Union Of India & Ors.

A communication dated 27.10.2025 issued by the respondent NIT, Silchar, whereby the petitioner has been banned / suspended from participating in all tenders issued by the NIT for a period of two years from the date of issue of the notice is a subject matter of challenge in this writ petition instituted under Article 226 of the Constitution of India.

Bereft of details, the facts of the case, as projected are that the petitioner is an MSME Unit which deals with the business of manufacture of UPS, batteries, backup system, etc. The petitioner was entrusted to make supplies of their products to the NIT, Silchar and services were also provided. It however, appears that there was a complaint with regard to the supplies made for which an email dated 16.09.2025 was issued. The said email was followed by a reminder dated 18.09.2025 which was responded to by the petitioner. Thereafter, the impugned order of ban / suspension dated 27.10.2025 has been issued. The aforesaid action is the subject matter of challenge.

I have heard Shri GN Sahewalla, learned Senior Counsel for the petitioner assisted by Ms. Tanvi More, learned counsel. I have also heard Shri SP Choudhury, learned counsel representing NIT, Silchar, who has submitted that the affidavit-in-opposition has been filed.

The learned Senior Counsel for the petitioner has submitted that the impugned order of blacklisting dated 27.10.2025 having adverse civil consequences upon the petitioner is not preceded by a show-cause notice. He has also submitted that no opportunity was given to the petitioner before the impugned action was taken and no hearing was also afforded.

On merits, the learned Senior Counsel for the petitioner has submitted that though it appears that some anomalies were found in the supplies made, the emails issued to the petitioner do not even give a hint that there was any consequential action contemplated against the petitioner. He has, on the other hand, relied upon communication dated 18.11.2025 issued by the respondent authorities recording the satisfaction on the services rendered by the petitioner which includes one number of the supplies mentioned in the email dated 16.09.2025. He has also submitted that at no point of time, there was any hint that such a penal consequence was contemplated and would be taken against the petitioner, which is impermissible in law without giving an opportunity.

To buttress his submission, the learned Senior Counsel for the petitioner has relied upon the following decisions:

Towards the end of his submission, the learned Senior Counsel for the petitioner has also drawn the attention of this Court to the affidavit-in-opposition filed by the respondent nos. 2 and 3 wherein the justification has been sought to be made. He has submitted that such justification would not meet the requirement of law as laid down by the decisions relied upon by him.

Per contra, Shri Choudhury, the learned counsel for the respondent nos. 2 and 3 has submitted that opportunities were indeed given to the petitioner before the impugned action was taken. He has submitted that admittedly, no response was made against the email dated 16.09.2025 for which a reminder was issued on 18.09.2025. He has also submitted that from the communications exchanged including the reply email dated 18.09.2025, it would appear that the petitioner had admitted the shortcomings in the supplies and therefore he submits that the impugned action is fully justified. He has submitted that the action has been taken bona fide and in the public interest, as the supplies made are in the form of essential service, which is required for the smooth functioning of the institute.

The rival submissions have been duly considered and the materials placed before this Court have been carefully examined.

The law on blacklisting is well settled. The Hon’ble Supreme Court in one of the landmark case of Erusian Equipment & Chemicals Ltd. Vs. State of West Bengal & Anr. reported in (1975) 1 SCC 70 has laid down that an order of blacklisting having adverse civil consequences is essentially required to be preceded by an opportunity which conforms to the principles of natural justice. The said principles have been consistently followed in the subsequent decisions by the Hon’ble Supreme Court including the decisions relied upon by the learned Senior Counsel for the petitioner. In fact, in the case of Gorkha Security Services (supra), the scope has been expanded that the opportunity granted should be not only a formal opportunity but also one in which the party would have the full scope to explain the position.

In the instant case, this Court has noticed that in the affidavit-in-opposition filed by the respondent nos. 2 and 3 on 25.06.2026, a specific stand has been taken that the action has been taken in accordance with law. In paragraph 14 of the said affidavit, it has been specifically averred that the action is “complaint-triggered, verification-based, preceded by written opportunity”. While the first two aspects may be correct, the opportunity which has been pleaded appears to be those which have been given vide the email dated 16.09.2025 and the reminder email dated 18.09.2025. A cursory glance of both the emails would however bring this Court to a conclusion that the contents of those cannot, by any stretch of imagination be deemed to be an opportunity to show-cause before any penal consequence action is taken. On the other hand, the emails would reveal that a query was put to the petitioner as to whether they have complied with the Minimum Guaranteed VAH as required in two GEM orders.

The submissions made on behalf of the NIT that the petitioner has admitted the default is neither factually correct nor can be a ground to issue the impugned order. The response made by the petitioner vide email dated 18.09.2025 cannot, in the considered opinion of this Court be construed to be an admission of any anomalies or misconduct in making the supplies. Further, even if the same is construed to be some kind of admission, it is clear that neither the email dated 16.09.2025 nor the reminder dated 18.09.2025 can be construed to be an opportunity before taking the impugned action of blacklisting.

In the conspectus of the aforesaid discussion, this Court is of the considered opinion that the condition precedent before issuing an order of blacklisting has not been followed, more particularly, on the aspect of giving a proper opportunity including a personal hearing, as mandated by law.

In view of the above, the impugned communication dated 27.10.2025 is interfered with and is accordingly set-aside.

The present action however would not stand in the way of the respondent authorities to take action which, however, has to be strictly in accordance with law.