Nsoft (India) Services Pvt. Ltd. Vs Purvanchal Vidhyut Vitaran Nigam Ltd. (Allahabad High Court)
Allahabad High Court has delivered a significant ruling concerning the issuance of show-cause notices for blacklisting, emphasizing the necessity for such notices to be free from pre-judgment and to clearly articulate the proposed action without indicating a concluded mind. The judgment came in two writ petitions, Nsoft (India) Services Pvt. Ltd. Vs Purvanchal Vidhyut Vitaran Nigam Ltd. and M/S Bcits Pvt. Ltd. vs. Purvanchal Vidhyut Vitaran Nigam Ltd., both challenging similar blacklisting notices.
Case Background
The petitioners, Nsoft (India) Services Pvt. Ltd. and M/S Bcits Pvt. Ltd., were issued notices dated June 18, 2022, by Purvanchal Vidhyut Vitaran Nigam Ltd. (PuVVNL) directing them to show cause against a proposed blacklisting/debarment for a period of two years. These notices followed an earlier round of litigation where previous notices, issued on May 18, 2022, were quashed by the High Court. In the earlier instance, the court found that the respondent authority had already concluded that the petitioners’ explanations were unsatisfactory, rendering the show-cause exercise an “empty formality.” The court had then granted liberty to the respondent corporation to issue fresh notices in accordance with law.
Petitioners’ Arguments
Represented by Senior Counsel Sri Prashant Chandra, the petitioners argued that the new notices dated June 18, 2022, though ostensibly show-cause notices, were in fact pre-meditated orders issued with malice. They contended that the notices were based on incorrect and incomplete facts, selectively presented to prejudice the petitioners. A key point of contention was the omission of any mention of the earlier notices and the petitioners’ responses, suggesting a deliberate attempt by the respondent authority to proceed with a pre-determined outcome. The petitioners asserted that the tenor of the notices indicated that the respondent had already decided to blacklist them, making the entire exercise futile. To support this, they cited Siemens Ltd. vs. State of Maharashtra & Others and Oryx Fisheries Pvt. Ltd vs. Union of India & Others. An attempt was also made to delve into the merits of their defense.
