Sujal Pharma Vs Karnataka State Medical Supplies Corporation Limited (Karnataka High Court)
Blacklisting Requires Justification, Proportionality, and Fair Hearing with Show-Cause Notice (SCN)
In the case of Sujal Pharma Vs Karnataka State Medical Supplies Corporation Limited (Karnataka High Court), Sujal Pharma, a pharmaceutical distributor, challenged its blacklisting by the Corporation without prior notice or a fair hearing. The Corporation had issued purchase orders for hand sanitizers during COVID-19, which were later deemed substandard by the Drugs Control Department. Sujal Pharma was blacklisted in October 2021 without being provided the test reports or an opportunity to respond to the allegations. The Karnataka High Court ruled that blacklisting must follow the principles of natural justice, including a show-cause notice and a fair hearing, due to its significant economic and civil consequences. Citing precedents from the Supreme Court, the Court emphasized that any blacklisting decision by a state authority is subject to judicial review and must adhere to the principles of fairness, reasonableness, and proportionality.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
The petitioner is before this Court calling in question an order dated 29-10-2021 issued by the respondent blacklisting the firm of the petitioner.
3. Heard Sri M.K. Prithveesh learned counsel appearing for the petitioner and Smt. M. Sumana Baliga, learned counsel appearing for the respondent.
