Blacklisting for 3 years from participating in tender reduced to 18 months on balancing of circumstances: Madhya Pradesh HC

Madhya Pradesh High Court: This petition was filed before a Single Judge Bench of Atul Sreedharan, J., against the order passed by respondents where petitioner-firm were restricted from participating in any tender floated by respondents for 3 years. Further, registration of petitioner-firm with the respondents was also cancelled on the ground that while participating in a tender they had given wrong turnover for the Financial Years 2008-09 and 2010-11.

Issue before the court was whether the order of blacklisting was disproportionate to the misdemeanor caused to respondents.

It was contended by the petitioner that they were declared ineligible from participating in the tender without adequate reasons. Further, no loss ever occurred to the respondents. In addition to that respondent could not have blacklisted petitioner according to Clause 7.3 of the tender document given by respondents thus, impugned order was bad in law. Whereas respondent contended that the ban was a business ban put on the petitioner and not blacklisting.

High Court was of the view that relevant aggravating circumstances against petitioner and mitigating circumstances in favour of petitioner were found. Court agreed with the fact that petitioner mis-stated its turnover in order to defraud the respondent. However, even after above observation, though the Court considered blacklisting to be appropriate but the period of three years was considered to be unduly harsh and the same was reduced to 18 months. [Fibretech v. BHEL,2018 SCC OnLine MP 875, order dated 30-11-2018]

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