NDLI: Umc Technologies Private Limited Vs. Food Corporation of India and Anr.

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Contract Blacklisting by Corporation Termination of
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Case(s) Referred	Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Allowed
Headnote	Contract – Termination of – Blacklisting by Corporation –The Corporation had issued a Bid Document inviting bids forappointment of a recruitment agency to conduct the process orrecruitment for hiring watchmen – The appellant was declared asthe successful bidder – The appellant conducted a written exam foreligible aspirants for the post of watchmen with the Corporation –On the same day a Special Task Force of Police arrested 50 persons,who were in possession of certain handwritten documents whichprima facie appeared to be the question papers related to theexamination conducted by the appellant – The Corporation issueda show cause notice dated 10.04.2018 to the appellant and allegedthat the appellant had breached various clauses of the Bid document– By its order dated 09.01.2019, the Corporation concluded thatthe shortcomings/negligence on part of the appellant stoodestablished beyond any reasonable doubt and proceeded to terminateits contract with the appellant and also blacklisted the appellantfrom participating in any future tenders of the Corporation for aperiod of 5 years – Writ petition filed by the appellant before theHigh Court was dismissed – Before the Supreme Court, the appellantsubmitted that it only seeks to contest the issue of blacklisting andnot the termination of the contract between the appellant and theCorporation – Held: A prior show cause notice granting areasonable opportunity of being heard is an essential element of alladministrative decision-making and particularly so in decisionspertaining to blacklisting which entail grave consequences for theentity being blacklisted – In these cases, furnishing of a valid showcause notice is critical and a failure to do so would be fatal to anyorder of blacklisting pursuant thereto – A show cause notice mustspell out clearly, or its contents be such that it can be clearly inferredtherefrom, that there is intention on the part of the issuer of thenotice to blacklist the noticee – In the instant case, the show causenotice makes it clear that the action of blacklisting was neitherexpressly proposed nor could it have been inferred from the languageemployed by the Corporation in its show cause notice – It wasincumbent on the part of the Corporation to clarify in the showcause that it intended to blacklist the appellant, so as to provideadequate and meaningful opportunity to the appellant to show causeagainst the same – Therefore, the show cause notice dated10.04.2018 does not fulfil the requirements of a valid show causenotice for blacklisting – The Corporations’s order dated 09.01.2019is quashed only so far as it blacklist the appellant from participatingin future tenders.
Judge	Hon'ble Mr. Justice S. Abdul Nazeer
Neutral Citation	2020 INSC 643
Petitioner	Umc Technologies Private Limited
Respondent	Food Corporation Of India And Anr.
SCR	[2020] 13 S.C.R. 1175
Judgement Date	2020-11-16
Case Number	3687

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1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
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Umc Technologies Private Limited Vs. Food Corporation of India and Anr.

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