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PETITIONER: RAGHUNATH THAKUR

       Vs.

RESPONDENT: STATE OF BIHAR & ORS.

DATE OF JUDGMENT08/11/1988

BENCH: MUKHARJI, SABYASACHI (J) BENCH: MUKHARJI, SABYASACHI (J) RANGNATHAN, S.

CITATION:  1989 AIR  620            1988 SCR  Supl. (3) 867  1989 SCC  (1) 229        JT 1988 (4)   728  1988 SCALE  (2)1326

ACT:     Administrative  Law: Black listing--Right to be  heard-- Making representation against the order--Necessity for.

HEADNOTE:      The  appellant  has bid in an auction of  Beni  Country Liquor Shop in the District of Samastipur and was given  the shop  being the highest bidder but he failed to deposit  the bid money in time.      The Collector, Samastipur by an order cancelled the bid and black listed the appellant. He then moved the High Court against  the order of the Collector. The High  Court  upheld the order of the Collector.      The appellant appealed to this Court by special leave.      Disposing of the appeal, the Court,      HELD: 1. It is an implied principle of the rule of  law that  any order having civil consequences should  be  passed only  after  following the principles  of  natural  justice. Black-listing any person in respect of business ventures has civil  consequences  for the future business of  the  person concerned in any event. [868H; 869A]      2.  Even  if  the rules do not express  so,  it  is  an elementary   principle  of  natural  justice  that   parties affected  by any order should have right of being heard  and making representations against the order. [869B]      In  the  instant  case,  that  portion  of  the   order directing that the appellant be placed in the black-list  in respect  of  future  contracts under the  Collector  is  set aside.  So  far  as  the cancellation  of  the  bid  of  the appellant is concerned, that is not affected. [869B-C]

JUDGMENT:     CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 4031  of 1988. From the Judgment and Order dated 14.4.1988 of the Patna High                                                    PG NO 867                                                    PG NO 868   Court in C.W.J.C. No. 1923 of 1988. R.K. Jain, R.P.Singh and Y.D.Chandrachud for the Appellant.

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U.S. Prasad for the Respondents.      The Judgment of the Court was delivered by      SABYASACHI MUKHARJI, J. Special leave granted.      The  order dated 25th March, 1988 of the  Collector  is under challenge in this appeal. The same reads as follows:      "Shri Raghu Nath Thakur S/o Late Gorakh Thakur, Village Repura,  P.S.  Puksha,  District  Samastipur  had  bid   for Rs.11,900 (Rupees eleven thousands only) per month Dak in an auction  of Beni Country liquor shop held on 27.3.88 and  he as  given the shop of Beni Country liquor but after  signing in Bandobasti Register he did not deposit dak amount.      The name of Shri Raghu Nath Thakur S/o Late Gorakh Nath Village  Repura, P.S. Pusa, Distt. Samastipur  is  therefore placed in the black list for future under the orders  passed by the Collector, Samastipur."      This  order  was passed pursuant to the  order  of  the Collector.  The  letter dated 25th March,  1988,  states  as follows:      "The  Collector  of the district after perusal  of  the said  office note passed order on 25.3.88 which is  produced in verbatim below:      Ist bidder chunki defaulter hai atah security prapt kar len tatha bhavishya ke liae Black list karen. "      Indisputably, no notice had been given to the appellant of  the  proposal  of black-listing the  appellant.  It  was contended  on behalf of the State Government that there  was no requirement in the rule of giving any prior notice before black-listing  any person. In so far as the contention  that there is no requirement specifically of giving any notice is concerned,  the  respondent is right. But it is  an  implied principle  of  the rule of law that any order  having  civil consequence  should  be  passed  only  after  following  the                                                    PG NO 869 principles  of natural justice. It has to be  realised  that black-listing any person in respect of business ventures has civil  consequence  for the future business  of  the  person concerned in any event. Even if the rules do not express so, it  is  an  elementary principle  of  natural  justice  that parties  affected  by any order should have right  of  being heard and making representations against the order. In  that view of the matter, the last portion of the order in so  far as  it directs black-listing of the appellant in respect  of future  contracts,  cannot  be  sustained  in  law.  In  the premises,  that  portion  of the order  directing  that  the appellant  be placed in the black-list in respect of  future contracts  under the Collector is set aside. So far  as  the cancellation of the bid of the appellant is concerned,  that is  not affected. This order will, however, not prevent  the State Government or the appropriate authorities from  taking any  future  steps  for blacklisting the  appellant  if  the Government  is so entitled to do so in accordance with  law, i.e.  giving the appellant due notice and an opportunity  of making  representation.  After hearing  the  appellant,  the State  Government  will be at liberty to pass any  order  in accordance  with  law indicating the reasons  therefor.  We, however, make it quite clear that we are not expressing  any opinion  on the correctness or otherwise of the  allegations made against the appellant. The appeal is thus disposed of. S . K . A .                            Appeal disposed of.