- (1.) BOTH the petitions pertain to forfeiture of security deposits and encashment of bank guarantee by the Jaipur Zila Dugdha Utpadak Sahakari Sangh Ltd. (herein after 'the Sangh') under order dated 12-9-2009 in respect of alleged breach of contract for supply of milk by the petitioners. A challenge has also been made to the validity of the petitioners' blacklisting entailing exclusion of the petitioners from consideration for grant of future contracts/ licenses by the Sangh. The two petitions aforesaid therefore are being decided by this common order.
(2.) THE counsel for the petitioners submits that the impugned order dated 12-9-2009 was passed in contravention of the principles of natural justice and even otherwise contrary terms and conditions of the contract between the petitioners and the Sangh. Reference has been made to clause 8 of the agreement between the petitioners and the Sangh, where under the respondent Sangh was obliged to issue a notice to the petitioners before terminating the contract. It is submitted that admittedly no notice as warranted in terms of clause 8 of the contract and in compliance of natural justice was issued to the petitioner and it submitted that on this ground alone the termination of the contract for supply of milk was bad. Counsel further submits that in any event the forfeiture of security deposit and encashment of bank guarantee could not have been made by the respondent Sangh, except in accordance with clause (x) of the condition 10 of the agreement dated 25-9-2009 entered into between the petitioners and the respondent Sangh. Heard learned counsel for the parties, and perused the material available on record of writ petition. Clause (x) of condition 10 of the agreement dated 25-9-2009 reads thus:- If any tanker engaged by the milk transporter is found indulged in pilferage/ theft of milk during transportation or the firm is found indulged in any other corrupt practice carried out at Milk Union/ Chilling Center/ receiving end etc. Jaipur milk Union/ milk Union at its own discretion may lodge F.I.R. against such transporter. The agreement/ contract of the milk transporter can be terminated and such firm can be blacklisted at the discretion of Jaipur Milk Union and due amount shall be forfeited/ adjusted against the losses suffered by the milk union and penalty amount as may be imposed by Jaipur Milk Union for such an act of pilferage/ theft/ corrupt practices. A bare reading of clause (x) clearly indicates that forfeiture of security deposit and encashment of bank guarantee is permitted only against the losses suffered by the Sangh. It is well settled that losses could be determined only after issuing notice to the petitioners and adjudication of the claim in law. Admittedly no losses have been determined as allegedly suffered by the Sang. On the contrary counsel for respondents admits that petitioner Madan Lal was allowed to supply milk during the currency of the contract allegedly terminated and was also granted similar contract/s for subsequent years including the current year. In my considered view since no losses have been determined by the respondent Sangh, the action of respondents in forfeiting the security deposit and encashment of bank guarantee is bad for being contrary to the governing conditions.
(3.) AS far as the issue of black-listing is concerned, in the case of Erusion Equipment & Chemical Ltd. Vs. State of West Bengal [(1975) 1 SCC 70] the Hon'ble Supreme Court has held that no order of black-listing of a contractor could be passed without compliance with the principles of natural justice. A similar view has been taken by this court in the case of Shri Abdhesh Sharma Vs. State of Rajasthan [2010 Western Law Cases (Raj.) UC 124] It is an admitted fact by the respondent Sangh that no notice was issued to petitioners prior to passing the order of black-listing. Further even after passing the order of black-listing the petitioner Madan Lal (in writ Petition No.13415/2009) has been continuously awarded work without any obstruction and has been paid for supplies made. The order of black-listing is therefore unsustainable and liable to be set aside on the admitted facts. Consequently the writ petitions are allowed. The impugned order dated 12-10-2009 passed by the Manager (Plant) Jaipur Zila Dugdh Utpadak Sahakari Sangh Ltd. Jaipur are quashed and set aside and the respondents are directed to refund to the petitioner the amount of security deposit and bank guarantee as encashed to the petitioners within a period of three weeks from the date of receipt of a certified copy of this order. ;