Page 1 of 52

HIGH COURT OF MEGHALAYA

AT SHILLONG

WA No.3/2026

Reserved on: 04.02.2026

Pronouncement on:19.02.2026

M/s BSCPL Infrastructure Ltd. through Mr. Bollineni

Krishnaiah, office at: 8-2-502/1/A, Jivi Towers, Road No.7,

Banjara Hills, Hyderabad-500034, Telangana.

..... Appellant

Vs.

Public Works Department (Roads) through its Chief Engineer

(National Highways), Government of Meghalaya.

..... Respondent

Coram:

Hon’ble Mrs. Justice Revati Mohite Dere, Chief Justice

Hon’ble Mr. Justice W. Diengdoh, Judge

Appearance:

For the Appellant : Mr. Jethmalani, Sr.Adv with

Mr. S. Chopra, Adv

Mr. K. Ch Gautam, Adv

Mr. R. Sharma, Adv

Mr. T. Tewari, Adv

Ms. S. Jethmalani, Adv

Ms. G.C. Marboh, Adv

For the Respondent : Mr. A. Kumar, Advocate General with

Mr. A.H. Kharwanlang, Addl.Sr.GA

Mr. A.S. Pandey, GA

Mrs. S. Laloo, GA

Ms. I. Syiemlieh, GA

i) Whether approved for reporting in Yes

Law journals etc.:

ii) Whether approved for publication

in press: Yes

Serial No.01

Supplementary List

2026:MLHC:85-DB

Page 2 of 52

JUDGMENT

Hon’ble, the Chief Justice:

By the aforesaid appeal, the appellant has impugned the

judgment and order dated 17

th

December, 2025, passed by

the learned Single Judge in Writ Petition (C) No.24 of 2025. By

the said judgment and order, the learned Single Judge

dismissed the appellant’s petition which sought quashing and

setting aside of the order dated 3

rd

December, 2024, passed

by the respondent, blacklisting/debarring the appellant for

five years from participating in any future tender/contract of

Public Works Department.

Brief facts:

In September, 2009, the Government of India, through

the Ministry of Road Transport and Highways, floated a tender

for the ‘2-laning of Nongstoin-Shillong Section of NH 44 and

Nongstoin-Rongjeng-Tura Road in the State of Meghalaya

under Phase ‘A’ of SARDP-Ne-NH-44E & SR-MG-PWD-2010-

11-172’. Accordingly, on 14

th

June, 2010, a Joint Venture

agreement was executed between M/s BSCPL and C&C 2026:MLHC:85-DB

Page 3 of 52

Construction for the purpose of bidding of the aforesaid two

specific projects, one in Nagaland and another in Meghalaya.

In the said Joint Venture agreement, M/s BSCPL (appellant)

was the lead partner of the said agreement.

2. On 15

th

June, 2010, Joint Venture, being BSC C&C JV

(hereinafter referred to as ‘JV’, submitted its bid before the

respondent.

3. On 31

st

January, 2011, a Letter of Acceptance was

issued in favour of the JV for the aforesaid 2-laning project.

On 21

st

February, 2011, the parties entered into an

agreement “contract” to execute the work of Ilvo Laning of

Shillong-Nongstoin Section of NH 44E and Nongstoin -

Rongjeng-Tura Road in the State of Meghalaya for contract

price of ₹1303.83 crores. The project was to be completed

within 36 months i.e., on or before 7

th

March, 2014.

4. It is not in dispute that the project could not be

completed within the stipulated period and hence, 2026:MLHC:85-DB

Page 4 of 52

supplementary agreements were entered into between the

parties and the timeline was extended. Admittedly, the revised

cost estimate was submitted on four occasions and the final

extension of time was approved by the respondent till 31

st

December, 2017. It appears that the Contract works were

completed on 15

th

December, 2017 and the completion

certificate for the project was issued on 13

th

March, 2018.

5. In the interregnum, during the aforesaid period i.e.,

2017-2018 disputes arose between the parties in terms of the

execution of the work under the contract. The appellant-JV

sent a notice in terms of Clause 24 of the Contract to the

respondent informing of its claims in relation to non-payment

of interest on delayed payments, non-payment of cost of extra

bitumen used in bituminous works and non-reimbursement of

labour cess. Accordingly, on 23

rd

April, 2015, the appellant-

JV sought appointment of Dispute Review Board-I (hereinafter

referred to as DRB-I) in terms of Clause 24 of the Contract.

2026:MLHC:85-DB

Page 5 of 52

6. Accordingly, on 1

st

June, 2016, DRB-I was constituted

for adjudication of the disputes for Claim-I, arising between

the parties. In May, 2016, Shri M. Phanbuh, Chief Engineer

(National Highway), denied the appellant’s claim as none of the

heads of claims were maintainable. On 2

nd

June, 2016, Shri

M.R. Sangma, Chief Engineer, admitted the claims of the

appellant-JV vide communication/letter sent by him. On 12

th

September, 2016, Mr. Sangma, Chief Engineer (National

Highway), submitted a letter of joint verification of claims with

the JV to DRB-I. On 25

th

September, 2016, DRB-I gave its

recommendation on the dispute and allowed Claim-I of the

appellant, i.e., ₹80 crore. On 19

th

February, 2017, DRB-I

revised its recommendation, i.e., passed an addendum to its

recommendation dated 25

th

September, 2016, and also

awarded interest to the appellant.

7. It appears that 3

rd

December, 2017, the Regional

Officer, MoRTH, forwarded the recommendation regarding

approval of RCE-IV (revised cost estimate). On 19

th

May, 2026:MLHC:85-DB

Page 6 of 52

2017, Mr. Sangma addressed a letter to DRB, communicating

that an amount of ₹16 crore has been processed towards

labour cess and the remaining claims were being processed to

be incorporated in RCE-IV.

8. Since the respondent failed to make the payment of

interest awarded by DRB-I, the appellant-JV sent a notice

dated 11

th

June, 2018, stating its intention to invoke

arbitration for the unpaid claims under DRB-I award. On 25

th

September, 2018, the appellant-JV applied to the DRB,

constituting the same members as the earlier DRB-I, for

adjudication of two sets of claims i.e., regarding additional

claims arising on account of delay, disruption and

prolongation of contract due to breaches by the respondent

during the execution of the contract (Claim-II), including loss

of profits. Accordingly, DRB-II was constituted. On 25

th

September, 2018, the DRB-II passed recommendation in

favour of the appellant-JV and awarded an amount of ₹220

(approx) crores/lakhs, towards delay, disruption and 2026:MLHC:85-DB

Page 7 of 52

prolongation, including loss of profits. On 16

th

October, 2025,

DRB-II further revised its recommendation.

9. On 16

th

January, 2019, the respondent also sent a

notice invoking arbitration and appointed Mr. K.K. Jalan as its

nominee arbitrator. On 1

st

January, 2019 in response to the

respondent’s notice of arbitration, appellant-JV appointed Mr.

R.K. Srivastava as its nominee arbitrator and sought for

consolidation of both, Claims-I and II before the learned

Arbitral Tribunal. On 13

th

March, 2019, the nominee

arbitrators of the appellant-JV and the respondent appointed

Hon’ble Mr. Justice (Retd) V.B. Gupta as the Presiding

Arbitrator and accordingly, the Arbitral Tribunal entered upon

reference in accordance with the Arbitration and Conciliation

Act, 1966 (hereinafter referred to as the ‘Act’) for adjudication

of both the claims allowed by DRB-I and DRB-II.

10. On 1

st

February, 2019, the appellant-JV also invoked

arbitration proceedings in respect of both the Claims i.e.,

Claims- I and II. 2026:MLHC:85-DB

Page 8 of 52

11. On 30

th

May, 2019, the appellant-JV filed its statement

of claim for two claims based on DRB -I and DRB-II

recommendations. As far as Claim-I was concerned, it was

based on the admission of the officials of the respondent.

Along with the statement of claim, the appellant-JV also filed

an application under Section 31(6) of the Act, seeking an

interim award on claim-I allowed by the DRB-I, since it was an

admitted claim. It appears that the appellant-JV in the

statement of claims had filed 16 volumes of unindexed

documents running into more than 9500 pages. On 30

th

July,

2019, the respondent before filing its reply to the appellant’s

statement of claim, filed an application under Section 16 of

the Act, challenging the jurisdiction of the Arbitral Tribunal.

The Arbitral Tribunal vide order dated 21st March, 2020

dismissed the respondent’s application under Section 16 of

the Act.

12. It appears that on 10

th

November, 2020 , the

respondent tried to implead the Ministry of Road Transport 2026:MLHC:85-DB

Page 9 of 52

and Highways (MoRTH) in the arbitration, by filing an

application seeking impleadment of MoRTH, as a party

respondent to the arbitration proceeding. The respondent also

filed its statement of defence. On 18

th

December, 2020, the

appellant-JV filed its rejoinder to the statement of defence.

13. By two separate orders dated 27

th

July, 2021, the

Arbitral Tribunal rejected the impleadment application of the

respondent with costs and allowed the interim application

preferred by the appellant under Section 31(6) of the Act and

passed an interim award directing the respondent to pay the

appellant-JV a sum of ₹75 crore with interest pending detailed

calculation, as a part of the claims, arising out of Claim-I.

14. The respondent challenged the interim award under

Section 34 of the Act by filing a petition alongwith an

application for stay of the interim award dated 27

th

July,

2021. The said petition was filed before the Commercial

Court, Shillong. Vide order dated 29

th

October, 2021, the

Commercial Court, Shillong issued notice to the appellant-JV 2026:MLHC:85-DB

Page 10 of 52

and the Court granted ad-interim ex-parte stay on the interim

award passed by the Arbitral Award. On 17

th

November,

2021, the appellant-JV filed an application and sought

dismissal of the petition i.e., Commercial Misc. Case

No.24/2021, filed by the respondent on the premise that the

same was premature , as the Section 33 application was

pending before the Arbitral Tribunal. The Commercial Court,

Shillong vide order dated 17

th

November, 2021 modified its

stay on the interim award so as to allow continuation of the

Section 33 proceeding before the Arbitral Tribunal. On 21

st

December, 2021, the Arbitral Tribunal, rejected the said

application filed by the appellant-JV under Section 33 of the

Act.

15. On 19

th

January, 2021, the appellant-JV filed a

petition being Civil Revision Petition No.2 of 2022 in the High

Court of Meghalaya and sought quashing and setting aside of

the said orders passed by the Commercial Court, Shillong. The

High Court vide judgment and order dated 11

th

February, 2026:MLHC:85-DB

Page 11 of 52

2022 set aside the orders of the Commercial Court, Shillong

and directed the Commercial Court, Shillong to take up

Section 34 petition de novo in the light of the dismissal of

Section 33 application.

16. On 14

th

February, 2022, the Arbitral Tribunal framed

issues for adjudication. It appears that one of the issues

framed by the Arbitral Tribunal concerned Claim-I, which was

already the subject matter of the order dated 27

th

July, 2021.

On 6

th

April, 2022, the respondent filed a petition in this

Court challenging the Arbitral Tribunal’s order dated 14

th

February, 2022 framing issues and also prayed for stay of the

arbitral proceeding. Vide order dated 9

th

May, 2022, this

Court quashed the order of the Arbitral Tribunal dated 14

th

February, 2022 to the extent, that it related to issue No.1,

i.e., issue which concerned Section 31(6) application and

accordingly, arbitral proceedings were stayed vide order dated

25

th

April, 2022. Later, this Court vide order dated 9

th

May,

2022 quashed Issue No.1 and disposed of the petition. 2026:MLHC:85-DB

Page 12 of 52

17. Being aggrieved by the said order passed by the High

Court, the appellant-JV filed a Special Leave Petition before

the Apex Court. It appears that the arbitral proceeding was

stayed approximately for one year. In view of the stay, the

recording of evidence of the appellant-JV remained

incomplete. On 19

th

June, 2023, the Arbitration Appeal No.6

of 2023 preferred by the appellant-JV in this Court under

Section 37 of the Act challenging the judgment dated 17

th

May, 2023, passed by the Commercial Court, Shillong was

dismissed by the High Court with costs was decided against

the respondent and the Section 31(6) order of the Arbitral

Tribunal was upheld, i.e., interim award passed by the

Arbitral Tribunal was upheld. Pursuant thereto, the

respondent filed a Special Leave Petition in the Apex Court

against the said order dated 19

th

June, 2023, passed in

Arbitration Appeal No.6 of 2023. The said SLP was dismissed

by the Apex Court vide order dated 7

th

August, 2023. While

dismissing the Special Leave Petition Nos.14475 of 2022, the 2026:MLHC:85-DB

Page 13 of 52

Apex Court modified issue No.1 in the arbitration as well as

vacated the stay on the arbitration proceeding.

18. On 14

th

September, 2023, the arbitration proceedings

resumed after the stay was lifted by the Apex Court on 7

th

August, 2023. It appears that the respondent filed an

application on 17

th

September, 2024, under Section 16

contending that the dispute had become non-arbitrable before

the arbitrator, however, the same was dismissed with costs.

On 17

th

October, 2023, cross-examination of the appellant-

JV and evidence recording concluded. As the mandate of the

Arbitral Tribunal had expired on 30

th

November, 2023, the

same was renewed for further six months by the Commercial

Court, Shillong vide its order dated 4

th

July, 2024.

19. It appears that the Tribunal passed its final award with

the majority of 2:1, allowing Claim-I of the appellant-JV and

rejected the entire Claim-II of the appellant-JV.

2026:MLHC:85-DB

Page 14 of 52

20. It is the respondent’s case that on 3

rd

September,

2024, they unearth several ledger entries showing that the

appellant-JV had engaged, during the extensions granted in

execution of the contract, in giving illegal gratification to

government officials, including the Engineers of PWD, funding

of MoRTH officials and other officials. Accordingly, a complaint

was filed by the Chief Engineer (Roads), National Highway with

the Sardar Police Station, East Khasi Hills against the

appellant-JV and its partners including certain known and

unknown officials and representatives of the appellant -JV

alleging offences punishable under Sections 120B, 409, 420,

465, 468, 471, 477(a) IPC read with Section 13(2) of the

Prevention and Corruption Act, 1988. Pursuant to the

complaint, on 10

th

September, 2024, FIR bearing No.286(9)

of 2024 was registered with the Sardar Police Station, East

Khasi Hills, Shillong against the appellant-JV and its partners

and certain officials/representatives of the respondent and the

appellant.

2026:MLHC:85-DB

Page 15 of 52

21. On 16

th

September, 2024, the respondent issued a

show cause notice to the appellant-JV and its partners in view

of the material found in the statement of claims, i.e., ledger

entries showing acts of corruption and bribery being

committed by the appellant-JV. Certain entries in the ledger

accounts were quoted in the show cause notice in support of

the same. On 30

th

September, 2024, the appellant-JV sent a

joint reply, including for C&C construction, to the show cause

notice stating therein that the expenses in the ledger account

were not by way of bribe or corruption.

22. On 3

rd

December, 2024, the respondent, after

considering their reply, blacklisted the appellant-JV and its

partners for a period of five years. It appears that almost

around this time, i.e., on 16

th

September, 2024, the

respondent also preferred an application under Section 2(3)

read with Section 16 of the Act, as according to the

respondent, the disputes had become inarbitrable due to

corruption and bribery. On 4

th

October, 2024, the appellant- 2026:MLHC:85-DB

Page 16 of 52

JV filed its reply to the Section 16 application filed by the

respondent before the Arbitral Tribunal, stating therein, that

the said entries relied upon by the respondent were records of

day-to-day expenses of the project incurred between 2014 -

2017.

23. Being aggrieved by the impugned order dated 3

rd

December, 2024 , blacklisting the appellant-JV and its

partners for five years, the appellant-JV preferred a Writ

Petition (C) No.24 of 2025, in this Court and sought quashing

of the order dated 3

rd

December, 2024, by which they were

blacklisted by the respondent for five years from participating

in any future tender/contract of Public Wors Department.

24. The learned Single Judge vide his judgment and order

dated 17

th

December, 2025, dismissed the said petition

essentially on the following counts:

(i) that the respondent was well within its authority to issue

show cause notice to the appellant-JV for blacklisting; 2026:MLHC:85-DB

Page 17 of 52

(ii) that the material relied upon for issuance of show cause

notice and subsequent blacklisting was not based on hearsay

or suspicion but on ledger accounts produced by the

appellant-JV themselves, which provided sufficient and

credible proof of illegal gratification and as such, the course of

action taken by the respondent was well within its right;

(iii) that the action resorted to by the respondent was neither

mala fide nor motivated nor without any basis, as the State

was obligated to put public interest over anything else in such

cases; and

(iv) there is no delay in taken action against the appellant-JV

and that the penalty imposed considering the nature of

allegations which reflects the conduct of the appellant-JV and

scale of public fund involved is neither disproportionate nor

excessive.

25. Hence, this appeal.

2026:MLHC:85-DB

Page 18 of 52

Submissions on behalf of the appellant:

Mr. Jethmalani, learned Senior Counsel appearing for

the appellant, assailed the order of blacklisting as well as the

impugned order passed by the learned Single Judge on the

following counts:

(i) that the show cause and the impugned order blacklisting

the appellant-JV, i.e., clauses 37 and clause 59.2(h) of the

conditions of contract, were inapplicable to the facts in hand.

(ii) that neither the show cause notice nor the impugned order

of blacklisting explicitly set out (a) the thing and value given to

the public official concerned; (b) what was the reciprocal

action of the public official, for the thing given, which was

meant to influence the public official concerned , in the

procurement process or in the contract execution; and (c) the

name of the public official who was sought to be influenced.

Thus, it is submitted that neither in the show cause notice nor

in the blacklisting order any such particulars are furnished. It

is further submitted that the show cause notice is also bereft

of vital particulars, rendering it void and illegal inasmuch as, 2026:MLHC:85-DB

Page 19 of 52

it does not put the appellant company to notice on the specific

factual particulars that he is supposed to meet vis-à-vis the

charge of corruption.

(iii) That the blacklisting order deals with much more

allegations, not referred to in the show cause notice and as

such, the impugned order cannot be sustained.

(iv) that the ledger entries which are admitted by the appellant

and relied upon by the respondent in the show cause notice

and in the blacklisting order do not disclose any payments

whatsoever to Mr. Sangma, Chief Engineer, for the alleged acts

performed by him or for any reason.

(v) that during the period of execution of the contract, there

were no complaints or allegations against the appellant-JV

regarding the quality of work, workmanship or progress of

work. It is submitted that due to the additional scope of works

and amounts, supplementary agreements were entered into

between the appellant-JV and the respondent under four

revised cost estimates on 30

th

July, 2013, 6

th

February,

2015, 7

th

July, 2015 and 30

th

May, 2017, which took the 2026:MLHC:85-DB

Page 20 of 52

project cost from ₹1303.83 crores to ₹2406.46 crores and that

these revisions were after following due procedure.

(vi) that at no stage of the arbitration proceeding, which was

delayed by the respondent, there were allegations of

bribery/corruption, either during recording of evidence or in

the statement of defence and that the allegations pertained

only to exaggeration of claims by the appellant-JV.

(vii) That the FIR lodged by the respondent, does not allege any

offence under the Prevention of Corruption Act; and that the

FIR alleges that the total value of property stolen was

₹2366.77 crore, which infact, is the entire sum awarded by the

Arbitral Tribunal to the appellant-JV, suggesting that no

amount was due and payable to the appellant company -JV at

all for the execution of the contract which execution of work,

spanned from 2011 to 2017 ; that the ledger entries of the

appellant company on which reliance is placed by the

respondent to blacklist the appellant-JV were annexed to the

statement of claim which was filed on 30

th

May, 2019, and

that the respondent despite knowing the same, lodged a police 2026:MLHC:85-DB

Page 21 of 52

complaint belatedly, only on 3

rd

September, 2024, after more

than five years and consequently, issued the impugned show

cause notice on 16

th

September, 2024, which ultimately

resulted in blacklisting the appellant-JV. It is submitted that

the explanation offered by the respondent for the delay in

filing the FIR/issuance of the show cause notice is, that they

waited till the cross-examination of the appellant-JV during

the trial of the arbitration petition, an explanation that defies

logic.

(viii) that the show cause notice and consequently , the

blacklisting order was passed by the respondent authorit y

with a mala fide intent only to deny the appellant-JV, its

legitimate financial dues arising out of an express contractual

obligation, which was accepted by the State PWD Department

and the nodal authority, MoRTH.

(ix) that the conduct of the respondent and the observations

made against the respondents in various proceedings, is

telling; 2026:MLHC:85-DB

Page 22 of 52

(x) that the FIR was registered show cause notice issued and

the impugned order was passed only to scuttle the arbitration

proceeding and prejudice the arbitrator; and

(xi) that the learned Single Judge failed to consider the

aforesaid.

Mr. Jethmalani, learned Senior Counsel appearing for

the appellant, relied on the following judgments in support of

his submissions:

(1) M/s Erusian Equipment & Chemicals Ltd. v. State of

West Bengal & anr: (1975) 1 SCC 70;

(2) Gorkha Security Services v. Government (NCT of Delhi)

& ors: (2014) 9 SCC 105;

(3) UMC Technologies Private Limited v. Food Corporation

of India & anr: (2021) 2 SCC 551;

(4) V-MARC India Limited v. State of Uttar Pradesh & ors:

2025 SCC OnLine All 379;

(5) Floral Electrical Pvt. Ltd. v. Haryana Vidyut Prasaran

Nigam Ltd. & anr: 2025 SCC OnLine P&H 2191 ;

(6) M/s Techno Prints v. Chhattisgarh Textbook

Corporation & anr: 2025 INSC 236: Civil Appeal No.2362

of 2025; and

2026:MLHC:85-DB

Page 23 of 52

(7) The Blue Dreamz Advertising Pvt. Ltd. v. Kolkata

Municipal Corporation & ors: 2024 INSC 589

Submissions on behalf of the respondent:

Mr. Kumar, learned Advocate General, opposed the

appeal on the following grounds:

(i) that the facts and the admitted ledger accounts which the

appellant-JV has admitted clearly reveals corrupt

practices/bribes made to public officials and that the action of

blacklisting the appellant-JV is justified, proportionate and in

larger public interest;

(ii) that there was no delay in issuing the show cause notice,

inasmuch as, there was a stay to the arbitral proceedings

pending before the Arbitral Tribunal for a sufficiently long

period; and that in any circumstance, actions of the appellant-

JV, who had indulged in corrupt practices cannot be

condoned, more particularly when the ledger entries have been

admitted by the appellant-JV. It is further submitted that the

ledger entries admitted by the appellant-JV clearly show that 2026:MLHC:85-DB

Page 24 of 52

the appellant-JV had indulged in corrupt practices and that

the argument, that the amount was small as compared to the

contract, is inconsequential, inasmuch as, corruption is

corruption;

(iii) that Clause 59.2(h) confers power on the respondent to

even otherwise, take appropriate action against the party

concerned, if it is found that the party has indulged in corrupt

practices. It is submitted that payment of monies to

government officials by way of wine bottles, laptops, mobiles,

costly gifts, hotel arrangements and donations to unknown

organisation cannot be trivialised;

(iv) that the ledger entries have been admitted by the

appellant-JV, although according to the appellant-JV, they

were given as gifts and as goodwill gestures, and not as bribes.

It is submitted that the appellant-JV is seeking to justify the

gifts, as legitimate business expenses, when infact, it is

nothing but bribery/corruption. He further submitted that the

appellant-JV had admitted the ledger entries submitted by

them, in the cross-examination before the Arbitral Tribunal. It 2026:MLHC:85-DB

Page 25 of 52

is further submitted that the ledger entries reveal the

underlying reasons for admission of claims made by the

Government officials in favour of the appellant -JV, thus

causing huge loss to the public exchequer;

(v) that both, the High Court and the Arbitral Tribunal had

passed critical observations vis-à-vis the ledger accounts

showing gifts given to government officials;

(vi) that sufficient details have been spelt out in the show

cause notice; that the principles of natural justice have been

duly complied with, as warranted and that thereafter, a

speaking order has been passed blacklisting the appellant-JV

for five years. Thus, according to the learned Advocate

General, due process has been followed to the hilt by the

respondent;

(vii) that in the FIR, Prevention of Corruption Act has been

invoked and the said FIR is being investigated; and that the

Enforcement Directorate has also issued summons to the

former Chief Engineer Mr. Almond M. Kharmawphlang under

the Prevention of Money Laundering Act; and 2026:MLHC:85-DB

Page 26 of 52

(viii) that the learned Single Judge, after going through the

record has rightly dismissed the appellant-JV’s petition by a

reasoned order and that no interference is warranted in the

same.

Mr. Kumar, learned Advocate General appearing for the

respondent, relied on the following judgments in support of his

submissions:

(1) Grosons Pharmaceuticals (P) Ltd. & anr v. State of U.P.

& ors: (2001) 8 SCC 604, para 2;

(2) Patel Engineering Limited v. Union of India & anr:

(2012) 11 SCC 257, paras 36 & 37;

(3) TPF Engineering Pvt. Ltd. & anr v. National Highways

Logistics Management Limited & anr: 2023 SCC OnLine

Del 7116, paras 24 to 28, 33 to 35, 43;

(4) ITD Cementation India Limited v. SSJV -ZVS Joint

Venture & ors: (2023) 2 High Court Cases (Del) 44: 2023

SCC OnLine Del 1391, paras 13 & 14;

(5) Asia Foundations & Constructions Ltd., Bombay & ors

v. State of Gujarat & anr: 1985 SCC OnLine Guj 93: AIR

1986 Guj 185: (1987) 2 GLH 510 , para 31;

2026:MLHC:85-DB

Page 27 of 52

(6) M/s Sabharwal Medicos Pvt. Ltd. through its Director

v. Union of India & ors: 2013 SCC OnLine Del 3839 , paras

12 to 15;

(7) Theme Engg. Service Pvt. Ltd. Assn. with Ishita Info

Sol. Thru. Their Auth. Rep. Sumeet Asthana v. National

Highway Authority of India Thru Chairman & anr : 2024

SCC OnLine All 6275, paras 35, 38;

(8) Riddhi Siddhi Associates v. National Highways

Authority of India & ors: 2024 SCC OnLine Del 5513,

paras 7 to 10;

(9) State of Odisha & ors v. Panda Infraproject Limited:

(2022) 4 SCC 393, paras 17, 18, 22, 24;

(10) Kulja Industries Limited v. Chief General Manager,

Western Telecom Project Bharat Sanchar Nigam Limited

& ors: (2014) 14 SCC 731, paras 17, 21, 25;

(11) State of Orrisa v. Madan Gopal Rungta: 1951 SCC

1024, para 15; and

(12) V. Punnen Thomas v. State of Kerala: 1968 SCC

OnLine Ker 110: AIR 1969 Ker 81 (FB): 1968 KLT 800 (FB),

paras 9 to 14.

26. Before we proceed to consider whether interference is

warranted in the impugned order dated 3

rd

December, 2024,

blacklisting the appellant-JV and the impugned judgment and

order dated 17

th

December, 2025, passed by the learned

Single Judge of this Court in WP (C) No.24 of 2025, it would 2026:MLHC:85-DB

Page 28 of 52

be apposite to deal with the law with respect to show cause

notice, in cases relating to blacklisting, which is no longer res-

integra.

27. In M/S Erusian Equipment and Chemicals Ltd v.

State of West Bengal & anr reported in (1975) 1 SCC 70,

the question that arose before the Apex Court was whether a

person who is put on the blacklist by the State Government is

entitled to a notice to be heard before the name is put on the

blacklist? The Apex Court in paras 15 to 17, 19 and 20 held as

under:

“15. The blacklisting order does not pertain to any

particular contract. The blacklisting order involves civil

consequences. It cast a slur. It creates a barrier between

the persons blacklisted and the Government in the matter

of transactions. The black lists are “instruments of

coercion”.

16. In passing an order of blacklisting the Government

department acts under what is described as a

standardised code. This is a code for internal instruction.

The Government departments make regular purchases.

They maintain list of approved suppliers after taking into

account the financial standard of the firm, their capacity

and their past performance. The removal from the list is

made for various reasons. The grounds on which

blacklisting may be ordered are if the proprietor of the firm

is convicted by court of law or security considerations to 2026:MLHC:85-DB

Page 29 of 52

warrant or if there is strong justification for believing that

the proprietor or employee of the firm has been guilty of

malpractices such as bribery, corruption, fraud, or if the

firm continuously refuses to return Government dues or if

the firm employs a Government servant, dismissed or

removed on account of corruption in a position where he

could corrupt Government servants. The petitioner was

blacklisted on the ground of justification for believing that

the firm has been guilty of malpractices such as bribery,

corruption, fraud. The petitioners were backlisted on the

ground that there were proceedings pending against the

petitioners for alleged violation of provisions under the

Foreign Exchange Regulations Act.

17. The Government is a Government of laws and not of

men. It is true that neither the petitioner nor the

respondent has any right to enter into a contract but they

are entitled to equal treatment with others who offer

tender or quotations for the purchase of the goods. This

privilege arises because it is the Government which is

trading with the public and the democratic form of

Government demands equality and absence of

arbitrariness and discrimination in such transactions.

Hohfeld treats privileges as a form of liberty as opposed to

a duty. The activities of the Government have a public

element and, therefore, there should be fairness and

equality. The State need not enter into any contract with

any one but if it does so, it must do so fairly without

discrimination and without unfair procedure. Reputation is

a part of a person’s character and personality. Blacklisting

tarnishes one's reputation.

19. Where the State is dealing with individuals in

transactions of sales and purchase of goods, the two

important factors are that an individual is entitled to trade

with the Government and an individual is entitled to a fair

and equal treatment with others. A duty to act fairly can

be interpreted as meaning a duty to observe certain 2026:MLHC:85-DB

Page 30 of 52

aspects of rules of natural justice. A body may be under a

duty to give fair consideration to the facts and to consider

the representations but not to disclose to those persons

details of information in its possession. Sometimes duty to

act fairly can also be sustained without providing

opportunity for an oral hearing. It will depend upon the

nature of the interest to be affected, the circumstances in

which a power is exercised and the nature of sanctions

involved therein.

20. Blacklisting has the effect of preventing a person from

the privilege and advantage of entering into lawful

relationship with the Government for purposes of gains.

The fact that a disability is created by the order of

blacklisting in decades that the relevant authority is to

have an objective satisfaction. Fundamentals of fair play

require that the person concerned should be given an

opportunity to represent his case before he is put on the

blacklist.”

28. In Gorkha Security Services v. Government (NCT of

Delhi) & ors reported in (2014) 9 SCC 105, the Apex Court

was called upon to consider the form and content of show

cause notice that is required to be served before deciding,

whether the noticee is to be blacklisted or not? and whether it

was a mandatory requirement that there should be a

stipulation contained in the show cause notice that action of

blacklisting is proposed? The Apex Court in paras 21, 22 and

29 held as under: 2026:MLHC:85-DB

Page 31 of 52

“21. The central issue, however, pertains to the

requirement of stating the action which is proposed to be

taken. The fundamental purpose behind the serving of

show-cause notice is to make the noticee understand the

precise case set up against him which he has to meet. This

would require the statement of imputations detailing out

the alleged breaches and defaults he has committed, so

that he gets an opportunity to rebut the same. Another

requirement, according to us, is the nature of action which

is proposed to be taken for such a breach. That should

also be stated so that the noticee is able to point out that

proposed action is not warranted in the given case, even if

the defaults/breaches complained of are not satisfactorily

explained. When it comes to blacklisting, this requirement

becomes all the more imperative, having regard to the fact

that it is harshest possible action.

22. The High Court has simply stated that the purpose of

show-cause notice is primarily to enable the noticee to

meet the grounds on which the action is proposed against

him. No doubt, the High Court is justified to this extent.

However, it is equally important to mention as to what

would be the consequence if the noticee does not

satisfactorily meet the grounds on which an action is

proposed. To put it otherwise, we are of the opinion that in

order to fulfil the requirements of principles of natural

justice, a show-cause notice should meet the following two

requirements viz:

(i) The material/grounds to be stated which

according to the department necessitates an action;

(ii) Particular penalty/action which is proposed

to be taken. It is this second requirement which the

High Court has failed to omit.

We may hasten to add that even if it is not specifically

mentioned in the show-cause notice but it can clearly and 2026:MLHC:85-DB

Page 32 of 52

safely be discerned from the reading thereof, that would

be sufficient to meet this requirement.

29. No doubt, rules of natural justice are not embodied

rules nor can they be lifted to the position of fundamental

rights. However, their aim is to secure justice and to

prevent miscarriage of justice. It is now well-established

proposition of law that unless a statutory provision either

specifically or by necessary implication excludes the

application of any rules of natural justice, in exercise of

power prejudicially affecting another must be in conformity

with the rules of natural justice.”

29. In UMC Technologies Private Ltd v. Food Corporation

of India & anr reported in (2021) 2 SCC 551, the Apex

Court held in paras 14 and 21 as under:

“14. Specifically, in the context of blacklisting of a person

or an entity by the State or a State Corporation, the

requirement of a valid, particularised and unambiguous

show-cause notice is particularly crucial due to the severe

consequences of blacklisting and the stigmatisation that

accrues to the person/entity being blacklisted. Here, it

may be gainful to describe the concept of blacklisting and

the graveness of the consequences occasioned by it.

Blacklisting has the effect of denying a person or an entity

the privileged opportunity of entering into government

contracts. This privilege arises because it is the State who

is the counterparty in government contracts and as such,

every eligible person is to be afforded an equal opportunity

to participate in such contracts, without arbitrariness and

discrimination. Not only does blacklisting take away this

privilege, it also tarnishes the blacklisted person's

reputation and brings the person's character into question. 2026:MLHC:85-DB

Page 33 of 52

Blacklisting also has long-lasting civil consequences for

the future business prospects of the blacklisted person.

21. Thus, from the above discussion, a clear legal position

emerges that for a show-cause notice to constitute the

valid basis of a blacklisting order, such notice must spell

out clearly, or its contents be such that it can be clearly

inferred therefrom, that there is intention on the part of the

issuer of the notice to blacklist the noticee. Such a clear

notice is essential for ensuring that the person against

whom the penalty of blacklisting is intended to be

imposed, has an adequate, informed and meaningful

opportunity to show cause against his possible

blacklisting.”

30. In Kulja Industries Ltd v. Chief General Manager

Western Telecom Project Bharat Sanchar Nigam Limited

& ors reported in (2014) 14 SCC 731, the Apex Court held as

under:

“21. The legal position governing blacklisting of suppliers

in USA and UK is no different. In USA instead of using the

expression “blacklisting” the term “debarring” is used by

the statutes and the courts. The Federal Government

considers “suspension and debarment” as a powerful tool

for protecting taxpayer resources and maintaining integrity

of the processes for federal acquisitions. Comprehensive

guidelines are, therefore, issued by the Government for

protecting public interest from those contractors and

recipients who are non-responsible, lack business integrity

or engage in dishonest or illegal conduct or are otherwise

unable to perform satisfactorily. These guidelines 2026:MLHC:85-DB

Page 34 of 52

prescribe the following among other grounds for

debarment:

(a) Conviction of or civil judgment for.—

(1) Commission of fraud or a criminal offense in

connection with obtaining, attempting to obtain, or

performing a public or private agreement or transaction;

(2) Violation of Federal or State antitrust statutes,

including those proscribing price fixing between

competitors, allocation of customers between competitors,

and bid rigging;

(3) Commission of embezzlement, theft, forgery,

bribery, falsification or destruction of records, making

false statements, tax evasion, receiving stolen property,

making false claims, or obstruction of justice; or

(4) Commission of any other offense indicating a lack

of business integrity or business honesty that seriously

and directly affects your present responsibility;

(b) Violation of the terms of a public agreement or

transaction so serious as to affect the integrity of an

agency program, such as.—

(1) A wilful failure to perform in accordance with the

terms of one or more public agreements or transactions;

(2) A history of failure to perform or of unsatisfactory

performance of one or more public agreements or

transactions; or

(3) A wilful violation of a statutory or regulatory

provision or requirement applicable to a public agreement

or transaction;

(c) * * *

(d) Any other cause of so serious or compelling a

nature that it affects your present responsibility. 2026:MLHC:85-DB

Page 35 of 52

25. Suffice it to say that “debarment” is recognised and

often used as an effective method for disciplining deviant

suppliers/contractors who may have committed acts of

omission and commission or frauds including

misrepresentations, falsification of records and other

breaches of the regulations under which such contracts

were allotted. What is notable is that the “debarment” is

never permanent and the period of debarment would

invariably depend upon the nature of the offence

committed by the erring contractor.”

31. In Patel Engineering Ltd v. Union of India & anr

reported in (2012) 11 SCC 257 , the Apex Court held as

under:

“36. We cannot say the reasoning adopted by the second

respondent is either irrational or perverse. The dereliction,

such as the one indulged in by the petitioner, if not

handled firmly, is likely to result in recurrence of such

activity not only on the part of the petitioner, but others

also, who deal with public bodies, such as the second

respondent giving scope for unwholesome practices. No

doubt, the fact that the petitioner is blacklisted (for some

period) by the second respondent is likely to have some

adverse effect on its business prospects, but, as pointed

out by this Court in Jagdish Mandal v. State of Orissa

[(2007) 14 SCC 517] :(SCC p.518) “Power of judicial review

will not be invoked to protect private interest at the cost of

public interest, or to decide contractual disputes.”

2026:MLHC:85-DB

Page 36 of 52

32. The aforesaid legal position is well settled and

undisputed and there can be no escape from the said settled

legal principles. The question that arises for consideration

before us, is whether there is breach of any of the said

principles enunciated, by the Apex Court in the facts of the

present case.

33. Keeping in mind the settled position of law and the facts

in hand, we are of the opinion that no interference is

warranted in the order blacklisting the appellant-JV and the

impugned judgment and order dated 17

th

December, 2025

passed in WP (C) No.24 of 2025, by which the appellant’s writ

petition, challenging the order blacklisting them for five years

from participating in any future tender/contract of the PWD

was dismissed, for the reasons that follow.

34. At the outset, we may note certain admitted facts; (a)

that a contract was entered into between the appellant-JV and

the respondent on 21

st

February, 2011, for the period of 36

months w.e.f. 7

th

March, 2011, i.e., till 6

th

March, 2014; (b) 2026:MLHC:85-DB

Page 37 of 52

that the contract amount was ₹1303.83 crore; (c) that the

contract period was extended from time to time; (d) that the

appellant-JV completed the work on 15

th

December, 2017;

and (e) that the final completion certificate was issued on 13

th

March, 2018. It appears that during the extension granted to

complete the contract, the comprehensive contract value was

revised from ₹1303.83 crores to ₹2406.46 crores. It is also not

disputed that there were two proceedings initiated by the

appellant-JV, i.e., DRB-I and DRB-II, and that arbitration

proceeding were also initiated by the appellant-JV and the

respondent.

35. It is also not in dispute that in the arbitration

proceeding, the appellant-JV had submitted statement of

claims, i.e., ledger accounts in support of its claim. The

ledgers concerned Claim-II. It is this ledger account, which

has been relied upon by the respondent to issue show cause

notice to the appellant-JV. The statement of claim dated 30

th

May, 2019, filed by the appellant-JV before the Arbitral 2026:MLHC:85-DB

Page 38 of 52

Tribunal, alongwith the ledger account under the head of

‘business promotion account ’, reflects payment s of

cash/expenditure/cheque payments made to various

officials/authorities. The statement of claim under the head of

‘business promotion account’ shows the following ledger

entries;

“13.1 Cash being paid for purchase of gift

items for Govt. officials;

13.2 Cash being paid for tour from Shillong to

Guwahati to-fro charges (for IOCL officials) and

sweets- for seeking extension of time in clearing

dues.

13.3 Cash being paid for gift articles purchased

and given to local administrators (watch from

HELOIS-Titan Company);

13.4 Cash being paid at Hotel Polo Towers for

celebration of Engineers Day of PWD Department

Staff as per instruction of Higher Management;

13.5 Cash being paid towards purchase of W.

Bottles (B Dog) 3nos@ 1600/- for officials;

13.6 Cash being paid towards amount at

Bamboo Hut Restaurant for farewell party with

PWD Staff;

13.7 Cash being paid towards expenses at City

Hut Family Dhaba for Govt. officials;

2026:MLHC:85-DB

Page 39 of 52

13.8 Cash being paid for purchase of Whisky

Bottles for officials;

13.9 Expenditure in favour of Highland Studio

against purchase of gift (Samsung Tab) items for

officials in the Christmas Festival;

13.10 Expenditure incurred in favour of MX Tech

against purchase of gift items (Samsung Galaxy

Core 2 Prime) for officials in the event of

Christmas Festival);

13.11 Cash being paid towards purchase of Titan

Watch 3 Nos from Meghatraders for officials;

13.12 Cash being paid towards purchase of

Whisky Bottles towards Govt. officials;

13.13 Expenditure incurred for purchase of gift

items for event of New Year 2015;

13.14 Cash being paid for purchase of sweets for

IOCL officials;

13.15 Cheque of Rs 5,00,000/ - paid to

NONGKHNUM WE CARE SOCIETY as per

instructions of Higer Management;

13.16 Cash being paid towards purchase of gift

items for officials of local administration purpose;

13.17 Cash being paid for purchase of Samsung

Mobile Phone 1 nos for official purpose.”

36. It is submitted on behalf of the appellant -JV that

reliance placed on these ledger entries in the impugned show 2026:MLHC:85-DB

Page 40 of 52

cause notice or the order blacklisting the appellant-JV is

misconceived inasmuch as, it does not show what was the

thing, its value and how it influenced the officials, in the

execution of the contract. It is further submitted that there is

no name of any public official mentioned but only designation

and that the show cause notice, which places reliance on the

ledger entries, does not in any way show quid pro quo by any

government official to the appellant-JV. It is further submitted

by the learned Senior Counsel for the appellant-JV that at the

highest, it can be said that it was a goodwill gesture by the

appellant-JV to the bureaucracy but does not show that the

appellant-JV got anything in return or that there was any quid

pro quo.

37. In this context, at this stage, it would be relevant to

reproduce Clause 37 of the ‘Instruction to bidders’ and 59.2(h)

of the General Conditions of Contract, respectively.

“37. Corrupt or Fraudulent Practice

37.1 The employer will reject a proposal for award if it

determines that the bidder for award has engaged in 2026:MLHC:85-DB

Page 41 of 52

corrupt or fraudulent practices is competing for the

contract in question will declare the form in eligible, either

indefinitely or for a stated period of time, to be awarded a

contract with National Highway Authority of India/State

P.W.D. and any other agencies, if at any time determines

that the firm has engaged in corrupt or fraudulent

practices in competing for the contractor, or in execution.

59. Termination

59.1. The Employer or the Contractor may terminate the

other party causes a fundamental breach of the Contract.

59.2. Fundamental breaches of Contract include, but shall

not be limited to the following:

a) the Contractor stops work for 28 days when no

stoppage of work is shown on the current Programme

and the stoppage has not been authorized by the

Engineer;

b) The Engineer instructs the Contractor to delay the

progress of the works and the instruction is not

withdrawn within 28 days;

c) The Employer or the Contractor is made bankrupt

or goes into liquidation other than for a reconstruction

or amalgamation;

h) If the Contractor, in the judgment of the

Employer has engaged in corrupt or fraudulent

practices in competing for or executing the

contract.

For the purpose of this paragraph: “corrupt practice”

means the offering, giving, receiving or soliciting of

anything of value to influence the action of a public 2026:MLHC:85-DB

Page 42 of 52

official in procurement process or in contract

execution.

Fundamental practice “means misrepresentation of

facts in order to influence a procurement process or

the execution of a contract to the detriment of the

Borrower and includes collusive practice among

Bidders (prior to or after bid submission) designed to

establish bid prices at artificial non-competitive levels

and to deprive the Borrower of the benefits of free

and open competition.

The above said act of corrupt practice in

execution of the project are duly covered under

the heading “fraudulent practice” and moreover

the employer has a right even independent of

contract to initiate blacklisting/debarment

procedure for indulging in corrupt and

fraudulent practices.”

(emphasis supplied)

38. It is pertinent to note, that Clause 37 applies not only at

the time of completion of the contract, but also in its

execution. According to the respondent, the facts reveal

corrupt practice by the appellant-JV, during the execution of

the contract. Clause 59.2(h) as reproduced hereinabove spells

out the scope of what is ‘corrupt practice’. The said Clause

59.2(h) reveals that there is a power vested in the respondent

to take appropriate action, even though it was concluded 2026:MLHC:85-DB

Page 43 of 52

contract. Clause 59.2(h) also reveals, that the respondent, in

addition, even in the absence of the said provision in the

contract, had an inherent power to blacklist/debar the

appellant-JV, for indulging in corrupt and fraudulent

practices.

39. The Apex Court in Kulja Industries Limited v. Chief

General Manager Telecom Project B harat Sanchar Nigam

Limited & ors: (2014) 14 SCC 731 has in para 17 held as

under:

“17. That apart, the power to blacklist a contractor

whether the contract be for supply of material or

equipment or for the execution of any other work

whatsoever is in our opinion inherent in the party allotting

the contract. There is no need for any such power being

specifically conferred by statute or reserved by contractor.

That is because "blacklisting" simply signifies a business

decision by which the party affected by the breach decides

not to enter into any contractual relationship with the

party committing the breach. Between two private parties

the right to take any such decision is absolute and

untrammelled by any constraints whatsoever. The

freedom to contract or not to contract is unqualified in the

case of private parties. But any such decision is subject to

judicial review when the same is taken by the State or any

of its instrumentalities. This implies that any such decision

will be open to scrutiny not only on the touchstone of the 2026:MLHC:85-DB

Page 44 of 52

principles of natural justice but also on the doctrine of

proportionality. A fair hearing to the party being

blacklisted thus becomes an essential precondition for a

proper exercise of the power and a valid order of

blacklisting made pursuant thereto. The order itself being

reasonable, fair and proportionate to the gravity of the

offence is similarly examinable by a writ court.”

40. As noted earlier in the ‘business promotion account’,

i.e., ledger account, the details of expenses have been

mentioned i.e., expenses incurred for purchasing alcohol,

personal gifts etc. for government officials. The said business

promotion account/ledger account has been filed with the

statement of claim and admittedly, has not been denied by the

appellant-JV. Eg. entry dated 31

st

December, 2015, shows

purchase of HP laptop for PWD, Junior Engineer; entry dated

18

th

June, 2015, cash paid to Mr. K. Chakradhar towards

purchase of gift items (family watch set 1 No.) for government

official purpose; amounts spent for costly gifts such as

mobiles, cameras; entries regarding monthly payments to the

police station; donation of ₹4 lakhs made to the Police Officers

Wives Association, donation of ₹5 lakhs made to Nongkhnum 2026:MLHC:85-DB

Page 45 of 52

We Care Society and so on; entries of gifts to officers of Public

Works Department, to MoRTH officers, DRB members etc.

41. It is pertinent to note that based on the aforesaid ledger

entries, which were submitted with the statement of claim

dated 30

th

May, 2019, the respondent had issued the

impugned show cause notice dated 16

th

September, 2024.

Admittedly, the appellant-JV has not denied the said entries

given with the statement of claim. The explanation offered by

the appellant-JV is, that the same was not given as bribes,

and that some of the mon ies were given to charitable

organisations, and that the said entries do not in any way

reflect that the said amounts were given by way of corrupt

practice or bribe to any official; and that at the highest, one

can say that the statement of claim submitted by the

appellant-JV, with respect to the said entries was wrongfully

claimed and that the same could not have been claimed by the

appellant-JV, is clearly an afterthought.

2026:MLHC:85-DB

Page 46 of 52

42. Infact, a perusal of the show cause notice dated 16

th

September, 2024, would show that the same clearly sets out

the instances of alleged corrupt practice directly attributable

to the appellant-JV. It may be noted, that the appellant-JV in

its reply thereto dated 30

th

September, 2024 has not

specifically denied the entries but have explained the same as

expenses validity incurred and were not acts of alleged

bribery/corruption. Thus, despite opportunity being given,

appellant-JV failed to satisfactorily explain the allegations on

which blacklisting was proposed. In this context, it would be

apposite to reproduce para 2 of the judgment of the Apex

Court in Grosons Pharmaceuticals (P) Ltd. v. State of U.P.

& ors: (2001) 8 SCC 604, which reads thus:

“2. ..... It is true that an order blacklisting an approved

contractor results in civil consequences and in such a

situation in the absence of statutory rules, the only

requirement of law while passing such an order was to

observe the principle of audi alteram partem which is one

of the facet of the principles of natural justice. The

contention that it was incumbent upon the respondent to

have supplied the material on the basis of which the

charges against the appellant were based was not the

requirement of principle of audi alteram partem. It was 2026:MLHC:85-DB

Page 47 of 52

sufficient requirement of law that an opportunity of show

cause was given to the appellant before it was blacklisted.

It is not disputed that in the present case, the appellant

was given an opportunity to show cause and he did reply

to the show cause which was duly considered by the State

Government. We are, therefore, of the view that that the

procedure adopted by the respondent while blacklisting

the appellant was in conformity with the principles of

natural justice.”

43. It is also evident from the aforesaid clauses 37 and

59.2(h), that it was permissible for the respondent to blacklist

or debar the contractor even independent of the contract,

inasmuch as, the respondent had an inherent right to choose

with whom to do business with and to debar entities that

indulge in corrupt and fraudulent activities. The allegations in

the show cause notice pertain to the execution of the contract,

during the period 2015 to 2017.

44. Thus, from the aforesaid clauses, it is evident that the

respondent was well within its power to issue show cause

notice to the appellant-JV for backlisting and consequently, on 2026:MLHC:85-DB

Page 48 of 52

consideration of appellant-JV’s reply, to take appropriate

action for blacklisting the appellant-JV.

45. We may also note from a perusal of the show cause

notice, the reply of the appellant-JV and the impugned order

dated 3

rd

December, 2024, that the material relied upon for

issuance of show cause notice and subsequently, passing the

blacklisting order, was based on the admitted ledgers

produced by the appellant-JV and admitted to , by the

appellant-JV in the cross-examination before the Arbitral

Tribunal. The admitted entries, albeit sought to explain, form

the basis of illegal gratification to government officials. In

these circumstances, we do not find the action of the

respondent to be vitiated by mala fides or motivated. The State

is under an obligation to put public interest over everything

else. After all, the monies utilised is public money, which

cannot be lost sight of.

46. On the question of delay as vehemently argued by Mr.

Jethmalani, learned Senior Counsel for the appellant-JV, we 2026:MLHC:85-DB

Page 49 of 52

are of the opinion that in the facts, no delay was occasioned

warranting quashing of the order of blacklisting on the said

count. As noted above, the statement of claim was filed on

30

th

September, 2019, and that during the period from 25

th

April, 2022 to 9th May, 2022, the proceeding before the

Arbitral Tribunal was stayed. It is also evident that the cross-

examination of the appellant-JV commenced only on 11

th

July, 2022, after the stay was vacated, after which on 3

rd

September, 2024, a complaint was filed, pursuant to which

an FIR was registered at the behest of the respondent. The FIR

is based on the statement of claims/ledger accounts

submitted by the appellant-JV before the Arbitral Tribunal.

Post registration of the FIR, show cause notice dated 16

th

September, 2024 was issued to the appellant-JV. Hence, in

the facts, we do not find that the delay is such, warranting

quashing of the impugned order blacklisting the appellant-JV.

47. As far as the submission of Mr. Jethmalani, learned

Senior Counsel, that the show cause notice is vague and 2026:MLHC:85-DB

Page 50 of 52

devoid of particulars, we find no merit in the same. We find

that the show cause notice details the particulars, including

setting out the entries in the ledger account showing

payments made to the officials, and as such, the said show

cause notice cannot be quashed and set aside on the ground

of vagueness and being devoid of particulars. We also find that

principles of natural justice have been duly complied with and

that the impugned order blacklisting the appellant-JV has

been passed after considering the material on record and as

such, no interference is warranted in the same.

48. As far as the delay in registration of the FIR and the

non-inclusion of the Prevention of Corruption Act is

concerned, it is pertinent to note that the said FIR is under

investigation. The question, whether or not an offence is made

out will be considered by the Court in the petition filed by

some of the persons seeking quashing of the FIR, and as such

cannot be gone into in the present appeal.

2026:MLHC:85-DB

Page 51 of 52

49. As far as the findings/observations made by the

Tribunal and the High Court in their orders, both learned

Senior Counsel for the appellant-JV and the learned Advocate

General vehemently relied on the same, to point out the

damning observations so made by the Tribunal/Court. It

appears that the Arbitral Tribunal’s order has been challenged

under Section 34 of the Act, before the appropriate forum. Mr.

Jethmalani relied on certain observations and scathing

remarks made by the Tribunal/High Court against the

respondent, including imposition of costs on the respondent,

whereas, Mr. Kumar, learned Advocate General, also relied on

the damning observations made by the Arbitral Tribunal and

the High Court with respect to the ledger entries submitted by

the appellant-JV in the arbitration proceeding, to show how

the Tribunal and the High Court had dealt with the ledger

entries and had made scathing remarks against the appellant-

JV. As stated aforesaid, we will not go into the merits of the

same, since the question before us is, whether the show cause

notice and consequently, the blacklisting order suffers from 2026:MLHC:85-DB

Page 52 of 52

any infirmities and is bad in law; and whether the impugned

judgment and order passed by the learned Single Judge

suffers from any infirmities, warranting interference in the

same.

50. Suffice to state, that in the facts as stated above and

having regard to the judicial pronouncements, we find that no

interference is warranted either in the order dated 3

rd

December, 2024, blacklisting the appellant-JV or in the order

impugned dated 17

th

December, 2025, passed by the learned

Single Judge in WP (C) No.24 of 2025.

51. In terms of the aforesaid, the w rit appeal stands

dismissed.

(W. Diengdoh) (Revati Mohite Dere)

Judge Chief Justice

2026:MLHC:85-DB