The Madhya Pradesh High Court has held that the blacklisting of a contractor cannot be done for an indefinite period.
The petitioner firm had challenged the order of the engineer-in-chief of MP state public works department that rejected an appeal against its blacklisting.
The firm was awarded contract for road construction, but due to certain disputes, including paucity of funds with the respondents leading to slow process of construction, the contract was terminated and the firm was blacklisted.
The petitioner argued blacklisting could not be done for an indefinite period.
A division bench comprising Chief Justice Hemant Gupta and Justice Vijay Kumar Shukla said: “We find merit in the said argument that blacklisting cannot be done for an indefinite period, as the fact of blacklisting is depriving the contractor of his participation in public contracts.”
“The period of blacklisting has to be specified, keeping in view the nature of default committed by the contractor,” the court said.