Allahabad High Court Deprecates Practice Of Authorities Using 'Blacklisting' As A Tool For 'Extraneous' Reasons

Emphasising that the punishment of blacklisting is required to be imposed upon a person only in rare cases, as the same is extremely harsh and stringent, which deprives a person of his right to carry on business, the Allahabad High Court recently noted that the authorities often use the tool of blacklisting as a mechanism for extraneous reasons. “Such practices are deprecated by this Court. It is to be further noted that the period of blacklisting has to be proportionate to the fault committed by the person upon whom the blacklisting is being done,” a bench of Justice Shekhar B. Saraf and Justice Vipin Chandra Dixit remarked. The division bench observed thus while disposing of the writ petitions moved by V-Marc India Limited challenging an order of blacklisting passed by the Superintending Engineer (Material Management-I), Vidhyut Vitran Nigam Limited, Urja, Victoria Park, Meerut. In this case, a three-member committee, after granting the petitioner an opportunity to hear, gave a recommendation to the authority concerned that passed the impugned order. The authority concerned, without providing a copy of the reports of the three-member committee, passed the final order of blacklisting and other penalties, including the termination of the contract. In its order, the bench noted that the report of the three-member committee should have been provided to the petitioner, and another opportunity of hearing should have been granted to the petitioner after being confronted with the three-member committee report. As the same was not done, the Court concluded that the principles of natural justice were violated in the case. Thus, without going into the merits of the case, the Court quashed and set aside the impugned order with a direction upon the authority concerned to grant an opportunity of hearing to the petitioner and, thereafter, pass a reasoned order. The bench directed that the entire process should be completed within two months. The Court clarified that in the meantime, since the impugned order has been quashed and set aside, the petitioner shall not be considered to be blacklisted, and it may participate in Government's tender in accordance with law. Senior Advocates Anoop Trivedi and Saket Singh, assisted by Advocates Mrinal Bharti, Ravikant Sharma, Manish Shekhari, Anisha Mahajan and Krishna Gopal, appeared on behalf of the petitioner. Standing Counsel appeared on behalf of the State. Advocate Kartikeya Saran appeared on behalf of the Vidhyut Vitran Nigam Limited.Case title - V-MARC INDIA LIMITED vs. STATE OF UTTAR PRADESH AND OTHERS 2025 LiveLaw (AB) 70Case citation: 2025 LiveLaw (AB) 70Click Here To Read/Download Order

Allahabad High Court Deprecates Practice Of Authorities Using 'Blacklisting' As A Tool For 'Extraneous' Reasons

Sparsh Upadhyay

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