Allahabad High Court Imposes ₹1 Lakh Cost On DM, ₹25K On Education Officer For Violating Law On Blacklisting Of Companies

The Allahabad High Court has imposed a cost of Rs. 1,00,000 on District Magistrate, Unnao and Rs. 25,000 on District Basic Education Officer, Unnao for violating the law laid down by the Supreme Court regarding blacklisting of companies.Petitioners approached the High Court against the order blacklisting them on grounds that no show cause notice was issued to them prior to passing of the order and the order for blacklisting cannot be for indefinite period. The bench of Justice Rajan Roy and Justice Manish Kumar said,“As observed earlier everyday we are flooded with such petitions where blacklisting orders are being passed either without issuing any show cause notice or for an indefinite period. After all, how many times the Court will pronounce their judgment as to the procedure and the law on the subject of blacklisting. The Officers should be aware of it especially when they have a battery of lawyers to assist them right from the High Court to the District level. In such matters, if they are not aware about the law, they should take legal opinion before proceeding against any firm as it may have serious consequences for a firm/company which is blacklisted. None of this exercise was done. That is why we were compelled to pass the aforesaid order.”The Court had earlier called upon the DM and the Education Officer to file their own affidavits as to why the order has been passed in teeth of Supreme Court judgments.The DM stated that once the petitioners bids were disqualified they were informed on the GeM portal and their email to challenge their disqualification, however, no response was filed by them. Accordingly, they were debarred. It was further stated that the debarment was for 1 year, extendable upto 2 years. To this, the Court observed that the period was not mentioned in the order when it is the law that period of blacklisting must be mentioned and it cannot be for an indefinite period. Further, the Court observed that the District Magistrate had not applied his mind and did not bother to respond or go through the judgments cited by the Court in its previous order. “It appears that he has not even bothered to go through the said decisions, referred in our order dated 07.07.2025, quoted hereinabove, otherwise he would not have offered the explanation which he has tried to putforth before us. This is nothing but an intransigent attempt to justify an unjustifiable act in the teeth of law declared by Hon'ble the Supreme Court. The provisions cited by him could not be applied without putting the petitioners to notice proposing the action of blacklisting giving them reasonable opportunity to respond and the basis/material on which such action was proposed, with opportunity to it to respond and consider such response. It is settled law that apart from other aspects proportionality is also an issue to be considered in such matters.”It noted that the District Basic Education Officer, Unnao had apologised and stated that in future she will not take any action which may be perceived in violation of judgments of the Supreme Court, however no such apology was put forth by the District Magistrate. Noting that the District Magistrate circulated the order in the State without verifying its legality, the Court quashed the order and imposed cost on both the District Magistrate and the District Basic Education Officer, Unnao.Case: M/S Cropscare Infotech Pvt. Ltd. Lucknow v. State Of U.P. Click Here To Read/Download Order

Allahabad High Court Imposes ₹1 Lakh Cost On DM, ₹25K On Education Officer For Violating Law On Blacklisting Of Companies

Upasna Agrawal

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