The Rajasthan High Court has held that repeated notices seeking payment of outstanding dues cannot substitute a proper notice informing a contractor that failure to comply could result in blacklisting or debarment from future tenders.

The bench of Justice Anoop Kumar Dhand set aside an order against the petitioner that debarred its participation in any further tenders of the respondent-department on account of non-payment of certain dues despite several notices, in the background that no opportunity of hearing was provided before passing the order.

“The petitioner was served with a brief show cause notice levelling certain charges against him. Thereafter, without providing due opportunity of hearing to the petitioner, straightaway the impugned order has been passed by the respondents.”

For context, the petitioner emerged successful in a tender floated by the respondent for operating golf carts in the Sajjangarh Biological Park, Udaipur. There were certain outstanding dues on part of the petitioner which remained un-deposited. Several notices were issued by the department to the petitioner, despite which the dues were not cleared.

Consequently, an order was passed by the respondent, blacklisting the petitioner from participating in the future tender processes of the respondent-department for indefinite period. This order was challenged by the petitioner.

It was argued that the order was passed without issuing any show cause notice and providing opportunity of hearing to the petitioner.

On the contrary, the respondent argued that several notices were issued to the petitioner, seeking payment of outstanding dues, which were not complied with. Hence, as per section 40 of the Rajasthan Transparency in Public Procurement Act, 2012, the order was passed.

After hearing the contentions, the Court highlighted that even though several noticed were issued to the petitioner, there was no assertion in any of the notices that in case of non-compliance, the petitioner shall be debarred from future tenders. This was held to be a clear violation of the principles of natural justice. The Court observed,

“The fundamental maxim of natural justice i.e. audi alteram partem has several facets, two of them being (a) notice of the case to be issued and (b) grant of due opportunity to explain oneself. In the instance case, he first requirement was duly complied with by the respondents by issuing a show cause notice to the petitioner but they failed to comply with the second requirement as they did not grant the petitioner an opportunity to be heard & explained his case before passing the impugned order, which has resulted in a gross violation of the principles of natural justice…”

In this background, the Court held that the order passed by the department was unsustainable in the eyes of law and hence was set aside.

Title: M/s S.S. Corporation v State of Rajasthan & Ors.

Citation: 2026 LiveLaw (Raj) 364

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