{"id":176078,"date":"1978-03-20T00:00:00","date_gmt":"1978-03-19T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/joseph-vilangandan-vs-the-executive-engineer-on-20-march-1978"},"modified":"2019-02-25T18:46:29","modified_gmt":"2019-02-25T13:16:29","slug":"joseph-vilangandan-vs-the-executive-engineer-on-20-march-1978","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/joseph-vilangandan-vs-the-executive-engineer-on-20-march-1978","title":{"rendered":"Joseph Vilangandan vs The Executive Engineer, … on 20 March, 1978"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Joseph Vilangandan vs The Executive Engineer, … on 20 March, 1978<\/div>\n
Equivalent citations: 1978 AIR 930, \t\t 1978 SCR (3) 514<\/div>\n
Author: R S Sarkaria<\/div>\n
Bench: Sarkaria, Ranjit Singh<\/div>\n
           PETITIONER:\nJOSEPH VILANGANDAN\n\n\tVs.\n\nRESPONDENT:\nTHE EXECUTIVE ENGINEER, BUILDINGS & ROADS (P.W.D.) DIVISION,\n\nDATE OF JUDGMENT20\/03\/1978\n\nBENCH:\nSARKARIA, RANJIT SINGH\nBENCH:\nSARKARIA, RANJIT SINGH\nKAILASAM, P.S.\n\nCITATION:\n 1978 AIR  930\t\t  1978 SCR  (3) 514\n 1978 SCC  (3)\t36\n\n\nACT:\nNatural\t  Justice-Black\t listing  of  a\t  contractor-Whether\nopportunity   of   being  heard\t  is   necessary-Nature\t  of\nopportunity.\n\n\n\nHEADNOTE:\nThe  appellant\twas  a Government  Contractor  of  16  years\nstanding.   He has been executing major building  contracts.\nThe Executive Engineer, PWD, Ernakulam, invited tenders\t for\nexecuting certain repairs to English and Mathematics  blocks\nof  Maharaja College at Ernakulam.  The tender given by\t the\nappellant was accepted, and a formal agreement was executed.\nThe  agreement\tprovided that the work should  be  completed\nwithin\ta  stipulated  time  and  that\tthe  time  shall  be\nconsidered as the essence of the contract.\nThe  appellant\talleged that in spite of  his  requests\t the\nbuilding  was not handed over to him to enable him to  start\nthe  work, and that in the meantime, the  Engineers'  strike\nsupervened  in which respondents 1 to 4\t participated.\t The\nExecutive Engineer sent a letter to the appellant asking him\nto  show cause why the work might not be arranged  otherwise\nat  the\t appellant's risk and loss  through  other  agencies\nafter debarring the appellant as a defaulter and making good\nthe  loss  that\t might accrue to  the  department  from\t the\nsubsisting  contract in the division.  The appellant sent  a\nreply  to the show cause notice asserting that he  committed\nno  default.  The Executive Engineer finally  cancelled\t the\ncontract and informed the appellant; that the work was being\narranged  at  the appellant's risk and\tloss  through  other\nagencies after declaring him a defaulter.  The appellant was\ndebarred  from\ttaking\tany contracts  in  future  from\t the\nDepartment  in\tErnakulam Division.  The appellant  filed  a\nwrit  petition\tunder Art. 226 before the High\tCourt.\t The\nlearned Single Judge dismissed the Writ Petition.  An appeal\nfiled to the Division Bench also failed:\nThe  appellant contended in, appeal by Special\tLeave,\tthat\nthe  order  was\t illegal and void for the  reasons  that  no\nopportunity was given to the appellant to represent his case\nbefore\tpassing\t the impugned order.  'The  respondent\tcon-\ntended that the notice given to the appellant requesting him\nto  show  cause why the work might not be got  done  through\nother agencies after debarring him as a defaulter,  afforded\nhim sufficient opportunity to represent his case.\nAllowing the appeal the Court,\nHELD  (1) The majority judgment of the Kerala High Court  in\nthe  case  of Thomas v. State of Kerala which holds  that  a\nperson\tis  not entitled to a hearing before  he  is  black-\nlisted must be deemed to have been over-ruled by this  Court\nin  the case of Erusian Equipment & Chemicals Ltd. v.  State\nof  West  Bengal,<\/a>  where it was held  that  fundamentals  of\nfairplay  require that the person concerned should be  given\nan opportunity to represent his case before he is put on the\nblack-list.   The show cause notice given to the  appellant,\nif  construed  in the context of the entire para,  could  be\nunderstood  as\tconveying no more than that an\taction\twith\nreference  to the contract in question only, was under\tcon-\ntemplation.   There are no words in the notice\twhich  could\ngive  a\t clear\tintimation  to the  addressee  that  it\t was\nproposed  to debar him from taking any contract whatever  in\nfuture\tunder  the Department.\tThe appellant was  thus\t not\nafforded  adequate  opportunity\t to  represent\tagainst\t the\nimpugned action which must, therefore, be held to be bad  in\nlaw. [518 E-F, 519 A-B, D]\nErusian\t Equipment & Chemicals Ltd. v. State of West  Bengal<\/a>\n[1975] 2 S.C.R. explained; Thomas v. State of Kerala  I.L.R.\n1968(2) Kerala 1(F.B.) overruled.\n\n\n\nJUDGMENT:\n<\/pre>\n
CIVIL  APPELLATE  JURISDICTION : Civil Appeal  No.  2448  of
\n1968.\n<\/p>\n
515<\/span><\/p>\n
T. C. Raghavan, Sardar Bahadur Saharya & Vishnu Bahadur
\nSaharya\t  for the appellant.\n<\/p>\n
S. V. Gupte & K. M. K. Nair for the Respondents.
\nThe Judgment of the Court was delivered by
\nSARKARIA, J.-This appeal by special leave directed against a
\nDivision  Bench judgment of the Kerala High Court  raises  a
\nquestion with regard to the validity of an order dated\tJune
\n20,  1968  whereby  the\t Executive  Engineer  debarred\t the
\nappellant  from\t taking\t any  further  contract\t under\t the
\nBuildings & Roads Division, Ernakulam.
\nThe  appellant\tis  a  Government  Contractor  of  16  years
\nstanding.   He has been executing major building  contracts.
\nThe, Executive Engneer, P.W.D. Ernakulam (Respondent No.  1)
\ninvited\t tenders  for  ,executing  certain  repairs  to\t the
\nEnglish\t and Mathematics Blocks of the Maharaja\t College  at
\nErnakulam.  The appellant submitted a tender, dated March 8,
\n1967,  for  doing this work.  In response to a\tletter\tfrom
\nRespondent  1, the appellant sent his consent letter,  dated
\nMarch  27,  1967  (Ex. p-1), agreeing to  reduced  rates  of
\ncertain items of the work, on the condition that “as soon as
\nthe  Selection Notice is issued the building should  be\t got
\nvacated to facilitate the starting of the work”.  The tender
\nwas then accepted by the Executive Engineer and a  Selection
\nNotice\twas  issued to the appellant on March  31,  1967  in
\nwhich  it was, inter alia, stated that the  “facilities\t for
\ncarrying out the work will be given as soon as you start the
\nwork”.\n<\/p>\n
A  formal agreement was executed on April 26, 1967,  by\t the
\nappellant  and the Executive Engineer.\tCondition No.  4  of
\nthe  agreement stipulated that “time shall be considered  as
\nthe  essence  of  the agreement and  the  contractor  hereby
\nagrees\tto  commence the work as soon as  the  agreement  is
\naccepted by the competent authority (Executive Engineer) and
\nthe site (or premises) is handed over to him (contractor) as
\nprovided  for  in the conditions and to\t complete  the\twork
\nwithin\t6 months from the date of such handing over  of\t the
\nsite (or premises)”.\n<\/p>\n
The  appellant\talleged\t that inspite of  his  request,\t the
\nExecutive  Engineer and his assistants (Respondents 2 to  4)
\ntook  no steps to hand over the building in order to  enable
\nhim  to start the work. rhe repair work could commence\tonly
\nafter the removal of the electric wirings, and such  removal
\nwag not done upto July 10, 1967.\n<\/p>\n
In the meantime, the Engineers’ strike supervened, in  which
\nRespondents  1 to 4 participated.  The period of six  months
\nfor  carrying  out the work expired  before  the  Engineers’
\nstrike came to an end.\n<\/p>\n
On  October  27, 1967, the appellant wrote a letter  to\t the
\n‘Executive  Engineer (Respondent 1), requesting for  release
\nfrom the contract.  He stated :\n<\/p>\n
\t      “Due  to\tsome unavoidable  circumstances\t the
\n\t      building has not been got vacated so far.\t The
\n\t      completion period
\n516<\/span>
\n\t      a per the tender for the work, i.e., 6  months
\n\t      is over.\tNow the cost of materials and labour
\n\t      have  increased  considerably.  In  the  above
\n\t      circumstances  I request that I may kindly  be
\n\t      released from the above agreement of work\t and
\n\t      the security may be released.”\n<\/p><\/blockquote>\n
\t      On  April\t 17, 1.968, the\t Executive  Engineer
\n\t      sent  a  Notice (Ex.  P-6) to  the  appellant,
\n\t      which reads as follows :\n<\/p><\/blockquote>\n
\t      “The  fulfilment of the undertaking  given  by
\n\t      the department to give facilities to carry out
\n\t      the work as soon as you start the work was not
\n\t      even  necessitated as you have failed even  to
\n\t      commence\tthe  work as per the  terms  of\t the
\n\t      contract….\n<\/p><\/blockquote>\n
\t      You  are, therefore, requested to\t show  cause
\n\t      within seven days from the date of this notice
\n\t      why the work may not be arranged otherwise  at
\n\t      your  risk  and loss, through  other  agencies
\n\t      after- debarring you as a defaulter and making
\n\t      good   the  loss\tthat  may  accrue   to\t the
\n\t      department, from your subsisting contracts  in
\n\t      this Division.”<\/p><\/blockquote>\n
\t\t\t\t(Emphasis supplied)
\nThe appellant, on May 20, 1968, sent a reply asserting\tthat
\nhe committed no default; that he had collected the  required
\nwooden\t materials   necessary\tfor   starting\t the   work,
\nimmediately  after the execution of the agreement, and\tthat
\nthe delay in starting the work was only due to the delay  in
\nhanding over the building to him.\n<\/p>\n
However,  the  Executive Engineer finally  communicated\t his
\norder,.\t dated\tJune  20, 1968\t(Ex.   P-8),  canceling\t the
\ncontract and informing the appellant that “the work is being
\narranged at your risk and loss through other agencies  after
\ndeclaring  you as a defaulter and debarring you from  taking
\nfurther contract under the Division.” (Emphasis supplied)
\nTo challenge this order of the Executive Engineer, debarring
\nthe  appellant\tfrom  ‘taking  further\tcontract  under\t the
\nDivision,  a  Writ Petition (O.P. No. 2869  of\t1968)  under
\nArticle\t 226 of the Constitution was filed by the  appellant
\nin the Kerala High Court.  It was contended in the  petition
\nthat  the said Order (Ex.  P-8) of the\tExecutive  Engineer,
\nwas ultra vires, illegal and unconstitutional as it violated
\nthe appellant’s fundamental rights guaranteed under  Article
\n19(1)(f) and (g) of the Constitution.  He further maintained
\nthat  Respondent I was not right in holding the appellant  a
\ndefaulter;  nor had he any power or jurisdiction to  ‘black-
\nlist’  or rebar the appellant from taking further  contracts
\nin Ernakulam Division.\n<\/p>\n
In the counter-affidavit filed on behalf of Respondent 1, it
\nwas. stated :\n<\/p>\n
(a)  The Principal of the College when the work had to
\n517<\/span>
\n\t      be  carried out reported that the work may  be
\n\t      done after the monsoon was over.\n<\/p>\n
\t      (b) During the period of the Engineers’ strike
\n\t      from 11-8-67 to 5-10-67 also there was nothing
\n\t      on   record  to  show  that   the\t  petitioner
\n\t      (Appellant)   had\t  approached   either\t the
\n\t      Administrative\t\tOfficer\t  or\twork
\n\t      Superintendent  or instructions to  start\t the
\n\t      work  and as soon as “No Work  Programme”\t was
\n\t      over,  the Assistant Engineer issued a  notice
\n\t      by  registered post to the appellant on  9-10-
\n\t      67,  directing  him to start the\twork  on  or
\n\t      before 13-10-67.\tThe contractor did not\ttake
\n\t      any  steps  to commence the work, but  sent  a
\n\t      reply,  dated 27-10-67, requesting that he  be
\n\t      released from the contract.\n<\/p>\n
\t      (c) On November 22, 1967, the Principal of the
\n\t      College, wrote that all arrangements to vacate
\n\t      the  building  had been  made.   Respondent  1
\n\t      thereupon\t sent one more notice by  registered
\n\t      post  to the\t     petitioner\t (appellant)
\n\t      on  December 8, 1967, but the latter  wilfully
\n\t      refused to accept the same.\n<\/p>\n
\t      (d)  It  was  wrong  that\t the  appellant\t had
\n\t      collected\t any materials at the site to  start
\n\t      the work.\n<\/p>\n
\t      (e)  On April 20, 1968, a letter was  received
\n\t      from  the appellant, claiming higher rates  to
\n\t      execute the
\n\t      work.   In the alternative, he requested\tthat
\n\t      his  security  might be released at  an  early
\n\t      date.  The appellant however admitted in\tthis
\n\t      letter that the building in question was\tmade
\n\t      available\t to  him for executing the  work  in
\n\t      October\t1967.\t Respondent  I\t found\t the
\n\t      explanation of the appellant unsatisfactory.
\nAfter  hearing the arguments, a learned single Judge of\t the
\nHigh  Court  (K.K. Mathew, J.-), dismissed the\tpetition  in
\nthese words
\n“In  the  light of the majority decision in  I.L.R.  1968(2)
\nKerala Page 1, I dismiss the Writ Petition.  No costs.”
\nAgainst this judgment, the appellant preferred a Writ Appeal
\n(No. 182 of 1968) before a Division Bench of the High Court.
\nThe Bench dismissed the appeal in limine.
\nHence this appeal, by special leave.\n<\/p>\n
Mr. Raghavan appearing for the appellant, submits that apart
\nfrom  the  competency of the Executive Engineer\t to  ‘black-
\nlist’ or debar the appellant from faking contracts with B  &
\nR  Department in Ernakulam Division, the impugned order\t was
\nillegal\t and  void for the reason that\tno  opportunity\t was
\ngiven  to the Appellant to represent his case before he\t was
\nput on the ‘black list’.  For this contention,
\n518<\/span>
\nreliance  has  been placed on the recent  decision  of\tthis
\nCourt in Erusian Equipment & Chemicals Ltd. v. State of West
\nBengal.<\/a>(1)
\nAs against the above, the learned Attorney General has drawn
\nour  attention\tto the fact that a notice, dated  April\t 17,
\n1968  (Ex.  P-6) was given by the Executive Engineer to\t the
\nappellant  requesting the latter to show cause why the\twork
\nmay  not  be  got  done\t through  other\t agencies,  at\t the
\nappellant’s  risk  and\tloss;  after  debarring\t him  as   a
\ndefaulter.   It is ‘submitted that this notice did  indicate
\nto the appellant that action to debar him from doing further
\ncontract work under the department was contemplated, and  as
\nsuch,  this  case  is  not  hit\t by  the  ratio\t of  Erusian
\nEquipment’s  case (ibid).  It is further maintained that  in
\nThomas\tv. State of Kerala,(2) it was rightly observed\tthat
\nthe law does not deny to the Government the freedom of\tcon-
\ntract  (carrying  with it the freedom not to  enter  into  a
\ncontract, it vouchsafes to every person.  Reference was also
\nmade  to the observations of this Court in C.K. Achuthan  v.
\nState  of Kerala<\/a> (3) in support of the contention  that\t the
\nimpugned order does not per se offend Articles 14 and 19 (a)\n<\/p>\n
(g)  of\t the Constitution.  Those observations\tare  to\t the
\neffect\t:  “There  is  no  discrimination,  because  it\t  is
\nperfectly open to the Government, even as it is to a private
\nparty,\tto  choose  a person to\t their\tliking,\t to  fulfill
\ncontracts which they wish to be performed.  When one  person
\nis  chosen rather than another, the aggrieved  party  cannot
\nclaim  the protection of Article 14, because the  choice  of
\nthe- person to fulfill a particular contract must be left to
\nthe  Government. (Because of the breach or, cancellation  of
\nhis contract, the private person) cannot complain that there
\nhas  been  a  deprivation.  of the  right  to  practice\t any
\nprofession or to carry on any occupation, trade or business,
\nsuch as is contemplated by Article 19(1)(g).”  (Parenthesis,
\nwithin brackets, added).\n<\/p>\n
The majority judgment of the Kerala High Court, inasmuch  as
\nit holds that a person is not entitled to a hearing, before:
\nhe is blacklisted, must be deemed to have been overruled  by
\nthe  decision  of  this Court in  Erusian  Equipment  (ibid)
\nwherein\t it was held that “fundamentals of fairplay  require
\nthat the person concerned should be given an opportunity  to
\nrepresent  his\tcase  before he is put\ton  the\t blacklist.”
\nControversy  in\t the instant case, therefore,  narrows\tdown
\ninto the issue, whether such an opportunity was given to the
\nappellant.   Answer  to\t this  question\t will  turn  on\t  an
\ninterpretation of the notice, dated April 17, 1968 (Ex.\t  P-\n<\/p>\n
8)  given by the Executive Engineer to the appellant.\tThis
\nnotice\thas  been  extracted in a  foregoing  part  of\tthis
\njudgment.   The\t material  sentence therein  is:  “You\tare,
\ntherefore, requested to show cause …. why the work may not
\nbe arranged otherwise at your risk and loss, through other 1
\nagencies  after debarring you as  a  defaulter…………..
\nThe crucial words are those that have been underlined.\tThey
\ntake their color from the context.  Construed along with the
\nlinks of the sentence which precede and succeed them,
\n(1)  [1975] 2 S.C.R.674.\n<\/p>\n
(2)  I L R (1968) 2 Kerala 1 (F.B.)
\n(3)  A.I.R. 1959 S.C. 490.\n<\/p>\n
 519<\/span><\/p>\n
the   words  “debarring\t you  as  a  defaulter”,  could\t  be
\nunderstood  as\tconveying no more than that an\taction\twith
\nreference  to  the  contract in\t question,  only  was  under
\ncontemplation.\tThere are no words in the notice which could
\ngive  a\t clear\tintimation  to the  addressee  that  it\t was
\nproposed to debar him from taking any contract, whatever, in
\nfuture under the. department.  A perusal of the\t appellant’s
\nreply (Ex.  P-7), dated May 20, 1968, sent to the  Executive
\nEngineer, also appears to show that by the word\t “debarring”
\nmentioned in the Executive Engineer’s letter dated April 17,
\n1968  (Ex.   P-6),  he\tunderstood  as\tdebarring  him\tfrom
\nexecuting  the\tcontract in question after declaring  him  a
\ndefaulter,  and\t then getting the same work  done  by  other
\nagencies,  at his risk and loss.  All that has been said  in
\nEx.   P-7 by the appellant is directed to justify  that\t the
\nnon-execution of the contract was not due to his fault,\t but
\ndue  to the delay on the part of the department\t in  handing
\nover  the building to him for starting the work\t within\t the
\ntime  specified in the agreement, and consequently,  if\t any
\nloss would be incurred by the department in getting the work
\ndone  through  any other agency, he would not be  liable  to
\nmake  good the same.  In short, the letter (Ex.\t P-6)  dated
\nApril 17, 1968 from the Executive Engineer, did not give any
\nclear notice to the appellant that action to debar him\tfrom
\ntaking\t in  future  any  contract,  whatever,\t under\t the
\ndepartment  or its Ernakulam Division was in  contemplation.
\nThe appellant was thus not afforded adequate opportunity  to
\nrepresent against the impugned action.
\nThis  being  the position, the rule in\tErusian\t Equipment’s
\ncase  (ibid)  will  be attracted  with\tfull  force.   While
\nconceding  that the State can enter into contract  with\t any
\nperson\tit chooses and no person has a fundamental Tight  to
\ninsist\tthat the Government must enter a contract with\thim,
\nthis Court observed (in the said case)
\n\t      “Blacklisting  has the effect of preventing  a
\n\t      person  from  the privilege and  advantage  of
\n\t      entering\tinto  lawful relationship  with\t the
\n\t      Government  for purposes of gains.   The\tfact
\n\t      that  a disability is created by the order  of
\n\t      blacklisting   indicates\tthat  the   relevant
\n\t      authority\t   is\tto   have    an\t   objective
\n\t      satisfaction.    Fundamentals  of\t fair\tplay
\n\t      require  that the person concerned  should  be
\n\t      given  an\t opportunity to represent  his\tcase
\n\t      before he is put on the black list.”\n<\/p>\n
The above enunciation squarely covers the case before us.
\nAccordingly, we allow this appeal, set aside the judgment of
\nthe High Court and quash the impugned order.  There will  be
\nno order as to costs.\n<\/p>\n
P.H.P.\n<\/p>\n
\t\t\t       Appeal allowed.\n<\/p>\n
520<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Joseph Vilangandan vs The Executive Engineer, … on 20 March, 1978 Equivalent citations: 1978 AIR 930, 1978 SCR (3) 514 Author: R S Sarkaria Bench: Sarkaria, Ranjit Singh PETITIONER: JOSEPH VILANGANDAN Vs. RESPONDENT: THE EXECUTIVE ENGINEER, BUILDINGS & ROADS (P.W.D.) DIVISION, DATE OF JUDGMENT20\/03\/1978 BENCH: SARKARIA, RANJIT SINGH BENCH: SARKARIA, RANJIT […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-176078","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nJoseph Vilangandan vs The Executive Engineer, ... on 20 March, 1978 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/joseph-vilangandan-vs-the-executive-engineer-on-20-march-1978\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Joseph Vilangandan vs The Executive Engineer, ... on 20 March, 1978 - 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