Gorkha Security Services vs Govt. Of Nct Of Delhi & Ors

4) The appellant, which is a partnership firm, was awarded the contract vide letter of award dated 1.9.2011 for providing security services in Shri Dada Dev Matri Avum Shishu Chiktsalaya, Dabri, New Delhi (hereinafter referred to as the 'hospital). This hospital is under the administration of Respondent No. 1 viz. Government of NCT of Delhi. The contract was for a period of 1 year i.e. from 2.9.2011 to 1.9.2012. The payment was required to be made contractually to the appellant on monthly basis. Though the contract was upto 1.9.2012, the appellant continued to provide services even thereafter. The case of the appellant is that it has not been given any payment after the expiry of the contract period though it worked till 31.7.2013.

7) The respondent authorities, however, were not satisfied with the reply which resulted in serving of the show cause notice dated 6.2.2013 upon the appellant detailing various lapses, which the appellant had allegedly committed. Since the entire dispute revolves around the nature of action that was stipulated therein and was proposed to be taken, we would like to reproduce that part of the show cause notice in verbatim:

(iv) A penalty of blacklisting the firm M/s Gorkha Security for a period of 4 years from the date of this order, from participating the tenders in any of the department of Delhi Government/ Central Government/ Autonomous Body under the Government.

29) No doubt, rules of natural justice are not embodied rules nor can they be lifted to the position of fundamental rights. However, their aim is to secure justice and to prevent miscarriage of justice. It is now well established proposition of law that unless a statutory provision either specifically or by necessary implication excludes the application of any rules of natural justice, in exercise of power pre-judicially affecting another must be in conformity with the rules of natural justice.

“21. From the ratio laid down in B. Karunakar1 it is explicitly clear that the doctrine of natural justice requires supply of a copy of the inquiry officer’s report to the delinquent if such inquiry officer is other than the disciplinary authority. It is also clear that non-supply of report of the inquiry officer is in the breach of natural justice. But it is equally clear that failure to supply a report of the inquiry officer to the delinquent employee would not [pic]ipso facto result in the proceedings being declared null and void and the order of punishment non est and ineffective. It is for the delinquent employee to plead and prove that non- supply of such report had caused prejudice and resulted in miscarriage of justice. If he is unable to satisfy the court on that point, the order of punishment cannot automatically be set aside.

36. The recent trend, however, is of “prejudice”. Even in those cases where procedural requirements have not been complied with, the action has not been held ipso facto illegal, unlawful or void unless it is shown that non- observance had prejudicially affected the applicant.

44. From the aforesaid decisions, it is clear that though supply of report of the inquiry officer is part and parcel of natural justice and must be furnished to the delinquent employee, failure to do so would not automatically result in quashing or setting aside of the order or the order being declared null and void. For that, the delinquent employee has to show “prejudice”. Unless he is able to show that non-supply of report of the inquiry officer has resulted in prejudice or miscarriage of justice, an order of punishment cannot be held to be vitiated. And whether prejudice had been caused to the delinquent employee depends upon the facts and circumstances of each case and no rule of universal application can be laid down.”

34) For the aforesaid reasons, we are of the view that the impugned judgment of the High Court does not decide the issue in correct prospective. The impugned order dated 11.9.2013 passed by the respondents blacklisting the appellant without giving the appellant notice thereto, is contrary to the principles of natural justice as it was not specifically proposed and, therefore, there was no show cause notice given to this effect before taking action of blacklisting against the appellant. We, therefore, set aside and quash the impugned action of blacklisting the appellant. The appeals are allowed to this extent. However, we make it clear that it would be open to the respondents to take any action in this behalf after complying with the necessary procedural formalities delineated above.

35) No costs.

August 4, 2014.