Dismissing the writ petition on grounds of delay should not be the thumb rule: Supreme Court

limine only on the ground of delay as having been preferred ten 3. Ms. Shobha Gupta learned counsel for the appellant submits that it holds a valid licence under the Drugs and Government of Andhra Pradesh. M s Palak Pharmaceuticals year 2007 and in turn had supplied it to the respondent under a tender notice dated 04.10.2006. The label ‘XYO701’ on the the medicine was correctly mentioned as “OXY­125”. The composition of the medicine was also correctly mentioned as INJ. I.P. VET” in place of “OXYTETRACYCLINE HCL INJ. I.P VET”. It was therefore a case of bonafide inadvertent printing error which resulted in misbranding. The product was not 08.09.2009 by the Office of Director Animal Husbandry Department of the respondent referring to the State Analyst report dated 10.10.2008 declaring the batch supplied by the appellant to be of substandard quality Ors. 9 SCC 105 to submit that the show cause notice Anr. vs. State of U.P. & Anr. 2019SCALE 758 where this Shri Ankit Goel learned counsel for the respondents of blacklisting. It was preceded by a show cause notice dated 21.10.2008 and consideration of the reply submitted. The Drugs Act duly supported by the report of the analyst. Any latent defect in the show cause notice has not caused any or adulterated. The appellant took the plea of a bonafide inadvertent printing error on the label by stating VET” in place of “OXYTETRACYCLINE HCL INJ. I.P. VET”. This explanation by finds no consideration by the respondents at any stage. The On 19.05.2011 the appellant requested the respondents for matter was also subsequently followed up by the appellants in requested to withdraw the order dated 08.09.2009. The reiterating violation of clauses 8.12 and 8.23 of the Tender of 2006­07. It however sought certain additional information to on 04.05.2019. The appellant was also debarred from thereafter from the respondents the writ petition came to be the respondents by the appellant. Yet the show cause notice dated 21.10.2008 referred to further action in terms of the Tender for supplying misbranded medicine to the appellant Furthermore the show cause notice did not state that action by any supply by the appellant the order of blacklisting dated 08.09.2009 invoking clauses 8.12 and 8.23 of the Tender is a after the appellant brought this fact to the attention of the respondents they refused to pay any heed to it. Further it West Bengal and another 1 SCC 70 held that there principles of natural justice. In Joseph Vilangandan vs. The Executive Engineer Ernakulam and others 3 SCC 36 this Court was considering a show cause notice as “17. ….“You are therefore requested to show The crucial words are those that have been the sentence which precede and succeed them the words “debarring you as a defaulter” could be with reference to the contract in question only was under contemplation. There are no words in the notice which could give a clear intimation to the addressee that it was proposed to debar him from taking any contract whatever in future under the 11. The question whether a show cause notice prior to blacklisting mandates express communication why blacklisting “27. We are therefore of the opinion that it was as to provide adequate and meaningful opportunity to the appellant to show cause against the same However we may also add that even if it is not mentioned specifically but from the reading of the show­cause notice it can be clearly inferred that requirement. In the present case however reading of could find out that such an action could also be 28. In the instant case no doubt the show­cause notice dated 6­2­2013 was served upon the alleged defaults and breaches of the agreement committed by the appellant the notice specifically mentions that because of the said defaults the appellant was “as such liable to be levied the cost accordingly”. It further says “why the action as competent authority could take other actions as deemed fit. However that may not fulfil the requirement of putting the defaulter to the notice the agreement entered into between the parties would not suffice the aforesaid mandatory penalty of blacklisting and forfeiture of earnest money security deposit is concerned it can be imposed only “if so warranted”. Therefore without 33. When we apply the ratio of the aforesaid difficult to accept the argument of the learned respondents that by omitting to state the proposed notice has not caused any prejudice to the appellant Moreover had the action of blacklisting being specifically proposed in the show­cause notice the appellant could have mentioned as to why such out with extenuating circumstances defending such an action even if the defaults were there and the Department was not satisfied with the explanation blacklist the appellant. Therefore it is not at all acceptable that non­mentioning of proposed any prejudice to the appellant. This apart the extreme nature of such a harsh penalty like blacklisting with severe consequences would itself If the respondents had expressed their mind in the show cause notice to blacklist the appellant could have filed an appropriate response to the same. The insistence of the hold that the order of blacklisting dated 08.09.2009 stands vitiated from the very inception on more than one ground and but for the arguments addressed before us. An order of for all times to come described as a civil death. The representations as also in the writ petition including the consequences under the Rajasthan tender where it stood in accordance with law even if the respondents decided to This court in Kulja Industries Limited vs. Chief General Manager Western Telecom Project Bharat Sanchar Nigam Limited and others 14 SCC 731 despite declining to “28.2. Secondly because while determining the the respondent Corporation may for the sake of objectivity and transparency formulate broad guidelines to be followed in such cases. Different the offences violations and breaches may be prescribed by such guidelines. While it may not be possible to exhaustively enumerate all types of contractual obligations by a contractor the exercise of the power vested in it and inspire confidence in the fairness of the order which the competent authority may pass against a defaulting Since the order of blacklisting has been found to be unsustainable by us and considering the long passage of time M s Daffodills Pharmaceuticals relied upon by the discretionary equitable jurisdiction and not a mandatory Article 226 of the Constitution therefore has to be a judicious exercise of the discretion after considering all pros and cons of the matter including the nature of the dispute the explanation The jurisdiction under Article 226 being equitable in nature jurisdiction will also arise. This Court in Basanti Prasad vs Bihar School Examination Board and others 6 SCC 791 after referring to Moon Mills Ltd. vs. Industrial Court AIR 1967 SC 1450 Maharashtra SRTC vs. Balwant Regular vs. Nandlal Jaiswal and others 4 SCC 566 held that if the delay is properly explained and no third party rights are being affected the writ court under Article 226 of the “18. In the normal course we would not have taken exception to the order passed by the High Court They are justified in saying that a delinquent would not ordinarily assist the tardy and indolent person. This is the traditional view and is well supported by a plethora of decisions of this Court inviolable rule that whenever there is delay the has stated that the writ court in exercise of its extraordinary jurisdiction under Article 226 of the Constitution may condone the delay in filing the case of the respondents that the procedure prescribed under Sections 23 25 and 26 of the Drug Act has been followed. The Act by alleged purchase of the samples under Form 14A at unknown source and date must be rejected outright as an 16. The aforesaid discussion therefore leads us to the delay as the appellant had been pursuing the matter with the High Court therefore erred in dismissing the writ petition on of the order dated 08.09.2009 with no third party rights affected never engaged the attention of the High Court in judicious exercise of the discretionary equitable 

Summary: High Court should exercise its discretion while hearing a petition that has been delayed in filing and dismissing the writ petition on grounds of delay should not be the thumb rule and the court should exercise its judicious discretion after considering all pros and cons of the matter, including the nature of the dispute, the explanation for the delay, whether any third-party rights have intervened etc. In the matter of Vetindia Pharmaceuticals Limited  V State Of Uttar Pradesh And Another, CIVIL APPEAL NO.3647 OF 2020, where the appellant who was a licensed drug manufacturer, took the plea of a bonafide inadvertent printing error on the label, by stating “OXYTETRACYCLINE INJ. I.P. VET” in place of “OXYTETRACYCLINE HCL INJ. I.P. VET. It was pertinent to note that the products were not spurious, adulterated or misbranded. The appellant through their show cause notice explained their stance to their respondents which the latter rejected and further went on to blacklist the appellants through an impugned order. It was alleged that the impugned order for blacklisting contained no specific time duration and even after the appellants seeking clarification on the same, the respondents did not pay heed to it. In light of these circumstances, the appellants filed a writ petition. The court after viewing the blacklisting order held it illegal on various grounds, one of them being it was arbitrarily passed which is against the principle of natural justice. The court opined that “An order of blacklisting operates to the prejudice of a commercial person not only in presenting but also puts a taint which attaches far beyond and may well spell the death knell of the organization/institution for all times to come described as a civil death. The repercussions on the appellant were clearly spelt out by it in the representations as also in the writ petition, including the consequences under the Rajasthan tender, where it stood debarred expressly because of the present impugned order. an order of blacklisting beyond 3 years or maximum of 5 years was disproportionate.”