10 June 2024


Supreme Court

Vetindia Pharmaceuticals vs. The State Of Uttar Pradesh




If the delay is properly explained and no third party rights are being affected, the writ court under Article 226 of the Constitution may condone the delay

The Appellant is aggrieved by indefinite order of blacklisting. The High Court dismissed the writ petition in limine, only on the ground of delay, as having been preferred ten years later. Learned counsel for the Appellant, submits that, it holds a valid licence under the Drugs and Cosmetics Act, 1940 (‘the Drugs Act’) in Form 28 (Rule 76) issued by the Drugs Control Administration, Government of Andhra Pradesh.

The Appellant is a licensed drug manufacturer. The drugs in question have been found to be misbranded and not spurious or adulterated. There is no dispute that, the injection was not supplied to the respondents by the Appellant. Yet the show cause notice 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 blacklisting was to be taken, or was under contemplation. It only mentioned appropriate action in accordance with the rules of the Tender. The fact that the terms of the tender may have provided for blacklisting is irrelevant in the facts of the case. In absence of any supply by the Appellant, the order of blacklisting dated invoking Clauses 8.12 and 8.23 of the Tender is a fundamental flaw, vitiating the impugned order on the face of it reflecting non application of mind to the issues involved.

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 Respondents to support the impugned order by reference to the terms of the tender cannot cure the illegality in absence of the Appellant being a successful tenderer and supplier. The order of blacklisting stands vitiated from the very inception on more than one ground and merits interference.

An order of blacklisting operates to the prejudice of a commercial person not only in praesenti but also puts a taint which attaches far beyond and may well spell the death knell of the organisation/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.

There is no doubt that, the High Court in its discretionary jurisdiction may decline to exercise the discretionary writ jurisdiction on ground of delay in approaching the Court. But it is only a rule of discretion by exercise of self-¬restraint evolved by the Court in exercise of the discretionary equitable jurisdiction and not a mandatory requirement that every delayed petition must be dismissed on the ground of delay. The Limitation Act stricto sensu does not apply to the writ jurisdiction. The discretion vested in the Court under Article 226 of the Constitution of India, 1950 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 for the delay, whether any third¬party rights have intervened etc.

Present Court in Basanti Prasad vs. Bihar School Examination Board and others, after referring to Moon Mills Ltd. vs. Industrial Court, Maharashtra SRTC vs. Balwant Regular Motor Service, State of M.P. and Others vs. Nandlal Jaiswal and others, held that, if the delay is properly explained and no third party rights are being affected, the writ court under Article 226 of the Constitution may condone the delay.

The writ petition was not barred by unexplained delay as the Appellant had been pursuing the matter with the authorities and it is they who sat over it, triggering rejection of Appellants tender by the Rajasthan Government on 5th July, 2019 leading to the institution of the writ petition. The High Court therefore erred in dismissing the writ petition on grounds of delay. Consequently, the impugned order of the High Court as well as order of the Respondents is set aside. Appeal is allowed.

Tags : Blacklisting order Legality Delay Condonation

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