Court Finds Procedural Lapses and Lack of Jurisdiction in Blacklisting Order Against M/s. Rahaman Construction
The Calcutta High Court, in a judgment delivered on February 24, 2026, by Justice Kausik Chanda, set aside the blacklisting order issued against M/s. Rahaman Construction by the Suti-I Panchayat Samiti. The Court found significant procedural lapses in the process leading to the blacklisting and highlighted the lack of jurisdiction of the Panchayat Samiti to issue such an order.
The case arose from a dispute concerning a work order for the construction of a concrete road in Paraipur Village, Murshidabad, which was awarded to M/s. Rahaman Construction. The Panchayat Samiti had blacklisted the construction firm for six months, citing failure to commence work on time. However, the firm contended that the blacklisting was carried out without adhering to the prescribed procedures and without considering their response to the show-cause notice.
The Court noted that the Standard Bid Document (West Bengal Form No. 2911) sets out a multi-stage debarment procedure, which involves recommendations and hearings by specific committees before a final order can be issued. The Panchayat Samiti failed to follow these steps, issuing a show-cause notice and blacklisting the firm without the necessary recommendations from the Tender Committee and without considering the firm's response to the latest show-cause notice.
Moreover, the Court highlighted that the power to blacklist resides exclusively with the concerned department, in this case, the Panchayat Department of the State, and not with the Panchayat Samiti. The judgment drew on several Supreme Court precedents, emphasizing that blacklisting must conform to principles of natural justice and be exercised fairly, reasonably, and proportionally, satisfying the requirements of Article 14 of the Constitution.
The Court's decision to quash the blacklisting order does not prevent the authorities from initiating fresh proceedings, provided they adhere to the proper procedure and consider the firm's responses comprehensively.
The State's request for a stay on the operation of the judgment was also rejected by the Court.
Bottom Line:
Blacklisting order set aside due to non-compliance with prescribed procedure and lack of jurisdiction by Panchayat Samiti.
Statutory provision(s): Article 14 of the Constitution of India, Standard Bid Document (West Bengal Form No. 2911)
M/s. Rahaman Construction v. State of West Bengal, (Calcutta) : Law Finder Doc id # 2857829
