All the three writ petitions have been filed by three contractors of the respondent Board. The relief sought for in all the writ petitions are identical and the matter in controversy is also identical. Therefore, for the purpose of disposal of all these three cases, the facts of the case in W.P.No.7685 of 2009 are taken up for consideration.
2.The petitioners are aggrieved by the order passed by the second respondent, dated 14.11.2008 in which the second respondent has stated that as per the directions received from the Chief Engineer, Tamil Nadu Water Supply and Drainage Board, Madurai, dated 14.11.2008, the petitioners registration is temporarily suspended until further orders. Therefore, it is to be noted that the impugned order dated 14.11.2008 is a consequential order pursuant to the order passed by the Chief Engineer, dated 24.10.2008. This order dated 24.10.2008 has not been challenged in the present writ petitions.
3.The petitioners has contended that the impugned order of suspension has been passed without issuing prior notice to the petitioner and without enquiry and the same is violative of
Article 14 of the Constitution of India. It is further stated that the second respondent has issued the impugned order in a hurry and later has sought for explanation by issuance of a show cause notice.
4.The respondent Board has filed counter affidavit in all the three petitions. It is stated that the Vigilance Officer of the Tamil Nadu Water Supply and Drainage Board inspected the works alleged to have been completed by the petitioners and found irregularities in the execution of the work. It is further found that the petitioners claimed money from the respondent Board by colluding with the site engineers of the respondent Board without laying pipelines. Pursuant to the report of the Vigilance Officer, dated 26.09.2008, the Managing Director instructed the competent authority to take further action based on the recommendation in accordance with circular dated 09.04.1992. Therefore, in exercise of power conferred under clause 4.1 of the Standardised Code for Works Contractors, the impugned order temporarily suspending the registration of the petitioners were passed until further orders. It is further stated that this order is interim in nature pending finalisation of the enquiry to be conducted pursuant to the show cause notice issued. It is further stated that since the petitioners are involved in malpractice in the execution of the work, proceedings have been initiated for blacklisting in conformity with Clause 4.4 of the Code. On the above grounds, the respondents prayed for dismissal of the writ petitions.
5.Heard Mr.C.Kasirajan, learned counsel for the petitioners and Mr.M.Ajmal Khan, learned counsel for the respondents and perused the entire materials available on record.
6.The issue to be decided is as to whether the impugned order which is an order temporarily suspending the petitioners registration is valid and as to whether the respondent Board has jurisdiction to pass such an order.
7.Learned counsel for the respondent Board would submit that such power is conferred on the authorities in terms of Clauses 4.1 and 4.4 of the Standardised Code for Works Contractors which read as follows:
"4.1)Suspension of business may be ordered for an indefinite period where, pending full enquiry into the allegations the competent authority is of the view that it is not desirable that business with the contractor should continue. Such an order may be passed if the competent authority is prima-facie of the view that the contractor is guilty of an offence involving moral turpitude in relation to business dealings which if established would result in banning business dealings with the contractor.
4.4)The fact of and the reasons for suspension of business shall not be communicated to the contractor concerned, but in every case, the competent authority shall record the reasons for suspension of business and also furnish the Head of the Department concerned, through the next higher authority/authorities, with a report indicating the reasons for the suspension of business".
8.A perusal of the above Clauses would reveal that there is power for the authority, for suspending of a business for a indefinite period where pending full enquiry into the allegations, the competent authority is of the view that it is not desirable that business with the contractor should continue. The said provision states that such interim order could be passed if the competent authority is prima facie of the view that the contractor guilty of an offence involving moral turpitude in relation to business dealings which if established would result in banning business dealings.
9.In terms of Clause 4.4 of the Code, it has been stated that the reasons for suspension of business shall not be communicated to the contractor, but in every case, the competent authority shall record the reasons for suspension of business and also furnish the Head of the Department concerned, with a report indicating the reasons for the suspension.
10.Learned counsel for the respondents produced a copy of the office note submitted on 14.11.2008 in the said note it has been stated that the contractor has not laid the pipes to a length 1000 meters and they have found some irregularities in execution of the work, hence, the Chief Engineer has instructed to temporarily suspend the contractors by an order dated 24.10.2008 and the same has been submitted to the Executive Engineer for his consideration and to pass orders as to whether the contractor can be temporarily suspended. Therefore, it is to be noted that this proposal is in terms of Clause 4.4 of the Code which has resulted in the impugned order.
11.In terms of Clause 4.1 as referred above, the Standardised Code for Works Contractors gives sufficient power for suspension pending enquiry. The Clause states that the competent authority should be of the prima facie view that the contractor is guilty of an offence, in the instant case, as could be seen from the counter affidavit and office note, a vigilance inspection has been conducted and a report has been submitted recommending to take certain action. Based on such a report, the Managing Director has considered the same and directed the competent authority to implement the said recommendation in accordance with, circular dated 09.04.1992. Thereafter, decision to invoke Clause 4.2 has been taken since they were prima facie satisfied that there arose a case for interim suspension and the said order was placed for the approval of the competent authority and thereafter, the impugned order has been issued.
12.It is further pointed out by the learned counsel for the respondents that the officers of the respondents Board who have colluded along with the petitioners have also been placed under suspension by the Managing Director by proceedings dated 09.09.2008 wherein the officers namely S.Muniyandi, Assistant Engineeer, A.Gunasekaran, Assistant Executive Engineer and P.Dhanushkodi, Assistant Executive Engineer placed under suspension under regulation 10(a)(i) of TWAD Board Employees' (Disciplinary and Appeal) Regulations, 1972. In circular dated 09.04.1992, the Board issued instructions to all the Chief Engineers/Superintending Engineers/Executive Engineers to strictly follow the procedures prescribed in the Standardised Code for Works and Contractors which provides for blacklisting of contractors for specific reasons. Therefore, the procedure for blacklisting has to be in accordance with the said code.
13.Hence, I am of the view that the impugned order has been passed in accordance with the provisions of the Standardised Code for Works Contractors. It is further submitted by the petitioners that after the order of interim suspension a show cause notice dated 20.11.2008 has been issued to the petitioners. However, till date the petitioners have not submitted any explanation to the said show cause notice.
14.In view of the above mentioned reasons, I hold that the impugned order in all these writ petitions are valid in the eye of law and the respondents Board has sufficient power under the Standardised Code for Works Contractors to place a contractor under interim suspension, pending full enquiry.
15.As noted above, since the show cause notice has been issued on 20.11.2008, the petitioners are directed to submit their explanation to the show cause notice and on receipt of the same, the second respondent shall afford an opportunity of personal hearing to the petitioners and thereafter, pass appropriate orders on merits and in accordance with law.
16.In the result, the writ petitions are dismissed. No costs. Consequently, M.P.(MD)Nos.1 of 2009 are closed.
sms To
1.The Chief Engineer, TWAD Board, Southern Region, Madurai.
2.The Executive Engineer, TWAD Board, RWS Division, Ramanathapuram.