Administrative order passed without mandated hearing violates natural justice and must be quashed.

The petitioner, Chun Chun Devi, had participated in a tender process issued by the Bihar State Credit and Investment Corporation Ltd. (“BICICO”) for a 3.57-acre plot and claimed to be the highest bidder. Her sale offer was subsequently cancelled by BICICO through letter dated 29 September 2021.

She challenged the cancellation in CWJC No. 18792 of 2021. By order dated 13 July 2022, the High Court directed her to submit a representation before the Managing Director, BICICO, who was required to decide it by a reasoned and speaking order, while following natural justice and affording due opportunity of hearing to the parties.

Pursuant to that direction, the petitioner submitted a representation dated 3 August 2022. The Managing Director thereafter passed the impugned order dated 2 November 2022 bearing Memo No. 362.

Alleging that the order was passed without considering her representation and without granting an opportunity of hearing, the petitioner filed the present writ petition seeking quashing of the order, completion of the sale formalities, or refund of the earnest money with interest.

Whether the order dated 2 November 2022 passed by the Managing Director, BICICO, complied with the earlier High Court direction requiring adherence to natural justice and the grant of an opportunity of hearing?

Whether the impugned order was liable to be quashed for failure to afford a hearing before deciding the petitioner’s representation?

Whether the petitioner was entitled to a direction for execution of the sale offer, or alternatively refund of the earnest money with interest?

The Court applied the principles of natural justice, particularly the requirement of a fair and meaningful opportunity of hearing before an adverse administrative decision is made.

It also applied the rule that directions issued by a constitutional court must be complied with in their substance and spirit; the earlier order specifically required the Managing Director, BICICO, to decide the petitioner’s representation through a reasoned and speaking order after affording due opportunity of hearing to the parties.

No specific statutory provision or judicial precedent was relied upon in the judgment.

The Court also reiterated that it had expressed no opinion on the merits of the petitioner’s claim concerning the tender or sale.

The earlier order did not merely direct BICICO to pass a speaking order; it expressly made compliance with natural justice and the grant of a hearing a condition of the decision-making process.

On examining the impugned order dated 2 November 2022, the Court found that it did not disclose that the petitioner or the concerned parties had been afforded an opportunity of hearing.

Consequently, the order was not in strict compliance with the earlier judicial direction.

Since the defect went to the fairness of the decision-making process, the Court quashed the impugned order without examining whether the petitioner was in fact entitled to the plot, whether the cancellation was justified, or whether the earnest money was refundable.

The impugned order was quashed.

The Managing Director, BICICO, was directed to give the parties an opportunity of hearing and thereafter pass an appropriate speaking and reasoned order within three months from receipt of the judgment.

The Court expressly left all issues on the merits—including the petitioner’s claim to completion of the sale or refund of earnest money—open and disposed of the writ petition accordingly.