Blacklisting Order Issued by an Incompetent Authority for an Indefinite Period is Legally Unsustainable.

The petitioner, a Class I registered contractor under the Bihar Contractors Registration Rules, 2007, was awarded a contract for the "Mukhya Mantri Peyjal Nischay Yojana" in Banka district for the construction and maintenance of Fluoride Removal Units

On 17.12.2025, the Executive Engineer (Respondent No. 4) directed the petitioner to pay outstanding electricity bills, threatening debarment/rescindment

Subsequently, Respondent No. 4 issued Office Order No. 164 dated 29.12.2025, debarring the petitioner firm indefinitely

The petitioner challenged this order on the grounds of lack of jurisdiction of the issuing authority and the illegality of indefinite debarment

1. Whether an order of debarment or blacklisting can be passed for an indefinite period.

2. Whether the Executive Engineer (Respondent No. 4) was the competent authority to issue the show cause notice and the subsequent debarment order.

Rule 11(d) of the Bihar Contractors Registration Rules, 2007, which mandates that blacklisting or suspension orders must be passed by the officer competent to register the contractor or their superior

Kuljha Industries Limited v. Chief General Manager, Western Telecom Project BSNL and Others (2014) 14 SCC 731, which stipulates that "debarment" is never permanent and must be proportionate to the nature of the offence

principles of natural justice and the doctrine of proportionality regarding the fundamental right to carry on trade

The Court examined the certificate of registration and found that the Chief Engineer (Urban) (Respondent No. 3) was the actual registering authority, not the Executive Engineer (Respondent No. 4)

Consequently, under Rule 11(d) of the 2007 Rules, Respondent No. 4 lacked the legal competence to initiate debarment proceedings or pass the final order

The Court reasoned that a debarment order issued by an incompetent authority without a valid show cause notice (from the correct authority) is void and violates natural justice

furthermore, applying the Kuljha Industries ratio, the Court held that the impugned order was legally unsustainable because it debarred the petitioner for an indefinite period, which is prohibited by law

The High Court allowed the writ petition, quashed the Office Order dated 29.12.2025, and remanded the matter to the Chief Engineer (Respondent No. 3) to issue a fresh show cause notice and pass a reasoned order in accordance with law