### Permanent Debarment and Orders by Incompetent Authorities are Legally Unsustainable and Violate Natural Justice Principles

The petitioner, a registered Class I contractor under the Bihar Contractors Registration Rules, 2007, was awarded a contract (Agreement No. 158/2019-20) for the Mukhya Mantri Peyjal Nischay Yojana in Banka District

Following an alleged failure to pay electricity bills, the Executive Engineer (Respondent No. 4) issued a directive on 17.12.2025 demanding payment under threat of debarment

Subsequently, Respondent No. 4 issued Office Order No. 06 dated 09.01.2026, debarring the petitioner indefinitely.

The petitioner challenged this order on grounds of jurisdictional incompetence of the officer and the illegality of indefinite debarment.

1. Whether an order of debarment 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 debarment order under the Bihar Contractors Registration Rules, 2007

The court applied Rule 11(d) of the Bihar Contractors Registration Rules, 2007, which stipulates that an order of blacklisting or suspension must be passed by the officer competent to register the contractor or their superior

Regarding the duration of debarment, the court relied on the precedent set by the Supreme Court in Kulja Industries Limited v. Chief General Manager, Western Telecom Project BSNL, (2014) 14 SCC 731, which established that debarment is never permanent and its duration must be proportionate to the offense

The court found that the registering authority for the petitioner was the Chief Engineer (Urban), Respondent No. 3, as evidenced by the registration certificate.

Consequently, under Rule 11(d), the Executive Engineer (Respondent No. 4) lacked the legal competence to initiate show cause proceedings or pass a debarment order.

The court held that an order passed by an incompetent authority without a valid show cause notice violates the principles of natural justice.

Furthermore, the court observed that the impugned order debarred the petitioner indefinitely, which contradicts the settled legal principle that debarment cannot be permanent, violating the doctrine of proportionality and the fundamental right to carry on trade.

The court allowed the writ petition and quashed the Office Order dated 09.01.2026. The matter was remanded to the competent authority (Respondent No. 3), who was directed to issue a fresh show cause notice and pass a reasoned order in accordance with the law and the agreement.