Sunday, 31 March 2019

When service of notice by ordinary post is not proved?

This Court finds that the petitioner-firm has categorically pleaded before this Court that the show cause notice dt. 14.09.2016 was not received by it and assuming the said notice was sent by the regular post, no presumption of service can be drawn.

31. This Court finds that the respondents by way of additional affidavit have tried to justify the service of the said notice dt. 14.09.2016 by producing xerox copy of the dispatch register and postage register on record. This Court finds that sending of notice by showing any dispatch register through ordinary post does not prove the fact of service of such notice on the petitioner-firm.

IN THE HIGH COURT OF RAJASTHAN (JAIPUR BENCH)

S.B. Civil Writs No. 17547/2016

Decided On: 19.01.2019

Agrofab Vs. State of Rajasthan and Ors.

Hon'ble Judges/Coram:
Ashok Kumar Gaur, J.

Citation: AIR 2019 Raj 34

1. The petitioner-firm has filed the instant petition challenging the order dated 28.11.2016 passed by the Principal Secretary, Department of Public Health and Engineering, Government of Rajasthan, Jaipur. The respondents have invoked Clause (20) of Rate Contract for breach of contract by the petitioner-firm and the impugned order imposes following four actions for breach of contract:-

(i) Contract security of petitioner stands forfeited i.e. Rs. 10.52 Lakhs.

(ii) The petitioner-firm is debarred from further business with the department for a period of 2 years from the date of impugned order.

(iii) The petitioner-firm is liable for recovery under risk and cost purchases.

(iv) Pending payment of the petitioner-firm has been withheld (Rs. 1.31 Crores approximately, as per the petitioner-firm's version).

2. The petitioner-firm while assailing the said order, has made following prayers in his writ petition in the prayer clause:-

"It is, therefore, most respectfully prayed that your Lordships may graciously be pleased to call for and examine the record and thereafter may kindly accept and allow this Writ Petition with exemplary cost and by an appropriate Writ, Order or Direction be pleased to:

(i) Quash and set aside the impugned Order dated 28.11.2016 (ANNEXURE-4 (COLLY) issued by Respondents;

(ii) Direct the Respondents to immediately release the Security Deposit furnished by the Petitioner against the Rate Contract dated 04.10.2013 along with applicable interest from the date the same became due;

(iii) Restrain the Respondents from making any coercive recovery from the Petition for any risk and cost purchases that may be effected against the Rate Contract dated 04.10.2013:

(iv) To take on record any further orders that may be passed by the Respondents against the Petitioner during the pendency of the Writ Petition and quash and set aside the same;

(v) Any other appropriate Writ, Order or Direction, in the present facts and circumstances of the case, which are deemed just and proper by this Hon'ble Court may also be passed in favour of the Petitioner."

3. The brief facts of the case are that the NIT No. Subpump/12-13/31 was floated by the Public Health & Engineering Department for supply of ISI marked 5 star rated submersible pumpsets for a period of 12 months.

4. The petitioner-firm claiming itself to be duly eligible-manufacturer of submersible pumps, submitted its bid along with prescribed bid fee, as provided in the tender. The technical bids were opened on 10.04.2013 and the price bids were opened on 02.08.2013. The petitioner-firm was found L-1 and the respondents vide letter dated 04.10.2013 accepted the bid and accorded the Rate Contract No. CPHRJ/RC-3511/NIT-31/AGROFAB/SUB-PUMPS/2012-13/138 dated 04.10.2013.

5. The petitioner-firm submitted all the requisite documents, executed agreement and submitted security deposit, as required under the Tender conditions. The petitioner-firm has pleaded in its petition that after execution of the agreement between the parties, several purchase orders were placed by the respondents and the petitioner-firm in pursuance of the said purchase orders made timely and effective supplies, as per the appended specifications, on Rate Contract basis. The said supplies were accepted by the respondents after due inspection in the manner, as provided under the Rate Contract.

6. The petitioner-firm has pleaded that in spite of complying with all the terms and conditions of Contract, to their utter shock, the respondent No. 1 issued impugned order dated 28.11.2016 where actions were taken against the petitioner-firm.

7. The petitioner-firm has pleaded in its petition in para-7 that the respondents have sought to invoke clause (20) of the Contract for breach of Contract, alleging the following discrepancies by the petitioner-firm:-

"a. During the inspection by the team of qualify control wing department, the submersible pump-set Sr. No. 402007 of category 300 LPM/160m/150/WE supplied by the firm (petitioner) against the supply order No. 02 dated 24.02.2014 to the consignee Division Dausa was not found in accordance with specification of rate contract;

b. During inspection the team found that the number of stages of supplies pump was 15 only whereas the number of stages should have been 20 as per rate contract. Similarly, the length of the submersible cable, supplied alongwith pump-set was less than the prescribed value;

c. Copy of above-said details of observations made by Additional Chief Engineer (QC) & Nodal Officer was sent to the firm vide letter No. HG III (3511) sub pump/NIT-31/Agrofav/12-13/11684-89 dated 14.09.2016 with directions to explain the reasons for supplying the substandard material within period of 10 days, however, no reply was submitted by the firm (petitioner);

d. Firm (petitioner) has not submitted the compliance and rectification report of 45 submersible pump-sets as desired vide office Final Notice No. HGIII (3511) subpump/NIT-31/Agrofab/12-13/28837-44 dated 03.03.2016;

e. Firm (petitioner) has not submitted the certified copy of proof of purchase of the total supplied submersible cable supplied along with submersible pump-sets, certified copy of bank statement as a proof of payment against submitted invoices and original documents for verification purposes as desired vide office letter No. HGIII (3511) sub pump/NIT-31/Agrofab/12-13/9858-59 dated 08.08.2016."

8. The petitioner-firm has pleaded in its petition that the impugned order dated 28.11.2016 was issued without any prior show cause notice and without affording any opportunity of hearing whatsoever. The petitioner-firm has further pleaded that the allegations levelled in the impugned order are wholly baseless, erroneous and factually incorrect. The petitioner-firm has pleaded that had adequate opportunity been provided to them, the same could have been easily clarified.

9. The petitioner-firm has asserted in response to the allegations leveled in the impugned order in regard to "submersible pump-set Serial No. 402007 of category-300 LPM/160m/150/WE not found in accordance with specification during inspection" that no intimation of any such inspection either in writing or otherwise was ever given to the petitioner-firm nor any report or copy thereof was supplied to the petitioner-firm informing it of the outcome of the said purported inspection.

10. The petitioner-firm has asserted in the writ petition that the respondents had not conducted any inspection by the Additional Chief Engineer (QC) and Nodal Officer for submersible pump-set or any other person authorized by them, the respondents are required to put to strict proof of the same as the conclusions drawn in the in the said purported report of supply of substandard materials by the petitioner-firm are false, baseless and fabricated.

11. The petitioner-firm has further asserted in the petition that the allegation of the respondents that submersible pump set was not in accordance with specifications of the Rate Contract are erroneous and baseless. The petitioner-firm has submitted that as per the condition No. 2.2.1 of Tender conditions and Clause (10) of the Rate Contract, a pre-dispatch inspection was carried out at the manufacturer/supplier by an inspection agency solely appointed by the respondent-department and charges/inspection fee for which was to be borne by the manufacturer/supplier. The petitioner-firm asserted that inspection certificate along with copies of the result and copy of the DD/Banker's Cheque, was submitted by the contractor along with bill to the consignee and without which the stores/articles supplied were to be rejected out-rightly. The petitioner-firm has given a complete mechanism that as per the conditions of Rate Contract, only after inspection of the material, the delivery is given at the consignee's divisional store in perfect condition, as per the schedule of specifications. The petitioner-firm has placed on record the inspection report of the goods which were duly inspected by a team - inspection agency M/s. CEIL which was appointed by the respondents and everything was found to be in order.

12. The petitioner-firm has asserted that in the impugned order dated 28.11.2016, there is no allegation of deviation of submersible pump sets supplied by the petitioner-firm or there was no complaint regarding performance/efficiency of the pump sets but the complaint was with regard to the hardware put therein namely (1) number of stages of supplied pump was 15 as against 20, as required under the Rate Contract; and (2) length of the submersible cable supplied along with the pump set, was only 98m as against 160m required, under the Rate Contact.

13. The petitioner-firm has further submitted that its guarantee for the supplies was to remain for a period of 24 days from the date of receipt of material at site or 24 months from the date of commissioning of the said material/store, whichever was earlier. It is alleged that the petitioner-firm's guarantee remained only for a period of 24 months i.e. from 24.02.2014 to 23.02.2016 and for any alleged defect thereafter, the petitioner-firm cannot be held liable.

14. The petitioner-firm in para-18 of the petition has asserted that the impugned order dated 28.11.2016 banning the petitioner-firm and forfeiting its security along with withholding all its payments, has been passed by the respondents in gross violation of principles of natural justice and fair play. It is asserted that before passing the impugned order dated 28.11.2016 neither any show cause notice was issued nor any opportunity of personal hearing was granted.

15. The petitioner-firm has further specifically asserted in para 19 of the petition that the reliance placed on the alleged notice/letter dated 14.09.2016, in the impugned order, to establish compliance of principles of natural justice, was wholly frivolous and misconceived and notice/letter dated 14.09.2016 alleged to be sent to the petitioner-firm was never received by it.

16. The petitioner-firm has asserted that blacklisting or debarring a company/firm has serious civil consequences and the same is akin to 'civil death' of the said company/firm. The show cause notice ought to be clear and specific to conclusively indicate the intention of the authorities to blacklist/debar the company/firm in case it fails to show any sufficient cause and any vagueness therein shall render it ineffective.

17. The petitioner-firm has further relied upon Clause (24) of the Standardized Code for Suppliers (Appendix-3) which is said to be a part of the tender document applicable to both the petitioner-firm and the respondents. It is asserted that decision regarding removal from registration/suspension/banning of business dealing has to be taken after issuance of show cause notice and consideration of representation, if any, in reply thereto should be communicated to the firm concerned. The petitioner-firm asserted that the said requirement of issuance of show cause notice and opportunity of hearing was not provided to the petitioner-firm.

18. Learned counsel for the petitioner-firm Mr. Vivek Dangi has made following submissions for consideration of this court:-

(a) The purported show cause notice dated 14.09.2016 was never served upon the petitioner-firm and no opportunity of hearing was granted to the petitioner-firm prior to issuance of the impugned debarring/blacklisting order dated 28.11.2016.

(b) Mere issuance of a notice does not satisfy the requirement of principles of natural justice and law and it is the due and timely service of show cause notice upon the noticee which constitutes adequate and meaningful opportunity of hearing and in absence of verifiable proof of service of the purported notice dated 14.09.2016 upon the petitioner-firm, the issuance of same is totally non-est in the eyes of law and in violation of Section 27 of the General Clauses Act, 1897.

(c) Once it is specifically pleaded by the petitioner-firm in paragraphs-18 and 19 of the petition of not affording opportunity of hearing before passing the impugned order dated 28.11.2016 as the notice dated 14.09.2016 was not served upon the petitioner-firm and since there is no specific denial of the said assertion by the respondents in their reply, as per the provisions of Order 8 Rule 5 CPC, the specific allegations of fact are required to be specifically rebutted and the court has to draw a presumption of "deemed admission" against the respondents.

(d) In response to the specific order of this court passed on 01.02.2018 to file an affidavit as to when show cause notice dated 14.09.2016 was served on the petitioner-firm, the respondents have filed an affidavit dated 20.03.2018 where it has only been stated that the notice dated 14.09.2016 bearing dispatch Nos. 11684-11689 dated 14.09.2016 was sent to the petitioner-firm and such affidavit, filed by the respondents, is wholly evasive and misleading and no affidavit regarding service of show cause notice dated 14.09.2016 with regard to proof of service has been filed and the purported notice dated 14.09.2016 was sent by the regular post to the petitioner-firm allegedly bearing dispatch Nos. 11684-11689.

(e) Inspection dated 22.08.2016 was not conducted by the independent agency and as such the impugned order dated 28.11.2016 has been passed on a wrong premise and in violation of tender condition mandated under Clause 2.2.2 of the Special Conditions of Contract.

(f) The conclusions drawn in the inspection report dated 22.8.2016 regarding supply of sub-standard pumps by the petitioner-firm are false, baseless and fabricated and the impugned order dated 28.11.2016 is not sustainable in the eyes of law.

(g) The allegation that the petitioner-firm has not submitted certified copies of proof of purchase of the submersible cable supplied along with the submersible pump sets, is totally baseless and without considering the relevant facts, the said finding was recorded.

(h) Forfeiture of performance security and withholding all due payments without proper adjudication of losses suffered by the department on account of the alleged default committed by the petitioner-firm, by a competent court, is wholly illegal.

19. The respondents have filed reply to the writ petition. The respondents have justified the order dated 28.11.2016. It is asserted that an inspection team of quality control wing of the department found that the petitioner-firm supplied submersible pump sets against the Supply Order No. 2 dated 24.02.2014 to the Consignee Division, Dausa and the same was not in accordance with the specification of the Rate Contract and during inspection, the team found that the number of stages of supplied pump was 15 only whereas the number of stages should have been 20, as per the Rate Contract and the length of submersible cable supplied along with the pump set was less than the prescribed value. The respondents have submitted that the said observations were made by the Additional Chief Engineer and Nodal Officer and were communicated to the petitioner-firm to explain the reasons for supplying the sub-standard material.

20. The respondents have submitted that disputed questions which are raised by the petitioner-firm with regard to quality of material may not be examined by this court. The respondents have placed on record a communication dated 22.08.2016 with regard to the inspection, calling the petitioner-firm for inspection and petitioner-firm did not turn up in spite of such letter being written with regard to the inspection.

21. The respondents further placed on record that vide communication dated 30.08.2016 inspection was to be carried out on 31.08.2016 and the inspection team found that products were not as per the specifications and accordingly, a decision was taken by the department to debar the petitioner-firm for further participation in the tender process for next two years. The respondents have placed on record a letter dated 14.05.2016 said to be received from one M/s. Kanha Enterprises wherein it was communicated that brand name "POLITOP" was never supplied to the petitioner-firm and it violated their trade mark and supplied duplicate submersible cable.

22. The respondents have further submitted that the petitioner-firm in fact was required to supply total length of around 3,43,180 mtrs. of submersible cable but they purchased 1,95,263 mtrs. of cable, which shows the manipulation of entire process by the petitioner-firm. The respondents have pleaded that the petitioner-firm was communicated vide letter dated 08.08.2016 to furnish the certified copy of proof of purchase of the total supplied submersible cables along with submersible pump sets within a period of seven days and the petitioner-firm did not respond to the said notice dated 08.08.2016. The respondents have further made a reference of an FIR registered against the petitioner-firm by ACB bearing No. 316/2016 dated 15.11.2016. The respondents have pleaded that the writ petition is liable to be dismissed.

23. The petitioner-firm has filed rejoinder to the reply and apart from denying the other facts, it was reiterated that neither the notice dated 14.09.2016 nor the copy of the purported inspection report made by the Additional Chief Engineer (QC) and Nodal Officer, was ever received by the petitioner-firm. It was reiterated that in spite of specific objection raised by the petitioner-firm, the respondents have failed to enclose the copy of the alleged notice dated 14.09.2016 (duly received by the petitioner-firm). The petitioner-firm has submitted that the show cause notice dated 28.12.2016 was received subsequently by the petitioner-firm on 03.01.2017, i.e. after passing of the impugned order dated 28.11.2016 which serves no purpose and under no circumstances, it can be assumed as sufficient compliance of principles of natural justice.

24. This court vide order dated 01.02.2018 directed the respondents to file additional affidavit as to when the show cause notice dated 14.09.2016 was served on the petitioner-firm. The Officer-in-Charge of the case, filed additional affidavit in compliance of order of this court and submitted a copy of the dispatch register dated 14.09.2016 wherein at S. No. 11684 dated 14.09.2016, the petitioner-firm was conveyed the notice indicating failure in supply of material, as per the specifications prescribed. The copy of register of postage stamps dated 14.09.2016 was also placed on record as Annex. R/9.

25. The petitioner-firm filed a counter affidavit to the affidavit filed by the respondents and submitted that the purported dispatch register and register of postage stamp were meaningless. The petitioner-firm submitted in the counter affidavit that notice to show cause must not only be issued or dispatched by the authority but also that the same is actually "served" upon or "received" by the person. The service of notice is sine-qua non for meaningful opportunity of "hearing". The counter affidavit filed by the petitioner-firm reiterated the fact that the purported show cause notice dt. 14.09.2016 was never served upon the petitioner-firm. The petitioner-firm further reiterated in the counter affidavit that it was mentioned in the tender condition that communication between the parties were to be made by the "registered post" only and all correspondences by the respondents to the petitioner-firm, except the purported show cause notice dt. 14.09.2016, was sent by the registered post. The petitioner-firm reiterated that it is intriguing as to why the respondents choose to send only the purported show cause notice dt. 14.09.2016 to the petitioner-firm by "regular mail" despite knowing fully well that the same would constitute the sole opportunity of hearing to the petitioner-firm prior to taking the extreme/drastic steps of blacklisting/debarring the petitioner-firm.

26. Mr. J.M. Saxena, counsel for the respondents has argued that sending of notice is clearly reflected from the dispatch register and as such principles of natural justice have been complied with and he has supported the impugned order passed by the authority.

27. During the pendency of the writ petition, an application No. 40782 dt. 17.07.2017 was filed by the respondents whereby the notices dt. 28.06.2016 and 14.09.2016 were filed on record by the respondents. The respondents pleaded in the said application that in response to para 19 of the petition that the letter/notice dt. 14.09.2016 was never received by the petitioner-firm and principles of natural justice have not been followed, the respondents submitted that notice dt. 14.09.2016 bearing dispatch No. 11684/11689 was sent to the petitioner-firm along with inspection report of the quality control wing. The respondents have mentioned that prior to issuance of notice dt. 14.09.2016, the petitioner-firm was given another notice dt. 28.06.2016. The respondents have submitted that the letter/notice dt. 14.09.2016 was conveyed to the petitioner-firm making it clear that the petitioner-firm was responsible for breach of contract and was liable for action under Clause (7.16), (12), (13), (16) and (30) of the Rate Contract. The respondents also pleaded that the postage register proved the fact that the letter/notice dt. 14.09.2016 was dispatched to the petitioner-firm and by all means the same was received by the petitioner-firm. The application No. 40782 dt. 17.07.2017 was allowed by this court vide order dated 06.12.2017 and the document filed along with the application was taken on record.

28. I have heard learned counsel for the parties and perused the material available on record.

29. The primary question to be decided in the present case is with respect to following the principles of natural justice before issuing the impugned order dt. 28.11.2016.

30. This Court finds that the petitioner-firm has categorically pleaded before this Court that the show cause notice dt. 14.09.2016 was not received by it and assuming the said notice was sent by the regular post, no presumption of service can be drawn.

31. This Court finds that the respondents by way of additional affidavit have tried to justify the service of the said notice dt. 14.09.2016 by producing xerox copy of the dispatch register and postage register on record. This Court finds that sending of notice by showing any dispatch register through ordinary post does not prove the fact of service of such notice on the petitioner-firm.

32. This Court further finds from the tender conditions - Clauses 5.1(f) and 5.2 where communications/purchase orders were required to be sent through registered post/AD. It would be useful to quote the 5.1(f) and 5.2 of the tender conditions as under:-

"5.0 PURCHASE UNDER RATE CONTRACT

5.1 As per your offer, your commitment to supply material comes as under.

(a) to (e) XX XX XX

(f) Orders against the rate contract shall be placed on or before last date of the validity of the rate contract by Registered AD/Speed Post. Orders placed during the closing days shall be complied with in accordance with the terms of the contract and shall not be refused on the ground that the orders have been placed on fag end of the contract period.

5.2 The firm shall examine the rate contract and supply orders placed against the rate contract and bring to the notice immediately, but not later than 15 days, any discrepancy with regards to the conditions, specifications, nomenclature, delivery period etc. of the stores ordered, for rectification, if the same are not as per agreed terms, conditions and specification. The letter to the Direct Demanding Officer and Chief Engineer (HQ) PHED shall be sent by registered post A.D."

33. This Court finds that terms of the contract provided that Rate Contract and supply orders and any discrepancy with regard to conditions, specifications, nomenclature, delivery period, etc., if the same were not as per the agreed terms, conditions and specifications, such letter to the Direct Demanding Officer and Chief Engineer was to be sent by the registered post/AD. This Court finds that once the communication is required to be made by the parties by way of registered post/AD, the plea of the respondents that the show cause notice dt. 14.09.2016 was sent by the ordinary post, is not to be believed by this Court.

34. This Court further finds substance in the submission of the learned counsel for the petitioner-firm that if all the communications, except the show cause notice, were sent by the registered post/AD, then the show cause notice containing important information/letter was also required to be communicated in the same manner enabling the petitioner-firm to file reply to the show cause notice.

35. This Court is constrained to hold this in view of the fact that issuance of notice was not enough and service of notice dt. 14.09.2016 was essential part for affording opportunity of hearing to the party concerned.

36. This Court finds that the Apex Court in the case of M/s. Erusian Equipments and Chemicals Ltd. Vs. State of West Bengal reported in MANU/SC/0061/1974 : (1975) 1 SCC 70 has laid down the law that before blacklisting a company/firm, it is required that the person concerned should be given an opportunity to represent his case before he is put on blacklist. The portion of judgment relevant for the present purpose is quoted hereunder:-

"20. Blacklisting has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains. The fact that a disability is created by the order of blacklisting indicates that the relevant authority is to have an objective satisfaction. Fundamentals of fair play require that the person concerned should be given an opportunity to represent his case before he is put on the blacklist."
37. The Apex Court in the case of Gorkha Security Services Vs. Government (NCT of Delhi) & Ors. reported in MANU/SC/0657/2014 : (2014) 9 SCC 105 has reiterated the principle that show cause notice is to make the noticee understand the precise case set up against him which he has to meet. The portion of judgment relevant for the present purpose is quoted hereunder:-

"21. The Central issue, however, pertains to the requirement of stating the action which is proposed to be taken. The fundamental purpose behind the serving of Show Cause Notice is to make the noticee understand the precise case set up against him which he has to meet. This would require the statement of imputations detailing out the alleged breaches and defaults he has committed, so that he gets an opportunity to rebut the same. Another requirement, according to us, is the nature of action which is proposed to be taken for such a breach. That should also be stated so that the noticee is able to point out that proposed action is not warranted in the given case, even if the defaults/breaches complained of are not satisfactorily explained. When it comes to blacklisting, this requirement becomes all the more imperative, having regard to the fact that it is harshest possible action."
38. This Court finds that under Section 27 of the General Clauses Act, 1897 read with Section 114 of the Indian Evidence Act, 1972, the presumption of service can only be drawn when the notice is sent at the correct address by the registered post/AD and moreover, even such a presumption is rebuttable i.e. if controverted, onus lies on the sender to demonstrate that the same was delivered to the noticee. Section 27 of the General Clauses Act, 1897 and Section 114 of the Indian Evidence Act, 1972 being relevant are reproduced hereunder:-

"27. Meaning of service by post - Where any (Central Act) or Regulation made after the commencement of this Act authorizes or requires any document to be served by post, where the expression "serve" or either of the expressions "give" or "send" or any other expression in used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing pre-paying and posting by registered post, a letter containing the document, and unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.

114. Court may presume existence of certain facts.-- The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case."

39. The Apex Court in the case of V.N. Bharat Vs. DDA & Anr. reported in MANU/SC/8009/2008 : (2008) 17 SCC 321 has laid down as under:-

"24. Ms. Tripathy urged that since the notice of demand in respect of fifth and final installment had been duly sent to the appellant by Registered Post with acknowledgment due at the address given by him, there would be a statutory presumption under Section 114 Illustration (f) of the Evidence Act that the demand notice had been duly served on the appellant. Ms. Tripathy urged that the Commission rightly dealt with the matter and no ground had been made out on behalf of the appellant for interference with the same.

25. As will be evident from what has been mentioned hereinbefore, the real controversy in this appeal appears to be whether the demand letter dated 10th September, 1996, for payment of the fifth and final installment had, in fact, been received by the appellant and as to whether non-compliance with the same resulted in termination of the appellant's allotment and whether the restoration of such allotment on a representation made by the appellant would amount to a fresh or new allotment.

26. As submitted by Ms. Tripathy, except for the statutory presumption under Section 114 Ill.(f) of the Evidence Act, there is no other material to suggest that the demand notice had actually been received by the appellant.

27. The assertion of service of notice on account of such presumption has been denied by the appellant as a result whereof onus of proving service shifted back to the respondent. The respondent DDA has not led any other evidence in support of the presumption of service. In such circumstances, it has to be held that such service had not been effected. Therefore, when on the appellant's application for restoration of the allotment, the allotment was restored, the only conclusion that can be arrived at is that the earlier allotment continued as no cancellation and/or termination had, in fact, taken place in terms of clause 4 of the Scheme in question.

28. As far as the MRTP Commission is concerned, there is no definite finding on the question of service of the demand notice. On the other hand, the Commission presumed that the appellant must have had knowledge of the allotment which had been widely publicised in leading newspapers. According to the Commission, it was for the appellant to have made inquiries relating to completion of the construction and it should have waited for a demand notice to have been sent to him. In our view, the Commission also erred in placing the onus of proof of service of the demand notice on the appellant, since except for denial there is nothing else that the appellant could have produced to prove a negative fact. As we have indicated hereinbefore, the presumption under Section 114 Ill.(f) of the Evidence Act is a rebuttable presumption and on denial of receipt of the Registered letter from DDA the appellant discharged his onus and the onus reverted back to the respondent to prove such service by either examining the postal authorities or obtaining a certificate from them showing that the registered article had been delivered to and had been received by the appellant. It is on a mistaken understanding of the provisions of Section 114 Ill.(f) of the Evidence Act that the Commission came to the erroneous conclusion that the allegation of unfair trade practice on the part of the respondent authority had not been proved. In our view, from the material on record it is quite clear that the respondent authority was unable to prove that service of the demand notice for the fifth and final installment had been effected on the appellant.

29. Once it is established that the notice of demand for the fifth and final installment had not been received by the appellant, the other consequences, as indicated by Ms. Tripathy, namely, automatic termination and fresh allotment, cannot follow. In any event, in our view, the restoration of the allotment did not amount to a fresh allotment on the basis of which the fresh demand notice could have been issued.

30. Having regard to what has been stated hereinabove, in our view the MRTP Commission erred in law in shifting the onus of proof of service of the demand notice on the appellant and in discharging the notice of inquiry and vacating the interim order issued under Section 12-A of the M.R.T.P. Act. The allegation of unfair trade practice on the part of the respondent authority stands established. The decision of the Commission is, therefore, liable to be set aside.

31. The appeal is, therefore, allowed. The judgment of the MRTP Commission impugned in this Appeal is set aside. The respondents are directed to accept the sum of Rs. 1,63,512/-, which had been deposited by the appellant prior to receipt of the demand notice, together with interest, if any, accrued thereupon, in full and final settlement of their dues in respect of the flat allotted to the appellant and to hand over possession thereof to the appellant within a month from the date of receipt of a copy of this order.

32. Having regard to the facts of the case, the parties will bear their own costs."

40. This court finds that other grounds raised by the petitioner-firm need not to be gone into by this Court as this Court has come to the conclusion that a reasonable opportunity of hearing was not given to the petitioner-firm before passing of the impugned order dt. 28.11.2016.

41. This Court accordingly allows the present writ petition filed by the petitioner-firm and set aside the impugned order dt. 28.11.2016 passed by the Principal Secretary, Department of Public Health and Engineering, Government of Rajasthan, Jaipur.

42. This court makes its clear that in case any action is to be taken against the petitioner-firm for the alleged breach of contract, the respondents are always free to proceed by following due process of law, after giving a proper opportunity of hearing to the petitioner-firm.

43. Accordingly, the present writ petition stands allowed. No costs.


Print Page

No comments:

Post a comment