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If the delay is properly explained and no third party rights are being affected, the writ court under Article 226 of the Constitution may condone the delay

In Vetindia Pharmaceuticals vs. The State Of Uttar Pradesh, the appellant was served with an order of blacklisting dated 08.09.2009 by the Office of Director, Animal Husbandry Department of the respondent referring to the State Analyst report dated 10.10.2008, declaring the batch supplied by the appellant to be of substandard quality (misbranded/not in accordance with Oxytetracycline injection), thus violating clauses 8.12 and 8.23 of the Tender of 2006­07. The appellant informed the respondents that it had never made any supplies to them under the Tender in question. The misbranding referred to was an inadvertent error. The brand name of the medicine was correctly mentioned as “OXY­125”. The composition of the medicine was also correctly mentioned as “Oxytetracycline HCL IP Vet 125 mg”. The generic term “Hcl” was only missing on the label, and it was written as “OXYTETRACYCLINE INJ. I.P. VET” in place of “OXYTETRACYCLINE HCL INJ. I.P. VET”. It was therefore a case of bonafide inadvertent printing error which resulted in misbranding. The product was not substandard or spurious veterinary medicine.

However, the authorities issued show cause but did not accept the arguments of the appellants who were blacklisted. The High Court rejected the appeal on the grounds of inordinate delay.

The Supreme Court observed that in the first instance, the drug were not directly supplied to the Respondents and neither did the appellants participate in the tender. Therefore in terms of natural justice, the Respondents were not within their rights to show cause or black-list the appellants or at least they should have paid more heed to the explanations given by the Appellants. Also the show cause had not mentioned blacklisting.

In M/s. Erusian Equipment & Chemicals Ltd. vs. State of West Bengal and another, it has been held that there could not be arbitrary blacklisting and that too in violation of the principles of natural justice. The Respondents had not followed the observations on show cause notices as laid down in Gorkha Security Services vs. Government (NCT of Delhi) & Ors., (2014) 9 SCC 105.

Based on these observations, the Supreme Court held that if the respondents had expressed their mind in the show cause notice to blacklist, the appellant could have filed an appropriate response to the same. The insistence of the respondents to support the impugned order by reference to the terms of the tender cannot cure the illegality in absence of the appellant being a successful tenderer and supplier.

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