Case Background
The petitioner is a registered road construction contractor under the Bihar Registration of Contractors Rules, 2007. Its registration number was mentioned as v0 iz0/ Js.kh-01 (izFke) – 533/2014.
The Road Construction Department of the State of Bihar had allotted certain work to the petitioner. During execution of this work, mining activities in Bihar were stopped. Because of this, sand was allegedly not available, and the petitioner says that the work could not be completed within the original time period.
According to the petitioner, it followed the agreement conditions and applied for extension of time before the competent authority. This request for extension of time, along with departmental recommendations from different authorities, formed part of Annexure-P-13 series to the writ petition. The Superintending Engineer, Road Construction Department, Magadh Road Circle, Gaya, also recommended extension of time to higher authorities through Letter No. 1858 dated 28.11.2018, and sent it to the Chief Engineer (Mechanical), South Bihar Sub-Part, Road Construction Department, Bihar, Patna for necessary orders.
Meanwhile, the petitioner states that it completed the work in February 2018. During the period of delay, the department deducted liquidated damages as fixed under the contract, up to the maximum limit of 2% of the contract value. Around Rs. 1 crore of the petitioner’s dues remained pending, which, according to the petitioner, would be released after final approval of the extension of time.
While the request for extension of time was still pending, the Engineer-in-Chief, Road Construction Department, issued a show cause notice dated 11.09.2017 (Annexure-P-6). The petitioner was asked to explain within seven days why action should not be taken against it under the Bihar Contractors Registration Rules, 2007 for delay in completion of work.
The petitioner submitted replies dated 19.09.2017 and 11.10.2017, marked as Annexure-P-7 and Annexure-P-8 to the writ petition. Despite this, the Engineer-in-Chief passed an order dated 15.12.2017 (Office Order-217, communicated by Letter No. Pra-7/vividh-97/2015(Ansh)/7142), suspending the petitioner’s registration for two years under Sub-clause (ii) of Clause 11(ka) of the Bihar Registration of Contractors Rules, 2007 read with departmental letter no. 4104(E) dated 28.10.2009.
In that impugned order, the Engineer-in-Chief recorded that the petitioner had not submitted any explanation to the show cause notice. To point out the error and to show that replies had been filed, the petitioner submitted another representation dated 23.01.2018 (Annexure-P-11) before the Engineer-in-Chief. However, by order dated 27.02.2018 (Annexure-P-12), the Engineer-in-Chief declined to act on it and suggested that the petitioner should have approached the Principal Secretary of the Department against his order.
Finding no other effective remedy, the contractor approached the Patna High Court in Civil Writ Jurisdiction Case No. 10385 of 2018, seeking quashing of the suspension order and related reliefs.
What the Court Examined and Decided
The matter came up before Hon’ble Mr. Justice Rajeev Ranjan Prasad. The petitioner was represented by counsel, but no one appeared on behalf of the State respondents at the time of hearing, although their counter affidavit was on record. The Court therefore considered the writ petition along with the counter affidavit and rejoinder.
The petitioner’s core argument was that the order dated 15.12.2017 (Annexure-9) suspending its registration for two years was illegal because it violated the principles of natural justice. The main points urged were:
First, that when the show cause notice dated 11.09.2017 had been issued, the petitioner had in fact submitted detailed replies on 19.09.2017 and 11.10.2017 (Annexure-P-7 and P-8). These replies explained that delay was caused due to non-availability of sand after stoppage of mining activities in Bihar, and that an application for extension of time had already been made as per the agreement. Supporting departmental communications were also produced to show that various authorities, including the Executive Engineer and Superintending Engineer, had recommended extension of time, and the matter was pending with higher authorities.
Second, despite these replies and the pending extension proposal, the Engineer-in-Chief proceeded to suspend the petitioner’s registration and wrongly recorded in the order that no explanation had been submitted. The petitioner contended that this was not just a technical error but showed non-application of mind and disregard of the record.
Third, when the petitioner later submitted representation dated 23.01.2018 (Annexure-P-11) pointing out that explanations had in fact been filed, the Engineer-in-Chief refused to look into it and, by order dated 27.02.2018 (Annexure-P-12), simply stated that the petitioner should have appealed to the Principal Secretary. The petitioner argued that this showed a mechanical and arbitrary exercise of power.
The Court carefully read the counter affidavit filed by the State. There, the respondents did not deny that the petitioner had sent the replies (Annexure-P-8) and the subsequent representation (Annexure-P-11). In other words, the State did not controvert the fact that explanations existed and were on record when the impugned order was passed.
On this basis, the Court drew an important inference: if the explanations had definitely been submitted, then recording in the suspension order that no explanation was given was plainly incorrect. This meant that the Engineer-in-Chief had either not looked at the file or had ignored its contents, and the petitioner was punished without its submissions being considered.
The Court emphasised that the power exercised by the Engineer-in-Chief under the Bihar Registration of Contractors Rules, 2007 is a serious, “drastic” power, because suspending or cancelling a contractor’s registration has clear civil consequences. A contractor whose registration is suspended cannot obtain work from the department and suffers financial and reputational harm. Therefore, before taking such action, the authority must strictly follow principles of natural justice and abide by the Rules.
The Court accepted that a show cause notice had been issued. But it held that merely issuing a notice is not enough. The authority must also consider the contractor’s reply in a fair and judicious manner. If the reply is ignored, the requirement of hearing is not fulfilled. The Court observed that non-consideration of relevant material placed by a party is itself a violation of natural justice, and in this case it formed another limb of the same violation.
The Court further noted that this was not an isolated incident. Recently, in several cases, including CWJC No. 2398 of 2019 decided on 29.03.2019, similar complaints had come before the Patna High Court. In those matters also, the Engineer-in-Chief, Road Construction Department, had passed orders suspending licenses or debarring contractors without issuing proper show cause notices or without considering the replies. The Court expressed concern that such practice had a tendency to generate avoidable litigation.
Considering the overall facts, the Court found that the Engineer-in-Chief had acted “in hot haste” without realising that the petitioner’s stand in Annexure-P-8 and related documents needed to be examined. This conduct showed that he was exercising power under the Bihar Contractors Registration Rules, 2007 without following the mandatory procedure and without respecting the principles of natural justice.
The Court therefore held that the impugned order was liable to be quashed on two distinct but connected grounds:
One, violation of natural justice, as the petitioner’s explanation was not considered even though it had been filed, and the show cause process thus remained incomplete. Two, non-consideration of materials on record, such as the replies and the extension-of-time recommendations, which amounted to arbitrary and unlawful exercise of statutory power.
The Court highlighted that because such orders have civil consequences, it was incumbent upon the Engineer-in-Chief to act cautiously. It directed that a copy of its judgment be communicated to the Principal Secretary, Road Construction Department, Government of Bihar, to ensure that such practices are stopped and that the department does not pass orders in haste, contrary to the Rules and natural justice.
Although the Court was critical of the departmental conduct, it decided, “for the present,” not to impose costs on the respondents. However, it clearly signalled that remedial steps must be taken by the Principal Secretary to prevent similar future disputes arising purely from non-compliance with the Rules.
In the result, the High Court set aside the impugned suspension order contained in Annexure-9. With that, the writ application was allowed. The effect is that the two‑year suspension of the petitioner’s registration stood quashed, and the contractor’s registration revived, subject of course to any future lawful action taken after following proper procedure.
Why This Judgment Matters
This judgment is important for all contractors working with government departments in Bihar, especially in the road construction sector. It makes clear that the department cannot suspend or debar a contractor’s registration in a routine or mechanical way.
Whenever the department wants to take such harsh action, it must not only send a show cause notice but must also carefully read and consider the contractor’s reply. If it ignores the reply or misstates that no reply was filed when in fact it was, the order can be struck down by the Patna High Court for violating natural justice.
The Court also sent a strong message to senior officials that misuse of these “drastic powers” leads to unnecessary litigation and financial hardship. By directing the Principal Secretary to look into the matter and stop this practice, the judgment pushes the department towards more transparent and lawful decision-making.
For ordinary contractors, this decision shows that they can challenge departmental actions that are taken without fair hearing, and the High Court is willing to protect their rights when rules are not followed.
Legal Issues and Answers
Issue: Could the Engineer-in-Chief validly suspend a contractor’s registration for two years when the contractor had already replied to the show cause notice and placed relevant materials on record?
Answer: No. The Patna High Court held that the suspension order was vitiated by violation of natural justice and by non-consideration of the contractor’s explanations and other materials on record, and therefore had to be set aside.
Issue: Is issuing a show cause notice alone sufficient compliance with natural justice while exercising powers under the Bihar Registration of Contractors Rules, 2007?
Answer: No. The Court clarified that along with giving a show cause notice, the authority must genuinely consider the contractor’s reply before passing any order that has civil consequences.
Cases Cited by the Court
- The Court referred to its own recent decision in CWJC No. 2398 of 2019 decided on 29.03.2019, where similar issues about orders passed by the Engineer-in-Chief without proper hearing had been noticed.
Case Details
Case Number: Civil Writ Jurisdiction Case No. 10385 of 2018
Case Title: M/s Dhanpat Prasad v. The State of Bihar & Ors.
Citation: 2019 (2) PLJR 1071
Court: High Court of Judicature at Patna
Coram: Hon’ble Mr. Justice Rajeev Ranjan Prasad
Date of Judgment: 01.04.2019
Advocates: Mr. Manish Sahay, Advocate, for the petitioner; name of counsel for the respondents is not mentioned in the judgment.
Respondents: The State of Bihar through the Principal Secretary, Road Construction Department, and other departmental officers including the Principal Secretary, Engineer-in-Chief-cum-Additional Commissioner-cum-Special Secretary, Chief Engineer (Communication) (South Bihar Wing), Superintending Engineer (Magadh Road Circle, Gaya), and Executive Engineer (Road Division, Nawada).
Nature of the Case: Writ petition under civil writ jurisdiction challenging an order of suspension of contractor registration under the Bihar Registration of Contractors Rules, 2007.
Impugned Order: Letter No. Pra-7/vividh-97/2015(Ansh)/7142 read with Office Order-217 dated 15.12.2017 issued by the Engineer-in-Chief-cum-Additional Commissioner-cum-Special Secretary, Road Construction Department, Government of Bihar, suspending the petitioner’s registration for two years under Sub-clause (ii) of Clause 11(ka) of the Bihar Registration of Contractors Rules, 2007 read with departmental letter no. 4104(E) dated 28.10.2009.
Outcome: Writ application allowed; impugned suspension order (Annexure-9) set aside.
Link to Judgment: https://patnahighcourt.gov.in/viewjudgment/MTUjMTAzODUjMjAxOCMxI04=—ak1–YtReGF–am1–NvM=
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