Contract - Contract with Government Company - For
supply of goods - Purchaser black-listed the supplier permanently on the ground that it committed gross misconduct
and irregularities by receiving excessive payments from the
purchaser - Held: Power to black-list a contractor is inherent
in the party allotting the contract - But if such decision is
taken by State or its instrumentalities, it is subject to judicial review and open to scrutiny on the touchstone of fairness,
relevance, natural justice, non-discrimination, equality and
proportionality - 'Debarment' though recognised as an
effective method for disciplining deviant suppliers, it is never
permanent - Period of debarment would invariably depend upon the nature of the offence committed by the erring
contractor - In the facts of present case, permanent
debarment is too harsh - Matter remanded back to competent
authority to determine the period of debarment - Constitution
of India, 1950 - Arts.226 and 32 - Judicial Review.