This judgment was produced in regards the order to Medical and Health Department in order to stop purchase from Daffodills, a local pharmaceutical supplier, where the Supreme Court of India quashed the order which was passed by Uttar Pradesh Government. The right to be heard, is one of the principles of Natural Justice and is entrenched in the legal ethos which cannot be ignored. Minimum opportunity to be heard is to be given before inflicting an adverse order.

The order against Daffodills was issued by the Principle Secretary of the U.P. government, a First Information Report (FIR) was lodged against the company alleging that it committed offences and there was an inquiry by the Central Bureau of Investigation (CBI) of the issue.

The judgment in apex court was delivered by Justice Rohinton Fali Nariman and Justice S. Ravindra Bhat stating that an opportunity to be heard and representation against the proposed action should be given before any executive decision is passed that proposes a drastic adverse action like blacklisting or debarring purchase of medicines from Daffodills for an indefinite duration. The bench further observed that:

In the present case, even if one assumes that Surender Chaudhary, the accused in the pending criminal case was involved and had sought to indulge in objectionable activities, that ipso facto could not have resulted in unilateral action of the kind which the State resorted to against Daffodils, which was never granted any opportunity of hearing of a chance to represent against the impugned order. If there is one constant lodestar that lights the judicial horizon in this country, it is this: that no one can be inflicted with an adverse order, without being afforded a minimum opportunity of hearing, and prior intimation of such a move. This principle is too well entrenched in the legal ethos of this country to be ignored, as the state did, in this case.

The scope of inquiry in judicial review is limited in matters of award of public contracts, while the court dismisses the petition filed by Daffodils. The Supreme Court disapproved the approach and added that:

“Granted, such jurisdiction is extremely circumscribed, no doubt the court had refused to grant relief to Daffodils against its plea of wrongful rejection of its tender. However, what the impugned judgment clearly overlooks is that the action of the state, not to procure indefinitely, on an assumption of complicity by Daffodils, was in flagrant violation of principles of natural justice”.

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Link to judgment: https://main.sci.gov.in/supremecourt/2017/15819/15819_2017_4_1501_19129_Judgement_13-Dec-2019.pdf