LIST OF ABBREVIATION

1. SCC- Supreme Court Cases

2. AIR - All India Rank.
3. SCR- Supreme Court Report
4. Govt. –Government
5. Ltd. - Limited.
6. Co. - Corporation.
7. Ors. - Others.
8. Pvt. – Private
9. Art. - Article
10. Btw. – Between.
11. Sec. - Section.
 STATEMENTS OF JURISDICTION

In the present Writ Petition under article 226 of the Constitution of Samudrasthal concerning
the matter Modern Infrastructure Private Limited v Government of Hind Pradesh the
petitioner humbly submits to the jurisdiction of this Hon’ble High Court of Hind Pradesh.

In the present Writ Petition under article 226 of the Constitution of Samudrasthal concerning
the matter Clive Lloyd Construction Private Limited v Government of Hind Pradesh, the
petitioner humbly submits to the jurisdiction of this Hon’ble High Court of Hind Pradesh.

In the present appeal against the order of the District Court of Nawabdwip concerning the
matter Clive Lloyd Construction Private Limited v Government of Hind Pradesh, the
appellant humbly submits to the jurisdiction of this Hon’ble High Court of Hind Pradesh.

The present memorandum sets forth facts, contentions and arguments in the present case.
 STATEMENTS OF FACTS

I. Samudrasthal is a democratic country. The last election to the House of People has seen
Mr. Mahendra Zodi being elected as the Prime Minister. Under his leadership, Samudrasthal
has progressed rapidly concluding partnerships with numerous developed and developing
countries. Hind Pradesh is a state within the boundary of Samudrasthal. The problem of
inequality of income is the acutest here amongst all states. Another problem faced by the
inhabitants of Hind Pradesh is the lack of proper healthcare at affordable rates. Mr. Saurabh
Sharma, the leader of PPS, was elected as the Chief Minister. He formed his government and
immediately started to deliver on his promises. He floated the idea of constructing a Super-
Specialty Hospital & Medical Concours 2018 College at the state capital, Nawabdwip, where
the masses would be treated at extremely subsidized rates.

II. For this purpose, a tender was floated inviting proposals to construct the SSHMC in
Nawabdwip. In this proposal, the minimum qualifications for the proposers were provided.
The last date for submission of proposals was fixed at June 30, 2012. However, no proposals
were received within the deadline. It was found out that the qualification (3) which spoke
about the contractor being financially sound could not be met with as it was the usual practice
of the industry to get their accounts audited and balance sheet prepared on September of the
succeeding year. Thereafter, the advertisement was amended and instead of the balance-
sheets of 2009-10, 2010-11 and 2011-12, the balance-sheets of 2008-09, 2009-10 and 2010-
11 were called for. Five proposals were received. MIPL was found to be lowest tender. In
spite of being lowest tender and qualifying required requisites MIPL was not selected for the
contract. Due to which the MIPL filed a case in the court under Article 226 for the violation
of Article 14. The Chief Minister, however, expressed his dissatisfaction at the qualifications
of MIPL. He said that he found Clive Lloyd Constructions Private Ltd to be a more suitable
option. On October 24, 2012, a contract was drawn up between the Government of Hind
Pradesh and CLCPL for the construction of the SSHMC. The parties jointly decided that June
15, 2015, would be the date for the handover of the possession of the completed SSHMC to
the Government of Hind Pradesh. Handfuls of street shops were within the vicinity of the
construction site. The shopkeepers filed a case in the Judicial Magistrate court it took 2
month to finally get the permission for the construction. For the demolition purpose big
machines and all were needed to be brought to the construction site. It took 2 months to shift
machineries to the site. 15th January 2014 was new deadline setup by the parties. The two
parties subsequently jointly decided to fix February 15, 2016 as the new deadline to hand
over possessions. The mishaps continued and the work was paused for another 2 months due
to the protest of the workers of the company to provide them better compensation and
humane environment for working. Deadlines were further extended by a period of six more
months. On July15, 2016, he received another letter from CLCPL requesting him to extend
the deadline by a further period of six months. Mr. Agarwal was aghast and strongly
expressed his displeasure to CLCPL. On the Chief Minister, however, agreeing to the said
extension, reportedly on another personal request by Mr. Nirav Khodi, Mr. Agarwal
requested the Chief Minister to transfer him to some other department.

III. After the elections on February 27, 2017, the DAS was sumptuously elected to power.
Mr. Adarsh Anand was appointed as the Secretary, Family Welfare and Health Department,
Hind Pradesh and was also assigned the SSHMC project. One Suresh Yadav and Sons
Constructions Private Limited (hereinafter referred to as “SYSCPL”) took up the work and
agreed with the government to complete the work within July 27, 2017, for a sum of INR
3,20,000 (Rupees Three Crore Twenty Lakhs Only). Eventually, the work was completed in
time and the possession was handed over to the Government of Hind Pradesh on July 25,
2017. It was inaugurated and made fully functional by September 2017. The Government of
Hind Pradesh filed a suit for compensation in the District Court at The Government
terminated the contract. The Government filed a suit of compensation of six crore in the
District Court of Nawabdwip against the CLCPL. CLCPL has filed an appeal under Article
226 against the decree passed by the Hon’ble District Court Nawabdwip to the High Court at
Nawabdwip on the ground that the Court did not have jurisdiction to hear the same. Both the
cases were clubbed together and are before the High Court of Nawabdwip.
 ISSUES RAISED

[ISSUE 1] THAT THE ACTION OF THE GOVT. OF HIND PRADESH OF NOT

AWARDING THE CONTRACT TO MODERN INFRASTRUCTURE PRIVATE
LTD.IS NOT VALID UNDER THE LAW.

[ISSUE 2] THAT THE DECISION OF DISTRICT COURT TO DISMISS ANY

OBJECTION TO THE JURISDICTION OF THE COURT IS FATAL .

[ISSUE 3 ] THAT THE DISTRICT COURT WAS WRONG IN DECREEING A SUM

OF RUPEES SIX CRORES IN FAVOUR OF THE GOVERNMENT OF HIND
PRADESH .

[ISSUE 4] THAT THE ACTION OF THE GOVERNMENT OF HIND PRADESH OF

BLACKLISTING CLIVE LLOYD CONSTRUCTION PRIVATE LIMITED FROM
FURTHER GOVERNMENT WORKS INVALID UNDER THE LAW
 SUMMARY OF ARGUMENTS

[ISSUE 1] THAT THE ACTION OF THE GOVT. OF HIND PRADESH OF NOT

AWARDING THE CONTRACT TO MODERN INFRASTRUCTURE PRIVATE
LTD.IS NOT VALID UNDER THE LAW.

It is humbly submitted before the Hon’ble High Court of Nawabdwip that the decision of the
Govt. of Hind Pradesh to award the contract to CLCPL is arbitrary , unreasonable and
coloured with bias.

[ISSUE 2] THAT THE DECISION OF DISTRICT COURT TO DISMISS ANY

OBJECTION TO THE JURISDICTION OF THE COURT IS FATAL.

It is humbly submitted before the hon’ble High Court of Hind Pradesh that decision of the
district court to dismiss any claim regarding the issue of jurisdiction is fatal, as per the clause
13 of the contract duly acceded by both the party, as both of them agreed to concede to
jurisdiction of Farashdanga in case of any dispute arising out of the contract signed btw.
them, thus the decision of the district court to not entertain any objection regarding the
objection against the jurisdiction is fatal.

[ISSUE 3]: THAT THE DISTRICT COURT WAS WRONG IN DECREEING A SUM
OF RUPEES SIX CRORES IN FAVOUR OF THE GOVERNMENT OF HIND
PRADESH

It is humbly submitted before the Hon’ble High Court of Nawabdwip that the Hon’ble
District Court of Nawabdwip did not have jurisdiction to hear the case and the decree passed
by the court is a nullity as it is not in consonance with the principles of the contract law.

[ISSUE 4] THAT THE ACTION OF THE GOVERNMENT OF HIND PRADESH OF

BLACKLISTING CLIVE LLOYD CONSTRUCTION PRIVATE LIMITED FROM
FURTHER GOVERNMENT WORKS INVALID UNDER THE LAW.

It is humbly submitted before this Hon’ble High Court of Nawabdwip that the action of Govt.
of Hind Pradesh of blacklisting CLCPL is against the principal of Natural Justice, hence
violative of Art. 14, 19(g) and 21 of the Constitution of Samudrasthal, thus, invalid under the
law.
 ARGUMENTS ADVANCED

[ISSUE 1] THAT THE ACTION OF THE GOVT. OF HIND PRADESH OF NOT

AWARDING THE CONTRACT TO MODERN INFRASTRUCTURE PRIVATE
LTD.IS NOT VALID UNDER THE LAW.

It is humbly submitted before the Hon’ble High Court of Nawabdwip that the decision of the
Govt. of Hind Pradesh to award the contract to CLCPL is arbitrary , unreasonable and
coloured with bias.

[1.1] THAT THE COMPANY MIPL FULFILLED ALL THE PRE REQUISITE CRITERIA
OF PROPSED TENDER.

It is humbly submitted before this hon’ble court that the MIPL fulfilled all the required
qualifications of the proposed advertisement.

Where the instrumentalities of the state invite tenders, the decision has to be taken on the
basis of the bid by the tenderers. There is no ques. of any other policy in such cases. It
chooses to invite tenders, then it must abide by the result of the tender and cannot arbitrarily
and capriciously accept the bid of any other bidder, although it would be higher, which would
be detrimental to the state.1

In the case in hand it is clearly visible that the Govt. of Hind Pradesh invited the tender
through an advertisement, the company MIPL fulfilled all the qualification be it technical
qualification or the financial qualification i.e. after the proposed amended advertisement net
worth of the proposed balance sheet of the year 2008-09, 2009-10 and 2010-11 each audited
by the auditor recognised by law is more than INR 50,00,000 .Even after fulfilling all the pre-
requisite qualification MIPL was not awarded the contract hence, the decision of the Govt.
not to award contract to MIPL is absolutely invalid.

[1.2] THAT THE ACT OF NOT AWARDING CONTRACT TO MIPL IS ARBITRARY

AND UNREASONABLE, HENCE VIOLATIVE OF ARTICLE 14.

It is humbly stated that the act of the govt. to award the contract to CLCPL is arbitrary in
nature and highly unreasonable, thus, violative of the tenets of Art 142. In the case of

1
Sri Shankaranarayan Construction Co v Konkan Railway Corp Ltd 2004 SCC Online Bom 130.
2
Constitution of India, 1950,Art.14.
Mahabir Auto Stores v Indian Oil Corp.3Justice Sabyasachi Mukherji observed: “ Although
4
the State acts in its executive power under Art.298 of the Constitution in entering or not
entering in contracts with individual parties. Indeed Art.14 of the Constitution would be
applicable to such exercise of power. The action of State organ can be tested under
Art.14.Every action of the state authority must be subject to rule of law and must be informed
of reason. SO whatever be the activity of the public authority, it should meet the test of Art
14.If a Govt. action even in the matters of entering or not entering into contracts fails to
satisfy the test of reasonableness, the same would be unreasonable.”

The Supreme Court in landmark judgment of Maneka Gandhi v. Union of India5 clearly
ruled out the room for arbitrariness. ‘Article 14 strikes at arbitrariness in State action and
ensures fairness and equality of treatment. The principle of reasonableness, which logically as
well as philosophically, is an essential element of equality or non-arbitrariness, pervades
Article 14 like a brooding omnipresence.’ Rule of law which permeates the entire fabric of
the Indian Constitution excludes arbitrariness. Wherever we find arbitrariness or

unreasonableness there is denial there is denial of rule of law.

Where the party is govt. or any of its agencies it should not arbitrarily pick and choose. It
should have some rules and those rules must require reasons for the departure from the
normal principle to be recorded in writing.

6
In case State of U.P v raj narain it was stated that the authority ought to have recorded
reasons for rejecting the tender which quoted the lowest price. Also in case of Sri
Sankaranarayana Construction v Konkan Rly. Corp. Ltd.7 the obligation ordinarily is to
accept the lowest tender.

Public interest being paramount in the tendering process , there should be no arbitrariness in
the award all the tenderer should be treated alike.

Constitutional mandate is absolute principle which has to be applied in all situation on case
to case basis to see which action fulfils the requirement thereof and which do not. The state
action be it legislative or executive action has to be tested for constitution infirmities qua art.

3
Mahabir Auto Stores v Indian Oil Corp (1990) 3 SCC 752.
4
Constitution of India 1950,Art.298.
5
Maneka Gandhi v Union of India 1978 AIR 59.
6
State of U P v Raj Narain ( 1975) 4 SCC 428.
7
Continental Drugs & Co Ltd v Chemoids & Industries Ltd 2004 2 Bonn CR 676.
The action of state to escape the wrath of art 14 has to be fair, reasonable, non-
discriminatory, transparent, non- capricious, unbiased, without favouritism or nepotism in
pursuit of promotion of healthy competition and equitable treatment.8

Since it is the duty of the state not to discriminate the person on any unreasonable basis here
in the case in hand it is unreasonable to not award the contract MIPL although it fulfilled
both technical as well as financial qualifications proposed in the advertisement and was also
found to be the lowest bidder thus the most appropriate to get the said contract but the Govt.
rejected to award the contract to MIPL without any genuine ground.

In the case in hand it is arbitrary on the part of the Govt. to include previous clause in the
amended advertisement of considering audited balance sheet of the the year 2011-12 and
rejecting to award the contract previously decided company MIPL on that basis without
proposing any fresh tender.

[1.3] THAT THE ACT OF GOVT. IS COLOURED WITH BIAS.

It is humbly submitted before the hon’ble High Court that the action of the Govt. to award
the contract to CLCPL is clearly coloured with bias. It is stated where the action of the Govt.
is mala fide the court has the power to interfere.9

If the Govt. intends to favour any party or shows biasness while awarding contract invited by
floating tender then the same ought to struck down i.e. comes under the purview of judicial
review. 10

In the present case in hand there exist biasness on the part of govt. even after MIPL found to
be L1 the chief minister initially expressed his dissatisfaction on awarding the contract to the
same as the very promoter of the next eligibile company CLCPL , Mr. Nirav Khodi happened
to be the brother-in -law of the Chief Minister on pouncing this very fact by opposition and
alleging him of being bias and corrupted the chief minister hurriedly in order to protect
himself of various allegation and avoid the confrontation asked the Mr. Agrawal to award the
contract to MIPL. This clearly shows his mala fide intention, it can stated that the act of the
govt. was influenced out of personal relation hence coloured with bias.

8
Natural Resources Allocation, In re, Special Reference No. 1 of 2012 v. , (2012) 10 SCC 1
9
Pramod Kumar Rath v State of Orissa (2005) 99 Cut LT 299.
10
Afcons Infrastructure Ltd v Nagpur Metro Rail Corp Ltd (2016) 16 SCC 818.
[ISSUE 2] THAT THE DECISION OF DISTRICT COURT TO DISMISS ANY
OBJECTION TO THE JURISDICTION OF THE COURT IS FATAL.

It is humbly submitted before the hon’ble High Court of Hind Pradesh that decision of the
district court to dismiss any claim regarding the issue of jurisdiction is fatal, as per the clause
13 of the contract duly acceded by both the party , as both of them agreed to concede to
jurisdiction of Farashdanga in case of any dispute arising out of the contract signed btw.
them, thus the decision of the district court to not entertain any objection regarding the
objection against the jurisdiction is fatal. This arguments is based on following submissions:

[2.1] THAT THE JURISDICTION OF DISTRICT COURT OF NAWABDWIP IS

AGAINST THE CLAUSE 13 OF THE SAID CONTRACT.

Sec. 20 of CPC talks about jurisdiction specified in agreement. It says that it is settled law
that any agreement between the parties to the contract cannot validly take away the
jurisdiction possessed by the Court, though ouster clause can operate as estoppel against the
parties to the contract. But if more than one Courts have the jurisdiction under the statute, it is
always open to the parties to agree to the jurisdiction of one court to the exclusion of the
other in such cases the party cannot insist that one court (whose jurisdiction is excluded )
should try the suit ignoring the jurisdiction of the Court which the parties agreed to submit.11

Sec. 2812 of Indian Contract Act which states that agreement in restrain of legal proceeding is
void. This sec. comes into play when the restriction imposed upon the right to sue is
“absolute” in the sense that parties are wholly precluded from pursuing their legal remedies in
the ordinary tribunals.13 A partial restriction will be valid.14

In the case of Continental Drugs & Co Ltd v. Chemoids & Industries Ltd.15 Justice Lahiri of
Calcutta High Court said that “If there are two courts which are equally competent to try the
suit, an agreement btw the parties that the suit should be instituted in one of those two courts
cannot be said to be an absolute restriction on the right of taking legal proceedings. It has
been established by a long line of judicial decision that such an agreement does not
contravene the provision of Sec.28 if the chosen court has jurisdiction to try the suit under

11
IVR Constructions Ltd v Technocraft Industries India Ltd 2010 (2) ALT (243)(DB).
12
Contract Act, 1872,Sec.28.
13
Emmsons International Ltd v Metal Distributors ( UK ) 2005 AIHC 1190 (Del).
14
Raigarh Jute and Textile Mills Ltd v New Haryana Transport Co 1994 MPLJ 626.
15
Continental Drugs & Co Ltd v Chemoids & Industries Ltd AIR 1955 Cal 161.
ordinary law.” This has been affirmed by Supreme court in Hakam Singh v Gammon (India)
Ltd.16

In the case of A.B.C. Laminart (P) Ltd. 17it was observed by the Court that:
“Where there may be two or more competent courts which can entertain a suit consequent
upon a part of the cause of action having arisen therewithin, if the parties to the contract
agreed to vest jurisdiction in one such court to try the dispute which might arise as between
themselves the agreement would be valid. If such a contract is clear, unambiguous and
explicit and not vague it is not hit by Sections 2318 and 28 of the Contract Act. This cannot be
understood as parties contracting against the statute.”
In the case in hand, clause 13 of the said contract clearly states that “The parties shall submit
all their disputes , if any , arising out of or in connection with this contract to the exclusive
jurisdiction of the Court of Farashdanga.” Therefore, by filing the suit of compensation in the
Court of Nawabdwip the Govt. violates the said clause 13 of the agreement to which both the
company, CPCPL and Govt. of Hind Pradesh had conferred with, hence the decision of
District Court of Nawabdwip to dismiss the appeal regarding the dispute of jurisdiction is
fatal.
[2.3] THAT THE DEFENDANT MUST NOT BE PUT INTO TROUBLE AND BEAR
EXPENSES FOR DEFENDING HIMSELF.

Subject to the limitations aforesaid, every suit shall be instituted in Court within the local
limits of whose jurisdiction-(a) the defendant, or each of the defendants where there are more
than one, at the time of the commencement of the suit, actually and voluntarily resides, or
carries on business, or personally works for gain; or (b) any of the defendants, where there
are more than one, at the time of the commencement of the suit actually and voluntarily
resides, or carries on business, or personally works for gain, provided that in such case either
the leave of the Court is given, or the defendants who do not reside, or carry on business, or
personally work for gain, as aforesaid, acquiesce in such institution19

Section 20 of the Code of Civil Procedure has been designed to secure that justice might be
brought as near as possible to every man's hearth-stone and that the defendant should not be
put to the trouble and expense of travelling long distances in order to defend himself in cases
16
Hakam Singh v Gammon (India) Ltd (1971) 1 SCC 286 .
17
A.B.C Laminart (P) Ltd & ors v A P (1989)2 SCC 163.
18
Contracts Act 1872,Sec 23.
19
Code of Civil Procedure 1908, sec 20.
in which he may be involved. It has accordingly been enacted that a person can be sued in the
place in which he actually and voluntarily resides.20

In the case of Ladulal Jain v Union of India21 the supreme court of India stated that
Principal behind the provision of clauses (a) and (b) of Sec.20 is that the suit be instituted at a
place where the defendant is able to defend the suit effectively and without undue trouble.

In the case in hand, the Govt. of Hind Pradesh filed a suit for compensation against CLCPL ,
thus CLCPL being defendant having its office registered as per the annexure III in
Farasdanga, it would be convenient for CLCPL to defend the himself at Farasdanga rather
than Nawabdwip, also Nawabdwip situated in another state it would would be inconvenient
and they ought to bear the cost of travelling in order to defend himself in the court of
Nawabdwip. Thus keeping in mind the said clause of Sec 20 of CPC it can be held that the
court of Nawabdwip does not bear the jurisdiction to try this suit, hence the decision of Court
of Nawabdwip regarding the jurisdiction is fatal .

[ISSUE 3]: THAT THE DISTRICT COURT WAS WRONG IN DECREEING A SUM
OF RUPEES SIX CRORES IN FAVOUR OF THE GOVERNMENT OF HIND
PRADESH.

It is humbly submitted before the Hon’ble High Court of Nawabdwip that the Hon’ble
District Court of Nawabdwip did not have jurisdiction to hear the case and the decree passed
by the court is a nullity as it is not in consonance with the principles of the contract law. This
contention is based on following submissions:

[3.1]: THAT THE GOVT. OF HIND PRADESH DID NOT FULFILL ITS OBLIGATION.

In the present case in hand Clive Lloyd Construction Private Limited [CLCPL] could not
complete the construction work because the Government of Hind Pradesh did not comply
with its obligations as mentioned in clause 8 of the contract.

Clause 8 reads as:

822. Obligations of the GHP: The obligations of the GHP shall be as follows:

(i) To ensure that the payment is released as per the payment schedule under clause 4.
20
Mohan Singh v Lajya Ram AIR 1956 P H 188 .
21
Union of India v Ladulal Jain AIR 1963 SC 1681.
22
Moot Proposition, pg 13.
(ii) To remove any obstructionists, if any, to enable CLCPL to start the work as soon as
possible.

(iii) To provide a detailed plan to CLCPL so as to enable CLCPL to perform the work
according to the plan.

It should be noted that CLCPL duly applied to the Nawabdwip Municipality for permission to
start construction. It was the Government of Hind P A.B.C. Laminart (P) Ltd radesh that
failed to remove obstructions that came during the construction process. Further changes
were made in the detailed construction plan where most of the changes were major in nature.
Lastly, the Government of Hind Pradesh could not even release the payment as per the
payment schedule. CLCPL was informed that the amount due would be paid only after two
months due unprecedent shortage of funds and reports had put this shortage of funds of to the
indiscriminate spend of money by the government of Hind Pradesh to mark the celebration of
Diwali.

The Government of Hind Pradesh claimed a sum of INR 2,00,00,000 (rupees two crores
only) as late penalty for two years and a sum of INR 2,00,00,000 (rupees two crores only) for
the loss of MBBS seats for two years with interest on the amount. But it should be noted that
substantial delay in completion of the project was due to the actions of the Government of
Hind Pradesh. It was Government of Hind Pradesh that failed to remove obstructions that
came during the construction process. Further changes were made in the detailed construction
plan where most of the changes were major in nature. Lastly, the Government of Hind
Pradesh could not even release the payment as per the payment schedule. Hence, the amount
of INR 6,00,00,000 (rupees six crores) decreed in favour of the Government of Hind Pradesh
by the District Court of Nawabdwip is not justified and arbitrary in nature.

Under Section 5423 of the Contract Act, when a contract consisting of reciprocal promises,
one of them cannot be performed or that its performance cannot be claimed till the other has
performed and the promisor of the promise fails to perform it, such promisor cannot claim the
performance of the reciprocal promise and must make compensation to the other party to the
contract for any loss which such other party may sustain by non-performance of the contract.

[3.2]: THAT THE GOVT. OF HIND PRADESH TERMINATED THE CONTRACT

WITHOUT PRIOR NOTICE.

23
The Indian Contract Act 1872, sec 54.
The Government of Hind Pradesh terminated the contract without due cause. Further, this act
of unwarranted termination of the contract has given rise to losses to CLCPL and led to
violation of clause 10 of the contract.

Clause 10 reads as:

1024. Termination: The GHP, or its authorized officer, may, if he is satisfied that CLCPL has
not operated in accordance with the provisions of this agreement, give a fifteen-day-notice
and terminate the agreement. Such termination shall not prejudice the rights of the GHP to
seek damages or for any loss occurred due to any act of CLCPL under clause 12.

Compensation for breach of contract where penalty stipulated for25.

When a contract has been broken, if a sum is named in the contract as the amount be paid in
case of such breach, or if the contract contains any other stipulation by way of penalty, the
party complaining of the breach is entitled, whether or not actual damage or loss is proved to
have been caused thereby, to receive from the party who has broken the contract reasonable
compensation not exceeding the amount so named or, as the case may be, the penalty
stipulated for. Explanation: A stipulation for increased interest from the date of default may
be a stipulation by way of penalty.

Compensation for loss or damage caused by breach of contract26.

When a contract has been broken, the party who suffers by such breach is entitled to receive,
from the party who has broken the contract, compensation for any loss or damage caused to
him thereby, which naturally arose in the usual course of things from such breach, or which
the parties knew, when they made the contract, to be likely to result from the breach of it.

[3.3]:THAT THE DISTRICT COURT OF NAWABDWIP HAS NO JURISDICTION TO

HEAR THE MATTER:

The registered office of Clive Lloyd Construction Private Limited [CLCPL] was at
Farashdanga. So, according to section 2027 of CPC:

Every suit shall be instituted in a Court within the local limits of whose jurisdiction

24
Moot Proposition, pg 14.
25
The Indian Contract Act 1872, sec 74.
26
The Indian Contract Act 1872, sec 73.
27
The Civil Procedure Code 1908, sec 20.
 (a) The defendant, or each of the defendants where there are more than one, at the time of
the commencement of the suit, actually and voluntarily resides, or carries on business,
or personally works for gain.

Further, since the contract was executed in Nawabdwip i.e., the Super-Speciality Hospital and
Medical College was to be constructed in Nawabdwip so, according to section 1728 of CPC:

Where a suit is to obtain relief respecting, or compensation for wrong to, immovable property
situate within the jurisdiction of different Court, the suit may be instituted in any Court within
the local limits of whose jurisdiction any portion of the property is situate

In the case of ABC Laminart Pvt Ltd & anr v AP Agencies Salem 29 it was held that:

Where there may be two or more competent Courts which can entertain a suit consequent
upon a part of the cause of action having arisen there within, if the parties to the contract
agreed to vest jurisdiction in one such court to try the dispute which might arise as between
themselves the agreement would be valid.

Hence the District Court of Nawabdwip did not jurisdiction of the present case as it is against
clause 10 of the contract. Thus, the decree passed by the district court is a nullity as it is not
in consonance with the principles of contracts law.

[ISSUE 4] THAT THE ACTION OF THE GOVERNMENT OF HIND PRADESH OF

BLACKLISTING CLIVE LLOYD CONSTRUCTION PRIVATE LIMITED FROM
FURTHER GOVERNMENT WORKS INVALID UNDER THE LAW.

It is humbly submitted before this Hon’ble High Court of Nawabdwip that the action of Govt.
of Hind Pradesh of blacklisting CLCPL is against the principal of Natural Justice, hence
violative of Art. 14, 19(g)30 and 21 of the Constitution of Samudrasthal, thus, invalid under
the law. This reasoning is based on following contention:

[4.1] THAT THE ACT OF BLACKLISTING IS VOILATIVE OF PRINICIPAL OF

NATURAL JUSTICE.

28
Civil Procedure Code 1908, sec 17.
29
ABC Laminart Pvt Ltd & anr v AP Agencies Salem, Civil Appeal No 2682 of 1982.
30
Constitution of India 1950, Art.19 (1)(g).
The concept of blacklisting was defined as the state or its instrumentalist not to deal with
certain person or class of person on the account of the undesirability of entering into
contractual relationship with such person is called blacklisting.31

The Hon’ble Court in case of Gorkha Security Services Vs. Government (NCT of Delhi)
and Others, has held that order of blacklisting is stigmatic in nature and debars such a person
from participating in Government Tenders which means precluding him from the award of
Government Contracts. While discussing necessity of serving of show cause as reiterating
principles of natural justice showing intention of proposed action, Court has held:

"It is a common case of the parties that the blacklisting has to be preceded by a show-cause
notice. Law in this regard if firmly grounded and does not even demand much amplification.
The necessity of compliance with the principles of natural justice by giving the opportunity to
the person against whom action of blacklisting is sought to be taken has a valid and solid
rationale behind it. With blacklisting, many civil and/or evil consequences follow. It is
described as "civil death" of a person who is foisted with the order of blacklisting. Such an
order is stigmatic in nature and debars such a person form participating in government
tenders which means precluding him from the award of government contracts."

The Court held that the Government being a Government of laws and not of men is bound to
act in conformity with the principles of natural justice when interacting with members of the
public should be given an opportunity to represent his case before he is put on the blacklist.
The activities of Govt. have the public element and therefore there should be fairness and
equality 32

33
Justice Mathew in the case of V. Punnen Thomas v. State Of Kerala , observed in his
dissenting judgment, as under:

“A contractual relationship presupposes a consensus of two minds. If Government is not

willing to enter into contract with a person, I do not think that Government can be forced to
do so. It is one thing to say that Government, like any other private citizen can enter into
contract with any person it pleases, but a totally different thing to say that Government can

31
Eurasian Equipment and Chemical Ltd v Union of India & ors 1973 SCC 120.
32
Ibid.
33
V Punnen Thomas v State Of Kerala AIR 1969 Ker 81.
unreasonably put a person's name in a blacklist and debar him from entering into any
contractual relationship with the Government for years to come. In the former case, it might
be said that Government is exercising its right like any other private citizen, but no
democratic government should with impunity pass a proceeding which will have civil
consequences to a citizen without notice and an opportunity of being heard. The reason why
the proceeding for blacklisting the petitioner and debarring him from taking Government
work for ten years was passed, is that he committed irregularities in connection with the
tender of the contract work. An ex parte adverse adjudication that the petitioner committed
irregularities in connection with the tender for working down timber from Udumbandhola
Block No. 1 by Government on the report of some petty officer without notice and an
opportunity of being heard to the petitioner and putting his name in the blacklist and
debarring him from 'taking any Government work for ten years' by way of punishment,
appear to me, to be against all notions of fairness in a democratic country."

“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."

Again, in Raghunath Thakur v. State of Bihar34, Court observed:

"Indisputably, no notice had been given to the appellant of the proposal of blacklisting the
appellant. It was contended on behalf of the State Government that there was no requirement
in the rule of giving any prior notice before blacklisting any person. Insofar as the contention
that there is no requirement specifically of giving any notice is concerned, the respondent is
right. But it is an implied principle of the rule of law that any order having civil consequence
should be passed only after following the principles of natural justice. It has to be realised
that blacklisting any person in respect of business ventures has civil consequence for the
future business of the person concerned in any event. Even if the rules do not express so, it is
an elementary principle of natural justice that parties affected by any order should have right
of being heard and making representations against the order."

In case of P. Nageshwar and others Vs. Government of Andhra Pradesh and Another35
Court held that “Delisting of tenderer resulting in denial to participate in tender process
without any opportunity is in clear violation of principles of natural justice. Court held that

34
Raghunath Thakur v State of Bihar (1989) 1 SCC 229.
35
P Nageshwar and others v Government of Andhra Pradesh and Another 1994 Supp (2) SCC 693
withholding of tender of such tenderers was not justified. Delisting of Contractor from the list
would have been done only after complying with principles of natural justice. Such order
even on the basis of Vigilance report without giving opportunity was held, bad in law.”

Similar view was taken in Patel Engg. Ltd. v. Union of India736. In view of the above
exposition of law, it is clear that for a proposed action to be taken an impugned order of
blacklisting should always be preceded by an appropriate show cause notice.

In the case in hand, the govt. of hind Pradesh after consulting with legal expert blacklisted
CLCPL from further govt., without giving any opportunity to the side company of presenting
their case i.e. without giving any show cause notice thus, denying the right of the party of
being heard before the court [AUDI ALTERAM PARTEM], hence violating the principal of
natural justice.

[4.2] THAT THE ACTION OF BLACKLISTING WAS DISCRIMINATING IN NATURE.

Under Art. 29837 it is stated that the executive power of the union and the state shall extend to
the carrying on of any trade and to the acquisition, holding and disposal of property and the
making of contract for any purpose. The State can carry on executive function by making law
or without making law. The exercise of such power is subject to provision of part III of
Indian constitution. Article 14 talks about the equality before law and equal protection of the
law. Equality of opportunity should apply to the matter of public contracts. The state has right
to trade. The state has there the duty to observe equality.an ordinary individual can choose
not to deal with the person. The govt. cannot exclude the person by discrimination. Equality
of opportunity applies to matters of public contracts. The State need not enter into any
contract with anyone but if it does, it must do so fairly without discrimination and without
unfair procedure. No one has any right to enter into a contract with the Governor quotations
for the purchase of goods. This privilege arises because it is the Government which is trading.
No one has any right to enter into a contract with the Governor quotations for the purchase of
goods. This privilege arises because it is the Government which is trading. With the public,
and the democratic form of Government demands equality and absence of arbitrariness and
discrimination in such transactions. The activities of the Government have a public element
and therefore, there should be fairness and equality. Exclusion of 'a member of the public

36
Patel Engg Ltd v Union of India (2012) 11 SCC 257.
37
Constitution of India , 1950, Art.298.
from dealing with a State in sales transactions has the effect of preventing him from
purchasing and doing a lawful trade in goods by discriminating against him in favour of
other people. With the public, and the order of blacklisting has the effect of depriving a
person equality of opportunity in the matter of public contract. A person who is the approved
list is unable to enter into advantageous relation with the govt. because of order of
blacklisting.38
As regards the Andhra Pradesh case of Bam Singh, Mr. Justice Chinnappa Reddy dealing
with the impugned blacklisting order held that the protection against discrimination afforded
by Article 14 extends to executive action.39

[4.3] THAT THE ACTION OF BLACKLISTING HAS TARNISHED THE REPUTATION

OF THE COMPANY.

The right to reputation has been considered as a facet of fundamental right, being a facet of
right to life under Article 240 of the constitution. It has been declared so in the recent case of
Subramanian Swamy v Union of India41

The Government being a Government of laws and not of men is bound to act in conformity
with the principles of natural justice when interacting with members of the public should be
given an opportunity to represent his case before he is put on the blacklist. An order of
blacklisting creates a disability for the concerned person. 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. The Hon'ble
Supreme Court held that the blacklisting order involves serious civil consequences, as in
effect it casts a slur on the reputation of the Company.Reputation is part of one’s character
and personality. Blacklisting tarnishes one’s reputation.42

Justice Mathew in the case of V. Punnen Thomas v. State Of Kerala43 held that

38
Eurasian Equipment and Chemical Ltd v Union of India & ors 1973 SCC 120.
39
The Union Of India v A K Mathiborwala (1974) 76 BOMLR 659.
40
Constitution of India 1950, Art. 21.
41
Subramanian Swamy v Union of India, AIR 2016 SC 2728.
42
Eurasian Equipment and Chemical Ltd v Union of India & ors 1973 SCC 120.

43
V Punnen Thomas v State Of Kerala AIR 1969 Ker 81.
"Reputation can be viewed both as an interest of personality and as an interest of substance,
viz., as an asset" and quoted following words of Roscoe Pound:

"On the one hand there is the claim of the individual to be secured in his dignity and honour
as part of his personality in a world in which one must live in society among his fellow-men.
On the other hand there is the claim to be secured in his reputation as a part of his substance
in that in a world in which credit plays so large a part the confidence and esteem of one's
fellow-men may be a valuable asset."44

In the case in hand, the company CLCPL has to bear serious civil consequences as the
damage has been done to its reputation as result of termination of contract without due cause,
thus, infringed the Art. 21 of the Indian Constitution which guarantees right to reputation as
Fundamental Right to an individual.

[4.4]THAT THE ACT OF GOVT. TO BLACKLIST FOR ANY FURTHER CONTRACT IS

NOT PERMISSIBLE.

This is stated that the govt act of blacklisting the company permanently or say from any
further contract is not permissible in law.

In the case in hand it is clearly stated that

The Apex Court referred to its earlier decision in Kulja Industries Limited Vs. Chief General
Manager, Western Telecom Project Bharat Sanchar Nigam Limited and Others45,wherein
it was held that “debarment” cannot be permanent and the period of debarrement would
invariably depends upon the nature of the offence committed by the party.
The Supreme Court case of in B.C. Biyani Projects Pvt. Ltd .v. State of Madhya Pradesh &
Ors.46 has held that order for blacklisting a company permanently is impermissible in law. A
Bench comprising of Justices Madan B. Lokur and R.K. Agrawal was considering plea of a
company which was blacklisted for the award of contracts by the state of Madhya Pradesh
since it is stated that there was unreasonable. delay in the comp completion of six contracts
awarded to the appellant. The order of blacklisting was for an indefinite period. The Court

44
Interest of Personality' 28 Harvard Law Review, pp. 445, 447 )

45
Kulja Industries Limited v Chief General Manager Western Telecom Project Bharat Sanchar Nigam Limited
and Others (2014) 14 SCC 73.
46
B C Biyani Projects Pvt Ltd v State of Madhya Pradesh and ors Civil Appeal No.6632 of 2016.
setting aside the order for blacklisting the company permanently observed: “the order for
blacklisting the appellant is a permanent one. This is impermissible in law.”
 PRAYER

Therefore in the light of the facts of the case, issues raised, arguments advanced and
authorities cited this Hon’ble court may be pleased to adjudge and declare that:

In the case of Modern Infractructure Pvt. Ltd. v Govt. of Hind Pradesh declare that :

That the action of the Govt. of Hind Pradesh of not awarding the contract to Modern
Infrastructure Private Ltd. is invalid.

In the case of