In Brief
A State warehousing corporation awarded a tender contract to Sudhir Kumar Singh in June 2018 at 341% above schedule rates. Following complaints about the high tender rates, the corporation's Managing Director conducted an ex parte enquiry in June 2019, found the rates excessive compared to an earlier cancelled tender, and recommended contract cancellation. The Special Secretary then directed the cancellation without any notice to the contractor. The High Court quashed the cancellation order as a breach of natural justice. The Supreme Court upheld this, holding that while writ remedies apply only to contractual matters involving a public law element (here, denial of natural justice), the contractor suffered genuine prejudice by losing contractual rights and facing debarment. Natural justice is a flexible principle requiring prejudice to be shown, but complete denial of hearing (no notice, no opportunity) causes presumptive prejudice requiring no further proof.
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