The Supreme Court of India ruled that principles of natural justice should be followed when show causing somebody, especially before blacklisting a person or entity, and the contents of such a notice to noticee shall include the particular action which is proposed to be taken.
“In order to fulfil the requirements of principles of natural justice, a show cause notice should meet the following two requirements viz: i) The material/ grounds to be stated on which according to the Department necessitates an action; ii) Particular penalty/action which is proposed to be taken”, the Court said but also added that even if it is not specifically mentioned in the show cause notice but it can be clearly and safely be discerned from the reading thereof, that would be sufficient to meet this requirement.
“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 from participating in Government Tenders which means precluding him from the award of Government contracts”, the Court observed.