High Court of Meghalaya Reaffirms Natural Justice in Administrative Cancellations: Cancellation Without Hearing Violates Contract Terms and Rule 31 of the 1951 Rules, Setting Aside Impugned Order and Directing Fresh Decision
Summary
| Category | Data |
|---|---|
| Case Name | WP(C) No. 255 of 2025 of Smti Kwenlin Sun vs. Khasi Hills Autonomous District Council & 2 Ors. |
| CNR | MLHC010007762025 |
| Decision Date | 30-08-2025 |
| Disposal Nature | Disposed of |
| Judgment Author | Hon’ble Mr. Justice H. S. Thangkhiew |
| Court | High Court of Meghalaya at Shillong |
| Bench | Single Judge |
| Citations | 2025:MLHC:777 |
| Ratio Decidendi | The High Court held that cancellation of a contractual work order without compliance with the contract terms and applicable rules and without affording the contractor an opportunity to be heard violates the principles of natural justice, rendering the impugned order invalid and necessitating a fresh decision after a hearing. |
| Facts as Summarised by the Court | The petitioner was awarded a five-year work order dated 12.05.2023 for preparation and printing of digital smartcard-based sticker computerised trading licences, which was abruptly cancelled by the respondents by order dated 04.06.2025 without any notice, show cause, or disclosure of intended further action, and the cancellation was purportedly effected by a single Executive Member in contravention of Rule 31 of the 1951 Rules. |
What’s New / What Lawyers Should Note
- Reaffirms that executive cancellations of multi-year contracts must comply strictly with both contractual terms and statutory rules.
- Emphasises the requirement of audi alteram partem—no cancellation without affording the contractor a hearing.
- Confirms that a single Executive Member’s signature, absent proper committee authorisation under Rule 31 of the Assam and Meghalaya Autonomous Districts (Constitution of District Councils) Rules, 1951, renders an administrative cancellation vulnerable to challenge.
Summary of Legal Reasoning
- The Court observed that the impugned cancellation order dated 04.06.2025 contained no show cause notice or explanation of further action regarding the existing five-year contract.
- It noted that the original work order dated 12.05.2023 was issued under the signature of a single Executive Member, raising compliance issues under Rule 31 of the 1951 Rules.
- Without adjudicating the merits of performance, the High Court held that any cancellation of a contract must adhere to contractual terms, the relevant statutory framework, and the principles of natural justice by providing an opportunity to be heard.
- The impugned order was set aside; respondent No. 2 was directed to hear the petitioner’s objections and pass a balanced order within ten days, with status quo maintained until final orders.
Arguments by the Parties
Petitioner
- The five-year agreement dated 12.05.2023 guaranteed the petitioner the right to execute the work order, which was arbitrarily cancelled without notice or show cause.
- The abrupt cancellation violated both the express terms of the Agreement and principles of natural justice.
Respondents
- The contract had been improperly settled by a single Executive Member instead of the full Executive Committee, contravening Rule 31 of the 1951 Rules.
- The respondents proposed to undertake the work departmentally and offered to re-examine the matter, affording the petitioner an opportunity to be heard.
Factual Background
Smti Kwenlin Sun was awarded a contract on 12.05.2023 for five years to prepare and print digital smartcard-based stickers for trading licences. On 04.06.2025, the Khasi Hills Autonomous District Council cancelled the work order without issuing any notice or show cause, and the cancellation order bore only the signature of one Executive Member. The petitioner challenged this cancellation by filing WP(C) No. 255/2025, alleging arbitrariness and violation of both contractual obligations and Rule 31 of the Assam and Meghalaya Autonomous Districts (Constitution of District Councils) Rules, 1951.
Statutory Analysis
- Rule 31, Assam and Meghalaya Autonomous Districts (Constitution of District Councils) Rules, 1951: Governs the authority of the Executive Committee to enter into or cancel contracts. The Court found that unilateral action by a single Executive Member without proper committee approval contravened this rule.
Citations
- 2025:MLHC:777 (neutral citation)