The Delhi High Court has upheld the termination of a contract to an Israeli government company for setting up a plant for manufacturing by-modular charge systems and doing civil works connected with it in Bihar’s Nalanda.

Dismissing the writ petition filed by the Israel Military Industries Ltd. (IMI) against the order of the Ordinance Factory Board (OFB) terminating the contract on the grounds that the company had paid a bribe and used a middleman to secure the deal, Justice Rajiv Shakdher said: “… There is no merit in the writ petition and therefore, it is, accordingly dismissed.”

Besides terminating the contract, the Board had also debarred IMI from doing any business with it for 10 years. Counsel for the company argued that the punishment was disproportionate to the charges levelled.

Dismissing the submission, Justice Shakdher said: “Having regard to the nature of the contract, which involves a project having implications for national security, in my view, no interference is called for. The submission is accordingly rejected.’’

The company had challenged the Board’s order mainly on the grounds that the principles of natural justice were not followed while taking the decision to terminate the contract as it was not given an oral hearing by the Board, which had passed the termination order.