M/S Daffodills Pharmaceuticals Ltd vs The State Of Uttar Pradesh

The Supreme Court held that the order issued by the Principal Secretary of U.P. to stop local purchases from Daffodills, a pharmaceutical supplier, was arbitrary and violated principles of natural justice as it was made without notice or a hearing. The Court emphasized that the mere existence of a criminal investigation against an individual who was no longer associated with the firm could not justify such an action against the company. The Court set aside the High Court's decision, reinforcing the need for fair procedure in administrative actions affecting contractual rights under Article 14 and Article 21 of the Constitution.