Saturday, March 25, 2023

Vishakhapatnam Port Trust matter: Supreme Court grants relief to Adani Ports holdings

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The Supreme Court has finally granted relief to Adani Ports by upholding the Andhra Pradesh High Court order, which ruled that the termination of a concession agreement between Adani and the Vishakhapatnam Port Trust (VPT) cannot act as disqualification for Adani in future tenders floated by public bodies.

The bench of Justice MR Shah and Justice Krishna Murari  in their order said that Adani can move to the Bombay High Court challenging a clause in the tender document of Jawaharlal Nehru Port Authority (JNPA) by which the Adani Ports was disqualified from bidding of the Port Authority’s container terminal in Navi Mumbai upgradation project.

The clause talks of the disqualification / termination from any project or contract by any public entity in the last three years would act as a disqualification to bid for the tender.

The Court added that the disqualification arising from termination of tender by VPT shall not bar or act as disqualification for the Petitioner for future tenders floated by public bodies.

The court further said that as the clause 2.2.8 in the tender document impugned in the writ was not challenged before the High Court, the petitioner shall be at liberty to challenge the same afresh before the High Court.”

The court gave this judgement in a plea challenging a Bombay high court judgement which imposed costs of ₹5 lakh while dismissing Adani’s plea against disqualification of its bid in connection with a tender for upgradation container terminal in Navi Mumbai.

A separate writ petition was moved by Adani challenging clause 2.2.8 of the tender document.

JNPA had invited applications from interested parties for operation and maintenance of their container terminal for a period of 30 years,but before the process began, the board forbade Adani to participate and disqualified them.

The basis was an order was the Andhra Pradesh High Court which upheld the termination of a concession agreement by the Vishakhapatnam Port Trust (VPT).

Adani immediately responded back, asking the board a ‘without prejudice’ participation in the bid.

The Board on May 2, informed Adani that as VPT has issued termination letter to them, they are disqualified.

Adani then moved the Bombay High Court challenging the same and the court said that :

“The decision of JNPT to disqualify the petitioner (Adani) after having once declared it as qualified, to our mind, conforms to the settled law that JNPT was bound by the tender terms and conditions, which amounts to a representation to the public, and that any deviation would have amounted to a fraud on public”.

As Adani brought an unmeritorious case for adjudication, ₹5 lakh will be borne by them.This led to the present appeal before the apex court.

Adani has given up on the challenge to its disqualification by JNPA, the petition was disposed of as withdrawn.

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