published on: September 5, 2022 at 17:51 IST
In Adani Ports and Special Economic Zone Limited vs. Board of Trustees of Jawaharlal Nehru Port Authority & Ors., the Supreme Court granted relief to Adani Ports, holding that the order of the Andhra Pradesh High Court upholding the termination of a concession agreement between Adani and the Vishakhapatnam Port Trust (VPT) will not disqualify Adani from participating in future tenders floated by public bodies.
Adani is free to appeal to the Bombay High Court a provision in the Jawaharlal Nehru Port Authority’s (JNPA) tender document that disqualified Adani Ports from competing for the upgrade of the Port Authority’s container terminal in Navi Mumbai, according to a bench of Justices MR Shah and Krishna Murari.
The disputed Article, Clause 2.2.8, stated that failure to participate in any project or contract by a public agency within the previous three years would exclude one from participating in the tender process.
According to this clause, JNPA used Adani’s termination by VPT as justification to invalidate its bid.
“The Petitioner will not be barred from or disqualified from participating in future public body tenders as a result of VPT’s termination of the contract. Clause 2.2.8 in the tender document that is being contested in the writ was not disputed before the High Court, so the petitioner is free to do so now,” said the Court.
The decision was made in a case brought by Adani Ports to overturn a decision of the Bombay High Court, which had dismissed Adani’s appeal of the disqualification of its bid in connection with a tender for upgrading the Jawaharlal Nehru Port Authority’s container terminal in Navi Mumbai and had instead imposed costs of Rs. 5 lakh.
Adani also submitted a separate writ petition to the court in which it contested clause 2.2.8 of the tender agreement.
JNPA had sent out a global invitation seeking submissions from organizations interested in operating and maintaining its container terminal for a 30 year period.
The Board delivered a notice to the company requesting them to provide justification as to why they should not be disqualified from the tender before the bidding process could start.
The Andhra Pradesh High Court’s decision to uphold the termination of a concession agreement by the Vishakhapatnam Port Trust served as the foundation for this notice (VPT).
Adani responded to the notification, and the Board decided to give him a personal hearing. Following the hearing, Adani asked to participate in the bid “without prejudice”.
However, the Board informed Adani in a letter dated May 2 that VPT was unable to take part in the current contract process since it had handed them a letter of termination.
A bench consisting of Chief Justice Dipankar Datta and Justice MS Karnik denied Adani’s subsequent appeal to the Bombay High Court, which was filed to contest the ruling.
The High Court ruled that the JNPT’s decision to disqualify the petitioner (Adani) after having previously declared it qualified was consistent with established law, and that the JNPT was bound by the terms and conditions of the tender, which amounts to a representation to the public, and that any deviation would have amounted to a fraud on the public.
Additionally, it was decided that Adani would be responsible for paying the proceeding’s estimated Rs. 5 lakh costs because it submitted an unjustified case for adjudication.
The apex court’s current appeal resulted from this.
In its ruling today, the Court added that it was free to challenge any identical clause before the high court, unaffected by the observations made in the ruling by the Bombay High Court.
Adani gave up trying to overturn JNPA’s decision to disqualify it, therefore the petition was dismissed as withdrawn.