Taken to court by L&T, MMRDA says scrapping tenders for mega infra projects worth Rs 14,000 crore

Taking the MMRDA statement on record, the bench disposed of L&T’s pleas against the May 20 order of Bombay High Court as “infructuous”. A vacation bench of the High Court had  denied relief to L&T on its pleas challenging the opening of financial bids for the two projects.

“Solicitor General Tushar Mehta and Senior Advocate Mukul Rohatgi appearing for MMRDA fairly state that the state (MMRDA) has decided to scrap the entire tender process in the larger public interest and take such steps as are advised. In that view of the matter, the petition is rendered infructuous and disposed of as infructuous,” the bench said in its order.

L&T had claimed that it did not receive any intimation about the status of the bids, while other bidders had received the same. It said MMRDA had initiated the opening of the financial bids by excluding L&T from the process.

Senior Advocates Kapil Sibal, Abhishek Singhvi, Ranjit Kumar, Neeraj Kishan Kaul, and Advocates Raunak Dhillon, Madhavi Khanna and Nihaad Dewan appeared for L&T.

The two projects are proposed to link Thane and Mira-Bhayandar. One of the projects consists of a 5-km twin tunnel of 14.6-metre diameter from Gaimukh to Fountain Hotel Junction at Shilphata, worth Rs 8,000 crore.

The other project, an elevated creek road bridge of 9.8 km, estimated to cost nearly Rs 6,000 crore, will connect Bhayandar with Ghodbunder Road in Thane.

The two projects are part of an extension of the Mumbai Coastal Road project and the elevated bridge is likely to be the second largest after the Mumbai Trans Harbour Link (MTHL) bridge, also called Atal Setu.

The MMRDA decision to scrap the tender process came after the Supreme Court on May 26 and May 29 asked the authority whether it was willing to carry out a re-tendering process for the two major projects. It warned that failure to do so may lead to the court staying the tenders.

The Supreme Court had said it was difficult to comprehend that technical bids of L&T, the company selected to execute the Central Vista Project in Delhi, had been rejected for the projects linking Thane and Bhayandar.

L&T had told the top court that the MMRDA had arbitrarily declared Hyderabad-based Megha Engineering and Infrastructure Ltd (MEIL) as L1 (lowest) bidder for both the projects, despite its bid being at a substantially higher cost compared to that of L&T. It said that its price bid was nearly Rs 2,521 crore less than that of MEIL in the tunnel project, and Rs 609 crore less for the elevated road project.

But the MMRDA said there were “substantial reasons” for rejecting the bid and that it was not on “flimsy” or “fanciful” grounds.

On Friday, when Rohatgi informed the bench that MMRDA was scrapping the tenders, CJI Gavai said, “Otherwise, if we go into the merits, we will have to consider the validity of that clause and everything.”

Rohatgi said, “I conveyed to the government. I had a discussion with the government.”

The CJI said, “We are basically concerned with the larger public interest. The difference is Rs 3,200 crore… We live in an era of transparency.”

The petitioner also urged the bench to set aside the High Court judgment, but the CJI said it was not necessary.

The CJI told the petitioner’s counsel, “You should appreciate the fairness of Rohatgi and the Solicitor. At least at times.”

In a statement Friday, the MMRDA said “both the tenders will be scrapped and a fresh tender process would be initiated only to safeguard larger public interest”.

“The authority is also actively considering a downward revision of the base cost by approximately Rs 3,000 crore — based on price quotations disclosed during the proceedings — to ensure optimal use of public funds,” it stated.

On Wednesday, Maharashtra Chief Minister Devendra Fadnavis, while speaking at the Express Adda in Mumbai, had said that the state government would follow the court order.

“Actually, the tender took place before the Assembly elections (during the Eknath Shinde-led government) and two companies were competing for it. One of them was L&T. It is a good company. But there was an objection against L&T that there were some cracks in its Telangana project. So, as per rules and regulations of MMRDA, their bid could not have been opened and they (L&T) got disqualified and went to court. And the Supreme Court said the price difference is too much. We will abide by what the court says. It is an administrative matter and I don’t think there will be much of a problem,” he said.