Tuesday, September 14, 2010

HC rejects L&T plea to stay NTPC’s Rs 25,000 cr equip bid

New Delhi: The Delhi High Court on Tuesday refused to stay the bidding process for power equipment purchase by state-owned NTPC, as sought by engineering major Larsen & Toubro (L&T) after being disqualified from the Rs 25,000 crore tender.

“We are not inclined to pass any interim relief in favour of L&T,” a bench headed by Justices Badar Durrez Ahmed and V K Jain said.
The bench also refused to intervene in the bidding process, which would now proceed as usual. “We are not going to dampen the bidding process as it will affect price.” Senior counsel Mukul Rohtagi, appearing for L&T, submitted that the company’s bid was rejected without giving it any chance of rectification, although rules provided for that. He said NTPC has acted arbitrarily. However, Rohtagi conceded that although L&T’s initial bid was not as per the terms and conditions of the bid document, the rectified one was submitted in June and it complied with the rules.
In the initial bid, L&T had limited the obligation of its partner Mitsubishi to the equipment supplied by it, which did not conform with the terms of the bid documents.
As per NTPC rules, bidders were supposed to have a joint venture with one foreign party and furnish an undertaking, ‘Bid of Joint Undertaking’ (BJU), that they both will be liable for the execution and performance of the contract.
Rohtagi further submitted that BJU was never made a point of contention in any correspondence of NTPC, despite meetings with L&T between March and July 2010.
ASJ Parag Tripathi, appearing for NTPC, submitted that BJU must be as per the terms of the bid documents which was not the case, and the company was right in rejecting the bid. PTI

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