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| Posco's petition against SAIL's re-tendering dismissed |
| Press Trust Of India / New Delhi Aug 14, 2009, 01:15 IST |
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Paving the way for SAIL to go ahead with re-tendering to set up a blast furnace in Bhilai, the Durg District Court has dismissed a petition of Posco E&C, which had lost a construction order from the Indian firm due to alleged delay in signing the contract.
The Durg District Court (Chhattisgarh) has dismissed the petition filed by the subsidiary of global steel behemoth Posco seeking a stay on re-tendering initiated by SAIL after the domestic firm cancelled the construction offer.
Dismissing the petition filed by the South Korean firm on Tuesday, Judge Ashok Kumar Panda of the Durg District Court said that Posco has failed “to make out a prima facie case” and “show that the applicant would suffer irreparable injury or loss if injunction is not granted”.
“... I found that the applicant has failed to make out a prima facie case and balance of convenience in its favour and has further failed to show that the applicant would suffer irreparable injury or loss if injunction is not granted. In view of the above the application filed by the applicant under Section 9 (ii) of the Arbitration and Conciliation Act, 1996, deserves to be dismissed and accordingly hereby it is disallowed and rejected,” he said.
Even after failing to get the construction order and stay on SAIL’s re-tendering process, Posco E&C, the lowest bidder in the previous bid, is keeping “all options open” including participation in the fresh bids.
Asked, if the firm will participate in the re-tendering process initiated by SAIL for constructing the blast furnace on EPC (Engineering, Procurement and Construction) turnkey basis at Bhilai, a senior official from Posco E&C, said, “All options are open to the company.”
However, he did not comment when asked if the company is mulling to approach the Chhattisgarh High Court.
Posco E&C had approached the Durg District Court on July 27, after withdrawing its petition from the Delhi High Court where it challenged termination of about Rs 2,000-crore order it won last year through competitive bidding to build a blast furnace for Bhilai steel plant.
The Delhi High Court had granted the company liberty to approach a civil court or any remedial forum.
On June 4, SAIL had cancelled the Letter of Acceptance (LoA) given to Posco for constructing the blast furnace for its subsidiary Bhilai Steel Plant which is enhancing its annual production capacity to 7 million tonnes from the present 3.2 million tonnes, entailing an estimated investment of Rs 12,000 crore.
SAIL had then invited fresh tenders on July 6, 2009.
The country’s largest steel producer, SAIL, has lined up massive capacity addition programme for five of its integrated steel plants to take its overall annual production capacity to about 23 million tonnes from the present 14 million tonnes.
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