HC rejects R-Infra's plea against toll collection contract

The Bombay High Court has dismissed a petition filed by Anil Ambani group company Reliance Infrastructure (R-Infra) challenging the decision of MSRDC to award the Rs 2,100-crore toll collection contract to MEP Toll Road.

R-Infra, which was disqualified along with its consortium partner SKS in the technical bid by the Maharashtra State Road Development Corporation (MSRDC), had filed a petition in the court in August last year challenging the contract award.

A division Bench comprising Chief Justice Mohit Shah and Justice Dr D Y Chandrachud, however, dismissed the plea saying "it did not find any merit in the petition."

"We are of the view that MSRDC was justified in coming to the conclusion that the bid submitted by RInfra was not responsive on the ground that it did not meet the eligibility criteria," the Bench observed.

Seven bidders had submitted their technical and financial bids. Of these, GVK, Reliance-Infra (with Shakti Kumar Sancheti), Sadbhav Engineering (with PBA), Sangam India Limited Joint Venture were disqualified in technical bids, while IL&FS, MEPL and Ashoka Builcon were qualified.

R-Infra withdrew from financial bidding following its disqualification and also took back the earnest money deposit.

R-Infra had quoted 11 years and one-month as the concession period for collecting the toll from Mumbai's five entry points -— Mulund, Dahisar, Vashi, LBS Road and Airoli, as against 16 years and 22 months quoted by MEPL.

"The plea, which was urged before the court at the hearing was that if the financial bid of the petitioners were to be opened, it would be found to be more favourable, in terms of the period of concession, than the bid, which has been accepted. The submission is lacking in substance. Such an argument would have been open to a bidder who is found to be eligible and who had a grievance about the award of the contract," the court observed.

The court held that a bidder, who does not meet the eligibility criteria, cannot complain of the award of the contract on the ground that its financial bid offers better terms.

Meanwhile, MEPL has agreed to pay the entire contract amount of Rs 2,100 crore upfront to MSRDC within 90 days from the date of the letter of acceptance by the Corporation and has also agreed to reduce their concession period from 16 years 22 months and 27 days to 16 years.