JV pacts for SEZ cancelled by Puducherry Govt

Puducherry Government today informed the Madras High Court that joint venture agreements inked with private companies in 2008 for establishing a Special Economic Zone in the Union Territory were cancelled this week.
All the agreements, entered into by the government in 2008 with joint venture partners for implementation of the SEZ on 840 acres, were cancelled on August 19 and an administrative order had also been issued in this regard, senior government pleader T Murugesan submitted.
The submission was made before Justice K K Sasidharan during the resumed hearing of petitions by the joint venture partners Delhi-based SPML Infra Limited and Jaipur-based Om Metal Infra Projects Limited seeking a direction to the Central Government to notify the project.

The petitioners had submitted that they had already invested about Rs 102 crore on the project and if it was not cleared, they along with the state government would be put to a bad corner.
Puducherry Government had in 2006 acquired 840 acres at Sederapet and Karasur revenue villages at a cost of Rs 74 crore for establishing an SEZ. However, the Union Government later withdrew its approval to the project.
Senior advocate P S Raman, appearing on behalf of the companies, submitted that the government's order cancelling the agreements were in violation of the status quo orders, passed by the High Court earlier in a related petition.

The judge said the orders were not extended after February 2011 and hence the cancellation order was not issued during the status quo period.
Additional Solicitor General P Wilson submitted that the two petitions became infructious as the government had issued the cancellation orders.
When the companies submitted that they were going to challenge the validity of the cancellation orders by way of separate petitions, the judge adjourned the matter for further hearing to August 26.