SC stays HC order quashing MIAL`s contract for duty-free shops

The Supreme Court today stayed the Bombay High Court judgement that quashed the decision of Mumbai’s airport managers to award the duty-free shops contract to DFS India.

A Bench headed by Chief Justice K G Balakrishnan, while admitting the petitions Mumbai International Airport Ltd (MIAL), also stayed the high court judgement that held that MIAL was a ‘state’ within the meaning of Article 12 of the Constitution. DFS Ventures Singapore had also challenged the high court ruling.

The high court on a plea by Dubai-based travel retail business company Flemingo Duty Free Shops Pvt Ltd had quashed MIAL’s decision to award contract to DFS Ventures and had directed re-tender of duty-free shops at the airport.

 

The high court, while holding MIAL as an instrumentality of the state, had held that the shortlisting of bidders by the company for setting up such shops was uncalled for as it was flawed and not on predetermined criteria.

It had held that in providing duty-free shops at the international airport, MIAL was performing public functions in the public interest and thus it was obliged to act fairly and reasonably.

The Airports Authority Of India holds 26 per cent share in the joint venture company, which was set up to operate and maintain the airport.