The Delhi High Court yesterday restrained the department of telecommunications (DoT) from encashing the bank guarantees of HFCL Bezeq Telecom Ltd (HBTL), the consortium which had won the right to operate basic telecom services in Delhi, Uttar Pradesh (West), Haryana and Orissa.
Disposing off a writ petition by HBTL, Justice K Ramamoorthy in his order said the ministry was not entitled to invoke the bank guarantees because it failed to act in accordance with the terms of tender documents. DoT sought to encash Rs 105 crore bank guarantees of the company last July.
Reacting to the judgement, a top DoT official yesterday said the department would file a review petition. This is a single-bench judgement. We have the option to file a Letters Patent Appeal before a two-judge bench and are likely to exercise it, the official said on condition of anonymity.
The court, which had reserved its decision since early this year, said yesterday that it decreed the suit in favour of HBTL and DoT has been permanently restrained from receiving any payment under bank guarantees. The case was argued by the additional solicitor general Manohar S Usgaonker for DoT. HBTL was represented by Mukul Rohtagi and Sujata Mishra.
The court felt that the question of encashment of earnest money by DoT would arise only if HBTL was guilty of acting contrary to the tender document. Rejecting Usgaonkers plea for forfeiting the earnest money, Justice Ramamoorthy said: As the ministry has not issued the letter of intent (LoI) within the bid validity period, it is clear that HBTL has not withdrawn the bid without any justifiable reasons.
