The Supreme Court on Monday permitted state-owned National Hydro energy Corporation (NHPC) and its subsidiary Lanco Teesta Hydro Power to procedure the tender for completion of balance functions for the Teesta-VI Hydro Electric Project on the Teesta river in Sikkim.
NHPC claimed that the Rs 5,748-crore project of “national importance” was becoming held up and it can’t procedure the fresh tender in the wake of a status quo order operating against it. The Sikkim High Court on December 11 in an interim order had asked it to retain status quo with regard to building of balance civil functions package of the project. NHPC had acquired the debt-ridden Lanco Teesta HP, which was executing the 500 MW
Teesta VI HP project, in July 2019.
Lanco and NHPC had collectively challenged the HC’s Division Bench’s interim order on the grounds that it had the “effect of stalling and delaying the time-bound project of national importance”.
A Bench led by Chief Justice SA Bobde, when enabling the NHPC and Lanco to procedure the tender, also restrained them from finalising it without the need of the HC’s permission. It also asked the single judge, which is hearing the most important petition, to choose the case inside a month on its personal merits. “We understand this is the project of national importance but for them respondents) its of commercial importance. The solution is early decision,” the CJI told solicitor common Tushar Mehta.
Gammon Engineering and Contractors (GEPCL) had in March final year bagged the contract for execution of the balance civil functions package. However, the contractor could not furnish the efficiency bank assure of more than `62.42 crore even right after finding a quantity of extentions till November 5, Lanco stated. While NHPC refused to give additional extensions to GECPL, “who had been all along fooling the petitioners with lame excuses as it seemed they neither had the readiness nor the wiliness to furnish the Performance Bank Guarantee,” the PSU sooner or later annulled the Letter of Acceptance.
However, Gammon wrongly took benefit of the finance ministry’s November 12 choice that decreased efficiency safety from current 5-10% to 3% of the worth of the contract for all current contracts, according to the appeal.
“Although, the Letter of Acceptance stood annulled…., GECPL purposefully indulged into a unilateral communication with the petitioner and as such GECPL, taking advantage of the OM dated November 12, 2020,… thereby proposing and requesting for approval to submit performance bank guarantee of 3% of contract value being `37.45 crore for and on place of 5% of the contract value, which again cast a shadow on the readiness and wiliness of financial capability of GECPL to execute a contract of Rs 1,248.44 crore,” Lanco/NHPC told the SC.
While the LoA was annulled by NHPC, the latter also invited fresh tender on November 27 for completion of functions, it mentioned, adding that GECPL without the need of difficult the fresh tendering procedure, moved the HC for declaring the letter of annulment and invocation of the bid safety as arbitrary and unconstitutional, and so forth. The contractor also sought a path to the Lanco/NHPC to accept the efficiency bank assure of Rs 37.45 crore.
While the single judge dismissed the GECPL’s keep application, the DB asked parties to retain status quo with regard to Construction of Balance Civil Works Package.
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