Case: M/s. Ganpati RV-Talleres Alegria Track Pvt. Ltd Vs. Union of India &amp; Another

6th Edn., p. 342) Joint venture companies are now being increasingly formed in relation to projects requiring inflow of foreign capital or technical expertise in the fast developing countries in East Asia, viz., Japan, South Korea, Taiwan, China, etc. [See Jacques Buhart : Joint Ventures in East Asia -- Legal Issues (1991).] There has been similar growth of joint ventures in our country wherein foreign companies join with Indian counterparts and contribute towards capital and technical know-how for the success of the venture. The High Court has taken note of this connotation of the expression "joint venture". But the High Court has held that NHL is not a joint venture and that there is only a certain amount of equity participation by a foreign company in it. We are unable to agree with the said view of the High Court.25. As noticed earlier, in its tender NHL had stated that it is a joint venture company established by TPI, LMI and WML and IIPL wherein TPI, LMI and WML and other companies in the same group as well as Mr. Aroon Purie own 60% shares and IIPL owns 40% shares. It was also stated that the joint venture has received approval of the Government of India and is currently in operation and that the promoter will increase their capital/contribution to commensurate with the project need and that the company has been established as an information and database management company with expertise in database processing, publishing, sales/marketing and the dissemination of related information. In the tender it is also stated that as a joint venture in the true sense of the phrase, the company will have access to expertise in database management, sales and publishing of its parent group companies. It would thus appear that the Indian group of companies (TPI, LMI and WML) and the Singapore-based company (IIPL) have pooled together their resources in the sense that TPI, LMI and WML have made available their equipment and organisation at various places in the country while IIPL has made available its wide experience in the field as well as the expertise of its managerial staff. All the constituents of NHL have thus contributed to the resources of the Company (NHL). This shows that NHL is an association of companies jointly undertaking a commercial enterprise wherein they will all contribute assets and will share risks and have a community of interest. We are, therefore, of the view that NHL has been constituted as a joint venture by the group of Indian companies and IIPL, the Singapore-based company and it would not be correct to say that IIPL which has a substantial stake in the success of the venture, having 40% of shareholding, is a mere shareholder in NHL.xx xx xx41. We have been informed that while the matter was pending in the High Court and in this Court the telephone directory for the year 1993 has been printed and supplied to the Department by Respondent 4 as per terms of the contract. Insofar as the directory for the year 1994 is concerned we find that, as per the terms of the contract, the process for preparation of the telephone directory has already commenced. We cannot lose sight of the fact that as a result of quashing of the contract in respect of the directory for 1994 fresh steps will have to be taken to award a fresh contract and the said process would take some time and thereafter the contractor will require time to print and publish the telephone directory. It would, therefore, not be feasible to bring out the directory for 1994 before the close of the year. As a result, the Department would suffer loss of revenue which it would otherwise earn by way of royalty from Respondent 4 for the directory for the year 1994. Insofar as the contract in respect of the year 1995 is concerned there is sufficient time for the Department to award a fresh contract if the contract awarded to Respondent 4 is cancelled and the new contractor will have sufficient time at his disposal to print and deliver the directory as per the time schedule. Moreover, in respect of the directory for the year 1995 the amount of royalty that is payable by Respondent 4 is Rs 45 lakhs and the amount of royalty offered by NHL for the directory for the said year was Rs .291.6 lakhs. Keeping in view the circumstances referred to above, the course that commends us is that, while maintaining the contract awarded to Respondent 4 in respect of the directories for the years 1993 and 1994, the said contract may be set aside insofar as it relates to the directory for the year 1995 and fresh tenders may be invited for award of the contract for the directory for the year 1995. The appeal filed against the judgment and order of the Delhi High Court dismissing the writ petition of the appellants must therefore, be allowed in the above terms. The other appeal has been filed by the appellants against the order of the Delhi High Court dismissing CM No.6120 of 1993 which was an application for an interim relief during the pendency of the writ petition in the High Court. In view of the final order that is being passed in the writ petition the application for interim relief has become infructuous and the appeal against the order dismissing CM No. 6120 of 1993 must, therefore, be dismissed as infructuous." 7. Though the aforesaid case related to experience, the other essential characteristic of a joint venture has also been highlighted. 8. In that view of the matter the inevitable conclusion is that the view taken by the High Court that the appellant did not fulfil the eligibility criteria was not correct. The High Court was not justified in dismissing the writ petition. We direct the Evaluation Committee to consider the bid of the appellant alongwith two persons who had been selected and take a final decision. 9.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]Keeping in view the circumstances referred to above, the course that commends us is that, while maintaining the contract awarded to Respondent 4 in respect of the directories for the years 1993 and 1994, the said contract may be set aside insofar as it relates to the directory for the year 1995 and fresh tenders may be invited for award of the contract for the directory for the year 1995. The appeal filed against the judgment and order of the Delhi High Court dismissing the writ petition of the appellants must therefore, be allowed in the above terms. The other appeal has been filed by the appellants against the order of the Delhi High Court dismissing CM No.6120 of 1993 which was an application for an interim relief during the pendency of the writ petition in the High Court. In view of the final order that is being passed in the writ petition the application for interim relief has become infructuous and the appeal against the order dismissing CM No. 6120 of 1993 must, therefore, be dismissed asthat view of the matter the inevitable conclusion is that the view taken by the High Court that the appellant did not fulfil the eligibility criteria was not correct. The High Court was not justified in dismissing the writ petition. We direct the Evaluation Committee to consider the bid of the appellant alongwith two persons who had been selected and take a final decision