Ratnagiri Gas & Power Pvt.Ltd vs Rds Projects Ltd.& Ors

3. The factual matrix leading to the filing of the writ petition by RDS Project Ltd. (hereinafter referred to as ‘RDS’ for short) has been set out at considerable length in the order passed by the High Court. We do not, therefore, consider it necessary to re-count the same all over again except to the extent the same is absolutely necessary for the disposal of these appeals. Suffice it to say that Government of India has entrusted the task of reviving and restructuring of the Dabhol Project to Gas Authority of India Ltd. (GAIL) and National Thermal Power Corporation (‘NTPC’ for short) both Government of India undertakings who have in turn formed a joint venture company in the name and style of Ratnagiri Gas & Power Pvt. Ltd., the appellant in this appeal, for short referred to as ‘RGPPL’. The appellant-RGPPL is charged with the duty of completing the balance work at LNG Terminal of the Dabhol Power project and of commissioning and operating the same. The appellant has, for that purpose, engaged GAIL as its Engineer who has in turn appointed Engineers India Limited (EIL) as their Primary Project Management Consultant. Scott Wilson a U.K. based entity was also kept in the loop as a backup consultant for marine works.

4. In terms of an international competitive bidding notice, issued by it on 26th June, 2009, EIL invited tenders from eligible parties for completion of, what is called “Breakwater” at LNG Terminal at RGPPL site, Dabhol, Maharashtra. The construction of the breakwater was left incomplete by a previously employed contractor appointed for the purpose on account of the stoppage of the work by the Dabhol Power Company. The earlier contractor had, according to the appellant, constructed only 500 meters of breakwater length leaving the balance of nearly 1800 meters incomplete and a certain length thereof untouched.

10. In response to the above writ petition filed by Hung-Hua, the appellant company filed a short affidavit in which it disputed the averments made in the writ petition and took the stand that the documents filed by RDS along with its bid showed that breakwater at Mus in Car Nicobar Island was built at an offshore location and that RDS had completed the entire work as a single entity on behalf of M/s Ellen Hinengo Ltd.

11. While the writ petition filed by Hung-Hua was pending before the High Court, the appellant sought from GAIL the work order issued to RDS in respect of the qualifying project at Car Nicobar to verify the credentials of the RDS. RDS was accordingly asked by EIL to produce the documents in support of its qualification such as the work order for the Andaman Harbour works. The appellant-company also sought the details about the contracts to verify the correctness of the certificates submitted by RDS along with its bid in response to the tender notice.

12. A further development in the meantime took place in the form of the CAG forwarding a report in which certain adverse observations regarding the completion of the breakwater at chainage 22M to chainage 200 M in the Andaman and Nicobar Project were made. The report revealed that in January, 1998 the contractor had completed only 15 to 47 percent of the work and that in April, 1998 the Executive Engineer had taken out a part of the unexecuted work for awarding it to another contractor. The CAG found that due to delay in the construction of a portion of the breakwater coupled with non-compliance of contractual terms, the department had suffered a loss of Rs.2.61 crores, apart from increase in cost of the work by Rs.3.55 crores.

14. While correspondence between RGPPL, GAIL and EIL was being exchanged on the subject the appellant received certain documents under RTI Act including the work order placed by Andaman Harbour Works on EHL and those placed on M/s Recon International for a part of the Andaman Project for chainage 22-200 meters. These documents were quickly sent to EIL for review who examined the matter again and submitted its observations in terms of letter dated 18th September, 2010 stating that RDS did not meet the basic qualifying conditions of offshore breakwater of a minimum length of 400 meters. GAIL then forwarded that opinion to the appellant to take appropriate action on the subject.

15. On receipt of the letters aforementioned, the appellant requested GAIL to forward its own recommendations. GAIL, however, reiterated that since all the relevant information on the subject was available with the appellant, it could take an appropriate decision in the matter in its capacity as the owner of the project.

17. With the annulment of the entire tender process Writ Petition No.2142 of 2010 filed by Hung-Hua/Ranjit Buildcon Ltd. inter alia challenging the acceptance of the technical bid submitted by RDS was dismissed as withdrawn by the High Court in terms of order dated 30th November, 2010. That order came to be passed on an application filed by the appellant-RGPPL stating that the entire tender process having been scrapped with a decision to invite fresh tenders Writ Petition No.2142 of 2010 did not survive for consideration. The High Court took note of the subsequent events and dismissed the writ petition as not pressed in view of the fact that the tender process had been scrapped and a decision to invite fresh tenders had been taken.

49. In the result we allow these appeals, set aside the judgment and order passed by the High Court and remand the matter back to the High Court with the following directions:

Resultantly, the appellant-RGPPL shall be free to carry forward and finalize the process of allotment of works started by it in terms of the second tender notice.

(4) Keeping in view that the tender process relates to a project of national importance, the High Court is requested to dispose of the matter at an early date and as far as possible within a period of four months from the date a copy of this order is received by it.

50. Parties are left to bear their own costs.

Petition(s) for Special Leave to Appeal (Civil) No(s).3571/2012 (From the judgement and order dated 17/10/2011 in WPC No.534/2011 of The HIGH COURT OF DELHI AT N. DELHI) RATNAGIRI GAS & POWER PVT.LTD. Petitioner(s) VERSUS RDS PROJECTS LTD.& ORS. Respondent(s) (With prayer for interim relief) WITH C.A. No.........../2012 @ SLP(C) NO. 5554 of 2012 C.A. No.........../2012 @ SLP(C) NO. 6180 of 2012 Date: 18/10/2012 These Petitions were called on for JUDGMENT today.

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