Dharavi project: Old tender cancelled, fresh one issued due to impact on economic-financial affairs

The Gautam Adani Group had bagged the 2022 tender with a bid of Rs 5,069 crore to redevelop an area of 259 hectares

The Bombay High Court
The Bombay High Court


The Maharashtra government told the Bombay High Court on Friday the 2018 tender for the Dharavi redevelopment project was cancelled and a fresh tender was issued in 2022 because of several factors, including the COVID-19 pandemic and the Ukraine-Russia war that affected financial and economic affairs.

The Gautam Adani Group had bagged the 2022 tender with a bid of Rs 5,069 crore to redevelop an area of 259 hectares.

The government's decision to cancel the 2018 tender and issue a fresh tender in 2022 with additional conditions was challenged in the HC by UAE-based company Seclink Technologies Corporation, which had emerged as the highest bidder in the earlier tender with a Rs 7200 crore bid.

The state Housing Department, in its affidavit filed in reply to the petition, said a decision was taken to cancel the earlier tender and issue a fresh one with new conditions due to several factors, adding the financial and economic state of affairs in 2019 and in 2022 were materially different.

"The present economic state of affairs is materially affected by the impact of the COVID-19 pandemic, Russia-Ukraine war, uncertainty over Rupee-USD rate, interest rate volatility and overall high-risk perception of common investor," the affidavit said.

Hence, the government took a bonafide decision after obtaining legal advice to cancel the tender and float a new tender in public interest.

The first tender for the redevelopment project was issued in November 2018, and bids were opened in March 2019. In the same month, an additional 45 acres was made available to the government by the Railways for the redevelopment project, the affidavit said.

The Housing Department's affidavit claimed there was no formation of contract between the government and the petitioner company and, hence, it (company) has no legal right.

"The petitioner has no vested right to get an award in a tender process. Any person who submits a bid can only legitimately expect his bid is considered in a non-arbitrary and transparent manner. No person has a right to do business with the government as a matter of right," it said.

The affidavit said the first tender dated 28 November, 2018 was cancelled by a government resolution (GR) dated November 5, 2020 as there was material change in the tender condition after the "bid due date".

The affidavit also termed the petitioner's allegations of the government having acted arbitrarily to favour the selected bidder (Adani) as "vague and ambiguous", adding the old tender and the new one were different and could not be compared.

In the new tender, the bids were to be submitted afresh and the petitioner could have taken part as there was no question of excluding anyone's participation, it said.

Senior counsel Abhinav Chandrachud and advocates Suresh Iyer and Jenil Shah, appearing for the petitioner company, argued it had bid Rs 7200 crore, while the highest bid in the second tender (Adani) was Rs 5,069 crore.

A division bench of Acting Chief Justice S V Gangapurwala and Justice Sandeep Marne on Friday said it would hear the plea on March 14.

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