SC relief to TANGEDCO, BHEL over Ennore thermal plants

A view of the Ennore Thermal Power Station in Chennai.—File Photo  

In a major relief to TANGEDCO and BHEL, the Supreme Court on Tuesday allowed a batch of civil appeals filed against the order of the Madras High Court over the construction of the 2 X 660 MW Ennore SEZ Supercritical Thermal Power Project.

The Supreme Court was also critical of the Madras High Court for not exercising restraint and held that the latter’s order “followed the path of error in continuum”.

Though BHEL was awarded the contract for the construction of these plants, a Division Bench of the Madras High Court had allowed pleas of the other bidder, Central Southern China Electric Power Design Institute (CSEPDI) – Trishe Consortium and directed TANGEDCO to evaluate the price bid taking into consideration representations submitted by the consortium, thereby prompting TANGEDCO and BHEL to challenge the order.

In its judgment, a Division Bench of the Supreme Court comprising Justices Dipak Misra and Shiva Kirti Singh observed, “We are obliged to say that in a complex fiscal evaluation the court has to apply the doctrine of restraint. Several aspects, clauses, contingencies, etc. have to be factored. These calculations are best left to experts and those who have knowledge and skills in the field.”

The bench was referring to a Consultant Report which defended the award of the contract to BHEL by TANGEDCO.

The bench was also critical of the Madras High Court entertaining a plea to consider representations before the finalisation of a contract.

“We are disposed to think that the High Court at that stage should have exercised caution. If the courts would exercise power of judicial review in such a manner, it is most likely to cause confusion and also bring jeopardy in public interest,” the judges said, adding an aggrieved party could approach the court at the appropriate stage, not when the bids were being considered.

“Once the price bid was opened, a bidder could not have submitted representations on his own and seek a mandamus from the court to take certain aspects into consideration. We have stressed this aspect only to highlight the role of the court keeping in mind the established principle of restraint,” the Supreme Court Bench said.

The construction of 2 X 660 MW Ennore SEZ Supercritical Thermal Power Project was delayed since there were several rounds of litigation in the Madras High Court over the tender process of TANGEDCO with CSEPDI – Trishe Consortium, alleging “arbitrariness, anomalies and inconsistencies” in the process.

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Printable version | Sep 14, 2021 12:24:17 PM |

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