HC refrains from setting aside Tangedco’s ₹1,330-cr. tender for supplying imported steam coal

Judge permits the utility to proceed with the process after publishing the notification in Indian Trade Journal

The Madras High Court on Wednesday refrained from setting aside a ₹1,330 crore tender floated by the Tamil Nadu Generation and Distribution Corporation (Tangedco) on February 8 for supply of 20 lakh tonnes of imported steam coal of any origin to be delivered at the Kamarajar port in Ennore between May 2021 and May 2022.

Justice B. Pugalendhi, however, directed Tangedco to strictly comply with Section 9(3) of the Tamil Nadu Transparency in Tenders Act, 1998, and publish the tender notification in Indian Trade Journal , a standard medium for public advertisements, so that a greater number of domestic and international bidders could participate in the process and quote competitive prices.

Though Tangedco had originally given only 15 days for submitting the bids as against the statutory requirement of a minimum of 30 days for such high-value tenders, the judge recorded the submission of Advocate-General Vijay Narayan and Additional Advocate- General P.H. Arvindh Pandian that the last date had now been extended till March 10.

Rush-through process

The judge recorded Mr. Narayan’s submission that Tangedco had to rush through the process by initially giving just 15 days for submitting bids because it had to take into consideration the requirement of coal by the thermal power plants during summer and also the code of conduct that would have to be observed on account of the Assembly election.

The Advocate-General also told the court that what was being imported was just 6% of the requirement of the thermal power stations in the State, and the imported coal was actually mixed with about 180 lakh tonnes of domestic coal, procured from Indian coal companies, to achieve a certain calorific value.

Concurring with the law officers that Tangedco must be prepared to meet the energy requirements during summer, the judge granted liberty to the power utility to approach the Election Commission of India for permission to move forward with the process if the code of conduct came into force before the finalisation of the tender.

The orders were passed while the court disposed of writ petitions filed by two private firms — one based in Thoothukudi and the other in Indonesia.

The firms had challenged the tender notification on the grounds of Tangedco not having given 30 days’ time for submitting bids and its failure to publish the notification in Indian Trade Journal as mandated under the 1998 Act.