There is no need for interference when decision of the respondents to reject tender is well considered, based on a study, understanding of the relevant facts and legal opinion : Delhi High Court

Conflict of Interest is a complicated arena to justify and prove one’s true interests and intents. Therefore, the party that is questioning has the right to make a decision after sufficient research and understanding. This was held in the judgment passed by a two-judge bench comprising HON’BLE MR. JUSTICE VIPIN SANGHI HON’BLE MR. JUSTICE JASMEET SINGH, in the matter of STERLITE GRID 20 LIMITED V. PFC CONSULTING LIMITED & ANR [W.P.(C) 5768/2021 & CM APPLs.18096/2021 & 18781/2021], dealt with an issue where the petitioner filed a petition seeking that the court allows the Petitioner to participate in bidding process of the respondents.

The Petitioner company (SGL 20) is a wholly owned subsidiary of Sterlite Power Transmission Limited. SPTL is a global developer of power transmission infrastructure with projects in India and Brazil. The commercial objectives of IndiGrid are, inter alia, to plan, promote, invest, own, construct, process, develop, maintain, manage, repair, accumulate, store, trade, lease, permit, license and operate all kinds of assets, designs, technologies and resources in relation to transmission of power, and generation and/or transmission of renewable energy.

The Respondent No. 1 is PFC Consulting Limited. It is a wholly owned subsidiary of Power Finance Corporation Limited, which is a Schedule-A, Nav-Ratna Public Sector Enterprise.

The Respondent No. 2 is U.P. Power Transmission Corporation. UPPTCL is engaged in acquiring, establishing and operating electrical transmission lines and network and associated sub-stations and connected ancillary services in the State of Uttar Pradesh.

The Respondent No. 1 issued the RfQ (Request for Qualification), inviting responses from prospective bidders for shortlisting the bidders for the next stage of bidding i.e. Request for Proposal, as part of the process of selection of the prospective Transmission Service Provider (“TSP”) in accordance with the Tariff Based Competitive Bidding Guidelines for Transmission Service and Guidelines for Encouraging Competition in Development of Transmission Project issued by the Government of India, Ministry of Power.

The Petitioner submitted its response to the RfQ. The Petitioner sought qualification on the basis of the technical and financial qualifications of its affiliate, Talwandi Sabo Power Limited (“TSPL”) for the purpose of meeting the qualification requirements under the RfQ.

The Petitioner argued that the impugned decision is arbitrary, illegal and violative of Article 14 and 19(1)(g) of the Constitution of India. The Petitioner submitted that there was no “Conflict of Interest” between the Petitioner and the IGL.

After hearing both the parties The Hon’ble Delhi High Court dismissed the petition and held that the respondent was not called upon to examine the situation at hand with a microscopic lens, and determine whether, as a matter of fact, information was exchanged. All that the respondent was required to examine was, whether, the two companies were in a position so as to have access to information of the other company with regard to their bids. In the light of the discussion above, we are of the view that the conclusion drawn by the respondent that both companies were in a position to access information of each other, was reasonable, well informed and justified.

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Judgement reviewed by – Vaishnavi Raman

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