RAMDAS SHRINIWAS NAYAK Vs. UNION OF INDIA

JUDGEMENT

(1.) MR. Ramdas S. Nayak, the petitioners No. 1 is a social worker and an Ex-member of the Legislative Assembly of Maharashtra and presently a Corporator of the Bombay Municipal Corporation. Petitioner No. 2 Mr. Vinay P. Shasrabuddhe, is also a social worker and Executive Director of Rambhau Mhalgi Prabodhini. By this writ petition filed by way of public interest litigation, both these petitioners seek to challenge the power purchase agreement being finalised between the Maharashtra State Electricity Board (respondent No. 6 herein) and the Dabhol Power Company, promoted by the U. S. based Enron Corporation, on the ground that it is unconstitutional and against the interest of the people at large. It is contended by the petitioners that this deal, which according to them is shrouded in total secrecy, is blatently illegal and has grave financial implications on the State Exchequer and the people in general.

(2.) WHEN the matter came up before us on 25th July, 1994, we heard the learned Counsel for the petitioners Mr. Apte at length. The main challenge to the award of the contract by the Maharashtra State Electricity Board to the Dabhol Power Company (respondent No. 8 herein) is on the ground that it was finalised without resorting to competitive bidding by inviting global tenders. The contention of the petitioners is that the Maharashtra State Electricity Board has not followed the norms normally followed in awarding such contracts i. e. inviting competitive bids. Finalisation of the contract by negotiations, according to the petitioners is not a permissible mode of awarding such contracts by the State or its instrumentalities. According to the petitioners, the whole contract has been finalised in complete secrecy and is even now shrouded by secret. The entire negotiations in this regard have been kept away from the gaze of the public and the decision to award the contract has been arrived at without any regard to the views expressed by various experts in the field including the World Bank. Reference was made to the report of a fact-finding committee appointed by some voluntary organisation, which had expressed its reservations in regard to the impugned deal. Our attention was also drawn to comments of some persons claiming expertise and experience in this field and some press reports published in the newspapers from time to time. The petitioners allege that the whole deal is against public interest. The petitioners have also a complaint against the guarantee and counter guarantee which is being given by the State of Maharashtra and the Central Government respectively. According to the petitioners, the terms on which the agreement has been finalised are not the most beneficial terms. By competitive bidding more beneficial terms might have been available.

(3.) ALSO heard the Counsel for the respondents who had entered appearances through their respective Counsel and filed their respective affidavits countering the various allegation made in the writ petition.