SREI INFRASTRUCTURE FINANCE LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners have assailed an order dated January 28, 2020 issued by the National Highway Authority (NHAI) blacklisting the petitioner No. 1 from participating in any ongoing or future tender of the NHAI for a period of three years.

(2.) Learned Senior Advocate appearing for the petitioners has referred to the Memorandum of Understanding dated January 28, 2006. He has submitted that, the petitioner No. 1 had entered into Memorandum of Understanding with Madhucon Projects Limited (MPL) and Madhucon Granites Limited (MGL) to form a consortium for the purpose of bidding for a project of NHAI to construct, operate and maintain the Madurai-Tuticorin section of National Highway 45B from Kochi Km 138.800 to Km 254.500 in the State of Tamil Nadu for a concession period of twenty years including construction period. The parties had formed a Special Purpose Vehicle (SPV) in terms of the Memorandum of Understanding. Such SPV had entered into a concession agreement with NHAI. He has submitted that, MPL was the lead member and that the petitioner No. 1 was the financial member holding only equity stake of 10 per cent of the share holding of the SPV. According to him, the role of the petitioner No. 1 had been restricted to being a financial member. He has submitted that, the SPV being Madurai - Tuticorin Expressways Limited (MTEL) was incorporated on May 11, 2006 with the petitioner No. 1 having 10 per cent stake therein.

(3.) Learned Senior Advocate appearing for the petitioners has submitted that, MGL, MPL and the petitioner No. 1 had entered into a shareholders' agreement on December 12, 2006 after emerging as the successful bidders in respect of the project of NHAI. He has referred to various clauses of the shareholders' agreement particularly Clause 3 and 5 thereof. He has contended that, the responsibility for execution of the project was with MPL and that the responsibility of the petitioner No. 1 was restricted to the extent stated in Clause 3 of the agreement. He has submitted that, the NHAI authorities had knowledge of such shareholders' agreement.