Authority: Hon'ble Justice V. Sujatha, High Court of Andhra Pradesh

Order Date: Not specified in the document

Case Overview

  • Petition No.10913 of 2011 filed by an unnamed company (concessionaire) seeking mandamus against G.O.Rt.No.319 dated 16‑04‑2011, alleging arbitrariness, violation of natural justice and Articles 14 & 19 of the Constitution.
  • The concessionaire, formed as Maytas Vasista Varadhi Ltd (SPV) with Maytas Infra Ltd, China Railway 18th Group Corporation, and later Coastal Projects Ltd, was awarded a BOT/BOO bridge project (Vasista Bridge) on an annuity basis; bid security of Rs 80 lakhs and performance guarantees of Rs 1.33 cr and Rs 1.99 cr were furnished.
  • Original financial‑closure deadline 04‑01‑2009 was extended repeatedly (first to 03‑07‑2009, then to 05‑01‑2010) with a weekly penalty of Rs 15,000; further extensions were sought but not granted beyond 05‑01‑2010.
  • Despite a term‑loan sanction by Tata Capital Limited (letter dated 17‑06‑2010) and addition of a new promoter (Coastal Projects Ltd) per G.O.Rt.No.942 (13‑08‑2009), financial closure was not achieved; the technical committee deemed the agreement terminated under clause 22.4.
  • G.O.Rt.No.319 (16‑04‑2011) ordered termination of the concession agreement and invocation of the bank guarantees; the petitioner challenged this order.
  • The Court had earlier stayed the operation of G.O.Rt.No.319 on 19‑04‑2011, made the stay absolute on 24‑06‑2011, and considered additional affidavits and NCLAT orders (2018) relating to the consortium.
  • Respondents argued that the agreement was already terminated and that invoking guarantees was lawful; petitioner contended that termination required proper procedure and that the bank guarantees had been extended under interim orders.

Final Outcome

  • The writ petition is allowed; G.O.Rt.No.319 dated 16‑04‑2011 is set aside.
  • No order as to costs; any other pending miscellaneous petitions in this writ are closed.
  • The Court recognises that the technical committee’s recommendation to terminate the agreement stands, but the specific G.O.Rt.No.319 invoking guarantees is invalidated, preserving the petitioner’s right to seek fresh tendering under revised cost estimates.

Topics: Infrastructure PPP, Court Order