SC dismisses Lanco appeal in Vizhinjam port project

Written by fe Bureau | Hyderabad | Updated: Feb 11 2009, 06:17am hrs
Lanco Infratech might suffer yet another setback in the case of the Rs 8,300-crore Vizhinjam International Transhipment Terminal Port project mooted by the Kerala government. The Supreme Court on Tuesday has dismissed the appeal of Lanco and has asked the Kerala government to consider the bids of the Mumbai-based Zoom Developers for building the container transshipment

terminal under PPP at Vizhinjam in Thiruvananthapuram within 15 days.

By this order, the apex court has held valid the Kerala High Court objection to the state governments decision to award the contract to a consortium led by Lanco Kondapalli Power for developing the project.

The Kerala government, it may be recalled, had awarded the multi-crore project to the consortium of Lanco and Pembinan Redzal Sdn Bhd of Malaysia. And the letter of intent (LOI) for the project was handed over to the Lanco group sometime during the end of September 2008. The project involves development of international container transhipment port with a capacity to handle 6.5 million TEUs (twenty foot equivalent units). It was to be developed in four phases with an overall outlay of Rs 8,300 crore.

Lanco officials had earlier stated that the port would be equipped with the state-of-the-art technology, equipment and highest industry service standards. The company had plans to achieve financial closure in about 12-18 months from the date of LOI. he transhipment terminal project ran into trouble when the tender of Zoom Developers (one of the bidders) was rejected by the bid evaluation committee and the Mumbai-based developer had raised objections to the tendering process adopted by government of Kerala for the project. The company also later moved the Kerala High Court and obtained temporary objection to the whole tendering process related to the project. The court in its ruling also ordered the bid evaluation committee to consider Zooms tender.

Subsequent to this, Lanco, Kerala government and Vizhinjam International Seaport Ltd the nodal agency set up for the project had

approached the Supreme Court challenging the High Courts ruling.