The Supreme Court has issued notice to the Himachal Pradesh government on cross-appeals filed by Netherland-based Brakel Corporation NV and Anil Ambani-led Reliance Infrastructure Ltd seeking awarding of a contract for setting up of hydropower projects in the state.

Both the companies have challenged the Himachal Pradesh High Court judgment that overturned the state government?s decision for allotment of the 960 mw Jangi-Thopanp-Powari hydropower project in Kinnaur district to Brakel Corp, which had emerged as the highest bidder.

An apex court bench headed by Justice HS Bedi asked the registry to list the matter before another bench headed by Justice Aftab Alam as the matter had been substantially heard by it.

?In the meantime, notice be served to the Himachal Pradesh government and on the standing counsel for the state,? Justice Bedi directed. The high court while cancelling the award of the project in favour of Brakel Corp had refused allotment to the ADAG firm.

The high court had directed the state ?to take fresh decision as to whether it wants to re-advertise the said projects or it wants to act on the basis of the old tender?. Brakel was awarded the contentious project after an international bidding process in December 2006, but the terms were altered after closure of the process by converting two 480 mw projects into a single project that was challenged by Reliance Infrastructure, who had failed to win the bidding process.

The mega power project involves tunneling through high rise mountains to change the course of fast flowing Satluj river and involves investments over Rs 6,000 crore. Reliance has moved the high court three times since the allotment of the project in 2006. Its two petitions against the government were earlier dismissed by the court.

Reliance, which claims to be the highest eligible bidder, in its petition before the apex court has alleged that the prequalification of the foreign company was totally fraudulent and had sought awarding of the contract in the public interest.

The ADAG firm said it was willing to match the bid of Brakel so that there was no financial loss to the state government. According to the petition, the state government had preferred JSW Ltd for allotment of DSC Himal project and thus it was incumbent on the former to allow Reliance to match Brakel?s bid and expedite the setting up of the project.

Further readvertising of the project would only entail long delay and cost escalation which would be prejudicial to public interest. The ADAG firm also stated that the upfront deposit of Rs 173.43 crore paid to the state government by Brakel Corp in January 2008 was actually paid by Brakel Kinnaur Pvt Ltd, which is a total stranger to the tender process. It further submitted that ?the investigation of the state authorities revealed that the entire payment was made by the Adani group companies who are not connected to Brakel Corp, through demand drafts?.

However, the company added that these facts were not disclosed to the state government.