The matter of redevelopment of Asia’s largest slum, Dharavi in Mumbai has reached the Supreme Court after a Dubai-based consortium alleged the rules were changed for the bidding, despite it being the top bidder for the tender, reported Khaleej Times. Dharavi’s development was allotted to the Adani Group to transform the area that is spread across nearly 2.4 square kilometres.
It has become one of the most watched urban development projects in the world and now, SecLink Technologies Corporation has approached the top court over the allotment of the redevelopment project. In its submission, the firm said it participated in the bidding process back in 2018, and was declared the highest bidder the next year, reported Khaleej Times.
However, the process was cancelled and rules were changed while it was awaiting the formal award of the bid, the company claimed, as stated in the report. The new rules, it said, prevented them from participating again.
Last year, SecLink had filed a petition in the Bombay High Court, which it rejected stating the “grounds urged in support of the petition lack force”, the report added.
How did it all begin?
The Maharashtra government invited global bids in late 2018 to redevelop Dharavi and SecLink competed with several Indian developers, reportedly emerging as the top bidder with an offer of around Dh3 billion. However, the report mentioned, right before the final contract could be issued, the entire bid process was cancelled.
The new tender was issued after two years, and certain criteria were revised making SecLink ineligible even for the bidding. Talking to Khaleej Times, SecLink’s CMD Nilang Shah said the consortium had already lined up significant financing before the tender was scrapped.
“We had set aside $4 billion (Dh13.5 billion) as bank guarantee for the project and costs have crossed Dh3.82 billion,” he was further quoted as saying. He further said that the cost of keeping the financing structure alive continues to mount until the dispute is resolved.
Shah mentioned that UAE-based financiers committed the capital based on the original tender outcome. But that has now turned into a financial risk for international investors.
What the company said in SC
In its petition, SecLink has reportedly argued that the changes made in the tender process undermined fair competition once the original results were public. The documents, Khaleej Times said, talked about the Maharashtra government’s clarification as well.
The state government reasoned the cancellation of the original tender by citing the need to include adjoining railway land. SecLink’s rejoinder said the 2018 tender had already accounted for this, maintaining that the pulling back of the tender “did not reflect any real change in scope”, the report added.
In its affidavit, SecLink’s said it was prepared to meet or surpass all terms in the 2022 tender, including payments to Indian Railways, but even then it was kept out. But the revised criteria in new tender blocked its participation. Changes to participation rules, bid thresholds and land development provisions threw SecLink out of a project it had already won.
The contract was later awarded to the Adani Group led special purpose vehicle. Both the Maharashtra government, as well as the Adani Group, denied the allegations in their responses to the petition, the report said.
As of now, the Adani Group has not responded to the plea in SC.