The Supreme Court (SC) on Thursday refused to stay the Bombay High Court’s order that quashed state-owned MIHAN India’s order cancelling a contract awarded to the GMR airports, to operate the Babasaheb Ambedkar International Airport in Nagpur.

A bench led by Justice Vineet Saran, however, sought a response from GMR Airports on a batch of appeals by various government entities, including the Central government, the Maharashtra government, the Airports Authority of India (AAI) and others against the HC’s August 18 order last year, which asked MIHAN (the Multi-modal International Cargo Hub & Airport at Nagpur) to execute the agreement signed with the infrastructure company for the upgradation and operation of the airport.

The HC had also quashed the March 19, 2020 letter issued by MIHAN India annulling the bidding process for the airport, and further directed the state-owned entity to take all steps in terms of the request for proposal (RFP) conditions, including signing of a concession agreement for the Nagpur Airport, within six weeks.

Challenging the setting aside of its decision to cancel the tender process and retender the project, senior counsel Dushyant Dave, appearing for Mihan India, said that all the four government authorities were not in favour of continuing with the five-year-old tender process, as the offers were financially low and a lot had changed in the interregnum, thus requiring fresh tendering with a new financial model.  The acceptance of the bid was conditional and required approval from the civil aviation ministry, MIHAN, a JV between Maharashtra Airport Development Co and the AAI, stated.

Still, the HC had interfered in the tender process, without there being a concluded contract with GMR and despite the facts on record clearly showing loss to the government exchequer, the appeal stated, adding that “the HC was incorrect in holding that GoI approval is a formality when the said condition was accepted by GMR and never questioned or challenged”.

According to MIHAN, the HC was not right in holding that the Maharashtra government had no business with the tender process despite the fact that the state government through its company, Maharashtra Airport Development Company, is a majority shareholder of MIHAN India, holding 51% shares. 

It needs to be considered that the role of state government was never in dispute and in fact the project monitoring and implementation committee (PMIC) constituted by the state government was overseeing the entire tender process, it added.

While GMR, which operates the Indira Gandhi International Airport in Delhi, had emerged as the highest bidder in the tender process for the Nagpur airport in 2019, a year later the Maharashtra government had decided to cancel the tender process and issued a letter annulling the bid process. GMR had moved the HC seeking quashing of the annulment letter.