VIJAYAWADA: In a major relief to the AP State government, the Andhra Pradesh High Court on Thursday lifted the stay on the execution of the prestigious Polavaram Multipurpose Irrigation Project clearing the decks for the recommencement of the works. The Navayuga Engineering Company Limited (NECL) challenged the decision of the YSRC government to terminate its contract for the construction of the hydro-power project.
While quashing the stay granted by a lower court, the High Court agreed with the contention of State Advocate General S Sriram that the writ petition filed by Navayuga was not tenable as it had already approached the arbitration court to settle the issue. “Since the arbitration process is going on, the petition filed by NECL cannot be entertained by the High Court,” the Advocate General argued.
Further, the HC also set aside the injunction granted by the lower court preventing the State government from encashing the bank guarantees given by NECL for not commencing the project on time. The HC also directed the lower court to hear the arguments of both the parties and review its judgment.
It may be recalled that the YSR government took recourse to reverse tendering to save public money on various projects that were awarded to various contractors by the previous TDP government. In the process, the Jagan Mohan Reddy government served notices on NECL for pre-closure of the contract and went for reverse tendering of the project.
Though NECL did not challenge the termination of the contract for the irrigation project, the works on the entire project had to be stalled as the government called for common tenders for both irrigation and hydel power projects in August. When the government went for reverse tendering, the total value of the contract was estimated at `4,987 crore, including `1,830 for Polavaram project headworks and `3,157 for the 960 megawatts hydro project.
The contract was awarded to Megha Engineering and Infrastructure Limited (MEIL), the only company which participated in the bidding and quoted `4,359.11 crore, which was `628.43 crore or 12.6 per cent less than the total estimated cost. NECL bagged the contract in 2017 to execute the Polavaram project when Chandrababu Naidu-led government was in power. Water Resources Minister Anil Kumar Yadav welcomed the High Court decision and said all the obstacles have been cleared.