ITDC moves court on shop contract

State-owned India Tourism Development Corporation (ITDC) and Dubai-based Flemingo Duty Free have separately moved the Karnataka High Court against Bangalore International Airport Ltd (BIAL) for "unjustly eliminating" them from bidding for a duty free shopping contract. The two companies were among the seven that had expressed interest for the contract.

BIAL awarded the contract to the 50:50 joint venture between Swiss company Nuance Group and K Raheja Corp's Shoppers' Stop last December.

ITDC has moved the court for not just a stay on the award of the contract, but also for retender. Interestingly, the public sector company has raised the issue of lack of level playing field vis-a-vis private-duty free operators.

"At the stage of submitting the expression of interest, we made it clear that we would be forging a joint venture with an international company. But we were not even sent the requests for proposal (the financial bids). How can we be eliminated before that? We were asking for no concessions and intended to participate solely on merit,"a top ITDC officials told Business Standard.

In an emailed response, a BIAL spokesperson said: "They (Flemingo and ITDC) participated in the expression of interest stage but were not shortlisted for the subsequent tender phase because they failed to match the evaluation criteria set out by BIAL. Both petitions are in the Karnataka High Court and are at different stages of proceedings. Therefore, it would not be appropriate for BIAL to offer any comments at this point."

"They have acted very parochially. One of BIAL's stakeholders is a Swiss company (Unique Zurich Airport) and it went ahead and awarded the duty-free contract to another Swiss company (Nuance). We cannot accept this position," ITDC officials added.

BIAL is owned by a consortium, with private promoters holding 74 per cent equity stake, while Karnataka State Investment and Industrial Development Corporation and the Airports Authority of India hold 1c3 per cent each. The private promoters include Siemens Projects Ventures (40 per cent), Larsen & Toubro (17 per cent) and Unique Zurich Airport (17 per cent).