Jindal not successful bidder for mines taken off auction: Govt

The Centre today defended its decision in Delhi High Court to cancel the tender process for three Chhattisgarh mines, for which Jindal Power Ltd had bid the highest, saying no right had accrued to the company as it had not been declared a successful bidder.
Additional Solicitor General (ASG) P S Narsimha made the submission on behalf of the Coal Ministry before a bench of justices Badar Durrez Ahmed and Sanjeev Sachdeva which reserved its verdict.
The ASG said the government "erred on the side of caution" while cancelling the tender process as it did not want to "fritter away" a public resource.

Senior advocate Kapil Sibal, appearing for Jindal Power Ltd (JPL), countered the arguments, saying the auction of the coal blocks was a statutory process and, after the company had complied with all tender conditions and emerged as the highest bidder, the government cannot cancel its bids without giving any reason.
He said the nominated authority had twice told the ministry that there was nothing wrong with the bidding process for the three mines - Gare Palma IV/2 and IV/3 and Tara blocks in Chhattisgarh - but the minister decided, without giving any reason, to take them away from the auction block.

On the issue of any right accruing to the company, Sibal said since it was the preferred bidder for the three mines, it had ended up reaching 150 per cent of its requirement and thus was unable to bid for two other mines of Ganeshpur and Utkal C.
Under the auction rules, once a company reaches 150 per cent of its coal requirement, it cannot bid for any other mines, JPL said.
Sibal also argued that though the ministry cancelled auction of these three mines on the ground that there was only one bidder in round two of bidding process and final price offered was only Rs eight more than the initial price offer, there were other blocks where the same thing happened but the auction was not cancelled.