Posco E&C, a part of South Korean steel giant Posco, today moved the Delhi High Court against steel maker SAIL alleging “illegal and discriminatory” termination of a Rs 2,000-crore order by the PSU despite it being the lowest bidder.
Admitting Posco’s petition, a Division Bench comprising Justice B D Ahmed and Justice Veena Birbal suggested the company to participate in the retendering process invited by SAIL.
Posco E&C, in its petition, alleged that despite being the lowest bidder and getting the contract offer after signing the letter of assurance, SAIL cancelled the bid and invited fresh tenders on July 13, 2009. It further alleged that SAIL, in an “arbitrary, illegal and discriminatory” manner, terminated the contract for installation of a blast furnace complex at the Bhilai Steel Plant.
Senior advocate Mukul Rohatgi, appearing for the South Korean firm, said that SAIL terminated the contract citing delay in signing the agreement offered to it.
“We had even offered a discount of Rs 70 crore on account of falling equipment prices, but the SAIL board did not approve it and cancelled the tender,” he added.
