The government said the decision was taken as it didn't want to delay the Rs 6,000-crore project further because of the warring Ambani brothers, the main contenders for the contract.
"One can't deny the fact that the project has been delayed because of the two warring brothers. If we had decided to go for re-bidding, we would have faced the same problem. So, we decided to do it on our own," Public Works Minister Anil Deshmukh said after a meeting of the Cabinet Committee on Infrastructure (CCI).
The only two bidders for the project were the RELINFRA-Hyundai consortium and the SeaKing Infrastructure Ltd (SKIL)-IL&FS consortium. RELINFRA is led by Anil Ambani while SKIL is controlled by Mukesh Ambani.
Last week, the bid granted to the RELINFRA-led consortium was treated as invalid by the Maharashtra State Road Development Corporation (MSRDC), the nodal agency for the project, as it did not respond positively to its request to extend the bid validity.
Officials said the MSRDC would now work out the financial model with other state infrastructure agencies like the Mumbai Metropolitan Region Development Authority (MMRDA) and the City and Industrial Development Corporation (CIDCO) and place it before the Cabinet panel within the next fortnight.
"After the panel approves the model, we will call bids for the engineering contract," Deshmukh said, but refused to give any deadline for awarding the engineering contract.
Deshmukh said the state government was also contemplating increasing the number of lanes on the link from six to eight. The state government, an official said, might consider options like levying an impact premium on real estate transactions in the vicinity as real estate rates would rise considerably after the link starts.
Sources close to SKIL and IL&FS welcomed the decision saying "this will ensure speedy completion of the project without creating any legal problems and give impetus to industrial development in the region".
A RELINFRA spokesman declined to comment.
