SC closes L&T’s plea after Mumbai civic body cancels ₹14,000-cr tender for key infra projects

In a relief for engineering and construction giant Larsen & Toubro Ltd (L&T), the Mumbai Metropolitan Region Development Authority (MMRDA) informed the Supreme Court on Friday that it has decided to scrap the ₹14,000 crore tender process in which it had disqualified the company.

“We are scrapping the tender,” senior advocate Mukul Rohatgi, representing MMRDA, told the court.

A Supreme Court bench led by Chief Justice B.R. Gavai accepted MMRDA’s decision to scrap the entire tender process for two major infrastructure projects. “It is fairly stated that the entire tender process is scrapped in larger public interest. Thus, the plea is disposed of as infructuous,” the court ordered. The bench then closed L&T’s plea.

L&T had moved the Supreme Court alleging procedural lapses and unfair treatment in the bidding for the Thane-Ghodbunder to Bhayander infrastructure project, a key part of Mumbai’s urban transport expansion.

The Supreme Court’s order now means that all existing bids, including L&T’s, stand void, prompting a possible re-initiation of the tender process by MMRDA. While the outcome doesn’t guarantee L&T the contract it sought, it does provide the company with a fresh opportunity to bid.

‘How could L&T be disqualified?’

The Supreme Court had on 29 May questioned how L&T—which built Delhi’s Central Vista—could be disqualified while others were allowed to proceed.

“Just remember what happened to the Uttarakhand tunnel, where 40 workers were trapped and then rescued. L&T is disqualified, and the person who is selected… you know,” the Chief Justice remarked, highlighting concerns about the qualifications of the selected contractors.

MMRDA then sought one more day to complete discussions on the tenders and L&T’s disqualification. The top court granted 24 hours and was set to hear the case on 30 May. However, MMRDA chose to scrap the tender process altogether

“MMRDA has voluntarily decided to proceed with a re-tendering process, without prejudice to its legal rights,” an MMRDA spokesperson said in response to today’s proceedings. 

“We are also considering a downward revision of the base project cost by approximately ₹3,000 crore as a step towards ensuring financial efficiency and delivering greater public value,” the spokesperson said.

Initially, L&T had challenged the matter in the Bombay High Court, which dismissed its petitions on 20 May. However, the High Court directed that the bids submitted electronically by L&T be preserved in a sealed cover for two weeks, giving the company time to approach the Supreme Court.

The High Court also instructed MMRDA to communicate the tender award decision in accordance with the instructions to bidders.

Why MMRDA disqualified L&T

L&T’s main contention was that it was never informed of its disqualification, and its price bid was not even opened, raising questions about transparency in MMRDA’s process.

According to L&T, it submitted its financial bids on 30 December. MMRDA then opened the technical bids on 1 January and started evaluating them but did not communicate the status to L&T.

Despite this, MMRDA scheduled the opening of financial bids for 13 May without informing L&T or inviting it to witness the process, while other bidders were notified.

MMRDA contested L&T’s claim before the Supreme Court, stating that although the company’s financial bid was about ₹3,000 crore lower, it was not opened because L&T was disqualified for failing to submit a required affidavit. 

Companies participating in the tender were required to file an affidavit declaring that no bridge built by the company had collapsed within two years of completion, a critical eligibility criterion that MMRDA said L&T did not fulfill. 

Two MMRDA infrastructure projects—estimated at ₹6,000 crore for an elevated road and ₹8,000 crore for a tunnel—are seen as crucial to reducing travel time between Mumbai’s suburbs and the city’s core areas. One of the planned bridges is set to become the second-largest in Maharashtra after the Mumbai Trans Harbour Link (Atal Setu).