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The key players in this dispute are M/s Reliance Airports Developers Pvt. Ltd. (in short RAL), Airports Authority of India (in short AAI), Government of India (in short GOI), GMR Infrastructures Ltd. (in short GMR), GVK Industries Ltd. (in short GVK).

Background facts sans unnecessary details are as follows:

As a part of the GOIs avowed policy of privatization of strategic national assets, the first step appears to be privatization of two airports i.e. Mumbai and Delhi on a joint venture basis. In March, 2003 AAI initiated process to consider modernization of Delhi and Mumbai Airports on the basis of an earlier decision taken on January 12, 2000 by the Union Cabinet relating to re-structuring of airports of AAI through long term leasing route. On 11.9.2003 the GOI approved restructuring of airports of Mumbai and Delhi through joint venture (shortly called JV) route and constituted Empowered Group of Ministers (in short EGOM) to decide the detailed modalities including design parameters, bid evaluation criteria etc. based on which JV partners were to be selected. It was required to submit the final proposal for Governments approval. An Inter Ministerial Group (in short IMG) was set up to assist EGOM for re-structuring of two airports. The same was set up under the Chairmanship of Additional Secretary-cum-Financial Adviser of Ministry of Civil Aviation. Subsequently, on 15.6.2004, EGOM was re-constituted under the Chairmanship of Minister of Defence. On 12.10.2004 IMG was re-constituted under the Chairmanship of Secretary, Ministry of Civil Aviation. On the basis of recommendations made by IMG, EGOM approved appointment of Global Technical Adviser, Legal Consultant and Financial Consultant (called GTA, LC & FC in short respectively). They were Airport Planning Ply Ltd., Amarchand, Mangaldas & Suresh A. Shroff & Co. and ABN AMRO Asia Corporate Finance (I) Pvt. Ltd (in short Airplan, AMSC and ABN AMRO respectively). The Consultants prepared the Invitation To Register An Expression of Interest (shortly called ITREOI) and the same was endorsed by IMG.

Writ Petition was filed by RAL before the Delhi High Court on 2.2.2006. On 4.2.2006 GOI informed GMR and GVK that they have been selected as successful bidders for undertaking the restructuring and modernization of the Delhi and Mumbai airports respectively and required them to furnish enhanced bid bonds guarantees for Rs.500 crores. Both GMR and GVK furnished their bid bonds guarantees of Rs.500 crores each on 6.2.2006 and 8.2.2006.

On 1.3.2006 Special Purpose Vehicle (in short SPV) was formed for Delhi while on the next day SPV was formed for the Mumbai airport. On 4.4.2006 Operations Management and Development Agreement (in short OMDA) was signed by the concerned parties. At this stage, it would be appropriate to take note of what has been described as OMDA. Shareholders agreement with GMR and GVK was signed. Consequently 26% shares in SPV were allotted to AAI and 74% shares allotted to GMR. Similarly, 26% shares in SPV were allotted to AAI and 74% shares allotted to GVK.

By the impugned order, RALs writ petition before the Delhi High Court was dismissed by order dated 21.4.2006.

The primary stand of the appellant is that the EGOM/ GOI should have accepted the recommendations of the EC and should not have asked the GETE to make further examination. It is submitted that GETE did not examine the queries relating to GMR as raised by the IMG and the reduction of technical qualification from 80% to 50% was impermissible. It is also submitted that the appointment of GETE itself was illegal and unauthorized. The High Court proceeded on the basis as if EGOM had absolute discretion in the matter of choosing the modalities. It is also submitted that the uniform pattern of assessment has not been done and while reducing the marks so far as the appellant is concerned, similar procedure has not been adopted so far as GMR and GVK are concerned. In the initial assessment, only the GMR and the appellant had crossed the bench mark. If in respect of one airport GMR was given the option of matching the financial bid of the appellant, in respect of the other airport similar option should have been given to the appellant who was at the relevant point of time and even now willing to match the financial bid of GVK. There was no justification for reduction of standard from 80% to 50%, particularly when at all stages EGOM had emphasized that there shall not be any compromise with quality. The argument that any bidder who had crossed the mandatory requirement stage would be competent to execute the contract is completely erroneous since in that case there was no need to fix the high bench mark of 80%. Appellant had scored over 80% on the development side and fell short of merely 6% less than 80% on the management side. The award of contract to the third ranked bidder i.e. GVK who had scored only 59% on the development side and whose bid had been adversely commented upon by all committees is against public interest. The bench mark of 80% had been approved by the EGOM. The EC expressly recommended against lowering the bench mark and the EGOM in its meeting on 5.12.2005 had also wanted the bench mark to remain at 80%. GETE had also not recommended lowering of the bench mark.

Appellant has contended that EC has given marks on the basis of RFP parameters. According to it, the parameters were fixed by the GOI or the EC. The question is not of allotting marks, the real issue is whether right parameters have been applied. It has been emphasized that the other Committees consisted of mainly bureaucrats or persons with inadequate technical knowledge, only the EC was an expert body and, therefore, its view had to be given primacy.

GMR had qualified in both the bids. Appellant has contended that the option of choosing one of the airports should not have been given to GMR but it should have been allotted the Mumbai airport because of its superior quality of bid in respect of the said airport. By giving option to choose one of the airports, the fate of the appellant was sealed because in the other, it had fallen below the bench mark. Though in one case, appellants bid was above the bench mark and its bid was the best amongst those who were below the bench mark in respect of the other airport, it has not been able to get any of the airports.