SC dismisses coal liaison agent's plea

The Supreme Court on Wednesday dismissed a petition filed by Mahagenco's coal liaison agent M/s BSN Joshi & Sons, challenging the
state-run power generation company's decision to terminate its contract. This will allow Mahagenco to terminate the coal liaison contract with the said company.

Mahagenco had on August 13 terminated BSN Joshi's contract on grounds of gross non-performance causing a loss of Rs 200 crore to the company. The termination order stated that the agent was not well equipped to operate such a huge contract and the execution of the contract was marked by non-performance. The agent was also charged with not deploying the required infrastructure or expertise to do justice to the contract.

The SC order further stated complaints were received from all seven thermal power stations regarding abnormal increase in transit loss, inadequate realization of linkages, total lack of supervision at loading points, supply of coal mixed with shale, stones and other extraneous materials.

The agent in his defence stated that the Supreme Court itself had observed in an earlier order that the other three bidders had formed a cartel. Mahagenco's director (finance) had stated in a note that M/s Nair Coal Services Ltd, Nagpur, M/s Naresh Kumar & Co Ltd, Mumbai, and M/s Karamchand Thapar & Brothers Ltd, Mumbai, had formed a cartel. The managing director of Mahagenco concurred with this opinion.

BSN Joshi charged that there was a deliberate and calculated attempt on part of Mahagenco to encourage cartelization and the company's action against it was vindictive and unlawful in nature.

After listening to arguments of both sides the apex court refused to entertain the agent's plea. Its counsel then offered to withdraw the petition. The court has stated 'dismissed and withdrawn' in its order.