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Informist, Thursday, May 14, 2026

 

NEW DELHI – The Delhi High Court Thursday upheld the Steel Authority of India Ltd.'s advisory stating Bhilai Engineering Corp. Ltd.'s unsatisfactory performance in a previous sinter plant project at Bokaro Steel Ltd., and its consequent removal from another project. The high court upheld SAIL's rejection of Bhilai Engineering's bid regarding installation of stamp charged coke oven battery for its IISCO Steel Plant at Burnpur, West Bengal.

 

The high court noted that Bhilai Engineering had failed to complete the sinter plant project at Bokaro Steel. The failure on part of Bhilai Engineering led to SAIL taking a decision to de-scope the portion of work assigned to the petitioner under the contract and complete the same, said the court.

 

While the SAIL corporate projects section's advisory acknowledges the satisfactory performance and long-standing experience of Bhilai Engineering in top charged coke oven battery projects, the same cannot by any length justify its acceptance for a stamp charged coke oven battery project, the court said. The distinction between the two battery projects lies in their design, coal charging and pushing operations, quality parameters and type of machinery used, it said. 

 

SAIL's action does not amount to blacklisting of Bhilai Engineering because the advisory is merely an internal communication between the units of the company, thereby intimating the bifurcation of satisfactory and non-satisfactory past performance of the petitioner in top charged coke oven batteries and in the remaining fields based upon the respondent's own experience at Bokaro Steel, said the court. The advisory is not intended for external application by organisations or institutions which are not working under SAIL, it said. Bhilai Engineering has altogether not been debarred as such from participating in new notice inviting tenders, it added.

 

Blacklisting implies a complete debarment of the bidder from participating in any of the project, which is not the case in the present circumstances, said the court. Bhilai Engineering continues to be eligible for participation in top charged coke oven battery project and, as a matter of fact, has been awarded contracts worth about INR 15 billion post the issuance of the advisory, said the court. 

 

It said that SAIL was going to install stamp charge coke oven batteries for the first time and would like to have an experienced contractor onboard for the same, with sufficient or at least some experience demonstrating its capability and credentials. Bhilai Engineering, however, does not claim that it has already gained sufficient capability and experience by installing similar works for other institutions, said the court.

 

The court said there was some force in the submissions of Bhilai Engineering that the advisory does not prescribe any defined period or time limit for its operation, which in effect would result in indefinite period of blacklisting. SAIL, to this extent, has said that if Bhilai Engineering makes a representation and satisfies the respondent, the advisory so issued could be reconsidered, noted the court.

 

Bhilai Engineering had argued that SAIL adopted an arbitrary and mala fide reason for disqualifying it from the present tender process, which was based upon the unsatisfactory performance in a different and unrelated plant project at Bokaro Steel. SAIL's advisory, in effect, leads to a permanent blacklisting of the petitioner, as it does not provide any definite period for its operation, said Bhilai Engineering.

 

SAIL said that the unsatisfactory performance of Bhilai Engineering at Bokaro Steel plant has led to prolongation of contract, by virtue of the culmination of multiple legal proceedings. Therefore, in view of the advisory and in particular the clause under the contract between the parties, the actions of SAIL were justified, it said.

 

At 1329 IST, shares of Steel Authority of India Ltd. were down 0.6% at INR 200.10 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Avishek Dutta

 

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