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PIL seeks to cancel lease of Kandla Port land to firm, Delhi High Court seeks Centre's reply


The Delhi High Court has sought response of the Centre on a PIL seeking cancellation of a lease awarding 50 acres of land at Kandla Port in Gujarat to a private firm.

A bench of Acting Chief Justice Gita Mittal and Justice C Hari Shankar issued notice to the Ministry of Shipping, Kandla Port Trust and the firm, Friends Salt Works and Allied Industries (FSWAI), and sought their stand on the plea by an NGO which has termed the tender process as "sham".

The court listed the matter for further hearing on September 24.

The NGO, Centre for Public Interest Litigation (CPIL), has alleged that the Kandla Port Trust (KPT) overvalued the structures set up at the site by FSWAI, when it had leased the land in the past, to ensure that only the firm gets the contract.

The petition, filed by the advocate Prashant Bhushan, alleged that KPT overvalued the assets, including a liquid storage tank terminal, at Rs 207 crore which a successful bidder for the land had to pay to FSWAI under the new tender issued in 2014.

It said that the FSWAI in its balance sheet had valued the structures at Rs 48 crore.

The petition claimed that FSWAI did not have to pay the amount of Rs 207 crore if it was successful in the bid and added that under the earlier lease agreement KPT did not have any contractual obligation to compensate the firm for its assets.

The NGO has sought that if the lease awarded to the firm in April 2015 is not cancelled, then the amount of Rs 207 crore be recovered from it.

"The introduction of said clause in the tender (to compensate FSWAI) is illegal and arbitrary since it was the responsibility of FSWAI to remove the structures before the expiry of the (earlier) lease. The additional burden of Rs 207 crore on other bidders put them at a significant disadvantage and ensured that the said tender would be awarded to FSWAI," the NGO has alleged in its plea.

CPIL had earlier raised the issue in a fresh application moved in a pending petition which claimed that a huge scam had taken place during 1960s and 1970s when plots near Kandla Port were leased out on nomination basis to private parties without a bidding process.

The court, however, had asked the NGO to file a separate petition to challenge the new lease and subsequently it filed the instant PIL.

The earlier PIL had also alleged irregularities in allotment of 16,000 acres of government land which caused a huge loss to the state.


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