In what can be considered a first setback for the YSR Congress party government in Andhra Pradesh headed by Y S Jagan Mohan Reddy, the state high court on Thursday stalled his plan to go in for reverse tendering for completion of 960 MW Polavaram hydro power station being built as part of the Polavaram irrigation project on Godavari river.
The high court found fault with the Jagan government for terminating the contract of Navayuga Engineering Company Limited (NECL) which was awarded by the previous Telugu Desam Party government.
It ordered that the works be restored to the same company which has to complete the project within the deadline of June 2021
However, the high court order is restricted only to the power project component which is worth Rs 3170 crore, but not the head works and other related works of the irrigation project.
The company has to move the court on the irrigation works separately. The irrigation component costs Rs 1800 crore for the balance works.
On August 14, the AP Power Generation Corporation (APGenco) issued orders as per the directions of the government to cancel the contract of Navayuga and go in for fresh tenders. The irrigation department floated fresh tenders on August 19.
The YSRC government has been alleging that there were large scale irregularities and corruption in awarding the contracts to Navayuga by the previous TDP government.
Navayuga moved the high court challenging the termination of contract.
It argued that the company was not responsible for the delay, which is mainly due to allotment of project site by APGenco.