Tangedco’s Rs 1,330 cr coal tender runs into controversy over validity time

The private firm, Ind-Vigo Coal Private Limited, had also moved the Madras High Court with a petition submitting that Tangedco failed to provide the minimum time for submission of bids as specified under the Act and tender rules serves as an entry barrier for many bidders as there cannot be effective participation in the tender process. 

The tender validity should be minimum of 30 days for tenders above Rs 2 crore, but as per tender notification, it read that the validity was only for 15 days for a global tender whose value is Rs 1,330 crore, the copy of the petition available with DT Next read. “Tangedco floated the tender seeking supply of 20 lakh tonnes of imported coal of any origin having Gross Calorific Value of 6000 kcal/kg to be supplied at Kamarajar Port, Ennore. The tender is arbitrary, illegal and unconstitutional, ” petitioner S Thirumalaisamy of Ind-Virgo Ltd told DT Next sharing the petition admitted at the HC. The petitioner’s firm is a company registered in Tamil Nadu and a preferred coal provider for many power and industrial plants. 

The tender inviting authority failed to take prior approval of the Tangedco board and rather submitted the same for ratification in the 99th board meeting held on February 18, 2021. Even the board meeting agenda was circulated only on February 17, where it should have been circulated at least a week before for the board members to appreciate the subjects placed for approval, the petition read. 

For the earlier tender in 2019 for a similar quantum, the price was Rs 800 crore only whereas the current tender value is estimated at Rs 1,330 crore. The USD conversion rate has remained uniform without any big fluctuation, the petition read. 

Tangedco sources said that the 2019 tender value was for Rs 910 crore and the quality of coal wasn’t the same as demanded in the latest tender. About 10 lakh tonne coal with 6000 GCV and 10 lakh tonne coal with 5000 GCV is a requirement and the international market rate for coal with 6000 GCV will decide the final tender value. If the cost per tonne at present is Rs 5,000, the tender cost will be between Rs 1,050 - 1,100 crore, a source said, adding that the process was at the preliminary stage. A state official said, “It is usual practice to speed up the tender process as the state will now have only about 10 working days left as the model code of conduct for TN assembly polls is expected by the mid of March.”