W.P.(C) 13160/2021 Page 1 of 30

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IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on:-24.01.2022

Date of Decision:-04.02.2022

+

W.P.(C) 13160/2021 & CM APPL. 41527/2021(interim)

JMC PROJECTS (INDIA) LTD. & ORS.

..... Petitioner

Through

Mr. Sandeep Sethi, Sr. Adv. with Mr.

Shamik Sanjanwala, Ms.Deepaprabha, Advs.

versus

NATIONAL HIGHWAYS AUTHORITY OF INDIA & ORS.

..... Respondent

Through

Mr. Parag P Tripathi, Sr. Adv. with

Ms. Gunjan Sinha Jain, Ms. Aparna Gupta and Mr.

Anirudh Dusaj, Advs. for R-1

Ms.Manisha Agrawal, Narain, Mr.Aditya Singh

Deshwal, Ms.Rakshita Goyal, Advs for R-2.

Mr.Rishi Agrawala with Ms.Shruti Arora, Advs

for R-3.

CORAM:

HON'BLE MS. JUSTICE REKHA PALLI

REKHA PALLI, J

JUDGMENT

1.

The present petition under Article 226 of the Constitution of India

assails the communication dated 18.11.2021, issued by the respondent

no.1/National Highway Authority of India (hereinafter referred to as

‘NHAI’). Vide the impugned communication the petitioner no.3, namely

JMC-AGE Joint Venture, which is a joint venture (JV) of petitioner no.1,

and M/s AGE INSAAT VE TICARET ANONIM SIRKETI (hereinafter

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W.P.(C) 13160/2021 Page 2 of 30

referred to as ‘AGE INSAAT’), a company incorporated in Turkey, has been

informed that security clearance required for award of the contract in its

favour by the respondent no.1 has been denied by the Competent Authority

i.e., respondent no.2.

2.

The petitioner no.1 is a company incorporated in India under the

Companies Act, having its registered office at Ahmedabad, Gujarat. The

petitioner no.1 is the lead member holding 76% share in the petitioner no.3

JV, while AGE INSAAT is holding the remaining 26% share therein. The

petitioner no.2 is a shareholder of the petitioner no.1 company.

3.

The respondent no.1/NHAI, an authority under the Ministry of Road

Transport and Highways (hereinafter referred to as ‘MORTH’), established

vide the National Highways Authority of India Act, 1988, is responsible for

the construction, development and maintenance of various highways across

India. The respondent no.2/Ministry of Home Affairs (hereinafter referred to

as ‘MHA’), is the authority entrusted with the task of granting security

clearance to bidders, or in the case of a joint venture, to such members,

wherein the controlling interest of 50% or more is held by persons residing

outside India. It is respondent no.2 which has taken the decision to not grant

security clearance to the petitioners, based on which the impugned

communication dated 18.11.2021 has been issued.

4.

On 13.05.2021, the respondent no.1 issued a Request for Proposal

(hereinafter referred to as ‘RFP’) for construction of 'four laning of part of

Union Territory of Jammu && Kashmir by EPC Mode' (hereinafter referred

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W.P.(C) 13160/2021 Page 3 of 30

to as ‘the project’). The work under the project was to be conducted in the

EPC mode i.e. ‘Engineering Procurement and Construction’ mode. As per

routine, the bidding process was divided in two parts i.e. determining the

technical responsiveness, followed by the assessment of the financial bids.

In terms of the conditions of the RFP, the bidding was, subject to certain

conditions, also open to persons from countries other than India; one of the

primary conditions for the same being approval of the Competent Authority

from national security and public interest perspective, as per the applicable

instructions of the Government of India, in terms of clause 2.1.12(a) of the

RFP. It is this clause which is the bone of contention between the parties.

5.

On 28.05.2021, the petitioner no.1 entered into a Joint Bidding

Agreement with