New Delhi: Delhi High Court has upheld the Delhi Jal Board‘s decision to bar companies facing corruption or money-laundering cases from bidding for high-value sewage and water infrastructure projects. A bench of justices Nitin Wasudeo Sambre and Ajay Digpaul held that the eligibility condition was a bona fide measure in public interest and did not warrant interference. “The decision taken by DJB in framing such a clause is not a targeted one and is a bona fide decision taken in the public interest. The specific work of public importance, like essential public services relating to the water supply, will always have overriding public interest,” the bench observed. The court dismissed petitions filed by two private firms challenging the eligibility clause introduced in Jan. The condition renders a bidder ineligible if an FIR or chargesheet alleging fraud, corruption, financial irregularities or other economic offences exists against the company or its key managerial personnel in relation to DJB contracts, or if they are under investigation by agencies such as the Anti-Corruption Branch, CBI, Enforcement Directorate or Economic Offences Wing. The firms—currently facing Enforcement Directorate proceedings under the Prevention of Money Laundering Act—argued that since they had not been convicted, the clause was arbitrary and discriminatory. The court rejected this, noting that allegations against the companies involve connivance with DJB officials, cheating and fraud. “Merely because the petitioners were not convicted, or because a conviction may lead to disqualification for three years, does not by itself confer any leverage upon the petitioners to claim they are being discriminated against,” the bench said. The court accepted DJB’s argument, presented by standing counsel Tushar Sannu, that the clause was preventive rather than punitive. The measure, it noted, was intended to protect public interest and prevent future harm. The bench underlined that the tender relates to the design, construction and operation of decentralised sewage treatment plants and pumping stations, along with long-term maintenance. Any delay or compromise in quality, it said, would directly affect sewage-treatment outcomes, groundwater contamination, and pollution levels in the Yamuna, with wide-ranging public-health consequences. Both companies and their directors face allegations in an alleged multi-crore scam involving the augmentation and upgradation of 10 sewage treatment plants, based on complaints from DJB’s vigilance wing. They face proceedings under the Prevention of Corruption Act, the Indian Penal Code and PMLA.
