NEW DELHI: Managing director of Maharashtra State Power Generation Co. Ltd (Mahagenco) Ajoy Mehta narrowly escaped action for allegedly wilfully showing disobedience to the Supreme Courts direction in a multi-crore coal supply contract tender, as the state undertaking conceded to award the bid to one BSN Joshi amp; Sons Ltd. But the apex court castigated Mahagenco for "encouraging formation of a cartel and, thus, allowing the rate of transportation of coal to go high up".

"Unless a power generating company takes all measures to cut down such malpractices, the generation cost of electricity is bound to go higher and ultimately the same would be passed on to the consumers of electricity, observed a bench of Justices SB Sinha and Cyriac Joseph.

The court expressed the "hope" that "a public sector undertaking would take adequate and appropriate measures to meet the said contingency in future. The present order came in an appeal by the coal company that had been awarded the contract earlier, but later got the refusal.

The public undertaking had said that "It is in public interest and in the interest of Mahagenco that the work is allocated to the lowest qualified bidder BSN Joshi amp; Sons Ltd".
Source : Central