SC Refuses to Halt Construction; Directs Payments Through Escrow Account
The Supreme Court of India has declined to stop the ongoing construction of the Dharavi Redevelopment Project (DRP), reinforcing the Bombay High Court’s decision in favour of the Adani Group. This ruling responds to an appeal by UAE-based Seclink Technologies Corporation, which challenged the Maharashtra government’s decision to award the project to Adani Properties Limited.
Court Supports Bombay High Court’s Decision
During the hearing, the Supreme Court noted that work on the massive redevelopment project had already begun, including the demolition of certain railway quarters. A bench led by Chief Justice of India (CJI) Sanjiv Khanna, accompanied by Justice PV Sanjay Kumar, emphasized that the Bombay High Court’s ruling was justified, particularly since the railway line forms part of the redevelopment plan.
The apex court refused to issue a stay order on the ongoing construction. However, it mandated that all financial transactions related to the Dharavi project must go through a single escrow account. This measure ensures transparency and proper allocation of funds throughout the project’s lifecycle.
Seclink’s Revised Bid Proposal
Seclink Technologies Corporation had originally placed a bid of Rs 7,200 crore for the Dharavi redevelopment project. During the hearing, the company expressed its willingness to increase its bid by 20 percent in an effort to regain consideration for the project.
The Supreme Court instructed Seclink to submit an affidavit outlining the details of its revised financial proposal. Meanwhile, notices have gone to the Maharashtra government and Adani Properties, with the next hearing scheduled for May 25.
Background of the Legal Dispute
The controversy stems from the Maharashtra government’s decision to cancel Seclink’s original bid from 2019 and issue a fresh tender in 2022. This move resulted in awarding the project to Adani Properties Limited, prompting Seclink to challenge the decision through legal channels.
In December 2024, the Bombay High Court ruled in favour of the Maharashtra government, upholding the validity of the re-tendering process. Seclink subsequently approached the Supreme Court, seeking to overturn this ruling and reinstate its bid.
The Maharashtra government defended its decision to reissue the tender, citing significant changes in economic conditions between 2019 and 2022. Key factors included the COVID-19 pandemic, the Russia-Ukraine war, currency fluctuations, and rising interest rates. These developments, according to the government, required a fresh evaluation of bids to ensure the project’s feasibility under current economic realities.
Implications of the Court’s Decision
The Supreme Court’s refusal to halt the Dharavi project allows the redevelopment efforts to proceed without interruption. This ruling provides clarity for stakeholders and enables Adani Properties Limited to continue with construction and infrastructure development.
The directive to use an escrow account enhances financial accountability, ensuring close monitoring of project-related payments. This decision aims to prevent potential disputes over fund allocation and maintain a clear financial trail for future reference.
As the legal battle continues, the outcome of the next hearing on May 25 will attract significant attention. It remains to be seen whether Seclink’s revised bid will influence the court’s position or if the current course of redevelopment will proceed unimpeded.
Dharavi Redevelopment: A Transformative Urban Project
The Dharavi Redevelopment Project represents one of the most ambitious urban renewal initiatives in India. Dharavi, known as Asia’s largest slum, is home to over a million residents. The redevelopment aims to transform the area by providing modern housing, improved infrastructure, and better living conditions.
With the Supreme Court allowing the project to continue, the Adani Group remains in a pivotal position to drive this significant urban transformation. However, the ongoing legal proceedings highlight the competitive stakes and the broader implications of large-scale public infrastructure projects in India.
