Bombay High Court
Bombay High Court

Mumbai: The decks have been cleared for Reliance Jio to become an IT giant, at least in Maharashtra. This comes after the Bombay High Court upheld the legality of the contract awarded to Jio to provide high-speed internet services to Maharashtra government and all its agencies and for all its projects.

In return, the government has decided to grant ‘waivers’ to Jio for laying down its cables without getting permissions from local authorities. As per this award, Jio would also be free to use any government office – buildings, schools or hospitals etc for enhancing its own connectivity.

This award was upheld by a bench of Justices Satyaranjan Dharmadhikari and Gautam Patel while dismissing a plea filed by Bharati Airtel, which opposed the handing over of the contract to Jio.

According to Airtel, the MahaIT, a nodal agency to implement information and communication technology across India, was in search of service providers to provide high-speed internet-based connectivity across Maharashtra with all components: services, effective and stable bandwidth and cost optimisation.

The project, as pointed out by Airtel, targeted e-governance services to be rendered to citizens (Government to Citizens or G2C; healthcare, subsidies etc) and to various government agencies (Government to Government or G2G; payment consolidation and so on).

In its request for the proposal itself, the MahaIT had stated that it would provide major concessions and benefits in regard to what are usually high-cost elements, particularly the ‘Right of Ways’ (RoW) fees. These are costs that service providers incur while laying cables or lines along or across roads.

Notably, laying cables involves digging up portions of public roads, many of which are vested in different authorities or agencies and then closing, refilling and resurfacing the road.

According to MahaIT’s offer, it decided to provide an across-the-board waiver of RoW fees, and, in addition, access to all roads and government buildings, including those of local bodies, schools, primary health care centres, hospitals, colleges and statutory corporations.

Airtel, while opposing the award argued that these benefits are of ‘tremendous value’ to any service provider. It claimed that these benefits are worth Rs 5000 crore, which is far more than the Rs 900 crore project of providing internet services to the government.

Jio won the award by way of the bids it sent pursuant to the government’s notifications in February 2019. Airtel, too participated in the bidding process, however, in the last phase of the bids, it made a negative bid, which was not accepted by the system and thus, its final phase’s bid was not accepted and Jio won the award.

Accordingly, Airtel argued that the government ought to have accepted its negative bid and if not so, they should have had specified that such negative bids would not be accepted.

Having heard all the contentions, the bench led by Justice Dharmadhikari said, “We are concerned only with the decision-making process. It must be shown to suffer from illegality, perversity, mala fides or unreasonableness This is not demonstrated. In our view, the plea is without merit and thus must fail.”

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