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Delhi HC says World Bank or any global body can’t be considered government agency in plea challenging NDMC’s electricity tender rejection

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New Delhi, Oct 23 (ILNS) The Delhi High Court has recently held that the World Bank or any other international body cannot be considered a “Government Agency” as none of these international bodies is bound by any directions issued by the Government of India. 

The Division Bench of Justice Vipin Sanghi and Justice Jasmeet Singh was hearing a writ petition of A2Z Infraservices Limited aggrieved by the rejection of its bid for an electricity tender floated by the New Delhi Municipal Corporation (NDMC) on the ground that the petitioner failed to disclose the fact that he is debarred by the World Bank, the Asian Infrastructure Investment Bank (AIIB), and the African Development Bank (AFDB).

Advocate Mini Pushkarna, standing counsel for NDMC, argued that the World Bank has representatives of India on its body, which includes the Union Finance Minister, moreover, the Government of India has voting rights in the World Bank. 

Senior Advocate Rajiv Nayar, appearing for A2Z Infraservices Limited, submitted that the debarment by either the World Bank Group or by the AIIB, and by the AFDB does not amount to either debarment by the Government, or the Government Agency. He added that, for the World Bank to be categorized as the “Government Agency”, it will have to be established that the World Bank acts as an agent of the Government of India and an agent is bound by instructions of the principal. 

Nayar has also placed reliance on the judgment of the Court of Appeals for the Federal Circuit in Case No. 2008-3004 decided on 07.05.2008 titled Philip W. Sedgwick vs. Merit Systems Protection Board, wherein the American court has held that the World Bank is not a federal agency. It has been held that the World Bank is not an agency of the Government.

He also placed reliance on the judgment rendered by the Delhi High Court in M/s GVR Infra Projects Limited vs. Union of India & Anr.-W.P. (C) 8090/2014, wherein the learned Single Judge had rejected the same submission of the NHAI, that the World Bank is a Central or State Government, or an entity controlled by the Government.

“The Government of India does not exercise control, actual or pervasive, over their affairs and that is why they have been held as not amenable to the writ jurisdiction of the High Court, as they are not considered State or other authority within the meaning of the said expressions under Articles 12, and 226, of the Constitution of India. By mere implication, the World Bank cannot be construed as a government agency when generally understood, it is not a government agency. We are, therefore, of the view, that “Government agency”– in the present context, certainly cannot be construed as encompassing within its scope, bodies like the World Bank,” the court held.

On the issue of the re-tendering process, the court held the petitioner cannot be barred from participating in it, unless the respondent amends the terms and conditions of the tender so as to specifically bar all such bidders who have been barred by international bodies, like the World Bank. /ILNS/KR/SNG/

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