The High Court hereby also cancelled a notice sent to an engineering firm involved in the project construction worth Rs. 58,000 crores.
HC was hearing on a plea filed by Navayuga Engineering Company Ltd (NECL), the engineering firm which was given the contract during the Chandrababu Naidu led Telugu Desam Party government.
The firm had approached the court after the change in the government led to cancellation of its contract, allegedly due to irregularities and non-fulfilment of contractual obligations.
Jagan led YSRCP government on July 29 had cancelled NECL’s contract that was allocated for a portion of the headworks project on the Godavari river.
The court directed the Andhra Pradesh government not to proceed with any new tenders as the government had called for fresh tenders on August 17, and allowed NECL to bid again for it.
The decision had come after Jagan in June ordered a review of contracts awarded during the TDP regime and last month an eight-member committee submitted a report and alleged problems in the whole process.
According to reports, the decision to re-tender has also been opposed by the centre government. Union Jal Shakti Minister Gajendra Singh Shekawat in parliament had said that the decision could increase costs and cause further delays in the project.
The Polavaram hydel project is a national project being executed under the supervision of the Polavaram Project Authority. The 700-MW hydel power project was also given to the same company.
This is one of the most expensive projects being undertaken by any state. However, the project cost will be borne by the centre after it was given national status as part of the AP Reorganisation Act.