The Madras High Court on Tuesday (3 February 2026) stayed the tender award for the proposed 14.2-km-long elevated corridor from Tiruvanmiyur to Uthandi on the East Coast Road (ECR) in Chennai, restraining the Tamil Nadu government and the Tamil Nadu State Highways Authority (TANSHA) from issuing any work order until further orders.
The interim order was passed by the First Division Bench comprising Chief Justice Manindra Mohan Shrivastava and Justice G. Arul Murugan on a writ appeal filed by Dilip Buildcon Limited, challenging the award of the ₹2,100-crore project to KNR Constructions Limited and the rejection of its own technical bid.
The Bench directed that the work order should not be issued until the next date of hearing and instructed the High Court Registry to list the appeal on 12 February 2025. The judges clarified that the interim order would not prevent TANSHA from communicating to Dilip Buildcon the reasons for rejecting its technical bid on 24 December 2025.
The appeal arose from the dismissal of a writ petition by a single judge on 29 January 2025, in which Dilip Buildcon had sought a direction to TANSHA to reconsider its technical bid.
Senior counsel C Manishankar, assisted by advocate M. Ashwin Kumar, contended that the rejection of the company’s technical bid was done without assigning any reasons and that no qualitative assessment of the bid had been undertaken. The petitioner further alleged that it was kept completely in the dark regarding the manner in which the technical evaluation was carried out.
Dilip Buildcon claimed it had quoted a bid that was ₹600–700 crore lower than that of KNR Constructions. It also pointed out that one of the conditions prescribed in the Request for Proposal (RFP) required that bidders should not be blacklisted or debarred from participating in tender processes.
In this context, the appellant alleged that KNR Constructions had been blacklisted in May 2025 by the Union Ministry of Road Transport and Highways, and that the National Highways Authority of India (NHAI) had disallowed KNR from participating in any ongoing or future bidding processes following the collapse of a road on NH-66. Despite this, KNR’s bid was accepted, the petitioner submitted.
Madras HC stalls a shady tender award of Rs-2100 crore for the ECR elevated corridor.
Tamil Nadu highways department chose a “black listed contractor” who wasn’t even the L1 – lowest bidder. The L2 contractor – Dilip Builcon – moved the court arguing he bid Rs 600-700 crore… pic.twitter.com/ydGhRkViNF
— Omjasvin M D (@omjasvinMD) February 4, 2026
Opposing the appeal, Advocate General PS Raman, appearing for the State government and TANSHA, reiterated that the Tamil Nadu Transparency in Tenders Act, 1998 does not contemplate disclosure of reasons for rejection prior to the award of the tender. He submitted that negotiations were underway with KNR Constructions to reduce the quoted amount and that the reasons for rejecting Dilip Buildcon’s technical bid would be uploaded on the tender bulletin board only after the award was finalised. He also argued that the tender process could not be stalled at an intermediate stage.
Senior counsel Vijay Narayan, appearing for KNR Constructions and assisted by advocate Vaibhav R Venkatesh, denied allegations of preferential treatment. He submitted that KNR was fully eligible to participate in the tender when the notification was issued on 25 August 2025, and that the extension of the bid submission deadline was only to clarify doubts raised by bidders and not to accommodate his client. He further pointed out that KNR Constructions had executed several major infrastructure projects across the country, including a 10.10-km elevated highway along Avinashi Road in Coimbatore.
Source: The Hindu
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