INDIA. The Supreme Court – India’s highest judicial body – has granted Mumbai International Airport Limited (MIAL) a stay of execution relating to an earlier order from the Bombay High Court demanding a new duty free tender.
As reported, the High Court ruling ordering MIAL on 5 June to call a fresh tender for the duty free contract at Chhatrapati Shivaji International Airport. That ruling followed a claim by Flemingo International that it had been excluded unfairly from last year’s Mumbai duty free tender, initially won by ITDC/Aldeasa and later awarded to DFS Group.
In its controversial 184-page ruling, the Court set aside the duty free retail contract award and gave MIAL eight weeks to call a new tender.
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The airport company told The Moodie Report at the time that it would appeal the decision to the Supreme Court.
The Supreme Court has now issued a stay on that original order until it hears the matter on 21 July.
In arguably the most contentious part of its ruling, the Court said that even though MIAL is registered under the Companies Act it cannot be viewed as a separate entity from the state (state-owned Airports Authority of India had leased out the international airport to MIAL for 30 years).
The case has important repercussions not just in Mumbai but also in Bangalore. There Flemingo filed a similar action, claiming that it was unfairly excluded from the duty free tender at the new Bengaluru International Airport,
In assessing the Bangalore case, a Karnataka High Court judge this month drew parallels with the Mumbai ruling, which he said involved “identical issues”.
As a result of the Bombay High Court decision, the Karnataka judge has allowed counsel for the respondents – principally the airport operator Bangalore International Airport Limited – time to consider the Mumbai decision.
NOTE: Both airports – and both disputes – will be covered in the next issue of The Moodie Report Digital Print Edition – out in September – which focuses on the booming travel retail markets of Turkey, Russia, India and China. The Moodie Report will visit India next month to speak to all the major players in the country’s booming airport commercial revenues sector.
The Moodie Report India, part of our dedicated regional news section on this website, contains all stories on India’s travel retail industry dating back to early 2003. You can access it via the dropdown menu on our home page under Regional News or by simply clicking here.
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[FOOTNOTE: Click here for last week’s reaction from Flemingo Duty Free Shop Director Atul Ahuja.]
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