The Delhi High Court has refused to grant interim relief to Karanja Terminal and Logistics Pvt. Ltd., which had challenged the decision of a consortium of banks led by Canara Bank and comprising Punjab & Sind Bank and Bank of Baroda to annul an earlier One Time Settlement (OTS) process and initiate a fresh bidding.
The petitioner had submitted an OTS proposal offering ₹472.10 crore to settle its outstanding dues. Canara Bank and Punjab & Sind Bank approved the proposal. However, Bank of Baroda did not grant its consent. Before the approval process could be concluded, the consortium decided to cancel the OTS and invite fresh bids, citing better value realisation.
Challenging this decision, the petitioner argued that acceptance by 75% of the lenders, as provided in the Bid Process Document (BPD), was sufficient for the OTS to attain finality. It contended that the Letter of Award (LoA) issued on July 7, 2025, evidenced a concluded contract, and that the subsequent cancellation was arbitrary, mala fide, and contrary to legitimate expectations.
The consortium banks opposed the petition, asserting that the LoA could not be treated as a concluded contract without unanimous approval from all consortium lenders.
The Court agreed with the banks, holding that no concluded agreement existed and that the petitioner could not rely on partial approvals to claim contractual finality. Justice Vikas Mahajan observed that the fresh bidding process had already attracted a higher offer of ₹520 crore, nearly ₹50 crore more than the petitioner’s proposal.
Finding no prima facie mala fides in the lenders’ decision, the Court dismissed the plea for interim stay.
The matter has been posted for further hearing on December 17, 2025.
Appearances
Petitioner- Mr. Sandeep Sethi and Mr. Sudhir Nandrajog, Sr. Advs. with Mr. Sameer Chaudhary, Mr. Preet Pal Singh, Ms. Sonali Gaur and Ms. Shakshi Kaushik, Advs.
Respondents- Mr. Tushar Mehta, Solicitor General and Mr. Nalin Kohli, Sr. Adv. With Ms. Nimisha Menon, Mr. Anoop Rawat, Ms. Arushi Chandra, Ms. Snigdha Saraff, Ms. Diksha Sharma and Ms. Charu Bansal, Advs. for R-3 to 5.
Mr. Ashish K. Dixit, CGSC with Mr. Umar Hashmi, Mr. Mayank Upadhyay and Ms. Iqra Sheikh, Advs. for R-1/UOI.
Mr. Ramesh Babu, Ms. Manisha Singh and Ms. Tanya Chowdhary, Advs. for R-2/RBI.
