CHENNAI: The Madras High Court has ruled that private developers posed no impediment for the development of the Pondicherry Port on a Build, Own and Transfer (BOT) basis.

Passing orders on two public interest litigation petitions challenging the private participation and alleged "real estate activity" in the port development, the First Bench, comprising Chief Justice A.P. Shah and Justice K. Chandru, said work on the project would continue only after obtaining clearance from the Union Ministry of Environment and Forests. It also warned the developers concerned against indulging in any real estate activity in the name of ancillary development.

The Bench said: "Even though the detailed project report submitted by the developers has certain basis to generate a grievance vis-à-vis construction that does not strictly come under port development, it should be made clear that such an activity can never involve construction of five-star hotels, trade centres and beach resorts, as these do not come under the proposal to develop the Pondicherry Port."

The Bench asked the Ministry of Environment and Forests to take note of the petitioners' objections and give them a written or oral hearing. It also directed the Pondicherry administration to "see that the project would be implemented in its letter and spirit for the development of the port." The petitioners — C.H. Balamohan and Villianur Iyarkkai Padukappu Maiyam — sought to quash a Government Order dated January 21, 2006 and a consequential memorandum dated January 24, 2006, on grounds that the developers were identified without calling for tenders and that the entire exercise was outside the jurisdiction of the Pondicherry Government.

They said the Government had failed to verify the developers' antecedents and alleged mala fide and extraneous reasons for awardingthe project. Additional Solicitor-General of South India V.T. Gopalan, appearing for the Pondicherry Government, argued that none could permit any construction activity in the prohibited coastal regulatory zone and assured that the project would undergo environmental impact assessment. Besides conducting the mandatory public hearings, specific issues raised by the petitioners would also be considered, he said.

Counsel for the developers submitted that they had no intention to make it a real estate venture, and added that the main project was to develop the port.

After perusing the records, the Bench concluded that there were neither mala fide nor extraneous reasons for granting approval to the project.

Pointing out that the Pondicherry Port was only a minor port under the Indian Ports Act 1908, the Bench said: "The State Government has full jurisdiction to develop it."

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