DELHI HC - THE WORLD BANK CANNOT BE CONSIDERED AS A GOVERNMENT AGENCY

A Division Bench of Justices Vipin Sanghi and Jasmeet Singh of the Delhi High Court held that the World Bank cannot be termed as a government agency as it is not considered 'State' or other authority under Articles 12 and 226 of the Constitution of India. Moreover, it is not bound by any directions issued by the Government of India, and the Government does not exercise any control over the affairs of these bodies. 

A2Z Infraservices Limited (petitioner) moved to the bench regarding the rejection of a bidder for an electricity tender floated by the New Delhi Municipal Corporation. The bid was rejected as the World Bank debarred the petitioner till November 11, 2024. Clause No. 20(r) of Chapter II of the Request for Proposal (RFP) document mandated the disclosure of such debarment/ blacklisting by any government agency. However, the petitioner failed to disclose in the undertaking that the world bank has debarred A2Z Infraservices. 

The primary issue in the instant case was whether the World Bank could be considered as a government agency in terms of clause 20 (r) of the tender conditions?

Advocate Mini Pushkarna, appearing for NDMC, stated that the World Bank has representatives of India on its body, and the Government of India also held voting rights in the World Bank. Rajiv Nayar, Senior Counsel for the petitioner, argued that in order to categorize the world bank as a government agency, it would have to establish that the world bank had acted as an agent of the Indian Government. An agent would have to be bound by the instructions of the Government of India, and it could not be said that the World Bank acted on the instructions of the Government.

After hearing the rival contentions, the Court ruled that authorities like the World Bank cannot be considered as government agencies. Therefore, the petitioner cannot be barred from participating in the tender process.

Author: Papiha Ghoshal