The Kerala High court issued a stay order on the construction of the Rs 5,000 crore Vizhinjam Port Transshipment Terminal Project in Kerala, which was awarded to Hyderabad-based Lanco Infratech. The ruling comes in response to a petition, filed by Mumbai-based Zoom Developers, whose bid for the port project was disqualified on technical grounds. The divisional bench, headed by chief justice H L Dattu, has given 15 days to the evaluation committee to look into the tender quotations, submitted by Zoom.

The court also quashed the report of the high powered committee, set up by the State Government, disqualifying Zoom Developers from participating in the bid. Minu Patriwala, vice president-infrastructure, Zoom Developers said, "Our net present value of the bid is over Rs 110 crore, as against Rs 33 crore offered by Lanco. The Kerala government was very secretive in awarding the contract to Lanco and disqualifying us, when the same technical bid was approved earlier." The Lanco-led consortium was awarded the project in May 2008. Lanco had tied-up with Pembinan Radzai Sdn Bhd (PRSB) of Malaysia, to execute the work.

The Vizhinjam port boasts of a natural 15 metre draft, which can accommodate very large ships and is planned as a transshipment hub in the west coast of India.

Currently, the traffic coming to India from western countries gets transshipped at Colombo port in Sri Lanka and at Salalah Port in Oman. Although the court ruling might get Lanco out of the project, analysts feel it will not impact the stock adversely.