Lanco Infratech [Get Quote] questioned on MOnday its disqualification from the 4,000 MW Sasan ultra mega power project but accepted the decision, even as the government said it will not bar the company from bidding in future projects.

"Lanco believes it has made a fair bid for the project and therefore, does not agree with the government's view. However, taking into consideration the larger interests of the public, Lanco respects the decision of the government," the company said in an advertisement in various national dailies.

The Hyderabad-based company was last week disqualified by an Empowered Group of Ministers, headed by Power Minister Sushilkumar Shinde.

The EGoM awarded the Rs 20,000 crore (Rs 200 billion) project on Monday to rival Reliance Energy Ltd [Get Quote]. Shinde today said Lanco has not been blacklisted and it can compete in other projects.

REL bags Sasan project; to invest Rs 20,000 cr

The government will also not forfeit Lanco's Rs 120 crore (Rs 1.2 billion) security deposit, which will be refunded after deductions to avoid litigations, Shinde said.

"They were not disqualified altogether...there were some flaws in the bidding document," he said. Lanco shares today surged 9.18 per cent on the Bombay Stock Exchange to settle at Rs 230.20 in a flat market.

Shinde also complemented Lanco's decision to accept the government's decision in wider national interest. Lanco and its partner Globeleq, Singapore, had won the project with a bid of Rs 1.19 per unit in December last year.

But dispute arose after Globeleq sold its 70 per cent stake in the consortium to Lanco and Jindal Steel. Allegations were also made that Lanco-Globeleq misrepresented facts in the bid, which ultimately led to the disqualification.