The Supreme Court on Tuesday gave time till November 30 to a Government firm appointed by it to determine the cost of Ghazipur abattoir project that has been a bone of contention between the MCD and M/s Food Processing Equipment Company Pvt Ltd, entrusted with execution of the project.
A Bench headed by Justice Ashok Bhan directed IL&FS Infrastructure Development Corporation Limited to decide the final cost of the project within the stipulated time taking into consideration the escalation in prices of raw material, additional machinery and new taxes that have come into effect.
The court has already made it clear that the decision of the IL&FS regarding the cost of the project for the state-of-the-art slaughter house in East Delhi would be final and binding on the parties.
As the MCD and the contractor kept finding fault with each other, the June 30, 2006 deadline fixed by the court for the completion of the project expired.
The Bench also directed the MCD to release Rs 12 crore to M/s Food Processing Equipment Company Ltd out of the expired bank guarantee furnished by it to enable it to take delivery of the remaining machinery.
The MCD has already paid a sum of Rs 87 crore to the contractor.
The Bench expressed concern over the slow progress in the construction of the slaughter house. Central Pollution Control Board (CPCB) counsel Vijay Panjwani submitted that the contractor must complete the civil work at the earliest so that the machines can be installed. He said the machines were lying at the cargo since October 13.
The court asked the contractor, which had threatened to pull out of the project, to continue with the work. Earlier, the contractor had categorically said, "it cannot do the work on the rates being given by the MCD."
The initial cost of the project was estimated to be Rs 65 crore with a capacity of 2,500 animals a day but it was revised after the capacity was sought to be doubled.
While the contractor is demanding Rs 150 crore for completion of the work, the MCD says the cost would not exceed Rs 106 crore. The contractor claimed it would lose an amount of Rs 43.51 crore if it accepted the rates offered by the MCD.
Claiming that it has already done work for more than the advance given to it, the contractor had said the bills pending with the MCD was to the tune of Rs 67.06 crore even after adjusting the Rs 16 crore paid to it on the orders of the court.
It had requested the court to direct MCD to release the bank guarantees and pay the bills so that "the needless outstanding financial exposure of the contractor which is almost Rs 145.17 crore is done away with."