The Brihanmumbai Municipal Corporation (BMC) has decided to levy a hefty penalty on its contractor, United Phosphorous Limited (UPL), following several complaints over delayed in closure of the Deonar dumping ground.
As per the work schedule, by December 2010, UPL was supposed to construct and operate a 1,000-tonne landfill and composting plant, which would convert organic waste into manure. However, the construction of the plant is yet to start.
The civic body is treating the delay very seriously and will be levying a penalty at the rate of Rs50,000 per day till the plant is made operational.
Considering that the delay is over a year, the penalty will be at least Rs 1.8 crore, which will be deducted from the final payment to be made to the contractor. “There is a delay in work, for which we have withheld payment to UPL since March. UPL has promised to expedite work and would complete at least one compost plant by May next year,” said additional municipal commissioner Mohan Adtani.
Civic officials told HT that the payment that has been withheld is around Rs40 crore. UPL has also been penalised on previous occasions and the total penalty amounts to Rs 13.5 crore.
Suketu Shah, COO of UPL, said that the holdup in setting up the plant was due to the BMC's delay in signing agreements. “It’s a Public-Private-Partnership project for which, a concession agreement and a land lease agreement needs to be inked between both parties. In absence of these, no bank will disburse funds, and hence the work slowed down,” he said.
Shah said that the scientific closure will be completed within the next 12 months, subject to signing of agreements. UPL has started work of scientifically closing the Deonar dumping ground a year and a half ago. The controversial contract is worth over Rs 3,000 crore.