The Brihanmumbai Municipal Corporation has issued a show-cause notice to RP Shah Infra Projects Ltd for concealing information during the bidding process and misleading the authorities.
In perhaps the first such instance, the civic body now plans to slap a fine on the contractor for hiding information in the bid document.
"We have issued a show cause notice to the firm and will fine them," said Aseem Gupta, additional municipal commissioner (roads).
He added that the fine amount could be deducted from the additional security deposit of Rs 16-17 crore made by RP Shah Infra Projects to the BMC.
Currently, there is no established protocol for fining contractors who mislead authorities while submitting bid documents.
The decision over the fine amount will be taken by the BMC after it receives the reply to the show cause notice. For shoddy road work, the civic body usually slaps fines ranging from Rs 5,000 to 2 lakh.
The BMC had floated tenders to execute road works in late July and had divided the work into nine smaller contracts. RPS Infra was one of the nine contractors short-listed by the civic body for a contract worth Rs 72 crore.
The contractor is currently building retaining walls along the Mithi River, a contract that it had originally bagged for Rs 97 crore.
The cost of this contract rose to Rs143 crore due to variations.
According to civic officials, RP Shah Infra did not disclose this fact while submitting the bid.
If it had, it would not have landed the job. After the disqualification of RP Shah Infra Projects, the contract has been awarded to the second-lowest bidder, Vitrag Construction Company.