BMC fails to recover ₹64-crore penalty from SoBo road contractor
BMC fails to recover ₹64.60 crore penalty from terminated contractor, dragged to court. Former corporator demands action and status report by June 1.
MUMBAI: Four months ago, the BMC terminated the contract of a South Mumbai cement-concrete road contractor for inadequate work. However, it has failed to recover the penalty of ₹64.60 crore within 30 days from the contractor.
“This is the first case in which a contractor dragged the BMC to court after the termination of the contract,” said former BJP corporator Makarand Narwekar, adding that only 25 percent of cement-concrete road works have been completed since Jan 2023. “A status report must be published by BMC on June 1.”
Narwekar wrote to BMC chief Bhushan Gagrani on Friday, demanding that a special counsel be appointed to fast-track the arbitration process. In November 2023, the BMC terminated Roadway Solution India Infrastructure Ltd (RSIIL)’s contract with a penalty of ₹52 crore, which was challenged by the contractor in the Bombay high court. Subsequently, following the directions of the HC, the BMC re-evaluated the case in January 2024 and terminated the contract with a penalty of ₹64.60 crore.
“The BMC order stated that the penalty dues must be paid within 30 days. However, despite the passage of four months, the contractor has not paid any penalty dues,” said Narwekar in his letter.
The former Colaba corporator said that instead of paying the penalty, the contractor dragged the BMC into arbitration. “I demand that the BMC file a civil suit against the contractor for the recovery of the penalty. Why is the BMC dragging its feet and allowing the contractor to take the civic body for a ride? The civic body must act sternly with contractors, as taxpayer money is involved,” stated Narwekar.
HT had reported on Friday how NCC Ltd was the lowest bidder for the ₹1,300 road tender in South Mumbai and would take up works left incomplete by RSIIL.
Narwekar further raised the issue of delays in road concretisation projects across the city and demanded a status report from the BMC. CM Eknath Shinde had instructed the BMC to concretise all city roads. Out of 2,050 km of roads in Mumbai, over 1,200 km of roads have been concretised so far.
“While no road works have commenced in the island city, the BMC has awarded a contract for concreting 397 km of roads in the eastern and western suburbs,” remarked Narwekar. “Despite setting an ambitious target of completing 40 percent of works before the monsoon, it has been able to complete only 25 percent so far.”
The former corporator added that when the cement-concrete road contracts were awarded in January 2023, 50 stretches were to be taken up and were supposed to be ready before the 2023 monsoon. Four hundred stretches were to be taken up from October 2023 to May 2024 and the last 450 stretches from October 2024 to May 2025. “Whether these deadlines have been achieved or not will only be clear through a status report,” said Narwekar.