Mumbai: Bombay High Court Restrains BMC's Actions Against RSIIL Amid Contract Termination Dispute

Mumbai: Bombay High Court Restrains BMC's Actions Against RSIIL Amid Contract Termination Dispute

The Bombay High Court has asked the BMC to file its reply affidavit by January 5 and kept the matter for hearing on January 9, 2024.

Urvi MahajaniUpdated: Thursday, November 30, 2023, 09:37 PM IST
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The Bombay High Court on Thursday restrained the Brihanmumbai Municipal Corporation (BMC) from taking any coercive, curative, or further punitive action against Road Solutions India Infra Ltd (RSIIL), the firm whose contract for concretising city roads was terminated as it failed to commence work after ten months of awarding the contract.

The BMC had issued the tender for Rs 1,033.11 crore for concretisation of 297 roads in the city. The work was to be completed in 24 months, minus the monsoon season. The civic body has awarded contracts for concretisation of 397 roads to five firms totaling over Rs 6,000 crore.

BMC imposed penalty

“Until the next date of hearing, the BMC will not take any coercive, curative, or further punitive action against the petitioner, including monetary or financial terms in whatsoever nature,” said a division bench of Justices Gautam Patel and Kamal Khata.

The BMC had also imposed a Rs 52 crore penalty and forfeited the earnest money.

Order passed 'without prejudice'

The bench, however, refused to restrain the BMC from issuing a fresh tender for the same. It has granted liberty to the contractor to approach the court in case a fresh tender is issued.

The bench, however, clarified that the order was passed “without prejudice” to any of the parties and does not create any equity in anyone’s favor.

BMC's termination decision challenged

The BMC floated a tender for concretisation of several city roads. After due process, the contract was awarded to RSIIL in January, and the work order was issued on January 4, 2023. The contract was terminated on November 9, stating that the contractor has not commenced the work even after 8-10 months of awarding the contract.

RSIIL’s counsel Janak Dwarkadas submitted that the work was delayed as the civic body failed to get the NOC from the traffic police department, which is mandatory for doing any road work in the city. He pointed out that the firm prepared a Work Programme and submitted the same to the BMC in January itself. Along with the work order, the firm prepared the application for seeking NOC from the traffic department and gave it to the BMC. The BMC has to then forward the same to the traffic department, which then processes the same.

As per the work programme, the date of commencement of work was February 3. However, the work could not commence as the civic body failed to get the requisite NOC from the traffic department, Dwarkadas submitted.

The firm had submitted a detailed reply to the BMC’s show-cause notice. The counsel further alleged that they were not given a hearing.

BMC advocate Joel Carlos informed the court that they had taken the firm’s reply into consideration while passing the termination order.

The Bombay High Court has asked the BMC to file its reply affidavit by January 5 and kept the matter for hearing on January 9, 2024.

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