Pune company's Delhi-Mumbai express-way contract may be axed over delays

NEW DELHI: The National Highways Authority of India (NHAI) on Wednesday slapped an "intention to termination notice" - the final procedure before termination - on Roadways Solutions India Infra Ltd (RSIL) for failing to meet the construction target of a 35-km stretch of the Delhi-Mumbai Expressway. The physical and financial progress on this stretch in Gujarat was barely 4.9% and 4.6%, respectively, of the target.

The progress on two other stretches - 27 km and 25 km - being constructed by the company in the state is at 23% and 36%. The dismal pace of construction may push the revised deadline of the project beyond March 2028, sources said.

Pune-based RSIL is an engineering and construction company that operates mainly in the roads and highways sector. The company had bagged the packages of the expressway in Gujarat in 2021.




Suprisingly, NHAI had terminated the contract of RSIL for two stretches in March 2023 and then re-awarded them to RSIL in Nov 2023 after it again put in the lowest bid. TOI on Feb 14 had first reported how the slow progress on these three stretches, with a total length of 87 km in Gujarat, was delaying the over Rs 1 lakh crore project.

In a letter to RSIL, NHAI said the "intention to termination notice" has been issued on account of contractor's "absolute and continued non-performance". It said, "...despite the contractor having been granted repeated indulgences and more than adequate opportunities through the execution of three settlement agreements, the contractor has achieved a negligible financial progress of only 4.59% (after lapse of 16 months from the appointed date of Aug 31, 2024)".

The letter said that as per the originally envisaged timeline of 18 months commencing from Aug 31, 2024, the contractor ought to have achieved approximately 70% financial progress. Mentioning how little progress has been made even after 16 months conclusively establishes that completion of the Jujuwa-Gandeva section of the expressway by Nov 15, 2026 "is wholly impossible", it said.

The highways authority claimed that despite granting repeated opportunities and its extended assistance to the contractor, it "failed to demonstrate any improvement or to achieve the requisite progress". It said that even after three settlement agreements, the contractor failed to meet targets. "In the settlement agreements, it was specified that if it fails to achieve agreed milestones, NHAI will terminate the contract without any cure period notice. So, we have served the notice," said an official.

Cure period notice is issued to a contractor to fix any breach in 60 days. NHAI said the communication may be treated as a "15-day notice", as per the contract agreement, and after the expiry of this period, the authority "shall be entitled to terminate the contract agreement". It has also said the incomplete three packages under RSIL are creating significant public inconvenience across multiple fronts. In the case of two other sections, NHAI is likely to give a cure period notice to RSIL.
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