Company accused of submitting false claims with regard to the ₹62.58-crore construction project
The Roads and Bridges Development of Kerala (RBDCK) has blacklisted Marymatha Infrastructure Pvt. Ltd. for a five-year period, citing, among other reasons, the alleged submission of false claims in connection with a ₹62.58-crore construction project on the Cochin University of Science and Technology (Cusat) main campus and inordinate delay in completing the project.
The other reasons that the RBDCK cited in its proceedings on Tuesday include the company resorting to “unwanted litigations, false claims, corrupt practices, and violation of directions given by the engineer [in this case KITCO] and employer [RBDCK] in breach of the contract terms.”
The flagship project, if implemented in time, would have benefited thousands of students. On June 11, the contracting firm submitted false claims amounting to ₹14.21 crore, which were found to be substantially wrong and submitted with mala fide intention, RBDCK sources said.
The firm also falsely claimed that the High Court of Kerala had ordered not to take any action on a termination notice issued by the RBDCK during the pendency of a writ petition it had filed. This shows the firm adopting unethical ways for small gains, misguiding the court and also the RBDCK. The actions of the contractor also impacted the RBDCK’s credibility as a special purpose vehicle (SPV) before the Kerala Infrastructure Investment Fund Board (KIIFB) and Cusat. Blacklisting of the firm and barring it from participating in any bid of the RBDCK have thus become unavoidable, to prevent similar events in future, the sources added.
In September 2018, the firm was awarded the construction project as part of developing Cusat as an International Centre of Excellence in Academics and Research. The work package included construction of an academic building, international guest house, engineering wing, facilitation centre, campus rejuvenation amenities, external water supply, drainage, and waste management on the main campus.
As per the tender conditions, the firm was directed to furnish additional performance security for ‘low quoted items’. But it approached the High Court of Kerala against this and yet again in 2019. Such continuous unwanted litigations alone by the contractor resulted in loss of one year. According to the agreement executed in September 2019, the project was to be completed in 24 months. From the very beginning, work was progressing at a very slow pace, following which the firm was repeatedly directed to increase the number of workers and appoint engineers at the site. But it persistently refused to comply with various obligations under the contract agreement.
To cover up delay and defaults, the firm strangely informed its intention to terminate the agreement on false grounds, on January 8, 2021. The RBDCK apprised it that its termination request could not be accepted. But it decided to go ahead with its intention and declared that the termination came into force from January 22, 2021, although the firm completed only l8% of physical progress and 8% of financial progress of the project entrusted to it, even after consuming 75% of the time for completion.
KITCO reviewed all aspects and reported that the project suffered badly on account of multiple failures on the part of the firm and non-adherence to many contractual obligations. The firm also failed to come up with a workable solution to complete the project as per the agreement. It also demobilised some equipment and materials and reduced considerable number of labourers from the site without the consent of KITCO and in violation of contract conditions. With the firm not responding to a termination notice served by the RBDCK, the agency terminated the contract and went on to blacklist it from the project for a period of five years, RBDCK sources said.
Meanwhile, sources in the infrastructure firm said the RBDCK owed it dues to the tune of ₹21 crore. They include those for KIIFB work that was completed before April 30, 2020, since the RBDCK did not process the bills.
“We had demanded clearing of dues with interest, as per the agreement. This affected our other projects as well. It was in this situation that we issued termination notice in January 2021, which the RBDCK was opposed to. Following this, even approved bills were returned without payment. The RBDCK opted to terminate the contract now, since the KIIFB made it clear that it would not be responsible for any loss arising out of alleged non-payment of dues,” they added.
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