Trial contract defaulters to get no new contract, will lose deposits

In a bold move to rap civil contractors for failing to complete the work awarded to them on their trial contracts, the BMC has decided to withhold their deposits and issue showcause notices. In May, the civic body had issued small contracts worth Rs 5 lakh for petty works on a trial basis as per the new civil work contract (CWC) system.

Based on the quality of work, the civic body will decide if the contract should be extended to the full cap of Rs 40 lakh. BMC standing committee chairman and Shiv Sena corporator, Rahul Shewale said, "This year, 31 contractors took up these contracts. Post-monsoon, two months have passed but work is yet to commence. The BMC will not return the deposit money – nearly Rs 110 crore – collected from the contractors."

Under the CWC system, the corporation collects two kinds of deposits from the contractors. While through annual security deposits, BMC collected Rs 100 crore, it has collected Rs 9.3 crore through earnest money deposit of Rs 30 lakh from each of the 31 contractors.

"It is not a question of withholding deposits. Under the new CWC system, the BMC had asked the contractors to undertake some work on contracts worth Rs 5 lakh which they have not done. So we are issuing them showcause notices," said Additional Municipal Commissioner Manisha Mhaiskar.

"The contractors will have to meet the BMC Commissioner individually and reply to the showcause notice. Based on this, the commissioner will decide how much the contractors should be fined and the money will be accordingly deducted from their deposit amount," said Shewale.

Despite a controversy over the internal note written by chief accountant Ram Dhas of the BMC that pointed out flaws in the corruption-ridden CWC, the civic body had decided to go ahead and float tenders for the two-yearly ward level contracts for the period 2012-14.

The BMC said a new system of thorough checks and balances would be introduced to ensure quality of work and avoid misappropriation of funds. Taking a cue from the internal note, the corporation decided to cut down the number of contractors from 110 to 31 for 24 administrative wards so that a proper check can be kept on the work done by each. One contractor will get to work in only one such area. Consequently, in the bids that were opened in May, contractors bid 60 per cent lower than the estimated cost -- the lowest in more than six years.

Works worth an average of Rs 16-20 crore for two years will be given to each of these contractors.

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