After disqualifying a road contractor for hiding vital information at the time of bidding,the Brihanmumbai Municipal Corporation (BMC) has now seized the firms earnest money deposit (EMD) totaling up to over Rs 70 lakh. After the disqualification of infrastructure firm RPS Infra,this is the first major step taken by the BMC towards monetarily penalising erring road contractors this year after repeated reports on alleged corruption in awarding the road contracts worth Rs 577 crore. Early last month,the BMC had served a showcause notice to RPS Infra,one among a group of firms that has been building city roads for years. The firm that is currently building retaining walls along the Mithi River had allegedly concealed information about its current work,including a cost escalation for the Mithi River revival project. It was later disqualified even after being awarded a contract of building concrete roads in eastern suburbs worth Rs 70 crore. Chief Engineer (roads) Satish Badve said as per the rules,one per cent of the contract cost is kept as earnest money deposit,which is taken from the contractors at the time of bidding. The security deposit is given by the contractor once he has been awarded a certain contract. In case of RPS Infra,it had paid an EMD of Rs 70 lakh (one percent of the contract worth Rs 70 crore) and Rs 17 crore as security deposit. While the latter has been returned to the firm after its disqualification,the EMD was forfeited. This is one of the rare occasions when a relatively hefty amount of fine has been levied. We hope it serves as a deterrent for other contractors in the future, said Badve. Additional Municipal Commissioner Aseem Gupta confirmed the same. The same firm was earlier demoted by the city engineers department for allegedly carrying out shoddy construction of a municipal school building. The firm has not been de-registered yet and it can bid for future BMC projects. Ketan Shah,director of the firm,said the intention was not to hide any information. We have proved our case to the top BMC officials. The difference between the amount quoted by us and the actual worth of our ongoing projects is just Rs 3 crore and it happened due to a technical mistake. We have written a letter to Gupta,asking the BMC to return the EMD since we did not have any ill intention, he said.
