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Nitin Gadkari asks NHAI to put in abeyance scrapping of road projects

"We will rectify those which can be rectified. We will further examine those which cannot be rectified and will terminate which cannot be solved," Gadkari said.

By: PTI | New Delhi |
November 9, 2017 10:14:48 pm
“We will rectify those which can be rectified. We will further examine those which cannot be rectified and will terminate which cannot be solved,” Gadkari said.(PTI photo)

Asking NHAI to put in “abeyance” scrapping of 20 highway projects till “case by case review” is done, Union minister Nitin Gadkari directed the Authority to debar a defaulting developer only after completion of any pending legal proceedings.

“It is not that only developers are at fault. At times, we (NHAI) have not provided them with adequate land and regulatory clearances. So, I have asked the NHAI to review the matters case by case. I will also personally examine each case and then only take further decision,” Gadkari told after chairing a high-level meeting on the issue.

The road transport, highways, shipping, water resources, river development and Ganga rejuvenation minister said each case will be reviewed with “full transparency” as it is the infrastructure sector that impacts the economy.

“I have directed the NHAI to review these cases and undertake detailed examination of each case on its own merits, examine the same from legal sustainability, if required,” the minister said.

Directions have also been issued to debar any defaulting developer only after completion of any pending legal proceedings.

The minister said, “We have taken a slew of positive steps. At the time I took over, as many as 403 projects involving an investment of Rs 3.85 lakh crore were stuck. We solved the problems by a series of meetings with bankers and developers with full transparency and with a positive approach. We took 22 Cabinet decisions,” he said.

“We will rectify those which can be rectified. We will further examine those which cannot be rectified and will terminate which cannot be solved,” Gadkari said.

The NHAI last week had uploaded a list on its website, which it withdrew later, containing details of 20 projects terminated by the regulator after April 2014 due to the contractor’s default in which developers were asked to make representation to the NHAI headquarters by November 6.

It has also uploaded names of companies such as Larsen and Toubro, HCC and Essel Infra Projects and the period for which they were barred from bidding for projects.

Meanwhile, a statement from the ministry said, “In cases where the termination of projects and the consequent debarring of any of the construction agencies had been stayed in any pending arbitration proceedings or by any court orders, the decision in such cases should be taken only after completion of the legal proceedings, unless the adjudicating body/court had refused to intervene or decline any interim relief on the termination orders.”

In cases where the NHAl does not receive any representation in response to its show-cause notice, the cases should be decided as per law after following the due process, the statement added.

The NHAI earlier this week had said it will maintain a “status quo” on its decision to scrap 20 contracts and will consult all stakeholders, including highway developers body NHBF and the road transport ministry.

The development came barely days after Gadkari had told PTI that he would chair a meeting of highway developers and officials from the NHAI and the road ministry to look into issues facing the sector.

Taking a strong exception to the NHAI move, highway builders federation NHBF has earlier said none of the companies that have been debarred for the next 2-3 years were issued any kind of show-cause notice or given an opportunity to represent before they were put to shame in public.

The highway builders’ body in its letter to Gadkari and Principal Secretary to Prime Minister, Nripendra Mishra, has said, “Even assuming that the NHAI falls under the definition of a state instrumentality and thereby it has powers to blacklist an entity flows from the executive power to carry out the trade/business, it has no authority to upload such document in the public domain.”

The letter stated, “This unilateral action of the NHAI has totally shaken the confidence of the developers/contractors community, especially when the Ministry of Road Transport and Highways is coming out with ambitious development of national and state highways including the Bharatmala scheme.”

When contacted, infrastructure major L&T has said termination cannot be treated as its default.

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