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Saturday, December 05, 2020

Overruling own decisions, Baghel govt spares Tatas Rs 200 crore penalty

This penalty was as per terms of the agreement between the company and the state and its imposition was a decision ratified by a Chief Secretary-led committee, records investigated by The Indian Express have found.

Written by Gargi Verma | Raipur | Updated: October 29, 2020 5:14:38 pm
A Common Service Centre in Korba district awaits fibre internet connection under BharatNet Phase II. (Express Photo: Gargi Verma)

OVERRULING THE decisions of two IAS officers who were successive CEOs of the key nodal agency for a Rs 3,057-crore rural broadband project, the Bhupesh Baghel-led Congress government in Chhattisgarh decided not to deduct Rs 200 crore in penalties it had imposed on Tata Projects Ltd for twice not meeting its deadline.

This penalty was as per terms of the agreement between the company and the state and its imposition was a decision ratified by a Chief Secretary-led committee, records investigated by The Indian Express have found.

That’s not all — the state government also refunded a Rs 28.79-crore penalty already levied, despite having granted Tata Projects an extension of timeline twice in two years.

Awarded to the company in July 2018, the BharatNet Chhattisgarh project was originally scheduled to be completed in a year. It involves laying an optical fibre network covering 32,466 km, linking 85 blocks and 5,987 gram panchayats across 27 districts in the state.

The lighting up of gram panchayats in Chhattisgarh with internet is part of the nation-wide BharatNet project, one of the flagships under Prime Minister Narendra Modi’s Digital India plan, and aims to connect 2.5 lakh villages.

As on September 25, 2020, Tata Projects could ensure broadband-ready infrastructure in only 1,394 gram panchayats (24 per cent of the target). A detailed questionnaire mailed to Tata Projects Ltd on October 26 did not elicit a response.

Under Sameer Vishnoi, appointed on January 23 as its CEO, the Chhattisgarh Infotech Promotion Society (ChIPS), a nodal agency of the state tasked with monitoring the project, set aside the decisions of its two past CEOs – Alex Paul Menon and KC Devasenapathi, both of whom had invoked the penalty on Tata Projects for not adhering to timelines mutually agreed upon.

But these decisions were set aside by Vishnoi. When contacted, he admitted not much work had been done when he joined in January this year. “The work picked up only in the past six months. We started with only 33 gram panchayats in February, and now within a fortnight, we will inaugurate 1,200-1,500 villages,” he said.

Asked why he decided to stop withholding the penalty and refund the amount already levied, Vishnoi told The Indian Express, “Earlier, procedure was not followed. I stopped so that we can restart the penalty procedure.” He said that a fresh notice for invoking penalty has now been issued to Tata Projects.

As per the original Master Services Agreement, Tata Projects was required to ensure end-to-end completion and integration of 10 percent of total gram panchayats with State Network Operations Centre (S-NOCs) by October 26, 2018. Having failed to do so, then CEO of ChIPS Alex Paul Menon invoked a penalty equal to Rs 164 crore (10 per cent of Rs 1,674.62 crore, the total capital expenditure) on November 3, 2018, after issuing three notices beginning August 2018.

With projected milestones not being met, KC Devasenapathi, who was appointed CEO of ChIPS in January 2019, invoked the maximum penalty equal to Rs 200.95 crore (12 per cent of total capex of Rs 1,674.62 crore) on February 23, 2019.

Not only that, ChIPS extended the project completion deadline by six more months on June 22 this year, beyond the 12-month extension already allowed earlier that had expired on June 17. Tata Projects, however, has sought more time given Covid19 restrictions, but a decision on this request is pending.

When contacted, Subrat Sahoo, Additional Chief Secretary, Chhattisgarh, told The Indian Express that a penalty was never issued. “We have just sent them a show cause notice of penalty. The money that was given to them is their money, kept as security deposit as in all standard tenders. About 90 per cent payment is generally made and the balance 10 per cent is given after checking the work quality. This is general practice,” he said.

(With inputs from Aashish Aryan in New Delhi)

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