NHAI suffers Rs 400 cr loss on non-recovery of damages from builders
National Highways Authority of India (NHAI) suffered losses of about Rs 400 crore on various counts including undue favour to developers by not recovering damages for project delays, government auditor CAG has said.
Indicting NHAI for undue favour to a developer on a stretch, CAG in its latest report said it cost NHAI a loss of nearly Rs 100 crore.
"NHAI extended undue benefit to the concessionaire to the tune of Rs 99.27 crore by not taking prompt action to recover the damages and maintenance cost from the concessionaire on account of its failure in achieving the project milestones and in meeting the maintenance obligations," CAG said in its report tabled in Parliament yesterday.
It said NHAI in March 2012 had entered into a concession pact with Vijayawada Gundugolanu Road Project Pvt Ltd for six laning of Vijayawada-Gundugolanu section of NH 5 but served termination notice as work was not commenced till August 2016.
"By that time, an amount of Rs 99.27 crore had become recoverable" but "NHAI failed to safeguard its financial interests as it neither encashed the bank guarantees submitted by the concessionaire nor recovered the dues from the Escrow account," the report said, adding that it failed to recover the damages.
Likewise, it said that the Authority failed to recover damages of Rs 85.19 crore from four concessionaires on account of delayed/non-completion of work in four road widening projects in Andhra Pradesh.
It further said: "NHAI failed to collect the toll at two toll plazas even after completion of the project relating to strengthening and upgradation of Karur-Coimbatore section of NH-67 which resulted in revenue loss of Rs 142.28 crore."
It added that the Authority also extended undue favour to a developer amounting to Rs 25.67 crore by not levying penalty for delay attributable to the concessionaire in construction of Railway Over Bridge (ROB) at Sitamarhi by-pass in a project for two laning of Muzaffarpur- Sonbarsa Section of NH-77 in Bihar.
Many other cases were also cited by the CAG.(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)