The National Mineral Development Corporation (NMDC) Limited in a rare move invoked termination clause against the Bharat Heavy Electricals Limited for inordinate delay in execution of
a project.
According to NMDC, raw material handling system package (Pkg-01) was awarded to BHEL on August 1, 2011 at a cost of Rs 1,395 crore. Original date of completion was February 28, 2014.
“There is a huge delay of more than 5 years in completion of this package. Even after continuous follow up at the NMDC and at the ministry level, BHEL was not accelerating the progress of the project,” the NMDC said in a communiqué.
“The progress of the work has been abysmal, and even today, after approximately 94 months since commencement of the contract, the raw material handling system is far from completion stage,” the communiqué added.
In view of the inordinate delay and the lack of intent on the part of the BHEL to complete the project, the termination clause was invoked, the NMDC said.
A notice was served to the BHEL for termination of the contract on Wednesday.
The NMDC will now take steps for completion of the project by exploring new options.