Financial Daily from THE HINDU group of publications
Wednesday, Sep 08, 2004
Financial Daily from THE HINDU group of publications Wednesday, Sep 08, 2004 |
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Roadways Association locks horns with AP Govt over builder's suicide Our Bureau
Hyderabad , Sept. 7 THE Andhra Pradesh Centre of the Builders Association of India (BAI) here on Friday said that Soham Constructions Pvt Ltd (SCPL), which was constructing the flyover near the State Secretariat, would not complete the project until the State Government reimbursed the escalated cost of the project amounting to Rs 15 crore. The association would also not allow any other contractor to take up the flyover work in protest against the indifferent attitude of the Government to the plight of SCPL Managing Partner, Mr V. Suresh, "who committed suicide last Saturday after incurring a loss of Rs 13 crore in executing the project". The association members have also resolved not to submit tenders for the five new flyovers proposed to be constructed by the Government in the city. Addressing a joint press conference here on Tuesday by the office-bearers of the association, Mr M.A. Razack, Mr N. Sachitanand Reddy, Mr C. Raghava Reddy, Mr S.N. Reddy, Mr K. Sudershan Reddy and Mr V. Sudhakar Rao, alleged that Mr Suresh of SCPL was forced to take the extreme step due to "financial distress arising out of the lopsided contracting system of the Government." Narrating the sequence of events, they said that the flyover package was awarded to SCPL in 1996 for Rs 18.61 crore. It had been scheduled to be completed in 18 months but it took eight long years and was still incomplete. Ever since the contract was awarded, SCPL was asked to stop work on "trivial" grounds. For some time, the Government was in a dilemma on whether the flyover should be directed towards lower tank bund or tank bund. Later, a controversy broke out over the shifting of the Ambedkar Statue from Tank Bund crossroads. Even now, they said, the officials have asked to stop the project till the completion of Ganesh idols immersion on the occasion of Vinayaka Chathurthi celebrations this month. Thus, for no fault of the contractor, the project was delayed for eight years. Meanwhile, the prices of construction material, like cement and steel increased steeply. The steel price had increased from Rs 13,000 to Rs 27,000 per tonne. The price of diesel was also doubled. But, despite several representations made by Mr Suresh, the Government did not reimburse the escalated costs, as there was no escalation clause in the contract. This has caused huge financial loss to SCPL, leading to its managing partner committing suicide.
More Stories on : Roadways | Real Estate & Construction | Andhra Pradesh
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