New Office Building: Panchkula civic body to allot project to new company

Panchkula, June 8

After years of delay due to a fundamental breach of contract and its cancellation, followed by a court case, the Panchkula Municipal Corporation’s project of construction of a new office building in Sector 3 is now set to be allocated to a new company. The MC aims at floating tenders and completing the construction by March 2025.

The Municipal Corporation had allocated the construction of the new building in December 2019 for Rs 29.49 crore. The work was supposed to come to completion in April 2021. However, well before the project could come to completion, it was marred by a fundamental breach of tender conditions due to subletting of part of the work and a delay in execution, after which the company expressed its inability to complete the task. The contract between the MC and the company was terminated, and the firm was held liable to pay liquidated damages of Rs 2.94 crore along with a 20 per cent penalty for the incomplete work. It was debarred from the tendering process, and its bank guarantee of Rs 1.47 crore was ordered to be forfeited.

The court also directed the MC to get the work done at the risk and cost of the company. The MC then invited fresh e-tenders for completion of the pending work; however, as the court had restricted it to finalising the bids only, the company again went to court over the same. As a result, the tender process remained inconclusive.

In a recent oral order issued by a single Bench of the Punjab and Haryana High Court, it said the contract between the MC and the firm envisaged an arbitration agreement and redirected the pending disputes, including the issue of debarment and the risk and cost of the company for completion of the pending work, to the arbitration court.

It also allowed the MC to raise construction for the new building either through the existing tender, by issuing a corrigendum, or by inviting fresh tenders.

Speaker of the Haryana Legislative Assembly and Panchkula MLA Gian Chand Gupta, in a communication with journalists, said the blockages in the way of construction of the new building were removed with the disposal of the court case. He said, “The MC will issue a new tender for the pending work soon, and it will be completed at the earliest.”