news details |
|
|
| Power Department pays interest of Rs 17.49 crore, fails to produce 219.30 million units | | Kalnai Hydel Electric Project suffers loss of Rs 11.20 crore | | early times report
jammu, Jan 30: Thanks to the lackadaisical approach of helmsmen Power Department, 48 MW Lower Kalnai Hydel Electric project has suffered a loss of Rs 11.20 crore and control over the execution of contract for design and engineering led to an unfruitful expenditure of Rs 25.30 crore.
As per the documents in possession of the Early Times, commissioning of 48 MW Lower Kalnai Hydel Electric Project led to unfruitful expenditure of Rs 25.30 crore. The Jammu and Kashmir State Power Development Corporation Limited could not generate 219.30 Million Units of energy per annum and had to pay an interest of Rs 17.49 crore on the term loan availed for the project. The company also failed to sequence the payment of consultancy fee with the progress of the contract which led to avoidable expenditure of Rs 6.57 crore. Despite encashment of bank/ performance guarantee of Rs 79.20 crore, the Company suffered a minimum loss of Rs11.20 crore.
The erstwhile state government granted in August 2013 approval for Design, Engineering and Commissioning of 48 MW, Lower Kalnai Hydel Electric Project (LKHEP) with an estimated completion cost of Rs 576.87 crore, including escalation during construction.
The expected design energy of the project was envisaged as 219.30 Million Units (MUs), per annum. The Jammu and Kashmir State Power Development Corporation Limited awarded in September 2013 contract for Design, Engineering and Commissioning of LKHEP on EPC44 mode to a firm at a cost of Rs 396 crore for completion within 48 months from the date of award of contract i.e by September 2017. As per the stipulation of the notification of award, the contract agreement was to be signed within 30 days from the date of issue of notification of award. The Company in October 2013 also engaged another firm as Project Management Consultant (PMC) for the work, at a cost of Rs 10.39 crore. Audit scrutiny of the records of Executive Engineer, Civil Construction Division-II LKHEP, Thathri revealed that the contractor failed to furnish performance security and seven and half months were lost between issuance of notification of award and signing in 23 April 2014 of contract agreement. The work started in May/ June 2014, was executed at a very slow pace, as only 6.39 per cent progress Rs 25.30 crore was achieved in October 2017. Despite assurances, the contractor failed to finalise the design and engineering activities and accelerate execution of work. Company did not take any action against the contractor for delay.
Time extension sought (July 2017) by the contractor was not granted and the Company decided (September 2017) to terminate the contract. However, the bank/ performance guarantee of Rs 79.20 crore available with the Company was only encashed (September 2017) and the contract was not terminated. After incurring the expenditure of Rs 65.68 crore, the project work was suspended (October 2017) and could not be resumed (December 2018). Company could not generate envisaged 219.30 MUs of energy annually, valuing Rs 78.73 crore49 and had to pay an interest of Rs 17.49 crore during 2015-19, on the term loan of Rs 45 crore availed for the project.
Despite encashment of bank/ performance guarantee of Rs 79.20 crore, Jammu and Kashmir State Power Development Corporation Limited could not recover the expenditure of Rs 90.40 crore50 incurred on the project so far and suffered a minimum loss of Rs 11.20 crore.
Documents reveal that due to deficient contract management, the payment of consultancy fee to PMC was not sequenced with the progress of work of the EPC contract. Payment clause, among other things provided that the interim payments for consultancy services rendered were to be made in monthly intervals upon presentation/ compilation of the monthly invoices by the consultant. Company released 70 per cent (Rs 7.23 crore) consultancy fee, against 6.39 per cent (Rs 25.30 crore) work executed by the EPC contractor (February 2018), thereby resulting in avoidable expenditure of Rs 6.57 crore. |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| |
|
|
|
|
 |
|
|
|
|
STOCK UPDATE |
|
|
 |
| BSE
Sensex |
 |
| NSE
Nifty |
|
|
| |
CRICKET UPDATE |
|
|
|
|
| |
| |
|
|
| |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
