Pics: Nayana J C
Daijiworld Media Network – Mangaluru (NJC)
Mangaluru, Mar 14: A long-pending dispute over payment of dues to a contractor for the construction of the new building of Ladygoschen Hospital, one of the city’s major maternity hospitals, was finally resolved through a compromise in the Lok Adalat on Saturday, March 14.
The dispute concerned the pending payment to be made by Nirmithi Kendra to the contractor for the construction work. Through the settlement process in the Lok Adalat, the compensation payable to the contractor, which had risen to nearly Rs 4 crore including interest, was reduced and settled at about Rs 2 crore, resulting in significant savings of public funds.
The issue dates back to the construction of the new building of Ladygoschen Hospital during 2012–13. A dispute had arisen between the contractor and Nirmithi Kendra over payment. Both parties had initially opted to resolve the matter through arbitration.
The case was later examined under Section 34 of the Arbitration and Conciliation Act in the District Court and was subsequently referred to the Lok Adalat for settlement through conciliation.
Fourth additional district judge Sridhar Gopalakrishna Bhat, who facilitated the settlement in the Lok Adalat on Saturday, said both parties agreed to resolve the case through a compromise with the involvement of their respective lawyers.
The Dakshina Kannada deputy commissioner also participated in the conciliation process, and the matter was settled for Rs 1,83,23,040.
“The amount payable to the contractor had increased to around Rs 4 crore including interest. Through the compromise settlement, it was reduced to about half, which has benefited the government and helped save public funds,” the judge said.
In 2012–13, Rs 21 crore was sanctioned under the Corporate Social Responsibility (CSR) fund of MRPL for the construction of the new building at Ladygoschen Hospital. As MRPL did not provide an advance amount, the work could not be assigned to the Public Works Department or other government construction agencies. Hence, the district-level committee at that time decided to execute the project through Nirmithi Kendra.
A tender was called for the project, and although the estimate was about Rs 18 crore, the contract was awarded to a contractor for Rs 9 crore.
The contractor was expected to complete the work within two years, but even after three years only half of the work had been completed. Due to the delay, the then deputy commissioner transferred responsibility for the project to another contractor.
The second contractor completed the remaining work and received payment accordingly.
Meanwhile, a portion of the payment to the first contractor was withheld with penalties due to the delay in execution of the project.
The first contractor later approached the court seeking payment of the pending amount. The court directed that the dues be paid. With an outstanding amount of around Rs 1.5 crore and interest at 12%, the payable amount had risen to nearly Rs 4 crore.
The matter has now been finally settled in the Lok Adalat, with the contractor agreeing to receive Rs 1.83 crore as full and final settlement of the dues.