Jal Board fires Gammon from JICA-assisted project; company makes final exit from Guwahati

The services of Gammon Engineers and Contractors Private Limited (GECPL) has been terminated from the JICA (Japan International Cooperation Agency) assisted Guwahati Water Supply Project (GWSP) by the Guwahati Jal Board on September 28. This comes after the company’s services were terminated by the Guwahati Metropolitan Development Authority (GMDA) from the South Guwahati West Water Supply Project last month.

 With this Gammon has been made to exit from Guwahati altogether.

GWSP’s contract with GECPL, formerly Gammon India Limited, has been terminated after it failed to deliver the work. In 9 years, till August 2022, the company could complete only 65.82 percent of the allotted work.

Instead, Gammon, infamous in Guwahati for deconstructing city roads, had yet again abandoned the project midway in August 2022 without restoration of roads, manhole covers, open excavated pits, etc thus causing severe risks to the safety of the citizens.

Gammon was awarded the work of transmission main and construction of 8 service reservoirs (with a total capacity of 721 lakh litres) in February 2011. The total cost of the project is Rs. 175.71 crores. The contract duration period was for just 30 months, to be completed in September 2013.

However, failure on the part of the company to deliver the project on time, led to a total of 8 extensions of the time period, first by 17 months (to February 2015), and subsequently by 22 months (to December 2016), 23 months (to November 2018), the 7 months (to June 2019), 16 months (to October 2020), 14 months (December 2021), 5 months (to May 2022) and lastly again by 12 months (to May 2023). However, GECPL reportedly abandoned all work on the project from August 5, 2022.

Till August 2022, Gammon had completed just 65.82 percent of the allotted work that was originally to be completed in 30 months. Construction of none of the 8 water reservoirs had been completed. GWSP could fill water in only 2 of the 8 reservoirs to date.

Furthermore, 89 percent of the total length of pipelines, amounting to 31.72 kms, had been laid by Gammon, that too not in a continuous stretch of more than 2 kms. The total length to be laid was 35 kms of the pipeline.

 Of the Rs. 175.71 crores, Guwahati Water Supply Project has already made payments of Rs. 110.83 crores to the company, 63.07 percent of the total amount.

Notably, this is not the first time that services of GECPL in the JICA-assisted Guwahati Water Supply Project have been terminated. Previously, the contract was terminated in January 2018. But the order was put on hold till April 2018 after the company assured of partial commissioning of water supply within the period. Gammon also assured of completing the entire project by May 2019 else the contract was to be terminated in May 2019.

However, no such termination of the contract was undertaken despite the incompletion of work as assured.

Additionally, the Jal Board has made certain payments in advance to Gammon, which are yet to be recovered. The Board has reportedly written to GMDA, the DDO of the board for encashment of Bank Guarantee of Gammon to the tune of approximately Rs. 23 crores. It needs mention that there is ongoing litigation in the Gauhati High Court by GECPL on the bank guarantee.

In August, GMDA terminated its water supply contract with Gammon Engineers and Contractors Private Limited after the latter failed to complete the project in 13 years despite numerous extensions of deadlines.

GJB started a trial run of the JICA-assisted GWSP project in July this year. Till now 781 households have been connected, although it has the potential to supply water to 3000 households. The original target of the Rs 1,427 crores JICA-aided project was 1.35 lakh households.

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