Centre cracks whip on Games Village builder

PTI

New Delhi, 21 October 2010: The government on Wednesday ordered confiscation of Rs. 183 crore furnished by Emaar-MGF as bank guarantee and initiation of legal action against it for recovery of other expenditure for “deficiencies” and “delays” in construction of the Commonwealth Games Village.

 

The direction by Union Urban Development Ministry to the Delhi Development Authority came a day after the civic authority submitted an interim report in which it said “immediate action” is required to be taken against the builder for the “non-execution of the project as per the agreement”.

 

Emaar-MGF, however, was unfazed by the criticism, saying “all the project milestones were achieved as per our scope of work” and the Games Village was built to the “highest standard of quality and design”.

 

In a letter to the DDA vice-chairman, the Urban Development Ministry asked the civic authority to “invoke the bank guarantee and to initiate legal action against the project developer and also take such other steps as are deemed necessary for protecting the interests of DDA.”

 

 

The directive was based on findings of the DDA about “shortcomings/deficiencies/delays” in the development of the Games Village by Emaar-MGF. Besides invoking the bank guarantee, the Ministry directed initiation of legal action against Emaar-MGF for recovery of other expenditure over and above the bank guarantee furnished by the project developer.

 

There are provisions in the project development agreement for taking legal action and invocation of bank guarantee for deficiencies and irregularities in execution of the project, the sources said. According to the interim report, the project developer failed to achieve the milestones in time and make payments to various statutory bodies agencies like Delhi Jal Board and BSES for making services available.

 

The report has mentioned large number of defects in the construction which were not attended to by the Emaar-MGF. “Such defects pertain to basement, lift pits, non-installation of required number of hydro-pneumatic pumps, water proofing of terrace, fixtures for balconies, inadequate power connection, choking of pipes, incomplete landscaping,” said the report.

 

In a statement, Emaar-MGF said it had “not received any notice for encashment” of the bank guarantee which was extended till December 31, 2010. On charges of deficiencies, it said “the Village was handed over to the DDA and the Organising Committee after full inventory of facilities/items/assets in June 2010.”

 

It said “all deficiencies pointed out by the DDA or any other agency were duly rectified by us. If there are any pending items that need rectification, they shall also be done after the Village is handed over back to us by the Organising Committee and the DDA.”