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Visakhapatnam , Nov. 10

LARSEN and Toubro and Nagarjuna Construction Company on Monday bagged two different contracts for bringing Godavari waters from the Kanithi reservoir to Narava filtration plant through a pipeline. Amid high drama, the Visakhapatnam Municipal Corporation general council rejected the two financial conditions set by the lowest tenderer, Indian Hume Pipe Company Ltd, in both the contracts.

L&T also bagged the main Rs 582-crore Vizag industrial water project to divert the Godavari waters from East Godavari to Kanithi reservoir through a pipeline. The State Cabinet took a decision to that effect on Saturday.

Amid allegations by some Congress corporators that the second lowest bidder had colluded with the lowest bidder and corporation officials in both the contracts, the first package was awarded for Rs 21.62 crore (about 30.48 per cent lower than the estimated cost) and the second package for Rs 22.04 crore (27.27 per cent less than estimate) to L&T and Nagarjuna Constructions, respectively.

The VMC had asked all bidders to revalidate their tenders after the expiry of the 120-day period; during that time, Indian Hume Pipe Company sought 75 per cent of the amount as advance for mobilisation of works on the invoice price of pipes against the allowable 10 per cent. It had also sought increase in the tender value based on the increase in the steel prices before completion of the project. These conditions were found unacceptable by the council and the second lowest bidder was chosen in both the cases.

Mayor Rajana Ramani refused to take note of the protest of her own party corporator, Mr K. Venkata Rao, against awarding the contract to the second lowest bidder in both the contracts. He had alleged that the whole process had been rigged and wanted the tendering process started afresh. Walking out of the council hall in protest, he called her "a Telugu Desam Mayor" and alleged that she was acting on the directions of the TDP and BJP leaders.

The Municipal Commissioner, Mr Navin Mittal, earlier explained that the VMC had already lost Rs 1.75 crore in the form of difference in the bid value between the lowest and second lowest bidders and if the tendering process was cancelled, it would take another four months for the process to be completed and project would get delayed. Delay by each month from April would cost the VMC about Rs 1 crore as it had to pay for the minimum committed quantum of Godavari water to the Visakhapatnam Industrial Water Supply Company and the bidders could quote more, resulting in a loss of more than Rs 9 crore, he explained to the corporaters, urging them to take a pragmatic view.

There were suggestions from the Congress corporators to scrap the current tendering process and go ahead with a short tender, which the Commissioner said was not feasible under the HMC Act. The Visakhapatnam-I MLA, Mr K. Haribabu of the BJP, appealed to the corporators not to take the drastic step of cancelling the tenders as that would result in a huge loss to the Corporation.

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