TaxTMI 
TaxTMI 
TaxTMI 
2018 (8) TMI 1826
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....oning of Steam Generator Comprising Boiler including Drum, Structures, Pressure Parts, Non-Pressure Parts, Boiler including Drum, Structures, Pressure Parts, Non-Pressure Parts, Boiler Auxiliaries, Power Cycle Piping, Electrostatic Precipitator (ESP), Rotating Equipments & Auxiliary Boiler including Final Painting, Assistance for Trial operation, Performance Guarantee Test and Handover of the Coal fired Unit- I of 2x600 MW Kalisindh Thermal Power Project, Rajasthan vide work order No.3300002925, dated 19.08.2009. 3. It is stated by the Operational Creditor that as per clause 2.6 of the Work Order, dated 19.08.2009, the work has to be completed within 24 months from the date of commencement of the work i.e. from October 2009, but the work started on 23.10.2009 and therefore, the work had to be completed on or before 22.10.2011. 4. It is stated that as per the clause 2.D(b) of the Work Order, dated 19.08.2009, for Boiler, any activities specified in the order got delayed and carried out beyond the time schedule of the Contract, payment will be made after pro rata adjustments towards LD, if the delays are attributable to the Operational Creditor. 5. It is stated that the total cont....
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.... its work order No.3300008844 (including Service Tax). The contract completion period was 30.07.2013. 10. It is stated by the Operational Creditor that Corporate Debtor could not provide the requisite facilities for completing the project within the time. The Operational Creditor brought to the notice of the Corporate Debtor about their obligations which they could not fulfil. 11. According to the Operational Creditor, the Corporate Debtor has to provide the following facilities to the Operational Creditor:- a. Supply of materials/ parts etc. b. Delays due to other reasons:- (i) The delay in readiness of Balance of Plant and other areas (especially coal handling system, etc.) and non-availability of coal were the main reasons for delay of trial run; (ii) Platen super heater coil burst due to operation fault. It took many days to rectify the same, causing delays; (iii) Cold Re-Heat piping got damaged during operation for no fault of the Operational Creditor. It took many months to rectify the same, which caused delays; (iv) Technical fault in other area like turbine delayed Trial run and Performance Guarantee test. c. Failure to provide work Fronts; d. Supply of Dr....
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....er the same has been revised vide letter, dated 08.10.2014, and reduced the ORC amount claim to Rs. 5,49,22,446/-. 21. It is stated by the Operational Creditor that the Corporate Debtor in its letter, dated 11.12.2014, informed the Operational Creditor that Overstay Compensation beyond the Contract period is under consideration. 22. Notwithstanding the delay in payments, the Operational Creditor completed the work on 28.03.2015 and the Corporate Debtor issued the Work Completion Certificate. 23. The Operational Creditor claimed the following amounts in this Petition:- Sl. No. Particulars Amount in Rs. 1. Final Bill- Boiler and ESP (S.O. No. 3300002925) (copy of the bills acknowledged by the Corporate Debtor and approved the release of payment) 2,35,20,413 2. Retention - Boiler and ESP (S.O. No.3300002925) (copy of the bills acknowledged by the Corporate Debtor and approved the release of payment) 2,68,22,327 3. Retention - Fuel oil piping & Auxiliary piping (S.O. No.3300008844) 7,01,724 4. Overrun Compensation (S.O.No.3300002925) 5,49,22,446 Total 10,59,66,910 24. It is stated that the Operational Creditor has given a Bank Guarantee to th....
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....nowledging the dues. 34. The Corporate Debtor filed counter and stated that intentionally the Operational Creditor did not include Form-3 notice and the reply issued by the Corporate Debtor. It is stated by the Corporate Debtor that the Corporate Debtor has specifically and categorically raised the dispute as to the alleged defaulted amount and referred to various correspondence between the parties relating the dispute. 35. The Operational Creditor also intentionally not filed Affidavit of no dispute which is mandatory Under sec. 9(3)(b) of IB Code. 36. According to the Corporate Debtor, the claim made by the Petitioner is disputable one. The Corporate Debtor stated that the claim made by the Operational Creditor over an amount of Rs. 8,56,84,939/- is absolutely false. 37. The Corporate Debtor also stated that the Operational Creditor cannot claim interest of Rs. 5,30,94,661/-. 38. It is stated by the Corporate Debtor that the Petitioner completed 5398 MT as on 31.10.2011 as against the stipulated quantity of 5670 MT. The balance quantity of 272 MT was completed with a huge delay of two years from the deadline fixed for such completion. 39. The Operational Creditor is aware t....
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....t is stated by the Corporate Debtor that the Operational Creditor has been committing defaults in mobilising required manpower and resources to take up the works within the stipulated time. The Corporate Debtor requested the Petitioner periodically to commence the erection works/activities by writing letters and emails repeatedly, vide emails dated 24.05.2012, 03.06.2012, 04.08.2012, 27.08.2012, 08.09.2012. 49. The Corporate Debtor by email, dated 01.10.2012, listed out the works, which were stopped abruptly by the Petitioner, since wages to the workmen were not paid. It amounts to violation of Sub-Clause (c) of Clause No.D of the Service Order, which states as hereunder:- "Notwithstanding the dues and payments to be received from BGRESL or otherwise, the Contractor shall be liable to make payment of wages and statutory remittances etc. to their staff and labour employed as per statutory requirements." 50. The Corporate Debtor vide emails, dated 13.12.2015, 09.05.2013, 14.02.2014 and 24.05.2014, made repeated requests to complete the execution of the work. 51. It is stated by the Corporate Debtor that the due amount claimed is not crystallized and there is a dispute regarding ....
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....iquidated damages. That means, in case of breach of the terms of the Work Order/ Contract is there on the part of the Operational Creditor, the Corporate Debtor is entitled for liquidated damages. 59. One of the claim amounts is Overrun Compensation. It is stated by the Operational Creditor that the inability of the Corporate Debtor to finalise the ORC, as per the contract, is breach of contract and it effected the cash flow of the Operational Creditor. 60. According to the Operational Creditor, he is entitled to receive ORC from January 2012. According to the Corporate Debtor, the Operational Creditor is not entitled for ORC. 61. The Operational Creditor is relying upon a letter, dated 11.12.2014, issued by the Corporate Debtor to the Operational Creditor, wherein it is stated Overstay Compensation beyond the contract period is under consideration. 62. A reading of the entire letter goes to show that the Overstay Compensation is only under consideration of the Corporate Debtor and it is linked upon with the assessment of delays in completion of works. 63. Therefore, the letter, dated 11.12.2014, given by the Corporate Debtor eannot be taken as admission of payment of Overstay....
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....of contract is liable to pay damages and if so, to what amount. 73. In the instant case, as can been scene from the following correspondence, the Corporate Debtor has been raising the issue of delay in completion of works even prior to the issuance of Demand Notice. The following are the letters, addressed by the Corporate Debtor to the Operational Creditor, raising the issue of delay in completion of work. 74. Letter, dated 31.08.2014, written by the Corporate Debtor to the Operational Creditor regarding completion of Unit # 1 pending work. The following are the pending works of Unit # 1: (i) Cutting & grinding of temporary structure welded on the boiler structure. (ii) Pending work/ defects observed trial operation & completion of punch point in boiler area. (iii) Final painting of Unit # 1 Boiler structure. (iv) Cutting, grinding of temporary structure & final painting of auxiliary structure from Boiler to ESP area. (v) Cutting, grinding of temporary structure & final painting of auxiliary structure from ESP area to ID fan. (vi) Cutting, grinding of temporary structure & final painting of auxiliary structure from ID fan to Chimney. (vii) Cutting, grinding of temp....
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....to the Operational Creditor stating about the stoppage of work for ten days due to non-availability of welding electrode, gas & filler wire and stoppage of erection work for four days. 79. Letter dated 04.08.2012 addressed by the Corporate Debtor to the Operational Creditor regarding employing less manpower at katpp and requesting to increase the manpower. 80. Letter dated 03.10.2012 regarding stoppage of work for 6 days due to wages not received by the workmen. 81. Letter dated 14.02.2014 about not engaging the manpower to complete the structural works. 82. Letter dated 24.05.2014 addressed by the Corporate Debtor to the Operational Creditor regarding inability of the Operational Creditor to engage the manpower for completion of work. 83. Letter dated 11.10.2017 addressed by the Corporate Debtor to the Operational Creditor regarding employing less number of manpower. 84. The above said correspondence clearly goes to show that there is a dispute regarding the delay in completion of work. The issuance of Work Completion Certificate by the Corporate Debtor is by no means a ground to say there was no delay in completion of work. 85. Admittedly, by both parties, there is delay i....