NMDC Serves BHEL Termination Notice For Delaying A Project At Nagarnar Steel Plant
BHEL was in 2011 awarded a contract to set up a raw material handling system at NMDC’s under-construction Nagarnar steel plant in Chhattisgarh. (Photographer: Nelson Ching/Bloomberg)

NMDC Serves BHEL Termination Notice For Delaying A Project At Nagarnar Steel Plant

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NMDC Ltd. has sent a termination notice to state-owned Bharat Heavy Electricals Ltd. for not completing a contract to set up a raw material handling system at the miner’s under-construction Nagarnar steel plant in Chhattisgarh, an official said on Tuesday.

On June 26, NMDC issued a notice to BHEL invoking the termination clause, after the engineering firm failed to complete the project it was awarded in 2011. The completion date was Feb. 28, 2014.

BHEL in a reply had said it “has already completed major portion of contractual scope of work and is in constant dialogue with NMDC to resolve the above issue”.

A notice of termination dated July 13, 2019, has been sent to BHEL, an NMDC official confirmed. BHEL too confirmed the receipt of the termination notice.

“Invocation of contractual clauses such as termination and provision for its redressal are part of contract management. BHEL proposes to take up matter through the redressal mechanism available for disputes resolution between CPSEs,” the state-owned engineering firm said Monday.

On Tuesday, NMDC shares rose 2.18 percent to Rs 114.90 apiece on the BSE while BHEL’s gained 0.70 percent to Rs 64.65. The benchmark Sensex ended the day 0.61 percent higher at 39,131.04 points.

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