Sunday , 15 September 2019
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Selaulim pipeline issue: govt wins arbitration battle



After a challenging fight for almost 18 long years, the state government won an arbitration case recently, pertaining to Selaulim water pipeline and saved around Rs 40 crore from the treasury.

Arbitrator Justice (retired) A P Lawande passed an order to this effect in a 2001 case filed by agency M/S  Karnataka Cement Pipe Factory (KCPF), Hubli, against chief engineer, PWD and EE (works division XII of PWD-Sanguem) over Selaulim pipeline dispute. 

The order, however, sends a strong message to construction companies and contractors who do not complete works in time and that cases of arbitration without proper supporting material and documents will not stand in the court of law.  

There have been allegations against construction companies and contractors that arbitration cases are filed to extract more money from the government over tendered works and many a times, they win the cases.

As regards Selaulim, it is a case of the first pipeline of 1400 mm dia that was laid in Goa under 160 MLD Selaulim water supply project (1984 to 1989) when Pratapsingh Rane was the chief minister, through a tendered amount of Rs 7.28 crore.

The tender was awarded to KCPF, Hubli for manufacturing of 1400 mm dia pre-stressed concrete pipes and transporting them at the site, laying and jointing and conducting hydraulic testing,  besides other work of treatment plant from Selaulim to Margao- a distance of 26 kms for 160 MLD SWSP.  The work was supposed to be completed within 1095 days, that is, by August 15, 1987.

As per case details, the pipeline could not be commissioned as per the schedule and it got delayed for two years. 

Sources said that then the government agreed to commission the pipeline in October 1989, leaving out minor works, considering acute shortage of water for the people of Margao and surroundings areas. The remaining works were however completed by 1991 with a separate agreement for hydraulic testing of the entire pipeline. 

The contractor released the bill in February 1996.  It was however not cleared for several alleged discrepancies.  This did not go down well with the contractor, who made a case for arbitration for Rs 21 crore in 2001. Counter claims were also filed in the court subsequently. The battle went on for 18 long years.

The case was first heard by arbitrator and former chief justice of Gujarat High Court, J D Kamat.  The final award, that was presented by the sole arbitrator Justice (retired)A P Lawande,  has terminated and closed  the arbitral proceedings, which involved the perusal of voluminous contract documents, technical drawings, correspondence  etc, taking over 18 years, and rejected all the claims made by KCPF and PWD. 

The state government, thus, saved around Rs 40 crore (double the amount of Rs 21 crore, considering the time period of 18 years), says advocate Fortunato D’Mello, who appeared for the respondent with assistance of the PWD senior engineers including late S P Paranjape.  

When contacted engineer in-charge of Selaulim dam area, for information on the pipeline, Srikant Gaonkar stated that the said pipeline was discarded five years ago and that a substitute pipeline was laid. He also informed that simultaneously JICA pipeline was laid for augmentation of water. He however could not give further information on it.

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