Red Line construction firm moves SHC against sealing of project site after Sindh cancels contract
• Transport dept says contract to construct Mosamiyat to Numaish corridor cancelled due to delays, unsatisfactory performance
• Contractors blame TransKarachi, govt for frequent design changes leading to delay in execution
• Their counsel says termination notice unlawful; petitioners reserve right to challenge it before ‘appropriate forum’
• Constitutional bench issues notices to CS, others for 29th
• Appoints court official to visit project site and prepare inventory
KARACHI: A day after the Sindh government cancelled the contract of a key segment of the Bus Rapid Transit (BRT) Red Line project over lack of progress, the construction company has moved the Sindh High Court and accused the provincial government of delay in completion of the scheme and asked the court to order unsealing of the project site.
On Tuesday, the Sindh transport department announced that the contract given to AM Associates and CR 3 for construction of Lot 2 of Red Line — from Mosamiyat to Numaish — had been cancelled due to persistent delays and unsatisfactory performance.
It added that during a recent visit, an Asian Development Bank delegation had expressed serious concerns over the “contractor’s performance, pace of work and non-compliance with occupational health and safety requirements”. “Proceedings are underway to finalise the termination of the contractor’s agreement by TransKarachi [the company undertaking the project].”
However, on Wednesday, the AM Associates and CR 3 filed a petition before the SHC, citing the Sindh chief secretary, TransKarachi, Board of Revenue, deputy commissioner East, SSP East and others as respondents.
Representing the petitioners, Barrister Salahuddin Ahmed submitted before a two-judge constitutional bench that his clients had entered into a joint venture agreement in November 2020 to execute the BRT Red Line project.
He stated that the petitioners were declared lowest bidder for the Red Line project Lot-2 (from Mosamiyat to Numaish) and the contract was awarded for an amount of Rs15.935 billion in January 2022 and since then the petitioners had been diligently performing their obligations and constructing the project.
However, he said that due to certain acts on part of the provincial government including design changes, variations and failure to make part of the site available, the construction was delayed.
The lawyer said that provision of the entire design of the project was the responsibility of TransKarachi but it had given only 50 per cent design to the petitioners, who executed 80pc of it.
He contended that the petitioners filed several claims about such changes in design/drawing and specifications before a Dispute Resolution Board (DRB), which had granted a total amount of Rs3.27bn in their favour.
He said the respondents had paid Rs1.6bn to the petitioners and around Rs2.1bn was outstanding. The petitioners had last year filed a lawsuit about the subject amount before a civil court.
He further maintained that earlier this week the civil court had referred the matter to an arbitrator for decision in two months. However, on Tuesday the police and district administration had sealed the project site at Aladdin Park and served a termination notice to the petitioners without any lawful justification and contrary to the terms of the contract.
Barrister Ahmed contended that the termination notice was unlawful and the petitioners reserved their right to challenge it before an appropriate forum.
The counsel submitted that a huge number of stocks including steel, machinery, construction material, etc, were lying at the sealed project site.
The petitioners pleaded for unsealing of the project site, seeking interim restraining order for the respondents from directly or indirectly carrying out any work or initiating any tendering process on the subject project.
They also asked the SHC to appoint a Nazir to make inventory of the entire stocks at the project site and restrain the respondents from removing or using such stocks.
After a preliminary hearing, the bench headed by Justice Mohammad Saleem Jessar appointed a Nazir (court official) to visit the site of the project and prepare an inventory of the machinery.
The bench also issued notices to the respondents as well as the provincial law officer for April 29.
However, it did not entertain the request to order unsealing of the project site.