NHAI to fine up to Rs 10 cr for major lapses in construction standards

National Highways Authority of India (NHAI) on Tuesday said it has come out with a strict policy to deal with major lapses in structures that provides for a fine up to Rs 10 crore for defaulters besides debarment of the firm or personnel for up to three years.

The move is aimed at maintaining high-quality standards in highway development.

"In order to deal with the lapses in highway development, NHAI has issued a strict policy to decide penal action against defaulting firms/ personnel if there are any lapses in construction standards of bridges/ structures/approaches to structure etc by the Concessionaires/ Contractors / Consultants," NHAI said in a statement.

The new policy allows NHAI to impose graded penalties that include heavy fines up to Rs 10 crore besides debarment and ban on bidding for any future NHAI projects for up to three years.

Graded penal action will be taken against the defaulters in cases of minor lapses, major incidents and major failures resulting in loss of human lives, it said.

"In case of a major lapse leading to loss of human life, a heavy fine up to Rs 10 crore and debarment of the firm/personnel up to 3 years along with rectification by the defaulting Contractors/Concessionaires on their own cost may be imposed," NHAI said.

For major lapses where no casualties are reported, rectification by the defaulting contractors/concessionaires on their own cost and /or debarment of firm up to 1 year with a penalty up to Rs 5 crore along with debarment of concerned personnel for up to 2 years from NHAI projects has been provisioned.

However, for minor lapses wherein no casualties are reported, the defaulting contractors/concessionaires will have to bear the expenses for carrying out the rectification work along with a penalty of Rs 30 lakh besides a written warning to the firm and the personnel involved.

Under the graded penalty, the consultancy firm involved in the project will also be held liable with a fine of up to Rs 40 lakh and debarment from NHAI projects for a period of up to two years, the statement said, adding that key personnel of the consultancy firm will also be debarred from NHAI projects for a period of up to three years.

"For each repeated lapse by the defaulting contractors/concessionaires/ consultants, the penalty for the subsequent offence shall be enhanced by an additional 50 per cent as compared to the penalty imposed in the previous instance. Suitable action on NHAI officials shall also be taken, depending on the extent of dereliction of the duties by the concerned official," it said.

As per the standard operating procedures (SOP), an Expert Committee will be constituted in compliance with an already established post-accident mechanism to investigate the matter.

On the outcome of the investigation, a suitable penalty will be imposed, NHAI said.

During the term of investigation, the concerned personnel of the contractor/concessionaire and the consulting firm may be kept under suspension from working on the project/ any other projects of the authority.

NHAI said it is committed to follow the highest standards in highway construction and any lapses in these will be dealt with zero tolerance and added that implementation of the SOP will ensure that proper action is taken against the defaulters and they will be debarred from NHAI projects with severe penalties.