Contractors send notice to govt over ₹90,000cr pending dues, warn of going to court
Pune: Contractors executing critical infrastructural works across Maharashtra have sent a legal notice to the state govt on June 10, demanding payment of dues amounting to over Rs 90,000 crore.
The notice sent to the chief minister, deputy chief ministers, chief secretary and heads of key departments, warned that they will approach Bombay high court if a payment schedule is not provided within a fortnight.
The contractors, represented by Builders' Association of India (BAI) — a national body with over 230 branches — say dues include payments for roads, bridges, water supply, irrigation, and govt building repairs taken up for over a year.
Public Works Department (PWD) alone owes them over ₹46,000 crore, association members said.
"We wrote to govt in Feb but no concrete action was taken. We have now issued a formal legal notice. The situation is untenable," a senior BAI member, requesting anonymity, said.
He added that it is discouraging to carry out infrastructural works when funds are not released on time. "Govt must revert within a fortnight or else we will have to take up the issue in Bombay high court," the BAI member told TOI.
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The notice states that non-payment of running bills has severely impacted contractors' ability to repay bank loans, leading to many accounts being classified as non-performing assets (NPAs). "This financial stress is not due to any fault of the contractors but entirely due to non-release of funds by the state," it reads.
BAI said many projects under the Hybrid Annuity Mode (HAM) where semi-annual payments are promised post-completion have also been affected.
"Payments are irregular and often as low as 6% to 7% of the billed amount which dissuades young contractors from entering the construction sector," the notice states.
During repeated meetings with govt officials, BAI members say they have been told that budget constraints are delaying payments.
What has angered the contractors is the state's massive outlay for Mukhyamantri Mazhi Ladki Bahin Yojana launched last year.
"We have been waiting for our dues for works that have been completed. But here, govt is handing out Rs 1,500 monthly to 2.46 crore women spending over Rs 3,700 crore every month," the BAI member said.
Text messages to the offices of the chief minister Devendra Fadnavis and finance minister Ajit Pawar remained unanswered at the time of going to press.
Break-up of dues
PWD I ₹46,000 crore
Jal Jeevan Mission I ₹18,000 crore
Water Resources Department I ₹19,700 crore
Rural Development Department I ₹8,600 crore
Urban Development Department I ₹1,700 crore
(BAI sources)
Govt is free to run welfare programmes, but it must pay contractors who have completed public infrastructural work using borrowed funds
BAI Member
Pune: Contractors executing critical infrastructural works across Maharashtra have sent a legal notice to the state govt on June 10, demanding payment of dues amounting to over Rs 90,000 crore.
The notice sent to the chief minister, deputy chief ministers, chief secretary and heads of key departments, warned that they will approach Bombay high court if a payment schedule is not provided within a fortnight.
The contractors, represented by Builders' Association of India (BAI) — a national body with over 230 branches — say dues include payments for roads, bridges, water supply, irrigation, and govt building repairs taken up for over a year.
Public Works Department (PWD) alone owes them over ₹46,000 crore, association members said.
"We wrote to govt in Feb but no concrete action was taken. We have now issued a formal legal notice. The situation is untenable," a senior BAI member, requesting anonymity, said.
He added that it is discouraging to carry out infrastructural works when funds are not released on time. "Govt must revert within a fortnight or else we will have to take up the issue in Bombay high court," the BAI member told TOI.
The notice states that non-payment of running bills has severely impacted contractors' ability to repay bank loans, leading to many accounts being classified as non-performing assets (NPAs). "This financial stress is not due to any fault of the contractors but entirely due to non-release of funds by the state," it reads.
BAI said many projects under the Hybrid Annuity Mode (HAM) where semi-annual payments are promised post-completion have also been affected.
"Payments are irregular and often as low as 6% to 7% of the billed amount which dissuades young contractors from entering the construction sector," the notice states.
During repeated meetings with govt officials, BAI members say they have been told that budget constraints are delaying payments.
What has angered the contractors is the state's massive outlay for Mukhyamantri Mazhi Ladki Bahin Yojana launched last year.
"We have been waiting for our dues for works that have been completed. But here, govt is handing out Rs 1,500 monthly to 2.46 crore women spending over Rs 3,700 crore every month," the BAI member said.
Text messages to the offices of the chief minister Devendra Fadnavis and finance minister Ajit Pawar remained unanswered at the time of going to press.
Break-up of dues
PWD I ₹46,000 crore
Jal Jeevan Mission I ₹18,000 crore
Water Resources Department I ₹19,700 crore
Rural Development Department I ₹8,600 crore
Urban Development Department I ₹1,700 crore
(BAI sources)
Govt is free to run welfare programmes, but it must pay contractors who have completed public infrastructural work using borrowed funds
BAI Member
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