Monday, February 4, 2019

Government formally cancels contract with CMC

Though, the Ministry of Water Supply is still trying to negotiate, the board of Melamchi Water Supply Project has formally cancelled the contract of the project with the Italian contractor today as the contractor failed to resume construction works within the deadline of the government notice.
According to executive director of the project Surya Kandel, the deadline of the ‘notice to contract termination’ that was issued to Co-operativa Muratori e Cementisti (CMC) di Ravenna (CMC) had expired today. The Melamchi Water Supply Development Board had sent a final letter to CMC to resume the remaining works on January 21 but the CMC has not replied yet. "The deadline is over and the contract with CMC has been formally terminated," he said, adding that the project has made multiple efforts to establish communication with the CMC officials but the contractor did not respond.
The contract – which had a legal provision – reads that the agreement would be automatically terminated, if the contractor did not resume construction activities within two weeks of receiving ‘notice to contract termination’.
Earlier, CMC had – from its side – terminated its contract with the project citing its bankruptcy. But the government did not accepted termination letter of CMC – as the project was in the final stage of completion – and asked the contractor to continue the work.
The project is preparing to assign the remaining works to local contractors, he said, adding that the project is preparing legal documents to assign the remaining works to local contractors.
The termination of the contract with CMC is, however, going to delay the construction of the Melamchi Water Supply Project, which was expected to be completed within a couple of months.

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