yp ‘SOMA INDUS VARANASI AURANGABAD TOLLWAY PRIVATE LIMITED Ref: SI-PO/NH-2/2023-24/14872 Dated 28'* March 2024 To, The Project Director Project Implementation Unit, Sasaram National Highways Authority of India, Near Satyam Service Centre + Post - Moresarai, Distt. Rohtas, Sasaram, PIN Code- 821113 (Bihar) Sub.: Six laning of Varanasi-Aurangabad Section of NH-2 from Km 786.000 to Km 978,400 in the State of UP/Bihar on Design, Build, Finance, Operate and Transfer (The ‘DBFOT’) Toll Basis under NHDP Phase-V: Non-achievement of Progress of 2" Milestone due to poor mobilization of resources and slow progress of work at site ~ Reg. Ref.: 1, NHAl letter no. NHAI/PIU-SSM/SOMA/2024/8936 dated 16.03.2024 2. Independent Engineer's Letter No. LNM/PD/NHAI/V-A/2023-24/0872 dt. 16.03.2024 3. Independent Engineer's Letter No. LNM/PD/NHAI/V-A/2023-24/0845 dt. 12.03.2024 4. NHAI letter no. NHAI/PIU-SSM/LN Malviya/2024/8884 dated 05.03.2024 5. Independent Engineer's Letter No.ICT:638:SKP:1925 dated 21.03.2022 6. Concessionaire’s letter no.SI-PO/NH-2/2021-22/11797A dated 12.03.2022 7. 8. 9. /. 2nd Minutes of Meeting Sole Conciliator dated 30.11.2023, . Settlement Agreement dated 18.08.2021 .. Supplementary Agreement dated 19.01.2015. 10. Concession Agreement dated 30.07.2010 Dear Sir, This is with reference to your office letters dated 05.03.2024 & 16.03.2024 regarding alleged non-achievement of progress of 2" Milestone and slow progress at site. At the very outset, we would like to express our strong disagreement to the contents of the above letters which are contrary to the factual position. In this regard, the following may kindly be noted: 1. The Concession Agreement (CA) for the Project was signed on 30.07.2010 and subsequently, the Appointed date for the Project was declared as 12.09.2011. Accordingly, the Scheduled Completion Date for the Project as per Clause 12.4 and Schedule-G of the CA was 10.03.2014. 2. Onaccount of various impediments and delays beyond the control of the Concessionaire, the Project Milestones were revised as per the provisions of the Supplementary Agreement dated 19.01.2015. 3. However, due to non-availability of encroachment free and un-encumbered land, the 660. oFFice: PROJECT OFFICE: 5th Flor, Block 2, Plot No. 266, 268, Grom-Mavio Aer Votko Business Pork, Sohne Reed, Pos Kurahuo, Tehsi-Sedor, Secioe-49, Guegeon-122101, Near Indra Hospital Heryene-Insio Voranas (UP) - 221005, Phone: 0124-4510800 Fox 0124-4510810 E-mail info@roodis. Website: wunuroadie. CIN No U45400HR2010PTCO4093118.08.2021 (date of signing of Settlement Agreement) in accordance with the Sr. No. 'x” of Sub-Clause 2 of the Settlement Agreement dated 18.08.2021. In view of the various issues, impediments and hindrances affecting works at site, the Extension of time was recommended / granted for achievement of the Milestones under the Settlement Agreement dated 18.08.2021. Without prejudice to the fact that the Milestone-I was achieved by the Concessionaire as on 20.12.2022 after reducing the impeded work stretches which was intimated vide its letter dated 21.12.2022, the IE vide letters dated 22.09.2022 & 29.12.2022 recommended / granted EOT till 31.03.2023 (127498 days) for achieving Milestone-| and also Milestones Il & Ill were deemed to have been extended accordingly. ‘The Milestone-| was achieved by the Concessionaire well within the extended period by 31.03.2023 despite all the issues and hindrances in the project. IE vide various letters dated 27.04.2023, 22.06.2023, 31.08.2023 acknowledged the achievement of MS-| by Concessionaire as on 31.03.2023 as per the terms of Settlement ‘Agreement dated 18.08.2021 and further recommended grant of an interim extension of time of 6 months for completion of subsequent Milestones MS-II and MS-III, over and above the Extension of time granted earlier vide IE letter dated 29.12.2022, for consideration and approval of the Competent Authority. Accordingly, as per the EOT recommended/ granted, the re-scheduled date for achievement of Milestone-Il is 30.12.2023 and for Milestone-tIl is 30.06.2024 which has also been agreed in principle by NHAI and recorded in the MoM issued vide NHAI letter dated 19.10.2023. Further, as per deliberations held between Parties in the review meeting held on 16.10.2023 at NHAI Headquarters, New Delhi, the Concessionaire vide dated 08.11.2023 has requested the Authority to amicably settle the issue of Extension of Time through Conciliation before a Sole Conciliator. Accordingly, both Parties appeared before Ld. Sole Conciliator on 20.11.2023 & 30.11.2023. Ld. Sole Conciliator heard both the Parties on 20.11.2023 wherein it was apprised that there are various Project stretches where the works are partially / completely hampered due to pending land acquisition and other issues beyond the control of both the Parties. As advised by the Ld. Conciliator joint inspection was carried out in presence of Independent Engineer from 23.11.2023 to 24.11.2023. The Ld. Conciliator during the meeting held on 30.11.2023 recorded that the hindered length identified for de-scope and delinking is around 11.10 km as under: Page: 22. As decided in the 1 meeting dated 20.11.2023, a joint inspection was carried cut by PD, Concessionaire and IE to know the exact status of land. As per the information provided by the PD/RO and agreed by the Concessionaire, the following is the land positio mew i emarls [ams | tora | — jae angi Tl ska Comoieted length) : Tieton Balance tobe completed a0 Gn {= tel-(), Proposed for escaping) | TEES Km | ESHER | LB4EKm | ARS Weludes 3 wos races ieDti Hyover | Propored Yor delcking@] | 82m | SERN | SABI ‘Length where work cannot ~ ‘11.100 Km — bevundertaken ss on date f= (a) +(e) | [Length “supposed to be ~ "35.300 Km | Out of this length, 8.980 km was, | Completed fd) =) (0 escoped. carder, hence In Salance tengts 2637, km || (35,300.898) workisin progress for which the, Concessonaire admitted that the encumbrance | | free land is ovalable. | | | | page tots | | on 10. The land acquisition/ disbursement issues have still not been resolved by CALA/State government and the same have been brought to the notice of IE and authority vide various correspondences and during various meetings/discussions. During the execution of works at site, several hindrances, issues and impediments were faced by the Concessionaire post signing of Settlement Agreement dated 18.08.2021 to till date which is constraining the Concessionaire to achieve the targeted progress within the revised scheduled dates. The detail of these issues and impediments beyond the control of Concessionaire are elucidated hereunder for your information and ease of reference. |. Non-availability of encroachment free & unencumbered land: Pursuant to Clause 10.3, 10.4 read along with Sub-clause 13 of Schedule-A of the Concession Agreement, the Authority is under obligation to grant possession to the encroachment free & unencumbered land for existing and additional land. However, there were substantial delay in land acquisition at various locations such as Mohania Toll Plaza & Sasaram Toll Plaza, legal disputes over the land acquired for the Project, encroachment by police stations, etc. Further, the revised estimates of Religious structures are yet to be finalized, 1, Delay in re-validation of GAD’s for ROB at Ch. 788+650 & Ch. 809+050: Upon request of Authority and requirement raised by Railway Department, the approved GAD's were submitted for revalidation of Railway Department. However, there was significant delay by Railway Department in providing comment/consent over thesubmitted GAD‘s, site constraints faced after revalidation leading to revision of GAD’s and the delay in finalization of GADs between the Railway Department and Authority had adversely affected the progress of ROB works at Site. Delay in approval to technical solution works in 2.84 Km.: The Concessionaire vide its latest letter cited under ref. (5) has submitted the proposal to undertake the works in obstructed 2.84 Km., which has been subsequently recommended to the Authority by the Independent Engineer vide its letter cited under ref. (4). However, till date, no communication/intimation over the acceptance/rejection over the submitted proposal has been accorded to the Concessionaire. Delay in approval of electrical utility estimates: In pursuant to Clause 11.2 of the Concession Agreement, the Concessionaire is under obligation to shift the utility obstructing works at Site which shall be reimbursed by the Authority. However, the Authority's approval of estimates prepared by entity owning such utility is necessary before commencement of works to avoid dispute over the disbursement of payment for such utility shifting works. In addition, the payment of supervision charges is remitted by the Authority to the entity owning such utility to supervise the works at Site. Without payment of supervision charges, the entity owning such utility does not allow works at Site. Thus, delay in shifting of electrical utilities on account pending approval of estimates, dispute over the payment of supervision charges and pending payment of supervision charges to the approved estimate entitles the Concessionaire for additional time. In the review meeting held at NHAI HQ on 16.10.2023, the PD was directed to personally follow up with Joint Advisor (Electrical) for review of pending estimates. It was informed by NHAI that the estimates cannot be revised independently as the Utility owner are required to certify bills and issue NOC. It was agreed that NHAI will engage with the Utility owner to seek a revision wherever possible and in the meantime, payments be disbursed for the completed work, which can be verified through records such as RFI’s, video recordings, past IE recommendations, etc. It was further decided that a three-member committee will be formed to estimate the remaining Utility works, and the revised estimate will be discussed with the Utility owner for further action. However, the revised estimates are yet to be finalized. Further, during the review meeting held on 11.01.2024 at DMRC Building under chairmanship of Member, NHAI it was decided that informed that the Committee has proposed payment for Railpoles erected for LT lines at the rates equivalent to PSC pole but he Railpoles standing on site as on date should be paid as per actual as these were now assets of NHAI and accordingly, the PD/IE was directed to review the inventory prepared by committee an consider the works already completed on site. It is pertinent to mention here that the issue of utility shifting estimates has been pending since long but a viable solution to resolve the issue and the process to be followed was proposed by NHAI only in Jan 2024. Delay in approval of COS proposal under Article 16 of the CA: The Concessionaire has submitted various proposals under Change of Scope as per Authority's instruction, site constraints, local demands, etc. However, the delayed K's ime Pee"approval/rejection to Concessionaire’s proposal under Clause 16.1.2 of the CA and issuance of Change of Scope Order under Clause 16.2.3 of the CA has constrained the Concessionaire to undertake the works in such locations. VI. Non-payment of amounts towards price escalation, GST implication, Grant etc: payments of huge amounts towards price escalation, GST implication, Grant are pending since long which have been leading to cash flow issues adversely affecting the progress of works. Description of | Total Amount Sr.No} pending payable as on Remarks payments date GST upto Sep 1_| 2023 165.95 2 | Escalation upto a TE recommended 90% of Rs.304.23 June 2023 Cri.e Rs.273.81Cr -Rs.78.42 Cr Escalation RA-4 3 85, 33.77 TE has recommended to NHAI vide 4 Grant 137.10 Letter No- 7151 dated 22.11.23 Utility shifting 5_| Payments 0.57 6 _| COS pending 22.48 Total Amount in Crore 389.37 11. Itis further submitted that all resources as required for completion of the balance works within the prescribed time has always been available at the site from the beginning. The slow progress if any are due to the above pending issues in the project which are beyond ‘the control of the Concessionaire and not due to poor mobilization of resources as alleged by the Authority in its letter under reply. 12. Despite various issues and hindrances beyond the control of the Concessionaire affecting progress in the project, the Concessionaire completed the UP section of the project facing all the difficulties. The UP portion was inaugurated by the Hon’ble Prime Minister on 23.02.2024. 13. Further, without prejudice to the above, the Concessionaire has achieved the Milestone- Mas on 30.12.2023. It is be noted that during the meeting held on 11.01.2024 at DMRC Building, New Delhi, under the chairmanship of Member (P), NHAI, it was discussed and decided that the progress of all the items of works / individual pavement layers shall also be considered / taken into account to assess the total physical progress in the project and not the progress of final layers (DBM & BC) alone. Accordingly, the physical progress in the project considering the progress of works of various pavement layers / items of works are given as under:Scope of work and Physical Progress sr.no Descriptions Length Reference Lo “r inkm 1 | Total Project Length 192.40 >| Lenath completed as on date of tray | Refer IE vide letter no.5542 Settlement Agreement (18.08.2021) “ dated 01.09.2021 3 _| tenath descoped due to non- 1.98 | Refer IE vide etter no.1925 availability +98 | dated 21.03.2022 Hindered length identified for - de-scope & de-link as 4 Gurrent Proposal for Reduction & 11.10 | recorded in MOM dated us 30.11.2023, chaired by Sole Conciliator ge34q__| Length descoped due to non- done availability Total Balance Length to be 6-125 | completed as on date of Settlement | 57.89 | T2t#! Balance length for completion of project as on Agreement Complet Weighta i Item _ [Scope of | caiypto | Physical | gefor | Weighted Sr.no unit | Balance Physical Description Work Dec Progress Work Progress 2023) progress rot F=(B1- A 8 caB/A. D 82)/A1*D1. 1 C&G Km 57.89 48.35 84% 75% 6.36% 2 Embankment | Km 57.89 43.44 75% 80% 5.05% 3 Sub-Grade Km 57.89 39.78 69% 85% 1.79% 4 GSB Km 57.89 38.56 67% 90% 6.19% 5 CTB- WMM/DLC Km 57.89 34.58 60% 95% 2.24% 6 DBM/PQC Km 57.89 | 33.21 57% 100% 57.37% Total Physical Progress Achieved * 79.01% * Further, BC in a length of 74 km has been completed 14. In view of the above, the physical progress achieved by Concessionaire of 79% which is, more than the 75% physical progress required for achievement of Milestone-II under the Settlement Agreement dated 18.08.2021 and thus the Concessionaire has achieved Milestone-II as on 30.12.2023 as per the Settlement Agreement dated 18.08.2021 within the re-scheduled Milestone-tI date. 15. Further, without prejudice to the above and although, the Concessionaire is not in agreement with the calculation methodology of physical progress solely based on lengths of completed stretches, even if the progress based on lengths are considered, the 3 Page: 6 TAH 7 Kee EConcessionaire has achieved the Milestone-II by completing more than 75% of the balance length i.e. 43.42 km out of total 57.89 km as under: -_ Length \SI. No. Item Description | (in Km.) 1 Total Project length A 192.40 3 _| Project length completed as on date of Settlement 8 ma | Agreement | 3._ | De-scoped Project length as per Settlement Agreement c 8.98 Hindered length identified for de-scope & de-link as 4 | recorded in MOM dated 30.11.2023, chaired by Sole D 11.10 Conciliator L 5 _| Balance Project length for project completion afterthe | ea pcy | 5789 date of Settlement Agreement Total length to be completed to achieve MS-I as per 6 _ | Settlement Agreement (75% of the balance length tobe |F=75%ofE| 43.42 completed) Length completed after the date of Settlement 7 _ | Agreement (detailed chainage wise break-up is G 43.42 enclosed herewith as Annexure-I) 8 _ | Total Project length completed H=B+G | 157.85 16. In view of above, the Concessionaire has achieved Milestone-II as per the Settlement Agreement dated 18.08.2021 and there are no violations or breach by the Concessionaire under Article 12.4.2, Schedule-G or any other provisions of CA which can attract any penal actions against the Concessionaire under provisions of Art. 35.1, 36.1, 36.2 and 37.1 as wrongly alleged by the Authority in the letter under reply. 17, Accordingly, the Authority is requested to acknowledge the achievement of Milestone-I by the Concessionaire as on 30.12.2023 within the re-scheduled Project Milestone date and further revoke the alleged notice under 13.4 of CA immediately. Thanking you & assuring of our best services at all times. Yours Faithfully; For SomaIndus Varanasi Aurangabad Tollway Pvt. Ltd. at ( ie} Zee LR top (Authorized Signatéry) Encl As stated above Copy to.: 1. The Authorized Signatory, Independent Engineer, M/s. LN Malviya Infra Projects Pvt. Ltd, Bhopal, M.P. — for information and necessary action. (01 Set) 2. The Team Leader, LN Malviya Infra Projects Pvt. Ltd. in association with Infratech Civil Solution & Consultant - for information. 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