Government Terminates Contract with Contech Pvt. Ltd. for Mid-Hilly Highway Project

Kathmandu. The government has terminated the contract with Contech Pvt. Ltd., the construction company responsible for the upgrade of the Lamjung section of the Pushpalal (Mid-Hilly) Highway, for leaving the work incomplete.

The Mid-Hilly Highway Project Office, Palungtar, published a notice on Thursday stating that the contract has been canceled and the company has been recommended for blacklisting.

Contech Pvt. Ltd., with its registered address in Nakhal, Kathmandu, had secured the contract for widening and improving the Paudikhola-Sundarbazar-Kirinche road section in Lamjung. However, despite multiple deadline extensions and written and verbal reminders, the company failed to advance the work, compelling the project to take this step.

According to the project office, the contractor did not comply with the instructions given to rectify faulty work. Furthermore, for over 200 days beyond the maximum penalty period, no personnel from the company were present at the construction site, bringing the work to a complete halt.

The office had sent a final letter urging the completion of work on Jestha 13th and provided clear instructions on Chaitra 12th, 2082. However, disregarding all these directives, the construction company unilaterally submitted a letter to terminate the contract, contrary to the agreement, the notice stated.

The contract was terminated in accordance with the Public Procurement Act, 2063, and the Civil Code, 2074, after determining that the company had fundamentally breached the contract and failed to fulfill its obligations in good faith. The project has announced that it will recommend the company be blacklisted by the Public Procurement Monitoring Office.

Additionally, the government has warned that the evaluation and financial settlement process following the contract termination will proceed, and if necessary, the outstanding government dues will be recovered.

The project office has requested the contractor to appear at the office within 15 days to conduct a measurement and evaluation of the work done so far and settle the accounts.

The notice clarifies that if the company fails to appear within the stipulated time, the process will automatically proceed according to regulations by the office's technical staff.