Financially troubled Infrastructure Leasing & Financial Services (IL&FS) Engineering and Construction Company is witnessing early improvement in its road portfolio with a go-ahead to start work on one of its road projects, which was earlier up for foreclosure. The company also saw settlement of one of its arbitration claims earlier this month.
“This is to inform that the IL&FS Engineering and Construction Company has received approval from the Ministry of Road Transport and Highways (MoRTH) on June 14, 2019, for revival/restart of the road project, which was previously referred for amicable foreclosure by the competent authority,” the company said in a statement to the BSE.
IL&FS added in view of the changed scenario, the company decided against the foreclosure and had sought permission for executing the project.
“IL&FS Engineering and Construction Company has received approval from MoRTH for restart of the project regarding rehabilitation and upgrading to two lanes/two-lane with paved shoulder configuration and strengthening of Birpur-Bihpur section (from 0 km to 106 km) of NH-106 in Bihar under Phase-1 of the National Highways interconnectivity Improvement Project,” the company said in its release.
Work on the project is expected to start within 15 days from the receipt of the ministry’s consent.
On June 10, the company also informed exchanges that it entered into a settlement agreement with the National Highways Authority of India against the arbitration award in relation to two of its road projects.
The company said it has received Rs 41.82 crore as claim amount for its Daboka-Nagaon section of NH-36 in Assam. In addition, it has also received Rs 108.33 crore as claim amount for Dharamtul-Sonapur section of NH-37 in Assam.
The arbitration settlement and approvals come after a spate of project terminations seen at the start of the year. In January this year, Gujarat Metro Rail Corporation terminated a couple of contracts given to the company due to slow progress. In the same month, Jharkhand Bijli Vitran Nigam also cancelled contracts for the same reason. In the course of one year, Rail Vikas Nigam and Maharashtra Metro Rail Corporation also terminated contracts with the company over tardy progress.