CHENNAI: The Neyveli Lignite Corporation of India Limited (NLCIL) allegedly violated its own rules and set aside objections of a senior company official to increase the tender value by Rs 33.78 crore for constructing a resettlement and rehabilitation colony for families displaced by its thermal power plant in Odisha, documents with TNIE show.
The alleged procedural irregularities pertain to the construction of 537 houses for the colony along with roads, water supply lines and non-residential buildings in Hirma village in Jharsuguda. The work was awarded to a private contractor, RSB Projects, in December 2022 for Rs 138 crore and was supposed to be completed and handed over on July 12, 2024, as per the original contract.
On April 24, 2025, the general manager (civil) of NLCIL issued a letter approving an increase in contract value by 24.48% to Rs 171.75 crore, even as a major part of works was pending.
The letter stated two important points: firstly, an upward revision of 18.47% over quoted rates for balance works to be carried out in the colony’s four blocks (A, B, C and K) which were carried out after the scheduled date of completion. The second was a similar increase of 23.47% in the quoted rate to construct 216 balance houses in the colony. The letter cited an approval given by a sub-committee of directors for this change.
This leeway for the contractor, which would cost NLCIL an additional Rs 33.78 crore, was given despite the original contract disapproving such revisions, internal documents show.
An official spokesperson for NLCIL declined to comment stating that the matter was subjudice.
On July 16, 2024, the chief general manager (civil) in the Central Technical Office (CTO) of NLCIL wrote an email to the executive director of the Talabira (Odisha) project categorically stating that such a revision could not be approved as per original contract clauses.
The CGM cited three clauses in the contract which stated that the rate quoted by the bidder would be firm and fixed for the entire duration of the contract. The CGM also stated that NLCIL had declined a specific request by bidders during a pre-bid meeting to incorporate a price variation clause.
This alleged largesse bestowed on the contractor has set tongues wagging with a petitioner approaching the Madras High Court for a CBI investigation.
