BBMP bungles waste management deal, fined Rs 4 crore

In a classic case of bungling, the Bruhat Bengaluru Mahanagara Palike is now forced to pay a penalty of Rs 4 crore to a company it engaged to process waste at Mavallipura.

The Arbitration and Conciliation Centre, Bengaluru division, has ordered the civic body to pay the sum to Ramky Energy and Environment Ltd for not complying with the terms and conditions of the contract. The copy of the order is available with DH.

The Palike had signed a contract in 2004, where it had promised to provide 100 acres of land to the company and also supply the waste collected from the East and Yelahanka zones to process it and sell it as organic manure.

However, the civic body provided only 44 acres of land and “...committed the fundamental breach of the agreement”. The civic body has claimed that it could not provide further land due to opposition from local residents and also because of high tension power lines passing across the unit.

Not only this, the civic body is believed to have dumped more than 600 tonnes of waste every day, which was more than the agreed limit in the contract. The unit found it difficult to manage the excess, and the Karnataka State Pollution Control Board (KSPCB) directed the BBMP not to dump more waste. The High Court of Karnataka also ordered the company not to receive further waste till it processed the accumulated waste in three months.

“The company was not managing the processes well. Instead of deploying 100 to 120 employees, it was running the unit with fewer people. As there was no improvement with the plant, we had to terminate the contract,” said a senior BBMP official. The contract was signed for 20 years, but it was terminated in 2016.

The company held that the premature termination of the contract and failure to provide 100 acres of land amounted to violation of the contract, and claimed penalty.

The BBMP was also paying a ‘tipping fee’, an amount paid per tonne of waste supplied, to help the company generate revenue and also “got 20% of the revenue from it”, said the official. The Palike had paid Rs 11.54 crore, including an excess of Rs 8.91 crore, which it wanted refunded.

“We have appealed against the fine and sought a reduction in the fine amount from Rs 4 crore to Rs 2 crore,” another BBMP official said.