Nagpur: The Nagpur Municipal Corporation (NMC) standing committee is likely to waive off penalties of over Rs120 crore due to be paid by private water operator Orange City Water Private Limited (OCW) in a meeting on February 21. The committee will also approve another extension of 18 months to the 24X7 Water Supply Project.After nod from the standing committee, the water works department proposal, termed as one time settlement (OTS) scheme for OCW, will be tabled before the general body for final approval. NMC’s special purpose vehicle Nagpur Environmental Services Limited (NESL) headed by mayor Nanda Jichkar and comprising top office bearers and officials has cleared the proposals in a meeting on February 15.The proposal says NMC will waive off penalty of Rs61.50 crore levied on OCW for non-compliance with terms and conditions of agreement between March 1, 2012, and March 31, 2018. The penalty was levied following OCW’s poor performance in handling water supply, failure to ensure equal water distribution in all areas, inordinate delay in completion of 24X7 Water Supply Project, non-appointment of expats (experts in water from foreign countries) etcAlso, NMC proposes to approve cost escalation of Rs54 crore without interest in 24X7 Water Supply Project’s cost. Thus, total cost of project will increase to Rs441.86 crore.The project was supposed to be completed on March 1, 2017, and cost escalated due to delays. The cost will escalate further due to the extension of 18 months for completion.The proposal to give extension has been prepared despite CM Devendra Fadnavis assuring the state legislative assembly in last year’s budget session about completion of the project by end of 2018. As against target of 3.20 lakh houses, OCW could convert only 48,000 houses to 24X7 Water Supply.Earlier, NESL board of directors had decided to give favours worth Rs200 crore to OCW in a meeting on May 2, 2018. TOI was the first to report the decision. After TOI’s report, corporators from Congress and BSP objected in NMC general body a couple of months ago. NMC then decided not to give exemption from renewal and replacement (R&R) works of Rs112.80 crore, which OCW was to execute between March 1, 2012, and March 31, 2018.NMC sources told TOI R&R works exemption was excluded from OTS as it would require amendment of the agreement executed between NMC and OCW, and will also fuel ongoing controversy. TOI had on Tuesday reported NMC declining OCW’s claim that it executed R&R works worth Rs71.22 crore in six years.The proposal to escalate project cost by Rs54 crore was not part of the earlier proposal, but was included in the OTS.Defending OTS to OCW, chairman of water works consultative committee Vijay Zhalke said project was delayed due to delays in payment to OCW and some hurdles in execution of the project.Congress corporator Praful Gudadhe alleged OTS was the biggest irregularity in NMC history. “NMC cannot waive off penalty as corporators from all parties proved OCW’s inexperience and failure. We will not allow the proposal to be approved in general body,” he said.IN A NUTSHELL* OCW appointed for operation and maintenance of water works and execution of 24X7 Water Supply Project* Agreement between NMC and OCW shrouded in controversy over favours to operator* OCW failed to comply with even this agreement* OCW was to complete project before March 1, 2017* NMC levied penalty of Rs61.50 crore on OCW over six years* Project cost escalated by Rs54 crore due to delays* NMC’s proposes scheme for OCW to waive off penalty, approve escalation and 18-month extension

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