NEW DELHI, Oct 2: Government will seek to push a bill to set up an institutional mechanism for resolving the disputes related to public contracts or PPP projects in the forthcoming winter session of the Parliament.
The Planning Commission has finalised ‘The Public Contracts (Settlement Of Disputes) Bill 2013 and submitted it before the Prime Minister’s Office (PMO), a source privy to the development said.
Now the bill would be placed before the Union Cabinet for discussion and approval. Once approved, it would be tabled for passage in the winter session of Parliament, he added.
The PMO has directed the Commission in May this year to draft the bill for setting up an institutional mechanism for resolving disputes in the public contracts which are holding back investment of hundreds of crores and discouraging investors.
The Government envisages an investment of one trillion dollars in the country’s infrastructure sectors like road, telecom and power in the 12th Five Year Plan (2012-17) with half of it coming from the private sector.
“We are very optimistic about the outcome of this because PMO has asked to draft the bill. We have already submitted it to PMO. Now it is for the Government to expedite it for further action. This law will help in kick-starting the investment cycle,” Planning Minister Rajeev Shukla told.
According to the draft bill, the Government will constitute a ‘Tribunal for Public Contracts’ having the principal seat in New Delhi and benches in Chennai, Kolkata and Mumbai.
The bill provides for the tribunal dealing with disputes in the public contracts exceeding Rs 5 crore. It will have jurisdiction over contracts executed by Central Government, State Government, Local or statutory authority or any corporation society or trust owned and controlled by the Government.
It will deal with disputes relating to execution of contract, specific performance of the terms of the contract, termination, cancellation, repudiation and claims for damages for breach of contract.
The Tribunal will be required to conduct day to day hearings and announce its arbitral award (decision) within 120 days of referring the dispute to it. The appeal against the order of the Tribunal will lie in the Supreme Court.
According to the bill, non-compliance of the Tribunal’s order will result in a fine of up to Rs 2 lakh at first instance and up to Rs 10 lakh at second and subsequent instances.
The draft proposes a high level selection committee headed by a Supreme Court Judge and having two Chief Justices of High Courts, a member of Union Public Service Commission, a distinguished jurist and Secretary of Department of Justice, to appoint chairperson and members of the tribunal.
The chairperson of the tribunal could be or should have been a Judge of Supreme Court or a Chief Justice of High Court. In case of Vice-Chairperson, he must be or should have been a Judge of High Court, while the members of the committee will have to be those who qualify to be a Judge of High Court.
The bill proposed a consolidated monthly remuneration of Rs 4.5 lakh for Chairperson and Rs 4 lakh for members. (PTI)
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