The multi-purpose Polavaram project on Godavari river has plunged into yet another crisis with Transstroy India Ltd, the main contractor for the prestigious Polavaram project, has virtually turned bankrupt.
The Canara Bank on Friday filed a petition before National Company Law Tribunal, Hyderabad asking it to declare Transstroy as insolvent and initiate the process for winding up of all its business activities, auction its properties and repay the dues to the banks.
The corporate branch of the bank at Secunderabad filed the petition stating that Transstroy had defaulted loans to the tune of Rs 725 crore taken from the bank in various forms. Similar petitions against Transstroy filed by various banks are also pending in the tribunal.
This would mean Transstroy has been delaying the construction of Polavaram because it has no money. It has not been clearing its payments to sub-contractors as well, as a result of which they stopped work.
While Andhra Pradesh chief minister is struggling to secure funds from the Centre, the contracting firm successfully diverted all its money and has now turned bankrupt.
Now, it will give an opportunity for Naidu to bring pressure on the Centre to give permission to go for fresh tenders for spill way and other works. Since Transstroy has no money, the Centre will have no option but to permit the fresh tenders.
