PNC Infratech says it has not been debarred by NHAI; show-cause proceedings pending over Kanpur-Lucknow Expressway
New Delhi, August 7
PNC Infratech Ltd has clarified that it has neither been debarred nor declared a "non-performer" by the National Highways Authority of India, stating that the matter relating to the Kanpur-Lucknow Expressway is presently at the showcause notice stage, with replies being submitted by its concessionaire subsidiary.
The clarification came in an exchange filing made under Regulation 30 read with Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, following NHAI's press release issued on August 5 and subsequent media reports.
The company said the project construction of the six-lane, upgradable to eight-lane Kanpur-Lucknow Expressway (Package-2) in Uttar Pradesh on Hybrid Annuity basis was completed and issued provisional and final completion certificates on October 1, 2025 and February 2, 2026, respectively, in favour of Awadh Expressway Private Limited, its subsidiary and concessionaire.
The project, having a bid cost of Rs 1,513 crore, is presently in the maintenance phase under the concession agreement, which requires the concessionaire to undertake routine and major maintenance for 15 years after completion.
According to the filing, recent heavy and incessant rains affected isolated stretches measuring around 300 metres, accounting for less than 0.5 per cent of the entire expressway length. The company stated that it immediately undertook repair and rectification work as part of its maintenance obligations, adding that most of the affected stretches have already been restored while work on the remaining portions is progressing. It also said traffic has continued to move smoothly on the project, as acknowledged by NHAI in its press release.
PNC Infratech further disclosed that NHAI has issued showcause notices to the concessionaire proposing action, including levy of a penalty equivalent to 2 per cent of the Performance Security, initiation of debarment proceedings against specific technical staff, including the Head of Pavement/Highways, for up to three years, and downgrading the concessionaire's Pavement Condition Index rating. The company said replies to the notices are being submitted.
The filing also states that NHAI had, through an interim direction dated July 28, 2026, instructed the concessionaire to immediately remove the Project Manager, Vivek Gupta, from the project site, and that the direction has already been complied with. The alleged violation relates to a slippage observed on an approximately 300-metre stretch near Km 64 (RHS) of the project on July 26, 2026.
Clarifying the legal position, the company asserted that it has not been debarred or declared a non-performer by NHAI, and that the proceedings are presently limited to issuance of show cause notices, with no final order having been passed. The company emphasised that the safety and quality of the projects it builds, operates and maintains remain central to its business and that it takes all such concerns with the utmost seriousness.
On the financial implications, PNC Infratech stated that the cost of ongoing repairs has already been budgeted as part of its contractual maintenance obligations and that there is no material impact on its ability to continue as a going concern or execute other projects. It also clarified that it remains eligible to participate in bidding for new projects and would disclose any further financial implications as and when greater clarity emerges.
— ANI
Reader Comments
The issue isn't just about 300 meters - it's about who is responsible when quality fails. We've seen so many infrastructure projects in India where contractors build cheaply and then maintenance problems show up later. But I also think NHAI's approach of immediately removing the Project Manager seems a bit harsh without proper investigation. Both sides need better communication.
Here we go again - another infrastructure company trying to brush off issues with "less than 0.5%" claims. Traffic moves smoothly? Of course it does, but that doesn't mean the quality is acceptable. We pay tolls for these expressways and expect them to last. That said, giving the company a chance to respond to showcause notices is fair. Let the process complete before jumping to conclusions.
As someone who has worked in infrastructure in India, let me clarify - the Hybrid Annuity Model means the contractor has a stake in maintaining the road for 15 years. So PNC Infratech has every incentive to fix this properly. The real issue here is the bureaucratic circus around show cause notices. NHAI needs to be more collaborative with contractors rather than resorting to threats of debarment over minor issues. 🌧️
The company is playing smart by getting this clarification out early. But let's be honest - they knew about the slippage on July 26, and NHAI gave interim directions on July 28. If the repair work was so quick, why did it take media pressure for them to respond? Transparency from both sides is needed. Also, removing the Project Manager so quickly suggests there might be more to this than just "heavy rains".
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.