Bhandup water plant repair contract worth Rs 36.83 crore goes to firm linked to Mithi silt scam

A contract worth Rs 36.83 crore to repair the water purification plant at the Bhandup complex, which supplies water to Mumbai, has been awarded to a company said to have an alleged link to the Mithi river silt-cleaning scam. The company is Vargo Specialities Private Limited. Questions were raised over its selection in the Brihanmumbai Municipal Corporation's standing committee on Wednesday.

The Bhandup plant has a capacity of 900 MLD, or 900 million litres a day. The company is to be given the work of replacing its worn-out parts. The controversy arose because the name of Jayesh Joshi, the company's former director and majority shareholder, had surfaced in the probe into the Mithi river silt-cleaning scam.

The probe was conducted by the Economic Offences Wing. The case concerns alleged irregularities in silt-cleaning contracts issued by the municipal corporation in the financial years 2021-22 and 2022-23. Jayesh Joshi is reported to have been arrested in May 2025. This raised the question of how such a company was considered eligible for the Bhandup contract.

Additional Municipal Commissioner (Projects) Abhijit Bangar explained why the company was allowed to take part in the tender. According to him, two people had been arrested in the case, one of whom was a director connected with Vargo. When it came to light that the company was participating in the Bhandup tender, the matter was referred to the corporation's senior legal advisers.

The administration says the case was registered, prima facie, not against the company but against the individual. If that person is no longer associated with the company, the company cannot be disqualified on that ground alone. Bangar also said legal advice was taken so that nobody could challenge the decision in court later.

Two companies bid for the project: Vargo Specialities and Suez India Private Limited. Excluding GST, Vargo's quote was Rs 28.38 crore, against Rs 31.59 crore from Suez India.

The last date for submitting tenders was January 21, 2026. The technical bids of both companies were found eligible. The financial bids were then opened on April 21. Vargo's quote was lower than that of Suez India, so the corporation's water engineering department recommended awarding the contract to it. The department also wrote that the company has met the corporation's conditions, has experience of such work for other civic departments, and that its rates are reasonable by current market rates.

Under the plan, repairs to the six clarifier tanks at the Bhandup plant are to be completed in 24 months, excluding the monsoon. The work on each tank will be separate, and a three-year defect liability period will follow completion.

The standing committee approved the proposal on Wednesday. Attention now rests on the role of the municipal administration in awarding the contract for this important Mumbai water purification project to a company with an alleged link to the Mithi river scam.