The Mumbai Metropolitan Region Development Authority (MMRDA) on Friday terminated the operation and maintenance contract with LTSE, a joint venture between Larsen & Toubro and Scomi Engineering, which was running the Chembur-Wadala section of the monorail.

MMRDA terminated the contract for the operator’s failure to perform and fulfil contractual obligations. In 2008, MMRDA had entered into the contract with LTSE for building and maintaining the monorail service.

A press statement issued by the MMRDA said the monorail services will continue as the present Indian staff of the joint venture will be rehired through an external agency under MMRDA supervision. The various operations and maintenance heads of the monorail would be lead by the MMRDA staff.

Metropolitan Commissioner of MMRDA RA Rajeev in the statement said that LTSE failed to supply the rolling stock trains, rectify the defects as per the contractual clauses and maintain the quality of monorail services. It has also resulted in inordinate delays in the second phase, which is to run from Wadala to Mahalaxmi.

MMRDA will encash the bank guarantee of ₹200 crore submitted by LTSE for the contract. All the decisions were taken after the LTSE failed to respond to the legal notices issued by MMRDA.