Chennai ad firm that won waste management bid starts work after two years

CHENNAI: The company, which won the contract three years ago to process the entire construction and demolition (C&D) waste generated in Chennai for 20 years, and started processing the waste in Kodungaiyur and Perungudi dumpyards a few months ago, is an advertising and public relations firm, as per the latest available filings with the Registrar of Companies (RoC). The firm, which got the contract in 2019, commenced work after a two-year delay due to the pandemic. 

According to the tender documents, Chennai Corporation will provide a minimum guaranteed C&D waste ranging between 400 and 659 tonnes per day for 20 years to WeStart Communications and pay a tipping fee of Rs 680 per tonne. With the city generating an average of 800 tonnes of C&D waste per day, the firm stands to get Rs 1.6 crore each month as tipping fee from the corporation. According to sources, at this rate, the firm may recover Rs 19 crore invested in buying machinery in one year. 

According to the firm’s memorandum of association accessed by TNIE, the objectives of the company include advertising, public relations and mass communication, and there is no mention of waste management.

“To advise individuals, firms, companies, corporations and others anywhere in the world on best methods of advertising products, processes and services and to act as consultants and agents and to deal with newspapers, magazines, TV, radio and other media on behalf of the clients,” says a company document explaining its nature of business. According to the firm’s financial statements, the firm had declared in 2019 — when it got the contract for processing corporation construction waste — that its revenue source is ‘advertisement services’.

This may be a violation of the technical prerequisites stipulated by the civic body in its tender document for the contract. The tender document said the bidders should have experience in construction and operation of at least one C&D waste plant in India processing at least 300 metric tonnes of C&D waste per day and the plant should have been in operation for at least three years.

Alternatively, the company may have experience in any of the solid waste management related work like door-to-door collection and transportation of waste, supply of materials/ equipment/ tools/ consumables required for such activities, or processing of waste in any government department/ local bodies in any one of the last three financial years in India before the bid due date.

The total cumulative value of such projects shall be more than Rs 10 crore either in a single project or multiple projects. TNIE reached out to WeStart for a response via email seven days ago, but the firm has not responded yet.

In 2019, WeStart competed with two other firms for the tender. One of the other bidders is Acetech, a Coimbatore-based machinery components firm. The tender was floated under two packages --- to process C&D waste from zones 1-8 of the city corporation in Kodungaiyur dump yard and to handle waste from zones 9-15 at Perungudi landfill. Apart from the tipping fee, the firm can also sell M sand and P sand generated from the construction waste.

According to the tender documents, the corporation has provided a 15-acre site each in Kodungaiyur and Perungudi at Rs 1 per sq.mt rent per month to the bidder. A top corporation official said the tender will be reviewed if any discrepancies are found. 

“There is an option to foreclose the tender before the intended period of 20 years,” he said. Another senior corporation official said the tender was awarded for a period of 20 years to enable the firm to recover the capital investment of Rs 19 crore. “The firm has been operating the processing units only since November last year and we may have released payments for only a month so far,” he said.

Rs 1.6 crore tipping fee per month 
WeStart Communications will get a tipping fee of Rs 680 per tonne. May recover Rs 19 crore invested in buying machinery in one year.