Mangaluru: Lady Goschen hospital construction dispute settled for Rs 1.83 crore in Lok Adalat

Mangalore Today News Network

Mangaluru, Mar 14, 2026: A dispute over pending payment to a contractor during the construction of the new building of the city’s prominent maternity hospital, Lady Goschen Hospital, was settled through compromise at the Lok Adalat on Saturday.

The dispute related to the amount that the Nirmiti Kendra had to pay the contractor for the construction work. Through mediation, the compensation amount — which had risen to nearly ₹4 crore including interest — was reduced to about ₹2 crore and settled, thereby saving a significant amount of public money.

The issue dates back to the construction of the new building of Lady Goschen Hospital during 2012–13. A dispute had arisen between the contractor and Nirmiti Kendra, and both parties had sought to resolve it through arbitration. The case was later examined under Section 34 of the Arbitration and Conciliation Act in the district court and was referred to the Lok Adalat for settlement.

Fourth Additional District Judge Shridhar Gopalakrishna Bhat, who settled the dispute in the Lok Adalat on Saturday, said that both parties agreed to a compromise through their lawyers and the Dakshina Kannada Deputy Commissioner also participated in the mediation process. The final settlement amount was fixed at ₹1,83,23,040.

“The contractor was earlier entitled to nearly ₹4 crore including interest. Through the compromise, the amount has been reduced by almost half, which has benefited the government as well,” the judge said.

Principal District Judge Basavaraju said that the case was resolved through mutual agreement and that the compromise not only settled the dispute but also saved a substantial amount of public funds.

Background of the case

In 2012–13, ₹21 crore was sanctioned under the CSR fund of MRPL for constructing a new building at Lady Goschen Hospital. Since MRPL could not provide an advance, the work could not be entrusted to the PWD or other government construction agencies. A district-level committee therefore decided to execute the project through Nirmiti Kendra.

A tender was called for ₹18 crore, and the contract was eventually awarded to a contractor for ₹9 crore. However, the contractor failed to complete even half the work even after three years, though the project was to be completed within two years. As a result, the then Deputy Commissioner assigned the remaining work to another contractor, who later completed the project and was paid.

Due to the delay caused by the first contractor, part of the payment was withheld with penalty. The contractor approached the court, which ordered the release of the pending amount. With 12% interest on the pending ₹1.5 crore, the payable amount had risen to nearly ₹4 crore. The case has now been settled in the Lok Adalat with a payment of ₹1.83 crore to the contractor.

Couple seeking divorce reconcile at Lok Adalat

In another notable incident at the Lok Adalat, a couple who had approached the court seeking divorce after 10 years of marriage reconciled and decided to continue their marital life.

The couple from Mangaluru, who had been living separately for the past three years due to marital differences, agreed to reunite before Judge Lakshmi Narayana Bhat at the Lok Adalat held at the Dakshina Kannada District Court on Saturday.

The couple, who also have a young child, exchanged garlands and shared sweets in the courtroom, marking their reconciliation.

According to Jaibunnisa, senior civil judge and Member Secretary of the District Legal Services Authority, three divorce-related cases were scheduled for settlement at the Lok Adalat on the day, of which two were successfully resolved through compromise.