Sri Lakshmi Steel Furniture Works vs. The State Of Ap

Held

The Court acknowledged the petitioner's claim for the refund of deposited amounts totaling Rs. 24,62,149/-, which were deposited as security (EMD and FSD) for works executed. The Court noted that the Standing Counsel for the respondents lacked immediate instructions. Considering the nature of the claim, the Court directed the respondent authority to examine the petitioner's claim within eight weeks. Upon satisfaction that the works were executed and the supplies met the required quality standards, the amounts found due to the petitioner were to be paid within a further period of eight weeks. The Court disposed of the writ petition with these directions, making no order as to costs. The issue of interest was implicitly addressed by the direction for payment within a specified timeframe, though the specific rate of 12% sought by the petitioner was not explicitly granted or denied.

Facts

The petitioner, Sri Lakshmi Steel Furniture Works, filed a writ petition seeking the refund of deposited amounts totaling Rs. 24,62,149/-. These amounts were deposited as security (EMD 2.50%, FSD 2.5%) for undertaking works of supply and delivery of furniture to Ward Secretariats in Kakinada Municipal Corporation, Tuni Municipality, and Rajahmundry Municipal Corporation. The petitioner claims that despite completing the works and the observation period, the security deposits, along with the final bill payment, have not been refunded. The petitioner also mentions a 5% GST component related to these deposits. The respondents, represented by the Standing Counsel, stated they did not have ready instructions.

Key Issues

1. Whether the action of the respondents in not refunding the deposited amounts (EMD, FSD, and GST) totaling Rs. 24,62,149/-, after the completion of the observation period for the works executed by the petitioner, is illegal, arbitrary, and violative of the principles of natural justice and Articles 14, 19(1)(g), and 21 of the Constitution of India? Petitioner's arguments: The petitioner contended that the non-refund of security deposits after the completion of works and the observation period is illegal and arbitrary. They argued it violates their fundamental rights to carry on business and the principles of natural justice. They sought the immediate release and repayment of these amounts with 12% interest. Respondent's arguments: The Standing Counsel for the respondents stated that they did not have ready instructions regarding the petitioner's claim.