Srihari Constructions vs. The State Of Andhra Pradesh

Held

The High Court allowed the writ petition. The Court directed the respondents to release the EMD & FSD amount of Rs. 3,72,439/- to the petitioner within two months from the date of receiving a copy of the order. The Court also stated that if the petitioner was entitled to any higher amount, it should also be paid as per their entitlement. The Court did not grant any order as to costs. The reasoning for allowing the petition was based on the admission by the respondents regarding the petitioner's entitlement to the EMD and FSD, despite their contention that the specific issue of returning withheld deposits was not covered by the cited judgment on delayed final bill payments. The operative direction was the release of the specified amount within a stipulated timeframe.

Facts

The petitioner, Srihari Constructions, filed a writ petition seeking the return of Earnest Money Deposits (EMD) and Full Security Deposits (FSD) along with Goods and Services Tax (GST) and interest on works executed under the "Neeru Chettu" scheme. The petitioner claimed non-payment of these amounts was illegal and arbitrary. The works were executed under five agreements, all dated November 30, 2018. The respondents, represented by the learned Assistant Government Pleader, admitted the petitioner's claim but stated that the return of withheld deposits did not fall under the ambit of a previous judgment (W.A.No.724 of 2021) concerning delayed payment of final bills. They clarified that FSD is payable after the defect liability period, not from the date of submitting the final bill. The total net amount payable was Rs. 68,81,193, with EMD & FSD amounting to Rs. 3,72,439.

Key Issues

1. Whether the respondents are legally obligated to return the EMD and FSD amounts to the petitioner, along with GST and interest, for works executed under the "Neeru Chettu" scheme. 2. Whether the non-payment of EMD and FSD, as claimed by the petitioner, constitutes an arbitrary and high-handed action by the respondents. Petitioner's Contentions: The petitioner argued that the respondents' failure to return the EMD and FSD, along with GST and interest, was illegal, arbitrary, and violated principles of natural justice and Articles 14, 19(1)(g), and 21 of the Constitution of India. They also cited GO MS No. 266 dated 15.02.2021, memo No.1279341/FMU-WR.I/2020 dated 18.02.2021, and orders in W.A.No.724 of 2021. The petitioner contended that the respondents admitted entitlement to the amounts, making the non-payment unjustified. Respondents' Contentions: The respondents, through the learned Assistant Government Pleader, admitted the petitioner's claim regarding the amount but argued that the case of returning withheld deposits did not fall within the scope of W.A.No.724/2021, which dealt with delayed payment of final bills. They asserted that FSD is payable only after the satisfactory completion of the defect liability period, not from the date of preferring the final bill.