B N V S Sambha Siva Rao vs. The State Of Andhra Pradesh

Held

The Court allowed the writ petition. It held that the respondents' action in withholding payment and not preparing the final bill was unsustainable. The Court reasoned that the admitted entitlement to the amounts, coupled with the stated reason for non-payment (lack of LOC for CFMS upload), indicated a procedural deficiency on the part of the respondents. The Court directed the respondents to pay the work bills covered under Agreement Nos. 74/2020-2021 and 75/2020-2021, dated 10.09.2020, and to return the withheld amounts, including GST, FSD, and EMD, by preparing the final bill for the works executed by the petitioner. The ratio decidendi is that government authorities cannot arbitrarily withhold admitted payments due to procedural lapses on their part, and such actions can be remedied through a writ of mandamus. The operative direction is to pay the amounts and return the deposits within two months of receiving the order.

Facts

The petitioner, B N V S Sambha Siva Rao, filed a writ petition seeking a direction to the respondents (State of Andhra Pradesh and others) to pay withheld amounts, GST, Further Security Deposit (FSD), and Earnest Money Deposit (EMD) by preparing the final bill for two works executed under agreement numbers 74/2020-2021 and 75/2020-2021, dated September 10, 2020. The petitioner contended that despite the respondents admitting entitlement to the amounts, no payment was made, constituting arbitrary and high-handed action. The respondents, through the learned Assistant Government Pleader, admitted the petitioner's claim and submitted that bills were not uploaded in CFMS due to a lack of LOC (Letter of Credit).

Key Issues

1. Whether the respondents' action in not paying the withheld amounts, GST, FSD, and EMD, by preparing the final bill for the works executed by the petitioner under Agreement Nos. 74/2020-2021 and 75/2020-2021, dated 10.09.2020, is illegal, arbitrary, malafide, against the principles of natural justice, contrary to law, and in violation of Articles 14, 21, and 19(g) of the Constitution of India. Petitioner's contention: The petitioner argued that the non-payment of admitted amounts is arbitrary and high-handed, necessitating judicial intervention. The petitioner relied on the principles of natural justice and constitutional provisions guaranteeing fundamental rights. Respondent's contention: The respondents, through the learned Assistant Government Pleader, admitted the petitioner's claim and stated that the delay in payment was due to the bills not being uploaded in CFMS because of a lack of LOC. No specific legal provisions or precedents were cited by the respondents.