Psr Constructions vs. The State Of Andhra Pradesh

Held

The Court held that the non-payment of the admitted dues by the respondents was arbitrary. Relying on its previous pronouncements, including a learned Single Judge's order dated 05.10.2021 in W.P.No.10038 of 2021 and batch, the Court found that such inaction warranted intervention. The Court also considered the Division Bench judgment in Writ Appeal No.724 of 2021 and batch dated 12.10.2023. Consequently, the Court directed the respondents to release the amount of Rs. 16,95,000/- to the petitioner. Additionally, the Court ordered the payment of interest at the rate of 6% per annum. The petitioner was also granted liberty to pursue a claim for a higher rate of interest in an appropriate forum. The Court did not expressly leave any issue undecided.

Facts

The petitioner, PSR Constructions, was awarded contract works in Kurnool District and completed them, with final bills prepared for Rs. 16,95,000/-. The respondents failed to make the payment, prompting the petitioner to file a writ petition. The petitioner contended that the non-payment was arbitrary. The respondents, through the Government Pleader, submitted that a proposal for Rs. 17.08 Lakhs was sent to the Chief Engineer for budget allocation, and payment, including GST, would be arranged upon receipt of the budget. The Court had previously taken a view that such non-payment is arbitrary and needs to be cleared promptly.

Key Issues

1. Whether the non-payment of Rs. 16,95,000/- by the respondents to the petitioner for executed contract works is arbitrary and requires the High Court's intervention under Article 226 of the Constitution of India. Petitioner's contention: The petitioner argued that despite admitted entitlement to the payment, the respondents' failure to disburse the amount was arbitrary and high-handed, necessitating judicial interference. The petitioner relied on previous orders of the High Court, including a learned Single Judge's order dated 05.10.2021 in W.P.No.10038 of 2021 and batch, which held similar non-payments as arbitrary. Respondents' contention: The respondents, through the Government Pleader, stated that a proposal for the payment amount had been submitted to the Chief Engineer for budget approval. They assured that payment, including GST, would be processed through CFMS upon receipt of the budget. The respondents did not explicitly contest the petitioner's claim on merits but indicated a procedural delay in budget allocation.