Tejha Power Controls PVT LTD vs. The State Of Andhra Pradesh

Held

The Court held that the non-payment of the pending bills was not justifiable, given the undisputed position that the petitioner was entitled to the amount for the completed works. The Court found the respondents' reasons for the delay, as stated in the counter affidavit, insufficient to justify the prolonged non-payment. The Court directed the respondents to arrange for the payment of Rs. 3,10,30,338/-, after effecting statutory deductions if any, as expeditiously as possible, preferably within four months from the date of receiving the order. The Court also noted that the petitioner was free to raise a claim for interest before the appropriate forum if advised. The issue of interest was expressly left undecided by the High Court.

Facts

The petitioner, M/s Tejha Power Controls Pvt Ltd, filed a writ petition challenging the respondents' inaction in releasing pending bills totaling Rs. 3,10,30,338/- for providing transformer sets to various government hospitals in Andhra Pradesh under Agreement No. 04/APMSIDC/2021-22 dated 05.10.2021. The petitioner had completed the works and submitted bills, but payment was not made despite Clauses 68 and 69 of the A.P. Standard Specifications obligating payment within six months of work completion. The respondents, through their counter affidavit, acknowledged that the petitioner completed the works, an amount of Rs. 3,74,30,591/- had been released, and the final bill of Rs. 3,10,30,338/- was pending clearance in CFMS since 2022. They attributed some delay to defects pointed out during execution that the petitioner allegedly delayed rectifying, and stated that APMSIDC is an executing agency for various Heads of Departments.

Key Issues

1. Whether the respondents' failure to release the pending bill amount of Rs. 3,10,30,338/- to the petitioner, despite completion of works and contractual obligations for timely payment, is illegal and arbitrary? Petitioner's Contention: The petitioner argued that the respondents have failed to release the pending bills totaling Rs. 3,10,30,338/- for the transformer sets provided, causing hardship and irreparable loss. They relied on Clauses 68 and 69 of the A.P. Standard Specifications, which mandate payment within six months of work completion, a period that has elapsed. Respondents' Contention: The respondents, through their counter affidavit, admitted that the final bill was pending. They stated that certain defects were pointed out by field officers during execution, which the petitioner delayed in rectifying, thus causing no delay on their part in submitting bills to CFMS. They also clarified that APMSIDC is an executing agency and payments are released by various Heads of Departments.