Katragadda Siva Ramakrishna vs. The State Of Andhra Pradesh

Held

The Court held that the action of the respondent authorities in withholding the bill amount of Rs.14,81,819/- was illegal, arbitrary, and lacked justification. The Court found the petitioner's case to be 'pitiable' as the works were completed satisfactorily, yet the payment was withheld without any reason. The Court noted the non-compliance with its interim order directing payment. The ratio decidendi is that public authorities must promptly fulfill contractual obligations and pay agreed-upon amounts to contractors, especially when the work is completed and no valid reason for withholding payment exists. The Court directed the respondent authorities to pay the bill amount of Rs.14,81,819/- to the petitioner along with interest at 6% per annum within six weeks, referencing a Division Bench judgment in Writ Appeal No.724 of 2021 and batch. The petitioner was also permitted to agitate claims for differential amounts or higher interest in an appropriate forum.

Facts

The petitioner, a contractor, filed a writ petition seeking a mandamus to direct the respondent authorities to release an amount of Rs.14,81,819/- for repair works completed in Guntur District. The petitioner had successfully completed the works, and the net payable amount was finalized. Despite the completion of works and the expiry of the default liability period, the respondent authorities failed to release the payment. The petitioner also sought interest on the withheld amount. The Court noted that no counter-affidavit was filed by the respondents. An interim order directing payment of the finalized bill amount within six weeks was also not complied with.

Key Issues

1. Whether the action of the respondent authorities in withholding the payment of Rs.14,81,819/- to the petitioner, despite the completion of works, is illegal, arbitrary, and violative of the principles of natural justice? Petitioner's Arguments: The petitioner contended that they had successfully completed the agreed-upon works to the satisfaction of the authorities. The bill amount was finalized at Rs.14,81,819/-. The respondents have failed to pay this amount without any justification, even after the default liability period has expired. The withholding of payment is arbitrary and violates natural justice. The petitioner also relied on the interim order of the Court which was not complied with. Revenue/State's Arguments: The judgment records no specific arguments from the respondents. However, the Court's observations imply a lack of justification for withholding the payment.