Ch. Chandrasekhar vs. The State Of Andhra Pradesh
Held
The Court held that the respondents' action in withholding admitted payments was arbitrary. Citing a Division Bench judgment in Writ Appeal No.724 of 2021 and batch dated 12.10.2023, the Court directed the respondents to clear the admitted amount payable to the petitioner along with interest at 6% per annum within six weeks. Failure to comply would result in interest at 12% per annum until actual payment. The Court further clarified that withheld amounts under Deposits (EMD/FSD etc.) should be released without interest, as the defect liability period had been completed as per the agreement. The ratio decidendi is that admitted dues must be paid promptly, and delays attract interest, with specific provisions for deposits after the completion of contractual obligations.
Facts
The petitioner filed a writ petition seeking a Mandamus to direct the respondents to pay withheld amounts and other deposits related to the execution of a work under a scheme. The petitioner contended that the respondents admitted entitlement to the payment but had failed to disburse it, which was deemed arbitrary. The respondents, through the Government Pleader, submitted written instructions stating that payment was delayed due to a lack of Letter of Credit (LOC) but assured payment upon budget release. The Court considered previous judgments on similar non-payment issues.
Key Issues
1. Whether the respondents' action in withholding admitted payments and deposits payable to the petitioner for work executed under a scheme is illegal, arbitrary, and contrary to natural justice, as per Article 226 of the Constitution of India? Petitioner's contention: The petitioner argued that despite the respondents admitting the petitioner's entitlement to withheld amounts and other deposits, no payment was being made. This non-payment was characterized as arbitrary and high-handed, necessitating judicial intervention. The petitioner relied on the principle that admitted dues should be paid promptly. Respondents' contention: The respondents, through written instructions, explained that the delay in payment was due to a lack of Letter of Credit (LOC). They assured that payments would be made once the budget was released. The respondents did not explicitly contest the petitioner's entitlement but cited administrative reasons for the delay.
AI-generated summary — verify with the full judgment below
THE HON’BLE SRI JUSTICE VENKATESWARLU NIMMAGADDA WRIT PETITION No.29946 of 2023 ORDER:
This writ petition under Article 226 of Constitution of India is filed to issue Writ of Mandamus, declaring the action of respondents in not paying the withheld amounts and other deposits, payable to the petitioner in relation to the execution of work under the subject scheme, as illegal, arbitrary and contrary to the principles of natural justice.
It is the contention of the petitioner that even though the respondents admitted that the petitioner is entitled for payment of the withheld amounts along with other deposits, no payment is being made. The petitioner contends that such non-payment of money is clearly arbitrary and high-handed requiring the interference of this Court.
This Court, in various orders, including the judgment of a learned Single Judge of this Court dated 05.10.2021 in W.P.No.10038 of 2021 and batch had taken the view that such non-payment of dues is arbitrary and that such dues need to be cleared by the respondents at the earliest.
During hearing, learned Government Pleader for Irrigation placed written instructions, wherein, it is stated
The judgment continues below.
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