M.Maruthi Rao vs. State Of Andhra Pradesh

Held

The Court held that the non-payment of bills for works executed by contractors is illegal, referencing a previous order in W.P.No.10038 of 2021 & batch. In light of the admitted position that the petitioner executed the works and is entitled to payment, and considering the respondents' statement that the amount would be cleared soon after BRO release, the Court found it appropriate to direct the respondents to release the admitted amount. The reasoning was based on the principle that contractors are lawfully entitled to payment for completed works and prolonged non-payment is unjust. The Court directed the respondents to release the amount of Rs. 6,60,773/-, after effecting statutory deductions, at the earliest, and within six weeks from the date of receiving the order. The petitioner was also granted liberty to pursue their claim for interest in an appropriate forum. No costs were awarded.

Facts

The petitioner, M. Maruthi Rao, filed a writ petition challenging the respondents' failure to release an amount of Rs. 6,60,773/- for works executed under Agreement No. 88/2019-2020, dated 06.03.2020. The works involved closing a breach in an East Channel and clearing jungle on DLF and DRF banks. The petitioner completed the works, received a Quality Certificate on 31.12.2020, and a final bill of Rs. 6,60,773/- (including GST and other charges) was approved. Despite completion and constant persuasion, the payment was not released, leading to the filing of the writ petition. The respondents, through instructions dated 24.03.2023, did not dispute the works executed or the petitioner's entitlement to payment, stating the amount would be cleared after the release of BRO by the Government.

Key Issues

1. Whether the non-release of payment for executed works by the respondents is illegal, considering the admitted completion of works and approved final bill, and if so, what directions are necessary? Petitioner's contentions: The petitioner argued that they executed the works as per the agreement, obtained a quality certificate, and had a final bill of Rs. 6,60,773/- approved, including GST. They invested their own funds with the expectation of prompt payment. Despite their efforts, the respondents failed to release the lawfully due amount, necessitating the writ petition for appropriate directions. Respondents' contentions: The respondents, through instructions dated 24.03.2023, acknowledged the works executed by the petitioner and their entitlement to payment. They stated that the payment would be cleared soon after the release of BRO by the Government. They did not dispute the petitioner's claim on merits but indicated a procedural dependency for release of funds.