V Narothama Reddy vs. The State Of Ap

Held

The Court held that there was no dispute regarding the works executed by the petitioner and his entitlement to the withheld amount. The written instructions from the respondents confirmed that the amount was withheld pending clarification by the Government on the GST rates for the earthwork items. Since the instructions indicated that the clarification had been made and the remaining amount would be paid, the Court found no reason to further examine the petitioner's detailed submissions. The Court directed the respondents to arrange for the payment of the withheld amount to the petitioner as expeditiously as possible, within a period of four weeks from the date of receipt of a copy of the order. The Court also noted that the petitioner was entitled to raise a claim for interest through appropriate proceedings if advised. The issue of interest was expressly left undecided by the Court in this writ petition.

Facts

The petitioner, V. Narothama Reddy, filed a writ petition challenging the action of the respondents in withholding Rs.1,59,903/-, which represented 10% of the net value of work executed under Agreement No. 151 SE/2017-18 dated 22.12.2017. The petitioner contended that the work was successfully completed as per the agreement, and the withholding of funds was arbitrary and illegal, pending clarification on reformulated rates for Neeru Chettu earthwork items with provision for GST. The respondents, through written instructions, acknowledged that the work was partially completed and a bill was raised. At the time of bill processing, GST was imposed, and as GST clarification was not finalized, 10% of the amount was deducted. The instructions further stated that the clarification has now been made by the Government and the remaining amount will be paid in due course.

Key Issues

1. Whether the action of the respondents in withholding Rs.1,59,903/- from the petitioner's bill amount for work executed under Agreement No. 151 SE/2017-18, pending clarification on reformulated rates for Neeru Chettu earthwork items with GST, is arbitrary, illegal, discriminatory, and violative of Fundamental Rights under Articles 14, 19, and 21 of the Constitution of India. Petitioner's Arguments: The petitioner argued that the respondents' action in withholding the payment, despite the successful completion of the work, was unjust and illegal. The delay was attributed to the respondents' need for clarification on reformulated rates concerning GST, which was causing undue hardship. Respondents' Arguments: The respondents, through written instructions, stated that the work was partially completed and a bill was raised. The deduction of 10% was made due to the imposition of GST and the pending clarification from the Government. They confirmed that the clarification has now been made and the remaining amount will be paid.