M/ S. Siva Sai Constructions vs. The State Of Andhra Pradesh

Held

The Court held that the non-payment of admitted bills, even after the completion of work and finalization of bills, is illegal and arbitrary. Citing numerous decisions from the Apex Court and the High Court, the Court found that such non-payment violates Articles 14 and 21 of the Constitution of India. The Court acknowledged the respondents' submission regarding the need for a GST tax invoice but found the continued non-payment of the admitted amount to be unjustifiable. Therefore, in the interest of justice, the Court directed the respondents to pay the admitted bill amount of Rs.12,31,796/-, including deposits, to the petitioner within six weeks from the date of receiving a copy of the order. The Court did not expressly leave any issue undecided.

Facts

The petitioner company, engaged in civil works, filed a writ petition challenging the non-payment of bills for the "formation of internal CC roads in Market Yard, Kuppam" awarded by respondents 2 and 3. The petitioner completed the work as per agreement No.206/2018-19 dated 04.08.2018 and submitted bills. The 4th respondent took over records and issued a statement for work done, but payment was not released. The petitioner argued that as per Clauses 68 & 69 of the Andhra Pradesh Detailed Standard Specifications, payment should be made within six months of work completion. The respondents, in their counter, cited a freezing of the R.D.R budget since December 2019 as the reason for non-payment. They stated that an alternative arrangement was made through CMF budget sanction, and bills were called for. However, the petitioner's bill was returned due to the non-enclosure of the contractor's input GST tax invoice, and the petitioner had not yet resubmitted it.

Key Issues

1. Whether the non-payment of admitted work bills by the respondents, despite the completion of work and issuance of a statement for work done, is illegal and arbitrary, violating the petitioner's rights under Articles 14 & 21 of the Constitution of India? Petitioner's contention: The petitioner argued that there is a statutory obligation on the respondents to pass and pay bills within six months of work completion, as per Clauses 68 & 69 of the Andhra Pradesh Detailed Standard Specifications. The continued non-payment, even after the work was finalized and a statement issued, is arbitrary and illegal. Revenue/State's contention: The respondents contended that payment could not be released due to the freezing of the R.D.R budget since December 2019. They further stated that the petitioner's bill was returned for re-submission due to the non-enclosure of the contractor's input GST tax invoice, and the petitioner had not yet submitted the required document, preventing the bill from being forwarded for payment. They also reiterated that pending bills would be cleared as soon as funds were available.