.Sri Satya Sai Constructions vs. The State Of Andhra Pradesh
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Cause title — parties, addresses and appearances
The Court made the following Common Order:
The present batch of writ petitions are filed challenging the memos issued by the 2nd respondent deducting the tender discount percentages on the price adjustment value and thereby reducing the amount receivable by the petitioners towards price adjustment. The said action is contrary to G.O.Ms. No.94 dated 16.04.2008, G.O.Ms.No.35 dated 30.01.2009, G.O.Ms.No.1 dated 25.02.2012 and G.O.Ms.No.62 dated 30.11.2021. All the writ petitions are filed challenging the action of the 2nd respondent and direction is sought from this Court directing the respondents to process the payment payable and release the same to the petitioner.
The prayers as sought for in the batch of writ petitions are as follows: “.....to issue an appropriate writ order or direetion more partieularly one in nature of Writ of Mandamus deelaring the Memo No.DEEI/AEEII/Araku/SCA to TSP/Sub estimate/Dumbriguda/PA/ dated 25.05.2026 issued by the respondent No.2 deducting the tender discount percentage of 15.39 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs.2,51,76,283/- (Rupees Two Crores Fifty One Lakhs Seventy Six Thousand Two Hundred and Eighty Three) to Rs.2,13,01,653/- (Rupees Two Crores Thirteen Lakhs One thousand Six Hundred and Fifty Three) for Construction of Ekalavya Model Residential School for Girls at Dumbriguda Village and Mandal, Visakhapatnam District (Now ASR District), having technically approved the same and concurred by the petitioner as arbitrary, illegal, colourable exercise of power, contrary to G.O.Ms.No.94, Transport, Roads and Buildings Department, dated 16.04.2008,
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G.O.Ms.No.35, Transport, Roads and Buildings, Department, dated 30.01.2009, G.O.Ms.No.1, Finance (Works and Projects) Department, dated 25.02.2012 and G.O.Ms.No.62, Water Resources (Reforms) Department, dated 30.11.2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14, 19, 21 and 300-A of Constitution of India and consequently set aside the same and pass such....” “.....declaring the Memo No DEEIII /AEEV /PVP/ EMRS /Anasabhadra /ReGenAb/202425 dated 27 05 2026 issued by the respondent No 2 deducting the tender discount percentage of 12.69 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs 2 63 94 173/ Rupees Two Crore Sixty Three Lakhs Ninety Four Thousand One Hundred and Seventy Three to Rs.2,30,44,753/ (Rupees Two Crore Thirty Lakhs Forty Four Thousand Seven Hundred and Fifty Three) for Construction of Ekaiavya Model Residential School for Girls at Anasabhadra Village Makkuva Mandal Vizianagaram District Now Parvathipuram Manyam District having technically approved the same and concurred by the petitioner as arbitrary illegal colourable exercise of power contrary to G O Ms No 94 Transport Roads and Buildings Department dated 16.04.2008 G O Ms No.35 Transport Roads and Buildings Department dated 30 01 2009 G O Ms No 1 Finance Works and Projects Department dated 25.02.2012 and G O Ms.No.62 Water Resources Reforms Department dated 30.11.2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....” “.....declaring the Memo No DEElll /AEEV /PVP /EMRS/ GNPeta /ReGenAb/202425 dated 27 05 2026 issued by the respondent No 2 deducting the tender discount percentage of 13.59 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs 2 71 89 983/ Rupees Two Crore Seventy One Lakhs Eighty Nine Thousand Nine Hundred and Eighty Three to Rs.2.34.94.864/- Rupees Two Crore Thirty Four Lakhs Ninety Four Thousand Eight Hundred and Sixty Four for Construction of Ekalavya Model Residential School for Girls at Kotikapenta Village site shifted to Guruvinaidupeta Village and Mandal Vizianagaram District Now Parvathipuram Manyam District having technically approved the same and concurred by the petitioner as arbitrary illegal colourable
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exercise of power contrary to G O Ms No.94 Transport Roads and Buildings Department dated 16 04 2008 G O Ms No.35 Transport Roads and Buildings Department dated 30 01 2009 G O Ms No.1 Finance Works and Projects Department dated 25 02 2012 and G O Ms No.62 Water Resources Reforms Department dated 30 11 2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....” “.....declaring the memo No DEEIII /AEEV /PVP /EMRS/ Kurupam/ReGenAb/202425 dated 27.05.2026 issued by the respondent No 2 deducting the tender discount percentage of 12.69 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs.1,89,45,648/- Rupees One Crore Eighty Nine Lakhs Fourty Five Thousand Six Hundred and Forty Eight to Rs.1,65,41,445/- Rupees One Crore Sixty Five Lakhs Forty One Thousand Four Hundred and Forty Five for Construction of Ekalavya Model Residential School for Girls at Kurupam Village and Mandal Vizianagaram District Now Parvathipuram Manyam District having technically approved the same and concurred by the petitioner as arbitrary illegal colourable exercise of power contrary to G O Ms No.94 Transport Roads and Buildings Department dated 16.04.2008 G O Ms No.35 Transport Roads and Buildings Department dated 30.01.2009 G O Ms No.1 Finance Works and Projects Department dated 25.02 2012 and G O Ms.No.62 Water Resources Reforms Department dated 30 11 2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....” “.....declaring the Memo No DEEIII/AEEVM/SPT/EMRS/Meliaputti/Re Gen Ab/202425 dated 22 05 2026 served on 26 05 2026 issued by the respondent No 2 deducting the tender discount percentage of 13.59 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs.2,94,11,874/- Rupees Two Crores Ninety Four Lakhs Eleven Thousand Eight Hundred and Seventy Four to Rs.2,54,14,800/- Rupees Two Crores Fifty Four Lakhs Fourteen Thousand Eight Hundred for Construction of Ekalavya Model Residential School for Girls at Meliaputti Village Seethampeta Mandal Srikakulam District Now ParvathipuramManya m District having technically approved the 7
same and concurred by the petitioner as arbitrary illegal colourable exercise of power contrary to G O Ms No.94 Transport Roads and Buildings Department dated 16.04.2008 G O Ms No.35 Transport Roads and Buildings Department dated 30.01.2009 G O Ms No.1 Finance Works and Projects Deparment dated 25.02.2012 and G O Ms No.62 Water Resources Reforms Department dated 30.11.2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....” “.....declaring Memo No DEEI/AEEII/Araku/SCA to TSP/Sub estimate/Munchingput/PA/ dated 22.05.2026 served on 26.05.2026 issued by the respondent No.2 deducting the tender discount percentage of 11.79 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs.2,65,25,016/- Rupees Two Crores Sixty Five Lakhs Twenty Five Thousand Sixteen to Rs.2,33,97,717/- Rupees Two Crores Thirty Three Lakhs Ninety Seven Thousand Seven Hundred and Seventeen for Construction of Ekalavya Model Residential School for Girls at Munchinput Village and Mandal Visakhapatnam District Now ASR District having technically approved the same and concurred by the petitioner as arbitrary illegal colourable exercise of power contrary to G O Ms No.94 Transport Roads and Buildings Department dated 16.04.2008 G O Ms No.35 Transport Roads and Buildings Department dated 30.01.2009 G O Ms No.1 Finance Works and Projects Deparment dated 25.02.2012 and G.O.Ms.No.62 Water Resources Reforms Department dated 30.11.2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....” “.....declaring the Memo No DEEIII/AEEVII/SPT/EMRS/Bhamini/Re Gen Ab/202425 dated 23.05.2026 served on 26.05.2026 issued by the respondent No.2 deducting the tender discount percentage of 13.59 percent on the price adjustment value and reducing the amount receivable by the petitioner towards price adjustment from Rs.2,87,48,729/- Rupees Two Crores Eighty Seven Lakhs Fourty Thousand Seven Hundred and Twenty Nine to Rs.2,48,41,777/- Rupees Two Crores Forty Eight Lakhs Forty One Thousand Seven Hundred and Seventy Seven for Construction of Ekalavya Model Residential School for Girls at Bhamini Village Bhamini Mandal
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Srikakulam District Now ParvathipuramManyam District having technically approved the same and concurred by the petitioner as arbitrary illegal colourable exercise of power contrary to G O Ms No.94 Transport Roads and Buildings Department dated 16.04.2008 G O Ms No.35 Transport Roads and Buildings Department dated 30.01.2009 G O Ms No.1 Finance Works and Projects Department dated 25.02.2012 and G.O.Ms No.62 Water Resources Reforms Department dated 30.11.2021 apart from being violative of the Fundamental and Constitutional Rights guaranteed to the petitioner under Articles 14 19 21 and 300A of Constitution of India and consequently set aside the same and pass....”
The petitioner is a contractor and has filed the batch of writ petitions. The petitioner is in the business of infrastructure and development works. The petitioner executed various works relating to construction of Ekalavya Model Residential School for Girls at various places in the State of Andhra Pradesh. The respondents have entered into an agreement with the petitioner for execution of the work. The respondents had obtained the requisite sanction for execution of the work and the petitioner had entrusted with additional works in various locations which also executed by the petitioner successfully and to the satisfaction of the respondent authorities. The petitioner had quoted the tenders at discount of various percentages for various works which was less than the estimated contract value. Apart from the estimated contract value the petitioner had also executed additional works and the total value of the works executed by the petitioners far exceeded the estimated contract value on account of execution of additional and exigency works which included price escalation, additional work, GST.
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It is submitted that as per clause No.46 of the Agreement, price adjustment for steel and cement could be permitted as per G.O.Ms.No.94 and price adjustment for machinery, labour, materials is permitted as per GOMs. No.
It is submitted that though the petitioner executed the works long back to the best satisfaction of the respondent authorities, the respondents have not released the payments due payable to the petitioner resulting in the petitioner classified as non-performing asset on account of default in repaying the loans.
Learned counsel for the petitioner submits that the then Chief Engineer of Tribal welfare department by name, S.Srinivas, along with the 3rd respondent demanded bribe from the petitioner for releasing the balance dues. Unable to sustain the pressure from respondent Nos.2 and 3, the petitioner approached Anti-Corruption Bureau and respondent Nos.2 and 3 were caught red handed in the ACB trap on 07.08.2025. The 2nd respondent was suspended after his arrest. The works executed by the petitioner and the additional works executed by the petitioner were in pursuance of the agreements and supplementary agreements entered by the petitioner with competent respondent authorities.
The respondents have issued the impugned proceedings stating that clause 46, tender premium/discount is to be applied to principal as well as price escalation. The GOMs.No.1 prohibits applying premium or discount on price escalation/adjustment as price adjustment is to ensure that the contractors are paid on real time basis. It is also submitted that the petitioner
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are targeted by the present Chief Engineer and Superintendent Engineer as the petitioner had filed a complaint against the illegal demands of the then 2nd and 3rd respondents.
Learned counsel for the petitioner submits that the 9th meeting of Board of Chief Engineers held on 11.09.2026, in respect of various items in the agenda including agenda No.4, whereby instructions on interpretation of tender premium as tender percentage was sought for. It is submitted that the recommendation of Board of Chief Engineers had clarified in unequivocal terms that the term premium shall be construed as tender percentage meaning that the quoted tender percentage can either be excess with respect to estimated contract value or discount with respect to estimated contract value. The minutes of the said meeting are forwarded to this Court by the learned counsel for the petitioner.
It is submitted that as per the clarification issued by the Board of Chief Engineers, the claim of the petitioner deserves to be allowed. Learned Assistant Government Pleader appearing for the respondents sought time for obtaining instructions on the minutes of the meeting dated 11.09.2026. 9. Today when the matter is taken up for hearing, Learned Assistant Government Pleader submits that the clarifications of the Board of Chief Engineers would have to be followed by all the concerned including the respondents.It is submitted that considering the clarification issue by the 11
Board of Chief Engineers on the issue raised by the petitioner, this Court may pass appropriate orders.
Considering the submissions made, the impugned proceedings deserves to be set aside in the writ petitions by directing the respondents to release the outstanding payment due payable by referring to the clarification issued by Board of Chief Engineers with reference to the applicability of tender discount for the price adjustment value.
With these observations the writ petitions are allowed, directing the respondents to release the outstanding payments to the petitioner within a period of 8 weeks from the date of receipt of copy of this order. No costs.
Pending miscellaneous applications, if any, shall stand closed.
____________________ JUSTICE HARINATH.N 24.09.2026 R 12
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THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION Nos.15033, 15154, 15156, 15159,15160,15161 & 15162 of 2026
2026 R
Reproduced from the public record of the Andhra Pradesh High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.