M/S. Vibri Media Private LTD. vs. The State Of Andhra Pradesh

Facts

M/s. Vibri Media Private Ltd. (Petitioner), an event management company, filed a writ petition against the State of Andhra Pradesh and its tourism departments (Respondents). The Petitioner had organized several events for the Respondents between November 2017 and December 2018, as per various work orders. Despite successful completion of the events and submission of bills, the Respondents had only made partial payments, leaving an outstanding amount of Rs. 6,26,00,000 plus GST. The Petitioner had made several representations for the release of these dues, but to no avail. The Respondents, in their counter-affidavits, acknowledged the outstanding amounts, with Respondent No. 3 stating that bills relating to the outstanding amount of Rs. 4,38,26,708/- would be processed for payment. Respondent No. 1 stated that proposals for budget sanction were awaited and payments would be cleared after due verification. An interim application was also filed seeking payment of the outstanding amount pending disposal of the writ petition.

Held

The Court noted that the outstanding amounts payable to the petitioner were admitted by the 3rd respondent in their counter-affidavit. The Court disposed of the writ petition with a direction to the respondents to release the admitted outstanding amounts of Rs. 6,26,00,000 plus GST within a period of three months from the date of receipt of the order. Regarding the interest component, the Court held that if there was a subsisting clause in the agreement or work order envisaging payment of interest on due and payable amounts, it would be binding on both parties. No order as to costs was made. Miscellaneous petitions, if any, were closed.

Key Issues

1. Whether the inaction of the Respondents in paying the outstanding bills for organizing events, amounting to Rs. 6,26,00,000 plus GST, is illegal and arbitrary, violating the Petitioner's fundamental rights under Articles 14, 19, and 21 of the Constitution of India? 2. Whether the Petitioner is entitled to the payment of the outstanding amount along with interest, as per the terms of the agreement/work orders? Petitioner's Arguments: The Petitioner argued that the Respondents' failure to pay the outstanding bills for the successfully organized events was illegal, arbitrary, and violative of their fundamental rights. They sought a direction for the payment of the principal amount of Rs. 6,26,00,000 plus GST, along with interest, as per the work orders. Respondents' Arguments: Respondent No. 1 stated that payments would be cleared after due verification upon receipt of budget sanction proposals or bills. Respondent No. 3 acknowledged the outstanding amount and indicated that the bills would be processed for payment. The learned Assistant Government Pleader submitted that payment was delayed due to the non-release of budget by the Government, and payments would be made soon after budget release.