M/S Gvriipl And Srrcipl(Jv) vs. State Of Telangana

Facts

The petitioner, M/s GVRIIPL and SRRCIPL (JV), a joint venture, was awarded a contract for "JCR DLIS-Phase-III, Package VI" by the Irrigation Department of Telangana. The agreement, dated 01-11-2021, stipulated conditions for the recovery of GST, NAC, seigniorage charges, and labour cess as per clause 12.4. The petitioner had been receiving these 'reimbursable amounts' in their running bills. Subsequently, the Government issued G.O.Ms.No.21 dated 31-03-2022, introducing a 'permit fee' at 0.8 times the seigniorage charges for all minerals. The 5th respondent, the Pay and Accounts Officer, proposed to recover Rs.78,96,015 as this 'permit fee' from the petitioner's 5th and part bill, in addition to seigniorage charges, without adding it to the work value. The petitioner contended this action was arbitrary and illegal.

Held

The Court acknowledged the submission of the learned Government Pleader that the writ petition was premature, as the petitioner had not first approached the respondents with their grievance. The petitioner's counsel then sought liberty to make a representation to the respondents. Consequently, the Court disposed of the writ petition by granting liberty to the petitioner to approach the respondents by making a representation. The respondents were directed to consider the representation and pass appropriate orders in accordance with the law within a period of six weeks from the date of receipt of the representation. No order as to costs was made. The Court did not decide the merits of the petitioner's claim regarding the legality of the 'permit fee' recovery or its inclusion in the work value, as the matter was disposed of on the ground of prematurity.

Key Issues

1. Whether the action of the 5th respondent in proposing to recover Rs.78,96,015 towards 'permit fee' is illegal, arbitrary, and violative of Articles 14, 19(1)(g), and 300-A of the Constitution of India, contrary to the agreement conditions? 2. Whether the 'permit fee' should be added to the value of the work as per agreement clause 12.4? Petitioner's arguments: The petitioner argued that the proposed recovery of 'permit fee' was contrary to the agreement conditions and illegal. They contended that the 'permit fee' should have been added to the value of the work as per clause 12.4 of the agreement, and its recovery without such addition was arbitrary and violative of constitutional rights. They relied on the agreement clause 12.4. Respondents' arguments: The respondents, through the learned Government Pleader for Irrigation, argued that the writ petition was premature and that there was no cause of action for the petitioner as they had not approached the respondents first.