Kurian Joseph, J.

" CONTRACTORS' BILL" is not an unfamiliar subject to this High Court for quite some time. There are two reported Bench decisions of this Court on the subject. The first one is reported in Anirudhan v. State of Kerala (1999 (2) K L J 252) and the other is reported in State of Kerala v. K.P.W.S.W.L.C. Co-operative Society Limited (AIR 2001 Kerala 60). In the former case, the only defence of State was of financial difficulty. Considering the financial position explained in the affidavit filed by the State and particulars furnished in the additional statement dated 23.6.99, the Government [was granted four months time atleast for making payments to the Contractors who had filed Original Petitions on or before 23.6.99 against the final bills submitted by them excluding the Original Petitions filed by the Associations/Union of Contractors. There was also a direction to make payments in the remaining cases strictly in accordance with the seniority of the bills under the respective head of accounts and subject to availability of funds, on the principle 'first done first paid'.

2. Coming to the latter decision, it may be seen that it is a case where the State filed Writ Appeal against the direction issued by the learned Single Judge following Anirudhan's case in various writ petitions. The main contention raised by the State was maintainability with particular reference to the prerogative writ of mandamus and the Division Bench held as follows:

"The Original Petition under Article 226 of the Constitution for a writ of mandamus for enforcement of the contractual obligation, viz., payment of amount to the contractors in a contract, which is non-statutory, cannot be enforced through Article226 of the Constitution. The petitioners have to approach the Civil Court for enforcement of the contractual obligations."

It was also held that:

"Conditions in the contract provide for everything including for payment under the contract and also for termination of the contract, recovery of damages, etc. Thus, essentially when the contractor moves this Court for payment of dues under the Contract, this Court has to enforce the provisions of the contract and not the provisions of the statute or public duty"…. "It cannot be said that they have no right to approach this Court".... "Here what is being done is not the enforcement of public duty. May be what is involved in the contract is for the welfare of the public. But the right to be enforced is for the reimbursement of the amount spent by the contractors for the purpose of contract. We cannot say that they were exercising public duty in so far as there is no statutory contract. Hence, according to us, it is a case where a writ of mandamus cannot be issued."

The Bench also took the view that the dispute relating to interpretation of the terms and conditions of a contract could not have been agitated in a petition under Article 226 of the Constitution of India.

3. In view of the conflicting orders from the different benches, and in view of the conflicting stand taken by the State before different Benches, by order dated 23.3.2001 another Division Bench referred the matter for authoritative pronouncement by a Full Bench.

4. Sri.V.K. Beeran, learned Additional Advocate General who appeared for the State fairly conceded that the State does not dispute the liability to pay the amounts covered by the bills admitted by the departments. It is significant in this context to note that the directions issued in judgments under appeal are only to disburse the admitted amounts. In that factual matrix, it is not necessary for us to investigate as to whether there was any disputed question of fact involved in these cases. When the State admits its liability and yet does not act in a fair, proper and reasonable manner. Can it be said that the State shall not be compelled to act according to the Constitutional conscience of fairness and reasonableness in State actions.

5. Apparently, the impression th