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HIGH COURT OF JAMMU AND KASHMIR
RAJESH SEKHRI, J
M/S CUBE CONSTRUCTION ENGINEERING TH THAKUR ASHWANI SINGH – Appellant
Versus
U T OF J AND K TH COMMISSIONER SECRETARY PWD R AND B DEPTT AND OTHERS – Respondent
WP(C) 1962 / 2022
(A) Contract Law - Administrative Approval - The petitioner, a partnership firm, was awarded a contract for road construction and completed the work satisfactorily, raising a final bill of Rs. 13.90 lacs. The respondents withheld payment citing lack of express Administrative approval for excess work. The court held that the respondents cannot deny payment for work completed satisfactorily. (Paras 1-11)
(B) Legal Principles - The court reiterated that it is the responsibility of the respondents to ensure necessary approvals are in place before work commences, and contractors are entitled to payment for work performed in good faith. (Paras 8-10)
Facts of the case:
The petitioner completed road construction work and raised a final bill, which was approved, but payment was withheld by the respondents due to lack of formal approval for excess work.
Findings of Court:
The court found that the respondents admitted the execution of work and their liability to pay, thus directing the release of the payment along with interest.
Issues: The main issues were whether the petitioner was entitled to payment for excess work done without express Administrative approval and the justification for withholding payment.
Ratio Decidendi: The court ruled that the respondents cannot escape liability for work completed satisfactorily, regardless of the absence of formal approval, emphasizing the need for fairness in contractual obligations.
Result: Petition allowed; respondents directed to release payment of Rs. 13.90 lacs with interest.
JUDGMENT :
1. Petitioner, a partnership firm, pursuant to e-NIT No. CEJ/PMGSY/474 of 2017-18 dated 30.10.2017, participated in the tendering process for the work namely “Construction and maintenance of road from Malwan Jagir to Abli Masri, Package No JK04-301, Phase-X, Stage II, Block Doda District Length 6.00 kms” and being the lowest bidder was allotted the aforesaid work vide Order No. CEJ/PMGSY/27614-23 dated 14.02.2018.
2. The case set up by the petitioner is that on completion of the aforesaid work, it raised its final bill (CC-8th) to the respondents for pending amount of Rs. 13.90 lacs duly approved by respondents after necessary tests on site. According to the petitioner, the exceeded work amounting to Rs.13.90 lacs, with respect to which a comparative statement showing excess over the allotted cost along with its estimate was prepared and approved by respondent No. 3-Executive Engineer, WP(C) No. 1962/2024 PMGSY, Division and was submitted to respondent No. 2-Superintending Engineer on 23.10.2021. It is contention of the petitioner is that aforesaid work was completed by it without any complaint or deficiency, owing to which, Executive Engineer, PMGSY Division, Doda issued a completion certificate on 27.01.2021. According to the petitioner, the balance payment in question is outstanding against the respondents inspite of regular follow ups on its part.
3. It is further case of the petitioner that it filed a complaint dated 25.01.2022 in the J&K Government Grievance Cell for release of the aforesaid admitted liability. Respondent No. 3 submitted its reply to the aforesaid complaint of the petitioner on 01.02.2022 whereby excess work done by the petitioner came to be admitted but with the reason that payment could not be made due to internal approvals.
4. Grievance of the petitioner is that despite execution of the allotted work, within the prescribed period to the satisfaction of the respondents, respondents have withheld its admitted liability without any reason or justification.
5. Respondents are affront to the claim of the petitioner for the release of balance payment in question, primarily on the premise that the alleged excess work might have been done by the petitioner firm on its own free will but without any express written order from the competent authority. It is contention of the respondents that petitioner cannot claim the payment, for the excess work done by it without formal Administrative approval.
6. Heard arguments and perused the file.
7. Learned counsels for the parties have reiterated the grounds urged in their respective pleadings in the arguments. Learned counsel for the petitioner has relied upon a judgment dated 07.05.2022 passed by this Court in Abdul Rashid Malik v. Union Territory of J&K and others ; WP(C) No. 873/2021 .
8. This Court in Abdul Rashid Malik has held that it is not for the contractor to consider whether the Administrative approval, technical sanction and other formalities have been completed or not before undertaking any work, but it for the respondents to explain how these works were executed in the absence of necessary approval and sanction. It was also observed that contractor executing the work on behalf of the respondents undertakes the same on the firm belief that the work is being undertaken by him on the asking of respondents after its due approval and completion of all the formalities. The Co-ordinate Bench in the aforesaid case relying upon M/s Surya Construction v. The State of UP in Civil Appeal No. 2610/2010 dated 02.05.2010 also clarified that State, while entering into a contract or agreement with private individuals, has to act in just, fair and reasonable manner as the contractual obligations of the State coexist with the constitutional obligations.
9. If the stand of the respondents is carefully glanced over, it is evident that respondents have neither denied the execution of work done by the petitioner over and above the allotted work, nor their liability to make th
Contractors are entitled to payment for work performed in good faith, regardless of the absence of formal Administrative approval for excess work.
The lack of administrative approval and technical sanction for the works does not absolve the respondents from their liability to pay for the executed works, especially when the liability is admitted....
A contractor's entitlement to payment for executed works cannot be denied based on alleged lack of administrative approval when such works were accepted, confirming the principle of accountability in....
Delay and laches cannot be invoked by the government to deny an admitted claim for payment, emphasizing the need for timely compensation to contractors.
Point of Law : Respondents have made the petitioner to execute the work out of his own funds, it is their bounden duty to reimburse the petitioner at the earliest, that too with interest.
A writ of mandamus can be issued to enforce payment of dues when work under contract is completed satisfactorily and unpaid despite confirmed completion.
Funds cannot be withheld due to procedural lapses by the respondents once the work has been satisfactorily completed.
The court emphasized the importance of allowing the petitioner to seek an appropriate decision through a fresh representation before the relevant authority.
Contractual obligations dictate that the petitioner must adhere to timelines, and failure to obtain necessary approvals does not exempt him from liability or justify his claims for completed works.
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