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2025 Supreme(Online)(Ker) 47869

IN THE HIGH COURT OF KERALA AT ERNAKULAM
Ziyad Rahman A.A.TH, J
Majestic Constructions – Appellant
Versus
State of Kerala – Respondent
WP(C) NO. 12312 OF 2022



Advocates:
For the Appellants/Petitioners: Sri.George Mathew, Sri.M.D.Sasikumar, Shri.Praveen S, Shri.Sunil Kumar A.G, Sri.Dipu James, Sri.Mathew K.T, Sri.George K.V, Shri.Stephy K Regi
For the Respondents: Sri.K.V. Manoj Kumar

The court affirmed that Government Orders for contracts apply at the time of contracting and must be followed for any additional work unless specifically exempted by the terms of the agreement.

Headnote:(A) Government Orders - Applicability in works contracts - Issue regarding enforcement of Government Order for subsequent tenders discussed - No retrospective application. (Paras 1-5)

(B) Supplementary agreements in contracts - Terms binding on contractor even if not specifically referenced - Negotiation for rate revisions required for quantities over contract amounts. (Paras 6-10)

Facts of the case:
The petitioner contends applicability of Government Orders to additional work carried out post tender award, seeking relief against deducted amounts.

Findings of Court:
The court held contract rates should align with referenced Government policy, ruling on owed amounts owed for works executed; the additional quantities need negotiation.

Issues: Applicability of Government Orders to additional contract work and boundaries of contracts as agreed upon through supplementary agreements.

Ratio Decidendi: The court ruled clarity in contract terms dictates adherence to Government Orders applying at contract execution time, reinforcing contractor rights concerning negotiated rates.

Result: Petition granted in part, stipulations for payment established, with additional negotiation rights preserved.

Table of Content
1. petitioner seeks reimbursement for additional work. (Para 1 , 2)
2. dispute over applicability of government order regarding additional work. (Para 3 , 4 , 5)
3. terms of contract clarify conditions for additional quantities and negotiations. (Para 6 , 7 , 8 , 9 , 10)
4. court confirmed rates under government orders must be followed. (Para 11)

JUDGMENT

The petitioner is a partnership firm and a registered A Class contractor under the Public Works Department. The petitioner was awarded with several works and the grievance of the petitioner in this writ petition, is in respect of the work the petitioner carried out viz. NABARD RIDE XXIV 2018-19-Improvements to Vellamthanam Road from ch.o/000 to 5/850. Exhibit P8 is the tender notification dated 2.3.2019 and the petitioner submitted the bid on 20.3.2019. Exhibit P2 is the work order dated 14.6.2019. The dispute in this case pertains to the applicability of Ext.P1 Government Order, as far as the additional quantity of work carried out by the petitioner in excess of 25%. The contention of the petitioner is that, the rate is calculated by the respondents as contemplated in Ext.P1 Government Order which is dated 4.5.2019, whereas, the tender invited in this case was as early as on 2.3.2019. Therefore, it was contended that, Ext.P1 Government Order, even going by the specific terms and conditions contained therein, does not have any retrospective application and the same is applicable only in respect of the tenders invited after the date of such Government Order. The reliefs sought by the petitioner are as follows:

“i)To call for the records which lead to the issuance of Ext.P1 and P7 and to issue a writ in the nature of certiorari or any other appropriate writ, order or direction quashing the same;

ii) To declare that the petitioner is entitled for entire amounts due to the petitioner for additional works executed based on Ext.P2 without effecting deductions as sought for in Ext.P1;

iii)To issue a writ of mandamus or any other appropriate writ, order or direction, commanding respondents to release the entire amounts due to the petitioner for additional works executed without effecting deductions as sought for in Ext.P1;

iv) To issue such other order or direction, as this Hon’ble Court deems fit and proper to grant, in the nature and course of the proceedings.”

2. A counter affidavit and additional counter affidavit were submitted by the 5th respondent, wherein, the aforesaid contentions are disputed. Besides, the learned Govt. Pleader also produced the supplemental agreement executed between the petitioner and the respondents, for the additional quantity, which is the subject matter of the dispute in this case. A reply affidavit was also filed by the petitioner controverting the averments contained in the counter affidavit.

3. I have heard Sri. George Mathew, the learned counsel for the petitioners and Sri. K.V. Manoj Kumar, the learned Special Government Pleader for the respondents.

4. The contention raised by the learned counsel for the petitioner is that, going by Ext.P1, it is evident that, the terms and conditions therein are applicable only in respect of tenders invited after issuance of Ext.P1, whereas, Ext.P8 would indicate that the tender in this case was issued prior to the said date. Therefore, the said GO is not applicable. On the other hand, the specific contention of the learned Special Govt. Pleader is that, the agreement in this case was executed after the issuance of Ext.P1 Government Order and as per the terms and conditions in the tender notification, all the Government orders and circulars are applicable to the contract, which are in existence as on the date of contract. Therefore, it was contended that, this being the position, as the contract was entered into in this case after issuance of Ext.P1 Government Order, the petitioner cannot take a contention that Ext.P1 is not applicable. To substantiate this contention, supplemental agreement executed between

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