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2026 Supreme(Online)(Ker) 10663
IN THE HIGH COURT OF KERALA AT ERNAKULAM
Ziyad Rahman A.A., J
MIDLAND CONTRACTING PRIVATE LIMITED – Appellant
Versus
STATE OF KERALA – Respondent
WP(C) NO. 5792 OF 2026
For the Appellants/Petitioners: SRI.P.SHANES METHAR, SHRI.N.KRISHNA PRASAD, SHRI.A.MOHAMMED FAIZAL, SHRI.ARJUN P.V., SHRI.HARKISH SREETHU V.S.
For the Respondents: SHRI.GEORGIE JOHNY, SC
The court affirmed the legality of substituting a performance guarantee with an unpaid sanctioned bill under specific government provisions.
Headnote:The petitioner, a contractor, sought substitution of the performance guarantee by utilizing an unpaid sanctioned bill as permissible under the relevant Government Order. The court affirmed the appropriateness of substituting the performance guarantee, acknowledging the unpaid bill's sufficiency. The petition was granted, directing the third respondent to carry out necessary actions within three months.
| Table of Content |
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| 1. contractor's relief for performance guarantee substitution. (Para 1 , 2) |
| 2. court direction for administrative compliance on guarantees. (Para 3) |
J U D G M E N T
The petitioner is a partnership firm and is a contractor, who was entrusted with the work, as evidenced by Exts.P1 and P2, namely, Jal Jeevan Mission (JJM) Kannur District – WSS to Alakkode and adjoining Panchayath – Package VI and Jal Jeevan Mission (JJM)- Kasaragod District- Balal Panchayth- RWSS to Maloth and Balal Phase III- Jal Jeevan Mission (JJM)-Kasaragod District- Balal Panchayth- RWSS to Maloth and Balal Phase IIILaying Distribution system and Providing FHTCs.- Pipeline Work .
2. The relief sought in this writ petition is to permit the petitioner to substitute the performance guarantee furnished by the petitioner in the form of treasury deposits, with the audited and sanctioned pending bill, which is Ext.P5. It is pointed out that, as per Ext.P3 Government Order, such exercise is permissible in respect of the contracts where, the Government is a party to the granted. Moreover, this Court has passed similar directions, in similar circumstances, as evidenced by Ext.P7.
3. After hearing the learned counsel for the petitioner and the learned Standing Counsel for the respondents, I am of the view that, the relief sought by the petitioner can be granted, as it is an admitted position that, the sanctioned bill remaining unpaid, is sufficient to meet the requirements of performance guarantee.
In such circumstances, this writ petition is disposed of directing the 3rd respondent to permit the petitioner to substitute the performance guarantee furnished by the petitioner in the form of treasury deposit, submitted in respect of Ext.P1 and P2, with Ext.P5. Necessary orders in this regard shall be passed within a period of three months from the date of receipt of copy of this judgment, upon the petitioner executing necessary documents in this regard.
Sd/-
