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2026 Supreme(Online)(Ker) 18554

IN THE HIGH COURT OF KERALA AT ERNAKULAM
HARISANKAR V. MENON, J
M/S. DEENS CONSTRUCTIONS – Appellant
Versus
STATE OF KERALA – Respondent
WP(C) Nos.328/2023, 8282/2023



Advocates:
For the Appellants/Petitioners: Sri. Rohan Mathew
For the Respondents: Sri. Manoj Kumar, Sri. P. Paulochan Antony

The imposition of risk and cost requires evidence of loss to the State; reconsideration ordered.

Headnote:The Court analyzed the legal implications under relevant contract law concerning the cancellation of awarded works to a contractor and the imposition of risk and cost. The petitioner disputed the cancellation alleging no loss to the State, seeking reconsideration of the 'risk and cost' demand. The core issue framed involved whether the State incurred losses warranting the imposition of costs. The Court ruled for reconsideration of the matter based on communications from the Public Works Department and directed a hearing for revisiting the 'risk and cost' issue expediently within six weeks.

Table of Content
1. petitioner seeks challenge against cancellation of works. (Para 2)
2. petitioner's argument regarding lack of loss to the state. (Para 3)

JUDGMENT

[WP(C) Nos.328/2023, 8282/2023]

Heard Sri. Rohan Mathew, the learned counsel for the petitioner, Sri. Manoj Kumar, the learned Government Pleader and Sri. P. Paulochan Antony, the learned counsel for Federal Bank Ltd.

2. The petitioner in these cases is a Class A contractor who had been awarded separate works by the Public Works Department. However, for the alleged lapse of the petitioner - according to the learned Government Pleader - the works awarded to the petitioner were cancelled at its risk and cost. It is seeking to challenge the cancellation of the works awarded, as well as the imposition of risk and cost on the petitioner, that these writ petitions have been filed.

3. Sri. Rohan Mathew, the learned counsel for the petitioner brings to the notice of this Court a communication dated 24.01.2026 issued by the Executive Engineer, Public Works Department Roads Division, Kottayam, as per which reference is made to the subsequent tender of the work, which according to the Public Works Department, was tendered for a lower amount. Therefore, it is his submission that there is no loss for the State and hence the risk and cost sought to be imposed on the petitioner, is incorrect. He prays that, on the basis of Ext.P32 communication dated 24.01.2026, the matter may be directed to be reconsidered.

On a perusal of the letter Ext.P32, I am of the opinion that the matter requires a reconsideration as contended above as regards the demand of “risk and cost” as against the petitioner. In such circumstances, these writ petitions would stand disposed of directing the 3rd respondent in W.P.(C).No.328 of 2023 and 2nd respondent in W.P.(C).No. 8282 of 2023 to grant the petitioner an opportunity of being heard in the matter and also to reconsider the issue with specific reference to the contents of Ext.P32 letter dated 24.01.2026 and Ext.P29 in W.P.(C). No.8282 of 2023. A decision as above to be taken as expeditiously as possible, at any rate within a period of six weeks from the date of receipt of copy of this judgment. Till finalization of the issue as above, the interim protection granted by this Court shall continue.

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