Unpaid certified bill from same authority substitutable for treasury deposit in performance guarantee.

JUDGMENT

The petitioner is an A Class contractor, who was awarded with the work named KIIFB-2016-2017- Improvement works to Mannarkkad-Chinnathadakam Road (Ch 19/000 to 52/362) - General Civil Work, as per the tender notification dated 15.04.2025. Ext.P2 is the letter of acceptance dated 29.01.2026. As per Ext.P2, the petitioner was directed to furnish a performance guarantee equivalent to 5% of the contract amount, which comes to Rs. 3,46,17,448/- and 50% of the same shall be in the form of a treasury fixed deposit and 50% in the form of a bank guarantee.

2. According to the petitioner, even though he is prepared to furnish the bank guarantee towards 50% of the performance guarantee, his case is that, in respect of the 50% of the performance guarantee in the form of a treasury deposit, he may be permitted to substitute the same with Ext.P4, an audited and sanctioned bill in respect of another work carried out by the petitioner which remains unpaid so far. This writ petition is submitted by the petitioner in such circumstances seeking the following reliefs:

a) To call for the records leading up to Ext.P1 to P5 and direct the

2ndrespondent to adjust an amount of Rs.1,73,08,724/- from the total amount of Rs.2,08,48,619/- from Ext.P4 certified bill towards bank guarantee to be deposited as per ext.P2 in respect of the

work namely Improvement work to Mannarcad – Chinnathadakam road Phase-III CH 19/000 to 52/362 – General Civil Work awarded by the 2^nd respondent by a writ of mandamus;

b) Declare that the petitioner is entitled to adjust the amount covered by Ext.P4 towards bank guarantee directed to be deposited as per Ext.P2 in respect of the work namely Improvement work to Mannarcad – Chinnathadakam road Phase-III CH 19/000 to 52/362 – General Civil Work awarded by the 2^nd respondent;

c) Issue such other appropriate writs, orders or directions as this Hon’ble Court deems fit and proper in the facts and circumstances of the case;

d) Dispense with filing of translation of vernaculars documents produced by the petitioner in the above case.

3. A detailed counter affidavit was submitted by the respondents by pointing out technical objections to the effect that, such an adjustment is not admissible in the contract work of the Kerala Road Fund Board.

4. After hearing the learned counsel for the petitioner and the learned Standing Counsel for the respondent, I find some merit in the contention raised by the petitioner. It is a fact that the amount covered by the Ext.P4 bill, is ultimately payable by the 2^nd respondent itself, and the entitlement of the petitioner to receive the said amount is not in dispute. Moreover, it is discernible from the documents that the amount specified in Ext.P4 is sufficient to cover the requirement of performance guarantee as per Ext.P2 letter of acceptance. In such circumstances, I am of the view that relief sought by the petitioner can be granted.

Accordingly, it is ordered that the 2^nd respondent shall permit the petitioner to substitute the performance guarantee in the form of a treasury deposit with Ext.P4 bill, upon the petitioner executing the necessary documents in this regard, to the satisfaction of the 2^nd respondent. This shall be done within a period of two weeks from the date of receipt of a copy of this judgment.