[Cites 9, Cited by 0]
Chattisgarh High Court
M/S Gayatri Construction vs State Of Chhattisgarh on 25 March, 2026
Author: Ramesh Sinha
Bench: Ramesh Sinha
1
2026:CGHC:14181-DB
Digitally signed
by SAGRIKA
SAGRIKA AGRAWAL
AGRAWAL Date: 2026.03.25
18:50:20 +0530
NAFR
HIGH COURT OF CHHATTISGARH AT BILASPUR
WPC No. 1323 of 2026
1 - M/s Gayatri Construction Through Its Proprietor Anurag Jaiswal S/o
Late Jawaharlal Jaiswal, Aged About 54 Years, Flat No. 307 Vaishali
Pride, Minocha Colony, Mungeli Road, Bilaspur, District Bilaspur
Chhattisgarh
... Petitioner(s)
versus
1 - State Of Chhattisgarh Through The Secretary, Public Health
Engineering Department, Mahanadi Bhawan, Mantralaya, Atal Nagar,
Mantralaya, Nawa Raipur, District Raipur Chhattisgarh
2 - The Engineering-In-Chief Public Health Engineering Department,
Indravati Bhawan, Atal Nagar, Mantralaya, Nawa Raipur, District Raipur
Chhattisgarh
3 - The Mission Director, Jal Jivan Mission, Mungeli, District Mungeli
Chhattisgarh
4 - The Executive Engineer And Member Secretary District Water
Sanitation Mission, Public Health Engineering Department, Division,
Mungeli, District Mungeli Chhattisgarh
... Respondent(s)
For Petitioner(s) : Mr. Harish Khuntiya, Advocate
For Respondent(s) : Mr. Shashank Thakur, A.A.G.
Hon'ble Shri Ramesh Sinha, Chief Justice
Hon'ble Shri Ravindra Kumar Agrawal, Judge
Order on Board
Per Ramesh Sinha, Chief Justice
25/03/2026
1. Heard Mr. Harish Khuntiya, learned counsel for the petitioner. Also
heard Mr. Shashank Thakur, learned Addl. Advocate General, appearing
for the Respondent/State.
2. By this petition under Article 226 of the Constitution of India, the
petitioners seek for the following relief(s):
"10.1 That, this Hon'ble Court may kindly be
pleased to issue an appropriate writ, thereby
directing the respondent authorities to forthwith
release the remaining 30% amount in favour of
petitioner for completion of tender work, with
interest @ 18% per annum from the date of
entitlement to its actual payment.
10.2 That, this Hon'ble Court may kindly be pleased
to direct the respondent authorities to decide the
petitioner's representation for release of unpaid bill
amount, within stipulated time.
10.3 To kindly grant any other relief which may be
deem fit in the given facts and circumstances of the
instant case."
3. The brief facts of the case are that, the petitioner, a duly registered
proprietorship firm, participated in a tender floated by the respondent
authorities under the Jal Jeevan Mission Scheme pursuant to NIT No.
431 dated 17.03.2023 for construction and allied works of a Single
Village Piped Water Supply Scheme at Village Baigakapa, District
Mungeli, with a tender value of Rs. 79.87 lakhs and stipulated
completion period of 9 months. Upon successful evaluation, the tender
was awarded to the petitioner and Agreement No. 97/01/2023-24 was
executed, followed by issuance of work order dated 26.05.2023,
pursuant to which the petitioner duly commenced and completed the
entire work in accordance with prescribed norms and standards; during
execution, the respondents released 70% of the bill amount, however,
despite completion of work and repeated representations by the
petitioner, the remaining 30% payment has been withheld without any
justification or fault on the part of the petitioner, even though the Mission
Director vide order dated 24.03.2025 directed release of dues to
contractors under the scheme, thereby compelling the petitioner to
approach this Hon'ble Court seeking appropriate relief.
4. Learned counsel appearing on behalf of the petitioner, submits
that, the act of the respondent authorities are arbitrary, illegal and
unjust manner, withholding the legitimate dues of the petitioner despite
successful completion of the tender work in accordance with prescribed
norms, thereby violating the mandate of Article 14 of the Constitution of
India. The petitioner has already received 70% of the bill amount during
execution, which itself establishes due satisfaction of work, yet the
remaining 30% has been withheld without any justification or fault on
the part of the petitioner, even after repeated representations and
despite a specific direction dated 24.03.2025 issued by the Mission
Director for release of payment to contractors under the Jal Jeevan
Mission. Such inaction has caused grave financial hardship to the
petitioner, who completed the work by procuring materials on credit and
is liable to pay labourers and suppliers. In support of his submission, the
learned counsel for the petitioner relied upon the Judgemnt passed by
the Hon'ble Supreme Court in ABL International Ltd. vs. Export
Credit Guarantee Corporation of India Ltd, that the State and its
instrumentalities are bound to act fairly, reasonably and cannot
arbitrarily deny legitimate claims arising out of contractual obligations,
and writ jurisdiction can be invoked in such cases. Hence, the action of
the respondents in withholding payment is wholly unjustified, and the
petitioner is entitled to release of the remaining amount along with
interest @ 18% per annum from the date it became due till actual
payment.
5. On the other hand, learned State counsel opposes the
submissions made by the learned counsel for the petitioner and submits
that, the dispute herein arises purely out of contractual obligations
under a tender agreement, involving disputed questions of fact
regarding completion, quality, measurement and verification of work,
which cannot be adjudicated in writ jurisdiction under Article 226 of the
Constitution. It is a settled principle that writ courts should not ordinarily
interfere in contractual matters where efficacious alternative remedies
such as arbitration or civil suit are available, further, the payment of the
remaining 30% amount is subject to due verification, certification, and
compliance of all contractual conditions, including defect liability and
other technical parameters, and mere completion as alleged by the
petitioner does not ipso facto entitle him to full payment; moreover, the
judgment in ABL International Ltd (supra), itself lays down that writ
jurisdiction is discretionary and to be exercised only in exceptional
circumstances involving clear arbitrariness, which is absent in the
present case, as there is no arbitrary or mala fide action on part of the
respondents but only a procedural and contractual compliance
requirement. Hence, the present writ petition seeking monetary relief is
not maintainable and is liable to be dismissed.
6. We have learned counsel for the parties, perused the material
annexed with the petition.
7. The Hon'ble Supreme Court in the case of Tata Motors Limited v
The Brihan Mumbai Electric Supply & Transport Undertaking
(Best) and Others passed in Civil Appeal No. 3897 of 2023 vide
judgment dated 19.05.2023 held as follows :
"48. This Court being the guardian of fundamental rights is
duty-bound to interfere when there is arbitrariness,
irrationality, mala fides and bias. However, this Court has
cautioned time and again that courts should exercise a lot
of restraint while exercising their powers of judicial review
in contractual or commercial matters. This Court is
normally loathe to interfere in contractual matters unless a
clear-cut case of arbitrariness or mala fides or bias or
irrationality is made out. One must remember that today
many public sector undertakings compete with the private
industry. The contracts entered into between private
parties are not subject to scrutiny under writ jurisdiction.
No doubt, the bodies which are State within the meaning
of Article 12 of the Constitution are bound to act fairly and
are amenable to the writ jurisdiction of superior courThe
Hon'ble Supreme Court in the case of Tata Motors
Limited v The Brihan Mumbai Electric Supply &
Transport Undertaking (Best) and Others passed in Civil
Appeal No. 3897 of 2023 vide judgment dated 19.05.2023
held as follows :
"48. This Court being the guardian of fundamental rights is
duty-bound to interfere when there is arbitrariness,
irrationality, mala fides and bias. However, this Court has
cautioned time and again that courts should exercise a lot
of restraint while exercising their powers of judicial review
in contractual or commercial matters. This Court is
normally loathe to interfere in contractual matters unless a
clear-cut case of arbitrariness or mala fides or bias or
irrationality is made out. One must remember that today
many public sector undertakings compete with the private
industry. The contracts entered into between private
parties are not subject to scrutiny under writ jurisdiction.
No doubt, the bodies which are State within the meaning
of Article 12 of the Constitution are bound to act fairly and
are amenable to the writ jurisdiction of superior courts but
this discretionary power must be exercised with a great
deal of restraint and caution. The courts must realise their
limitations and the havoc which needless interference in
commercial matters can cause. In contracts involving
technical issues the courts should be even more reluctant
because most of us in Judges' robes do not have the
necessary expertise to adjudicate upon technical issues
beyond our domain. The courts should not use a
magnifying glass while scanning the tenders and make
every small mistake appear like a big blunder. In fact, the
courts must give "fair play in the joints" to the government
and public sector undertakings in matters of contract.
Courts must also not interfere where such interference will
cause unnecessary loss to the public exchequer. (See:
Silppi Constructions Contractors v. Union of India,
(2020) 16 SCC 489)
52. Ordinarily, a writ court should refrain itself from
imposing its decision over the decision of the employer as
to whether or not to accept the bid of a tenderer unless
something very gross or palpable is pointed out. The court
ordinarily should not interfere in matters relating to tender
or contract. To set at naught the entire tender process at
the stage when the contract is well underway, would not be
in public interest. Initiating a fresh tender process at this
stage may consume lot of time and also loss to the public
exchequer to the tune of crores of rupees. The financial
burden/implications on the public exchequer that the State
may have to meet with if the Court directs issue of a fresh
tender notice, should be one of the guiding factors that the
Court should keep in mind. This is evident from a three-
Judge Bench decision of this Court in Association of
Registration Plates v. Union of India and Others,
reported in (2005) 1 SCC 679.
53. The law relating to award of contract by the State and
public sector corporations was reviewed in Air India Ltd.
v. Cochin International Airport Ltd., reported in (2000) 2
SCC 617 and it was held that the award of a contract,
whether by a private party or by a State, is essentially a
commercial transaction. It can choose its own method to
arrive at a decision and it is free to grant any relaxation for
bona fide reasons, if the tender conditions permit such a
relaxation. It was further held that the State, its
corporations, instrumentalities and agencies have the
public duty to be fair to all concerned. Even when some
defect is found in the decision-making process, the court
must exercise its discretionary powers under Article 226
with great caution and should exercise it only in
furtherance of public interest and not merely on the making
out of a legal point. The court should always keep the
larger public interest in mind in order to decide whether its
intervention is called for or not. Only when it comes to a
conclusion that overwhelming public interest requires
interference, the court should interfere.
54. As observed by this Court in Jagdish Mandal v. State
of Orissa and Others, reported in (2007) 14 SCC 517,
that while invoking power of judicial review in matters as to
tenders or award of contracts, certain special features
should be borne in mind that evaluations of tenders and
awarding of contracts are essentially commercial functions
and principles of equity and natural justice stay at a
distance in such matters. If the decision relating to award
of contract is bona fide and is in public interest, courts will
not interfere by exercising powers of judicial review even if
a procedural aberration or error in assessment or prejudice
to a tenderer, is made out. Power of judicial review will not
be invoked to protect private interest at the cost of public
interest, or to decide contractual disputes."
8. Upon perusal of the judgment passed by the Hon'ble Supreme
Court in Tata Motors Limited (Supra), as the Apex Court has
categorically held that judicial review in contractual and tender matters
must be exercised with great restraint and only in cases where clear
arbitrariness, mala fides, bias or irrationality is demonstrated, in the
present case, no such exceptional circumstance is made out, and the
dispute raised by the petitioner pertains purely to non-release of alleged
contractual dues, which involves factual determination regarding
completion of work, compliance of contractual conditions,
measurements and verification, and therefore falls within the domain of
a civil dispute. The scope of judicial review in contractual and tender
matters is limited and the Court ordinarily does not interfere unless the
decision-making process is found to be arbitrary, irrational or contrary to
law, which is not established in the present case. Hence, in light of the
settled legal position, the present petition seeking release of payment
under a contract is misconceived, devoid of merit, and liable to be
dismissed, leaving the petitioner to avail appropriate alternative
remedies available under law.
9. Therefore, the present petition being devoid of merits deserves to
be and is hereby dismissed.
Sd/- Sd/-
(Ravindra Kumar Agrawal) (Ramesh Sinha)
Judge Chief Justice
sagrika
