N.D. Joseph vs The State Of Kerala
2021 Latest Caselaw 2544 Ker

W.P(C).No.17633/2020-D               1

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                  PRESENT

                 THE HONOURABLE SMT. JUSTICE P.V.ASHA

      FRIDAY, THE 22ND DAY OF JANUARY 2021 / 2ND MAGHA, 1942

                         WP(C).No.17633 OF 2020(D)


PETITIONER:

               N.D. JOSEPH,
               AGED 59 YEARS
               PROPRIETOR, TRAVANCORE EARTH MOVING COMPANY,
               NELLIMATTATHIL HOUSE, THIRUVAMKULAM P.O.,
               PIN-682305, ERNAKULAM.

               BY ADVS.
               SRI.M.K.DILEEPAN
               SRI.DEEPAK T.NEDUNGADAN
               SMT.P.SUMITHRA

RESPONDENTS:

       1       THE STATE OF KERALA
               REPRESENTED BY THE SECRETARY, PUBLIC WORKS
               DEPARTMENT, GOVERNMENT OF KERALA, GOVERNMENT
               SECRETARIAT, THIRUVANANTHAPURAM, PIN-695033.

       2       THE CHIEF ENGINEER,
               PUBLIC WORKS DEPARTMENT (ROADS AND BRIDGES),
               THIRUVANANTHAPURAM, PIN-695033.

       3       THE SUPERINTENDING ENGINEER,
               PUBLIC WORKS DEPARTMENT (ROADS AND BRIDGES),
               CENTRAL CIRCLE, ALUVA, PIN-683101,
               ERNAKULAM DISTRICT.

       4       THE EXECUTIVE ENGINEER,
               PUBLIC WORKS DEPARTMENT (ROADS DIVISION), PAINAVU,
               PIN-685603, IDUKKI DISTRICT.

               R4 BY GOVERNMENT PLEADER SMT.VINITHA B.



     THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
12.01.2021, THE COURT ON 22.01.2021 DELIVERED THE FOLLOWING:
 W.P(C).No.17633/2020-D                   2




                                   P.V.ASHA, J.
                -----------------------------------------------------
                          W.P(c) No.17633 of 2020-D
                 ----------------------------------------------------
                   Dated this the 22nd day of January, 2021

                               JUDGMENT

The Writ Petition is filed seeking the following

reliefs:

"a) Issue a writ of mandamus or other appropriate

writ, direction or Order directing the respondents to

raise final bill for the work mentioned in Exhibit-P7

supplementary agreement and to effect payment of amount

due to petitioner for the executed work immediately.

b) Issue a writ of mandamus or other writ

direction or order directing the 2nd respondent to take

immediate steps to settle the bills and to pay amounts

due to petitioner as per Exhibit-P14 letter.

and

c) Grant such other reliefs and orders that this

Hon'ble Court may be deem fit and proper in the facts

and circumstances of the case.

2. The petitioner was awarded the work of NABARD-

RIDF-XV- improvements to Kanjar-Koovappilly-Chakkikavu

- Elaveezhapoonchira - Melukavu-Kanjiramkavala Road in

Idukki district on 21.3.2010. It is stated that on

account of the orders issued in Writ Petitions filed by

other contractors, the petitioner was not able to

commence the work except after the Honourable Supreme

Court passed order dated 26.02.2013 in the Civil

Appeal. The Government thereafter issued Ext.P1 order

dated 03.02.2014 revising the rates from 2009 schedule

of rates to 2012 schedule of rates. The administrative

sanction for the same was issued as per Ext.P2 order on

05.12.2016, for a sum of Rs.16,49,73,183/-. It is

stated that there were other obstacles for continuing

the work as widening of the road and shifting of

electric post etc. could not be done. It is stated that

as per Ext.P3 order dated 15.09.2018 time for

completion of the work was extended upto 31.08.2019

without imposing fine, pointing out that the time had

expired on 31.08.2018. In the meanwhile petitioner had

executed Ext.P4 supplementary agreement on 27.2.2018.

It is stated that the work was originally funded by

NABARD. As the funding RIDF -XV by NABARD expired on

31.03.2017 and the work was not completed within the

period of the said scheme, it became necessary for the

Government to allocate the funds for the work. It is

stated that only 3 part bills were paid to the

petitioner as on 31.10.2016 and thereafter no payment

was made even against part bills though the petitioner

had executed substantial portion of the work. It is

stated that the 4th running account bill was raised by

the Assistant Engineer and it was approved on 28.3.2018

for a sum of Rs.7,64,95,439/-. But the payment was not

made in the absence of fund allocation by the

Government. Therefore, the petitioner approached this

Court filing W.P(C).No.20182 of 2018. As per Ext.P6

judgment, this Court directed the respondents to take

appropriate steps to release the payment within a

period of three months. It is stated that thereafter

the Government passed Ext.P9 order on 22.01.2019

allotting a sum of Rs.5,97,34,634/-. The petitioner

was thereafter paid a sum of Rs.2,96,92,831/- on

21.03.2019. It is pointed out that even that payment

was made only after the petitioner filed a contempt

case. The contempt case was closed as per Ext.P10

judgment allowing the petitioner to raise disputes if

any, regarding the amounts due to the petitioner.

3. It is further stated that the petitioner had

executed Ext.P7 supplementary agreement on 15.09.2018

after extension of time was granted upto 31.08.2019.

It is also stated that the 2nd respondent had requested

for administrative sanction for the work as per Ext.P8

letter on 17.10.2018 based on 2012 SoR. In that letter

request was made for a sum of Rs.14,25,88,281/- for

completion of the work against which the Government had

allotted only Rs.5,97,34,634/-. It is stated that the

fourth part bill which was a subject matter of the Writ

Petition covered by Ext.P6 judgment was in respect of

the work carried out before 28.03.2018. After the

fourth part bill, the respondents did not raise any

part bill though the petitioner continued the work till

31.08.2019. The petitioner submitted that payment was

made against Ext.P4 bill only for the quantity as per

tender schedule and the respondent did not obtain

approval of revised estimate on the basis of the actual

quantity. However, it is stated that by 01.08.2019

approval was obtained for the revised estimate before

the expiry of the extended period of contract. It is

stated that the petitioner had requested for payment of

a sum of Rs.1,78,45,727/- towards the work executed

over and above the scheduled quantity which was part of

the fourth part bill in addition to a sum of

Rs.56,24,097/- towards the work done thereafter. The

respondents did not make any payment thereafter though

the petitioner made several requests. It is stated

that as per Ext.P11 representation the petitioner had

requested the 2nd respondent to relieve him from the

work. The 4th respondent issued Ext.P12 letter

directing the petitioner to complete the work

immediately, alleging inaction on his part to complete

the work as per the revised estimate. As per Ext.P13

letter dated 04.02.2020, the petitioner informed that

he would not be able to complete the balance work under

2012 schedule of rates in view of the adverse site

conditions and in view of his bank loan account being

turned as NPA due to non payment of bills. It is

stated that thereafter he submitted Ext.P14

representation on 17.06.2020 demanding payment of

Rs.1,78,45,727/- for the work done over and above the

original schedule quantity of the work till the fourth

part bill dated 28.3.2018 for Rs.56,24,097/- towards

the work done till 31.08.2018 and for another Rs.30

lakhs for the work executed upto 31.8.2019 along with

interest @ 12.45% per annum. The Writ Petition was

filed thereafter alleging that the respondents are not

taking any action. According to the petitioner, he is

not responsible for the delay caused in carrying out

the work. It is stated that the very fact that the

extension was granted without any penalty would show

that the delay was not attributable to him. It is

stated that the petitioner had to carry out the work by

mobilising funds from banks since the respondents did

not make any payment on the ground that the funds from

NABARD had lapsed. The petitioner states that when the

respondents have not even raised bills for the works

executed upto 31.8.2019 and also for the extra work

done, he is not bound to execute the balance work.

4. The 4th respondent filed a statement. It is

stated that the work awarded to the petitioner was

under the NABARD RIDF-XV scheme which was originally

tendered for administrative sanction amount of Rs.10

crores on 03.02.2010. But on account of a stay order

in W.P(C).No.9016/2010 filed by another contractor, the

agreement could be executed only on 10.3.2011.

Subsequent to the judgment in that Writ Petition on

24.02.2011, the site was handed over to the contractor

on 19.03.2011 and the department took necessary steps

to start the work by taking initial levels. The work

was stayed by the Supreme Court on 04.04.2011 in SLP

No.8169/2009. The contract was renewed after the said

stay order was vacated in February, 2013, extending the

validity period upto 21.01.2014. It is stated that the

total length of the road for the work was 13.46

kilometres (main road 10.92 km and bi-roads of 0.800 km

and 1.74 km). The petitioner requested to refix the

rate in the year 2013 in view of the lapse of time. The

Government thereupon issued G.O.Ms.10/2014/PWD

dt.03.02.2014 for revising the estimate under SOR 2012.

Revised estimate was prepared and forwarded for

sanction on 14.08.2014 and it was sanctioned on

30.08.2017. In the meanwhile, extension was granted

for completion of work upto 19.02.2015, 19.02.2016,

19.02.2017 and 31.08.2018. It is stated that as

against 13.46 km which was to be improved the work

executed by the petitioner is only 4 km; the works like

culvert, drainage and retaining wall were not completed

even in the said 4 km, apart from the fact that tarring

work was not satisfactory. It is stated that the road

is even now not traffic worthy and the petitioner did

not rectify the defect. It is stated that the

petitioner was directed to complete the work at the

earliest issuing a letter dated 01.01.2020 which was

followed by another notice on 22.01.2020 and thereafter

as per Ext.P12 notice in which the petitioner was

informed that on failure to complete the work, it could

be terminated at his risk and cost. It is stated that

despite all these, the petitioner did not resume or

complete the work though Ext.R4(b) notice was issued on

17.06.2020. It is also stated that recommendation is

already made for terminating the contract at the risk

and cost of the petitioner.

5. The petitioner has filed a reply to the

statement pointing out that the work could be commenced

only after 26.2.02013 at a time when 2012 PWD schedule

of rates was in force. Even though the respondent had

issued Ext.P1 order on 03.02.2014 granting

administrative sanction for the work under 2012 SOR,

the said order was issued under the impression that a

portion of the work was completed before implementation

of 2012 SOR. Thereafter, revised orders were issued

only on 5.12.2016, after the delay of more than 3 years

and 10 months. It is stated that eventhough Ext.P2

order was issued on 5.12.2016, there were some more

anomalies to be clarified and the final order was

issued only on 30.08.2017 by the 2nd respondent. It is

stated that despite this the petitioner continued to

work and the first RA bills were prepared under 2009

SOR.

6. According to the petitioner, he has completed

the formation of entire 13.5 km and also 2 layer of

metallic work by 27.9.2016. The respondents made

payment only for the work till 09.1.2017 towards 3 RA

bills. It is also stated that the funds from NABARD

got lapsed only because of the laches on the part of

the respondents in getting administrative sanction in

the revised rate. It is stated that the petitioner

lost the opportunity to compound the sale tax also on

account of the delay. Pointing out the injustice in

denying the payment of Rs.1,83,12,993.84 despite the

fact that the fourth RA bill was for Rs.7,80,47,628/-,

the petitioner submitted that the denial of payment is

unjust as the petitioner has been continuing the work.

It is stated that the respondents had approached the

Government for fund allocation only after the

petitioner filed a contempt case and despite the

administrative sanction granted in Ext.P9 order the

amount paid to the petitioner on 21.3.2019 was not in

accordance with the bills raised and the respondents

did not pay the amount due to the petitioner towards

the work covered by the first 3 bills under the

schedule of revised rates. It is also alleged that

Ext.P8 would show the amount already paid to the

petitioner as well as amount to be paid to the

petitioner till the fourth part bill and to be paid to

the petitioner thereafter which could not be paid due

to the lapse of the NABARD fund. It is also pointed

out that the amount required for compliance of the

judgment was also stated in Ext.P8, but payment was not

made based on the said statement.

7. The petitioner also pointed out that Ext.P15

bill was raised by the Assistant Engineer towards the

work done by the petitioner till 2019, which would

show that the petitioner had completed the work for

Rs.8,57,92,413.66 out of which the amount paid was only

4,80,05,825/-. It is also his case that except

Ext.P16 notice dated 09.10.2020, that too, after filing

of the Writ Petition, asking him to fill the pot holes

and to rectify the defect, no other notice was issued

pointing out any defects and the petitioner had already

informed the respondents that defect would be rectified

on settlement of the payment.

8. According to the learned Government Pleader,

steps are afoot for termination of the work at the risk

and cost of the petitioner for which recommendation is

already made. It is stated that when termination is

ordered, 30% of the amount for the work is to be

realised/withheld by the Department. The amount due to

the petitioner would not be sufficient to meet the said

30%. Therefore, no payment can be made.

9. Having heard the contentions on both sides it

is clear that the petitioner was able to commence the

work only after 26.02.2013, on account of interdiction

by the orders from this Court/the Apex Court. It is

also clear that the administrative sanction for the

work, granted on the basis of 2009 schedule of rates

was revised to 2012 rates and after two rectifications

the revised administrative sanction was issued only on

30.08.2017. The contention of the petitioner is that

payment towards 3 part bills were made as on

31.10.2016. It cannot be disputed that the said

payment was made at 2009 rates, as sanction for the

revised estimate under the 2012 rate was accorded only

on 30.08.2017. Therefore, there is no justification in

denying payment of the balance amount due towards the

three part bills, to the petitioner reckoning the

revised rates of 2012.

10. In the judgment Ext.P6 in W.P.(C)

No.20182/2018, this Court directed payment towards the

part bill dated 28.03.3018. Thereafter, the Chief

Engineer had, in the letter Ext.P8 addressed to the

Principal Secretary, explained the amount due towards

the first 3 bills, from which it is seen that a sum of

Rs.1,83,12,994 is due. Ext.P8 would also show that the

respondents could not make payment to the contractor

due to the termination of the NABARD RIDF-XV which was

closed on 31.3.2017. The respondents do not deny the

contents of Ext.P8 letter. If at all the petitioner

has not completed the work, in Ext.P8 it is stated as

follows:

"Administrative Sanction for the subject work was

accorded vide GO (Rt) 34/2010/PWD dated 07.01.2010 for

Rs.10 Crores. Technical Sanction was issued vide TS

No.896/CE/2009-10 dated 15.01.2010 and awarded to

Travancore Earth moving company to complete the work

within 24 months Due to legal proceedings such as WP(C)

No.9016/2010 and wit appeal 198/2011 before the Hon'ble

High Court of Kerala and the proceedings before the

Hon'ble Supreme Court in Special leave to appeal (Civil)

No.S/8169/2011 at the instance of Contractors whose

tenders were not accepted, the execution of the work was

delayed. Finally the Hon'ble Supreme Court by order in

special leave to appeal dated 26.02.2013, allowed the

Travancore Earth moving company to commence the work.

Since the PAC for the work was originally fixed

based on 2009 PWD schedule of Rates the contractor could

not even commence the work even after 2012 schedule of

rates was implemented. The contractor requested for

revision of rates and it took time to get Revised

Administrative Sanction from the Government for the work

with rate enhancement. As per order GO (MS)

No.10/2014/PWD Dated 3.2.2014 issued by the Secretary to

Government Administrative Sanction with enhancement of

rates at 18.1% below 2012 schedule of rates for the

balance portion of the work was allowed. Thereafter by

GO (Rt) No.1664/2016/PWD dated 5.12.2016 the Deputy

Secretary to Government accorded revised Administrative

Sanction for the work for an amount of Rs.16,49,73,183/-

against Rs.10 crores originally sanctioned. The

contractor has completed a total amount of work of

Rs.7,80,47,628/- of which Rs.1,83,12,994/- only was paid

to the contractor till date. A balance amount of

Rs.5,97,34,634/- to be paid to the contractor for items

of the work which he has already completed till date.

The Contractor had filed a case before the Hon'ble

High Court of Kerala case No.WP(C) 20182 of 2018 where

in the Hon'ble High Court passed the judgment (Ref:2)

directing the Government to take appropriate steps to

release the payment within a period of three months at

the earliest and it was also directed that any request

made from the contractor for an early release of the

bill also be considered sympathetically by the

Government in its finance department.

A total amount of Rs.14,25,88,281/- is needed for

the payment of the work already completed and for the

balance work is to be completed.

The bill already paid and to be paid to the

contractor and the amount further needed for the

satisfactory completion of the work are as below.

Details of bill paid to the contractor.

Sl. Description Bill No. & Date C.V.B No. Bill amount in No. Rs.

1 CC Ist and Part bill 3/N/2014-15 CBV 14/Dn. Of 08/14 67,02,375/-

                                    dtd.25.7.2014            dtd 5.8.2014
2     CC IInd and Part bill         2/N/2015-16          dtd CBV 10/Dn. Of 08/14      28,02,431/-
                                    25.5.2015                dtd 15.09.2015
3     CC IIIrd and part bill 6/N/2016-17              dted CBV 14/Dn.of 08/14        88,08,188/-
                             9.1.17                        dtd 30.3.2017.
                                    Total                                          1,83,12,994/-

Details of the bill amount to be paid to the contractor

Sl.No. Description Bill amount in Re Rs.

                                                                  marks
1         Part bill IV                      3,62,89,525/-
2         Part Bill V                       56,24,097/-
3         The bill amount to be 1,78,21,012/-                     The amount was not paid to the
          paid for the work already                               contractor due to the termination
          completed                                               of the NABARD RIDF XV


          Total                             5,97,34,634

Since the NABARD-RIDF XV tranche was already closed

on 31.03.2017, there is no scope of any fund for payment

from NABARD for this work. A total amount of

Rs.14,25,88,281/- is to be sanctioned from the State fund.

To comply the judgement as per reference (2) cited an

amount of Rs.5,97,34,634/- is to be paid to the contractor

before 31.10.2018. So I kindly request your goodself to

take necessary action for sanctioning the required amount

at the earliest."

11. In the said circumstances, the denial of

payment for the said work, which is covered by the

judgment Ext.P6 and admitted in Ext.P8 letter is

illegal. If at all the respondents propose to issue

orders of termination of work at risk and cost, they

can take appropriate steps which are legally available

to them to realise the loss if any caused. The

respondents are not justified in denying payment based

on grounds which they did not raise or even mention in

Ext P8 letter. The amount found due to the petitioner

in Ext.P8 letter was a sum of Rs.5,97,34,634/-, out of

which the respondents paid only a sum of

Rs.2,96,92,831/-. The petitioner would therefore be

entitled to the balance amount in tune with Ext.P8

letter. Regarding the work carried out thereafter the

respondents have raised a dispute.

12. Therefore, the Writ Petition is disposed of

with a direction to the respondents to effect the

payment of the balance amount due to the petitioner in

accordance with the calculation made in Ext.P8 letter,

ie - balance towards the total amount of

Rs.5,97,34,634/-, within a period of two months from

the date of receipt of a copy of the judgment.

13. The claim of the petitioner for the subsequent

period is left open.

Sd/- (P.V.ASHA, JUDGE)

rtr/

APPENDIX PETITIONER'S EXHIBITS:

EXHIBIT P1 TRUE COPY OF THE ORDER ISSUED BY 1ST RESPONDENT DATED 03.02.2014.

EXHIBIT P2 TRUE COPY OF THE ORDER ISSUED BY 1ST RESPONDENT DATED 05.12.2016.

EXHIBIT P3 TRUE COPY OF THE ORDER ISSUED BY 3RD RESPONDENT DATED 15.09.2018.

EXHIBIT P4 TRUE COPY OF SUPPLEMENTAL AGREEMENT DATED 27.02.2018.

EXHIBIT P5 TRUE COPY OF THE REPRESENTATION GIVEN BY PETITIONER DATED 20.03.2018.

EXHIBIT P6 TRUE COPY OF THE JUDGMENT IN W.P.

(C)NO.20182/2018 DATED 30.07.2018.

EXHIBIT P7 TRUE COPY OF SUPPLEMENTAL AGREEMENT DATED 15.09.2018.

EXHIBIT P8 TRUE COPY OF LETTER ISSUED BY 2ND RESPONDENT TO THE PRINCIPAL SECRETARY DATED 17.10.2018.

EXHIBIT P9 TRUE COPY OF THE FUND ALLOCATION ORDER ISSUED BY GOVERNMENT DATED 22.01.2019.

EXHIBIT P10 TRUE COPY JUDGMENT IN CONTEMPT CASE(C)NO.229/2019 DATED 01.08.2019.

EXHIBIT P11 TRUE COPY OF THE LETTER ISSUED BY PETITIONER TO 3RD RESPONDENT DATED 01.11.2019.

EXHIBIT P12 TRUE COPY OF THE LETTER ISSUED BY 4TH RESPONDENT TO PETITIONER DATED 22.01.2020.

EXHIBIT P13 TRUE COPY OF THE REPLY LETTER ISSUED BY PETITIONER TO 4TH RESPONDENT DATED 04.02.2020.

EXHIBIT P14 TRUE COPY OF THE LETTER ISSUED BY PETITIONER TO 3RD RESPONDENT DATED 17.06.2020.

EXHIBIT P15 TRUE COPY OF THE 5TH R.A BILL PREPARED BY ASST.EXECUTIVE ENGINEER TO 4TH RESPONDENT DATED 26/8/2020.

EXHIBIT P16 TRUE COPY OF THE NOTICE ISSUED BY ASST.EXECUTIVE ENGINEER, THODUPUZHA DATED 9/10/2020.

EXHIBIT P17 TRUE COPY OF THE REPLY GIVEN BY PETITIONER TO EXHIBIT-P16 NOTICE DATED 22/10/2020.

EXHIBIT P18 TRUE EXTRACT OF THE RELEVANT PAGE OF PWD MANUAL REGARDING RETENTION OF AMOUNT FROM BILL.

RESPONDENTS' EXHIBITS

ANNEXURE R4(a) TRUE COPY OF THE NOTICE DATED 1.1.2020 ISSUED BY THE ASSISTANT ENGINEER, ROADS SECTION, MUTTAM, IDUKKI.

ANNEXURE R4(b) TRUE COPY OF THE NOTICE DATED 17.06.2020 ISSUED BY THE ASSISTANT ENGINEER, ROADS SECTION, MUTTAM, IDUKKI.