Telangana High Court
Ivrcl Navayugasew Jv vs State Of Telangana on 29 January, 2025
Author: B. Vijaysen Reddy
Bench: B. Vijaysen Reddy
HONOURABLE SRI JUSTICE B. VIJAYSEN REDDY
WRIT PETITION No.34492 OF 2023
ORDER :(ORAL) This writ petition is filed aggrieved by the action of the respondents in not releasing the admitted and approved amount of Rs.80,26,24,011/- (Rupees eighty crores twenty six lakhs twenty four thousand and eleven only) to the petitioner (Joint Venture) for price adjustment towards labour and other materials as per the conditions of the Agreement No.LS 1/2005-2006 dated 03.04.2005 and orders of this Court in W.P. No.40000 of 2012 dated 23.03.2022 as illegal, arbitrary, unconstitutional and for a consequential direction to the respondents to release the amount along with interest.
2.1. In the tender process floated by the respondents for execution of Stage II, Phase I of Sripada Sagar Project - Investigation, soil exploration, Design, Supply, Installation, Testing and Commissioning of Pumping Machinery, Transformers, Substations, Rising Mains, including construction of Pump Houses, all Civil Structures, CM & CD works, Delivery Cisterns etc., to develop about 2.00 lakh acres of ayacut under Sripada Sagar Project near Yellampalli Village, Ramagundam Mandal in the up-land area of erstwhile 2 BVRJ W.P. No.34492 of 2023 Karimnagar District (Sripada Sagar Project), the petitioner was declared as successful bidder.
2.2. Project Agreement No.LS 1/2005-2006 dated 03.04.2005 was entered into between the petitioner and respondents. General Conditions of Contract (GCC) were incorporated into the Agreement between the petitioner and the respondents.
2.3. It is the case of the petitioner that as per Clause 13.8 of the GCC, the petitioner is entitled to price adjustment from the respondents in the event of increase in rates and prices of labour, cement, steel, fuel, lubricants and other materials. Accordingly, the petitioner, right from October 2005, was submitting running account bills with price adjustment for the aforesaid items in terms of GCC and agreement conditions. There was exchange of correspondence between the petitioner and the respondents regarding price adjustment. As there was dispute regarding price adjustment, the petitioner filed W.P. No.40000 of 2012 before this Court against the respondents to declare the letter dated 03.02.2012 and the internal proceedings dated 16.11.2009 whereby the petitioner's price adjustment claim was rejected as illegal, arbitrary and unconstitutional. W.P. No.40000 of 3 BVRJ W.P. No.34492 of 2023 2012 was allowed by this Court by the order dated 23.03.2022 directing the respondents to verify the claim of the petitioner for price adjustment towards labour and other materials and pay the amount as expeditiously as possible preferably within a period of eight (8) weeks from the date of receipt of a copy of that order.
2.4. Thereafter, the petitioner made several representations for payment of price adjustment towards labour and other materials as directed by this Court in W.P. No.40000 of 2012. Upon receipt of the petitioner's request vide letter dated 15.10.2022, the Government vide Memo dated 27.10.2022 requested respondent No.3 - Engineer-in- Chief (General), Irrigation and CAD Department, Secretariat Buildings, Hyderabad, to take necessary action for release of pending payment of price adjustment towards labour and other materials. Respondent No.7 - Superintending Engineer, Irrigation Circle, Dharoor Camp, Jagitial, vide Letter No.SE/IC/JGL/DSE/ DEE-1/AEE-2/338/H dated 19.06.2023 to respondent No.5 - the Chief Engineer, I&CADD, Dharoor Camp, Jagitial, informed that the verified amount of Rs.80.26 crores (Rs.80,26,24,011/-) is the amount towards price adjustment payable to the petitioner and requested for taking further necessary action. In turn, respondent No.5 vide Letter No.CE(Irrigation)/TS/T2/ 4 BVRJ W.P. No.34492 of 2023 SYP Price escalation/2023/621 dated 28.06.2023 verified and requested respondent No.3 to address the Government for taking further necessary action.
2.5. It is submitted that subsequently respondent No.3 vide Letter No.ENC(G)/SE/(P&M)/DCE(GB)DEE3/AEE7/SYP/2023 dated 28.07.2023 informed respondent No.2 - the Special Chief Secretary to the Government, Irrigation & CAD Department, Hyderabad, to accord approval for payment of price adjustment towards labour and other materials to the petitioner as per the agreement conditions and the order of this Court in W.P. No.40000 of 2012 for Rs.80,26,24,011/-.
2.6. Thus, it is the case of the petitioner that there is no dispute whatsoever regarding payment of Rs.80,26,24,011/- towards price adjustment. Despite the same, the respondents are not releasing the amount.
3. Respondent No.1 - the State of Telangana, represented by the Special Chief Secretary to Government, Finance Department, Secretariat Building, Hyderabad, filed counter affidavit contending that pursuant to the orders of this Court in W.P. No.40000 of 2012, no file is received in the Finance Department from the concerned 5 BVRJ W.P. No.34492 of 2023 Administrative Department. As and when the file is received from respondent No.2, the same will be processed by the Finance Department in accordance with the Rules in vogue and as per the orders of this Court in W.P. No.40000 of 2012.
4.1. Respondent Nos.2 to 9 filed separate counter affidavit and subsequently filed additional counter affidavit.
4.2. It is stated in the counter affidavit that the contract price shall be adjusted for increase or decrease in the rates and prices for labour, cement, steel, fuel, lubricants and other materials (Electro Mechanical works) in accordance with the principles mentioned under Clause 13.8.1(i) to 13.8.1(iii) and procedures as defined in Clause 20.9 of the conditions of the contract. The formulae for calculation of price adjustment on labour, cement etc., are stipulated under Clause 13.8.2 of Volume II, Part - A GCC of the agreement. Further, in Corrigendum - 2 to Tender Notice No: 'e' Procurement No.4/2004-05, dated 19.01.2005 at Item - 5 i.e., under Clause 13.8.3 Components with percentage (Vol-II Part A), it is stipulated that "Price Variation for Electro-Mechanical Component is acceptable as per IPMA & IEEMA recommendations only."
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BVRJ W.P. No.34492 of 2023 4.3. In accordance with the above conditions of the agreement, the price escalation is being allowed on steel, cement and fuel as per the formulae mentioned in Clause 13.8.2 of Volume - II Part - A of GCC and price escalation is being allowed on electro mechanical works as per IPMA and IEEMA recommendations as mentioned in Corrigendum-2.
4.4. The bill raised by the petitioner for price adjustment on labour and other items was not accepted by the respondents on the ground that it is in deviation of the Government (I&CADD) Memo No.5217/Reforms/06 dated 23.02.2006 stating that price adjustment can be allowed only on cement, steel and fuels. The Government vide Memo No.30250/ Maj.Irr.III/A2/2007-6 dated 16.11.2009 rejected the proposal of price variation on labour and other materials. Aggrieved by the same, W.P. No.40000 of 2012 was filed by the petitioner and the same was allowed by the order dated 23.03.2022.
4.5. It is stated that:
"a) The Engineer-in-Chief (General), I&CADD, Hyderabad has requested the Chief Engineer (Irrigation), Jagtial to furnish the Cost particulars of Price Adjustment on Labour and Other Materials (Other than electro mechanical works) for taking further necessary action vide Lr.No.ENC(G)/SE 7 BVRJ W.P. No.34492 of 2023 (P&M)/DCE(GB)/DEE3/AEE7/SYP/2022, dt:- 16-12-2022 ... ...
b) The said letter was received in this Office through proper channel on 07-01-2023 and immediately after receipt of the same this office has started to work out the cost particulars of price adjustment of labor and other materials from 2004 to 2020 i.e pertaining to a period of 16 years (up to RA 139th and Part bill).
c) Meanwhile, the petitioner has submitted a representation dated: 29-12-2022 and requested to deduct VAT @ 2.8% only instead of 4% /5% from the value of work done and to revise the "R" value accordingly while calculating the price adjustment ... ...
d) After procuring the relevant indices, linking factors, and analyzing the representation of the agency for revision of "R" value with reference to the previous objections raised by the audit department regarding the calculation of price adjustment and existing Government orders, this office has worked out the cost particulars of price adjustment in the various scenarios and submitted a detailed report to the Superintending Engineer, Irrigation Circle, Jagtial vide this office Letter No. EE/Irrigation Div.6/VMD/A1/53/H, dated:-20-02-2023 ... ...
e) After careful examination of the report and vetting the calculations, the Superintending Engineer, Irrigation Circle, Jagtial has suggested certain corrections and orally directed 8 BVRJ W.P. No.34492 of 2023 to resubmit the calculations. Accordingly, this office has worked out the final cost particulars on price adjustment on labour and other materials which is arrived at Rs 80.26 Crores and submitted the detailed report and calculations to the Superintending Engineer, Irrigation Circle, Jagtial vide this office Lr.No. EE/Irrigation Division No.6/VMD/A1/ 135/H, dated:- 14-06-2023 ... ..."
4.6. It is further stated in the counter affidavit that after detailed verification and checks, the Superintending Engineer, Irrigation Circle, Jagitial has submitted report to the Chief Engineer (Irrigation), Jagitial vide Lr.No.SE/IC/JGL/DSE/DEE-1/AEE-2/338/H dated 19.06.2023 and later the same was submitted to the Engineer-in-chief (General), I&CADD, Hyderabad vide Chief Engineer (Irrigation), Jagitial CE(I)/TS/T2/SYP Price escalation/2023/621 dated 28.06.2023 which was finally submitted to the Government vide Lr.No.ENC(G)/ SE(P&M)/DCE(GB)/DEE3/AEE7/SYP/2023 dated 28.07.2023. Immediately after receipt of approval from the Government for payment of price adjustment on labour and other materials, proposals for Revised Estimate - II would be submitted and Revised Administrative Approval will be obtained and payment will be made to the agency as per the orders of this Court.
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BVRJ W.P. No.34492 of 2023 4.7. A fresh Revised Estimate - II has to be prepared duly incorporating the provision for Price Adjustment on Labour and other materials along with other items viz., VAT Reimbursement, GST Reimbursement, amount for additional pipe line work etc., claimed by the agency from time to time. The Revised Estimate - II has to be prepared by respondent No.8 - the Executive Engineer, I & CADD, Irrigation Division - VI, Vemulawada, and to be submitted to respondent Nos.7, 5 and 3 through proper channel for their scrutiny and onward submission. The Government vide G.O. No.5, I&CADD (Reforms) Department, dated 15.07.2024, has constituted a State Level Standing Committee (SLSC) to carry out certain functions in respect of the project works under EPC system taken up under Jalayagnam with the following composition:
i) ENC (General), I&CADD, Hyderabad : Chairman,
ii) ENC (Admin), I&CADD, Hyderabad : Co-Chairman,
iii) CE, Central Designs Organization : Member
iv) Director of Works Accounts : Member,
v) ENC/CE of the concerned project : Member-Convener.10
BVRJ W.P. No.34492 of 2023 4.8. Subsequently, the Government vide Memo No.3769/ Reforms/2019 dated 08.08.2019 issued certain instructions for processing the Revised Estimates and issues relating to the Major, Medium and Minor Irrigation Projects by the SLSC.
4.9. It is stated that after verification of the bill and after applying all necessary checks, respondent No.8 has to pass the bill and present the same to respondent No.10 - the Assistant Pay and Accounts Officer (W&P), Rajanna Sircilla District, for arranging payment. It is stated that presently the matter is in early stages awaiting approval from the Government and there is lot of procedure to be followed before reaching the final stage of payment.
4.10. It is submitted that:
" ... ... ... as per Preliminary Specification: 69 (a) of the Andhra Pradesh Detailed Standard Specifications states that "No omission by the Executive Engineer or the Sub Divisional Office to pay the amount due upon certificates shall vitiate or make void the Contract, nor shall the contractor be entitled to interest upon any guarantee fund or payments in arrears, nor upon any balance which may, on the final settlement of his accounts, be found to be due to him" ... ... ...11
BVRJ W.P. No.34492 of 2023 As per Para 1 of Articles of Contract of Agreement, ... ... ... the Contractor has also signed the copy of the Andhra Pradesh Standard Specification and addenda volume there to be maintained in the office of the Superintending Engineer, SripadaSagar Project Circle, Mancherial, Adilabad District in token of acknowledgement of being bound by all the conditions of the clauses of Standard Specifications for items of work as described by the standard specification number in schedule.
Hence, the petitioner does not entitle for payment of any interest as he is bound by the Preliminary Specification:
69 (a) of the Andhra Pradesh Detailed Standard Specifications which restricts the petitioner from claiming any such interest."
It is thus contended that the petitioner is not entitled for payment of interest as per PS 69(a) of the APDSS.
5.1. Additional counter affidavit has been filed by respondent Nos.2 to 9 stating that as per the directions issued by this Court in C.C. No.2757 of 2023, claim of the petitioner for price adjustment on labour and other materials was examined. Respondent No.8 has presented the claim of price adjustment on labour and other materials for Rs.67.64 crores to the Assistant Pay and Accounts Officer, Rajanna Sircilla and following amounts have been paid: 12
BVRJ W.P. No.34492 of 2023 S RA Bill Number Gross amount of Cheque Vr Date No. the bill Number No 1 RA 145th & Part bill 10,00,00,000.00 2512429224 1 13-06-2024 2 RA 146th & Part bill 25,00,00,000.00 2514401589 2 24-06-2024 3 RA 147th & Part bill 19,11,29,813.00 2512429224 1 26-06-2024 Total 54,11,29,813.00 5.2. It is stated that instead of Rs.80.26 crores, the bills of the petitioner were restricted to Rs.67.64 crores and payment was made for Rs.54.11 crores by the Assistant Pay and Accounts Officer, Rajanna Siricilla District. It is stated that Rs.13.53 crores is to be released after receipt of approval for Variation Estimate-II from the Government.
5.3. It is submitted that as per the guidelines for calculation of price adjustment vide G.O. Ms. No.35, Transport, roads & Buildings (R.I) Department, dated 28.02.2006, the formula of Price adjustment, R, the value of work shall exclude the Seigniorage Charges, VAT and all other Over Head Charges. The 'R' value adopted for calculation of price adjustment in most of the bills of the subject work is not in accordance with the above principle of excluding VAT, seigniorage charges or overhead charges. This resulted in payment of price adjustment not only on the value of work done but also price adjustment is paid on VAT, seigniorage charges and other overhead 13 BVRJ W.P. No.34492 of 2023 charges which is contrary to the agreement conditions, the Government Orders and the basic concept and spirit of price adjustment itself.
5.4. It is also stated that:
"f. Moreover, an amount of Rs 24.36 Crores has been already paid to the Petitioner's JV in RA 140th and Part Bill towards reimbursement of difference between 4%/5% VAT recovered from running account bills and 2.8% TOT loaded in the estimate. Hence, there is no separate need for price adjustment on VAT, as the difference was already reimbursed. As such, the inclusion of VAT in "R" Value leads to undue benefit and double payment to the agency.
g. The Accountant General (A&E), Hyderabad has observed the above deviations in calculation of price adjustment and raised audit paras in the Inspection Reports of 2009-10 and 2016-17 regarding excess payments made to the agency due to non- deduction of VAT, Seigniorage charges, or overhead charges from the "R" Value in calculation of price adjustment ... ... ...
h. Further, after receipt of Honorable High Court orders in WP No. 40000 of 2012, the Engineer-in-Chief (General), I&CADD, Hyderabad has requested to furnish the cost particulars of price adjustment on labor and other materials vide Lr.No.ENC (G)/SE (P&M)/DCE(GB)/DEE3/AEE7/SYP/2022, dt:- 16-12-2022. While preparation of cost particulars, the agency was involved at every stage along with departmental staff, as the contract was under EPC mode. The Petitioner's JV was then very much satisfied with the calculations of price Adjustment on labor and other materials worked out by the department for Rs 80.26 14 BVRJ W.P. No.34492 of 2023 Crores. The "R" value taken by the department in said calculations excludes the VAT, Seniorage and other overhead charges. The agency has also submitted the Variation Estimate-II duly making provision for same amount i.e Rs 80.26 Crores towards price adjustment on labour and other materials. The agency has even filed the WP No. 34492 of 2023 and CC No.2757 of 2023 & 120 of 2024 in the Honorable High court praying for payment of same Rs 80.26 crores towards price Adjustment on labor and other materials but never challenged the procedure adopted for calculation.
i. It is surprising that, the petitioner's JV is now finding faults and challenging the action of the department, when similar procedures is adopted to regularize the irregular payments of price adjustment on cement, steel, fuel and electromechanical items which were made earlier without deducting VAT, Seigniorage and other overhead charges from "R" value. This exposes the dual standards taken by the petitioner in their attempt to get undue benefit.
j. It is true that, the Honorable High Court in WP No.28183 of 2010 regarding deduction of VAT from "R' value has directed the respondents that "such deductions may not be allowed before the Dispute Adjudication Board takes a decision. Both the parties shall take recourse to approaching the Dispute Adjudication Board prescribed by clause 20.2 of the general conditions of contract and the further conditions that followed in the agreement. Pending adjudication of the question by the Dispute Adjudication Board, the respondents shall not interfere with the process of price adjustment in making payments with reference to seigniorage and VAT" ... ... ...15
BVRJ W.P. No.34492 of 2023 k. But, when the AG has raised Audit Para in Inspection Report 2016-17 regarding non deduction of VAT from "R" Value, the Petitioner's JV itself started submitting the RA bills duly calculating the price adjustment by deducting VAT @ 5%, Seigniorage and additionally Income Tax @ 2% also from "R"
Value. This ascertains that the agency has agreed with the observations of the Audit and submitted the subsequent bills accordingly.
l. Moreover, the Petitioner's JV itself has requested this office to deduct VAT @2.8% from "R" value and revise the price adjustment vide their letter dated:29-12-2022. Now, the department has considered their request and regularized the price adjustment in RA 145th and Part Bill.
As such, the averment of the Petitioner's JV that the department has made unilateral deductions does not stand. m. Hence, the action taken by the department in regularizing the excess payment by recovering an amount of Rs 10.15 crores towards excess payment of price adjustment made due to non- deduction of VAT, Seigniorage and Other Overhead Charges from "R" value is strictly in accordance with the agreement conditions and Government orders.
5.5. The reasons for withholding GST reimbursement of Electro Mechanical Items are stated as under:
a. The Government has issued certain guidelines vide G.O.Ms.No.67 I&CAD (Reforms) Dept, dated: 04-07-2018 for 16 BVRJ W.P. No.34492 of 2023 implementation of Goods and Service Tax (GST) which was came into effect w.e.f 1st July 2017. In respect of ongoing works for which estimates prepared with SOR prior to 2017-18 (in which embedded taxes are included), it is stipulated that, the estimates are to be split into two le value of work done and paid in VAT regime and balance value of work to be done from 01- 07-2017 for which GST applicable. For this purpose the taxes embedded in the estimates are to be quantified and deducted while allowing reimbursement of GST.
b. The Engineer-in-Chief (General), I&CADD, Hyderabad vide letter No.ENC (G)/SE (P&M)/EE/DEE2/AEES/GST/2021, dt:-
04-03-2021 (Copy submitted) has issued certain guidelines for finalization of GST rates without embedded taxes, as per which, the embedded tax rates for work items from the year 2004-05 to 2008-09 (05) years is to be arrived from SSR-2009-10 and a committee will be formed with respect to Electro Mechanical and Hydro-Mechanical items to the ongoing lift irrigation schemes to finalize the issue.
c. Accordingly, the embedded tax on work items of above work (estimate prepared with 2004-05 SOR) has been quantified and GST reimbursement was allowed in RA 140th and Part Bill duly.
d. Later, the State Level Standing Committee has convened a meeting on 23-04-2024 for approval of Variation Estimate-II and in the minutes of the said meeting (Copy submitted), it was specifically mentioned that, the provision towards the reimbursement of GST without embedded tax rates on Electromechanical and Hydromechanical item has to be considered subject to finalization of guidelines/methodology.
e. Hence, the GST reimbursement made on Electromechanical 17 BVRJ W.P. No.34492 of 2023 and Hydromechanical items for Rs 3.75 Crores in RA 140th and Part Bill was disallowed in RA 145th and part bill.
The same will be again released to the agency after finalization of embedded tax component by the committee."
6. Heard Mr. Avinash Desai, learned senior counsel, appearing for Mr. T.P.S. Harsha, learned counsel for the petitioner, and Mr. S. Rahul Reddy, learned Special Government Pleader, appearing for the respondents, and perused the material on record.
7. It is submitted that alleging non-compliance of the interim order dated 22.12.2023 in the present writ petition (W.P. No.34492 of 2023), C.C. No.120 of 2024 was filed by the petitioner. During pendency of the contempt case, on 18.07.2024, it was reported by the counsel appearing for the parties that an amount of Rs.54,11,29,813/- (rupees fifty four crores eleven lakhs twenty nine thousand eight hundred and thirteen only) has been paid as part-payment to the petitioner out of Rs.80.26 crores; and on 27.08.2024, it was reported that an amount of Rs.13,67,89,493/- (Rupees thirteen crores sixty seven lakhs eighty nine thousand and four hundred and ninety three only) which is the balance undisputed amount was paid to the petitioner; and the same were recorded by this Court. 18
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8. The learned senior counsel appearing for the petitioner submitted that pursuant to the interim order passed by this Court in this writ petition on 22.12.2023 and time granted vide interim orders in C.C. No.120 of 2024, in total an amount of Rs.67,79,19,306/- (rupees sixty seven crores seventy nine lakhs nineteen thousand three hundred and six only) has been paid to the petitioner out of Rs.80.26 crores, and without prejudice to the rights of the petitioner to claim the balance amount, the petitioner received the said amount. However, the petitioner is entitled to interest on the admitted amount which was delayed. It is submitted that the petitioner cannot be relegated to Civil Court in view of the decisions in M. Gangareddy v. State of A.P. 1, J. Devender Ready v. Kakatiya University 2 and also unreported decisions of this Court in W.P. Nos.12677 of 2023 and 12825 of 2023 dated 03.10.2023.
9. The learned Special Government Pleader submitted that the bills of the petitioner have been admitted only after 2020. Lot of procedure is involved for processing and finalising the bills payable to the petitioner. After the order in W.P. No.40000 of 2012, process was 1 1996(3) ALD 434 - MANU/AP/0658/1996 2 2015(3) ALD 96 - MANU /AP/2434/2014 19 BVRJ W.P. No.34492 of 2023 initiated and in view of the reasons explained in the counter affidavit and additional counter affidavit, time was consumed for processing the payment. Assuming that there was delay, it was not intentional and price adjustment could not have been made within few days or months as it required several procedures like Government Orders, Administrative and Executive instructions to be followed. There was no delay as such on the part of the respondents. Thus, the petitioner is not entitled to any interest. The learned Special Government Pleader further submitted that the writ petition is barred by constructive res judicata in as much as the petitioner did not seek interest in W.P. No.40000 of 2012 and relied on the decisions of the Hon'ble Supreme Court in Small Industries Development Bank of India v. SIBCO Investment Private Limited3 and Commissioner of Income Tax, Bombay v. T.P. Kumaran4 on the principle of constructive res judicata.
DISCUSSION :
10. Grant of penal interest is discretion of the Court. No doubt, as held in the decisions referred in paragraph No.8, this Court in exercise of jurisdiction under Article 226 of the Constitution 3 (2022) 3 SCC 56 4 (1996) 10 SCC 561 20 BVRJ W.P. No.34492 of 2023 of India has power to award interest. However, in every case of delay in payment of bills, interest cannot be awarded as a matter of routine. It depends on facts and circumstances of each case. The claim of the petitioner for price adjustment was initially rejected. Thereafter, W.P. No.40000 of 2012 was filed by the petitioner and the same was allowed. The petitioner did not specifically seek for award of interest in W.P. No.40000 of 2012. The present writ petition is filed for releasing payment of admitted bills quantified in compliance of the order in W.P. No.40000 of 2012. Subsequently, the present writ petition was filed. The quantification of penal interest is to be done by guessing work and depending upon the nature of contract. In the commercial transactions, the loss suffered by the party for delayed payments is usually compensated by award of penal interest. It may be noted that there was initial rejection of claim of the petitioner, thereafter acceptance of its claim for Rs.80.26 crores, which was again readjusted to Rs.67,79,19,306/- (Rupees sixty seven crores seventy nine lakhs nineteen thousand and three hundred and six only) by excluding VAT and other charges. In the circumstances, it would be difficult to decide what would be starting point for awarding penal interest. Further, assuming that there is delay as contended by the 21 BVRJ W.P. No.34492 of 2023 petitioner, it requires some detail exercise/adjudication to be done to decide whether delay of payment after quantification of price adjustment was intentional or deliberate. Such adjudication needs to be done by a Civil Court or through in-house mechanism, as the case may be, by giving sufficient opportunity to the respondents to explain its case.
11. The learned Special Government Pleader stated during the course of hearing that Clause 20.2 of the GCC provides for resolution of disputes relating to payment of bills by the Disputes Adjudication Board (DAB) and Clause 20.1 of GCC provides for arbitration. The petitioner is always at liberty to approach the DAB. The learned senior counsel appearing for the petitioner submitted that the DAB has not been constituted despite request of the petitioner. According to the learned Special Government Pleader, DAB will be constituted for each contract and in accordance with the consent of both parties.
12. In the circumstances, the petitioner is given liberty to make a request to the respondents to constitute DAB for quantification of interest for the delayed payment. On such request of the petitioner, the DAB shall be constituted and enquiry shall be conducted in accordance 22 BVRJ W.P. No.34492 of 2023 with the procedure provided under GCC within a period of six weeks thereafter.
13. This Court by the order dated 22.12.2023 directed the respondents to release the admitted principal amount of Rs.80,26,24,211/- (Rupees eighty crores twenty six lakhs twenty four thousand and two hundred and eleven only) within fifteen (15) days from the date of receipt of the copy of the order. However, as stated in the preceding paragraphs No.5.1. and 7, an amount of Rs.54,11,29,813/- and Rs.13,67,89,493/-, totalling to Rs.67,79,19,306/- (Rupees crores seventy nine lakhs nineteen thousand and three hundred and six only) was paid on different dates (between June and August 2024) after lapse of the time granted by this Court. As the total admitted principal amount was not paid within the time fixed by this Court by the order dated 22.12.2023, the respondents are liable to pay interest to the petitioner for such delayed period, and therefore, the respondents are directed to pay interest to the petitioner at the rate of 6% per annum for the admitted principal amount from 06.01.2024 (the date of expiry of the time granted by this Court) till the date of payment to the petitioner.
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14. With the above directions, the writ petition is allowed in part. No order as to costs.
As a sequel thereto, miscellaneous applications, if any, pending in the writ petition stand closed.
______________________ B. VIJAYSEN REDDY, J January 29, 2025.
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