Sri Pichandi R Vs State of Karnataka

Digitally signed REPRESENTED BY ITS SECRETARY by AL BHAGYA DIRECTORATE OF MUNICIPAL ADMINISTRATION Location: HIGH COURT OF AMBEDKAR ROAD KARNATAKA 9TH AND 10TH FLOOR VISHVESHWARAIAH TOWER SAMPANGI RAMA NAGAR BENGALURU-560001

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THE COMMISSIONER SHIVAMOGGA CITY CORPORATION OPP TO GANDHI PARK SHIVAMOGGA-577201

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NC: 2025:KHC:27987 WP No. 4017 of 2025

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HC-KAR

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THE EXECUTIVE ENGINEER (DIV-2) CITY CORPORATION SHIVAMOGGA OPP TO GANDHI PARK SHIVAMOGGA-577201

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…RESPONDENTS

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(BY SRI.H.K KENCHEGOWDA, AGA FOR R1 SRI RAVISHANKAR, ADVOCATE FOR SRI A.V GANGADHARAPPA, ADVOCATE FOR R2 AND R3)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE RESPONDENTS TO CONSIDER THE REPRESENTATIONS DATED 19.08.2024 AND 03.01.2025 AT ANNEXURE-E AND F RESPECTIVELY AND DIRECT THE RESPONDENTS TO RELEASE THE PAYMENT OF 1ST/FINAL BILL DATED 12.01.2024 OF RS. 20,54,460/- (RUPEES TWENTY LAKHS FIFTY FOUR THOUSAND FOUR HUNDRED SIXTY ONLY) AFTER DEDUCTING TAXES IF ANY IN FAVOUR OF PETITIONER WITH INTEREST AT 18 PERCENT PER ANNUM FROM THE DATE IT IS DUE TILL THE DATE OF PAYMENT PERTAINING TO WORK ORDER DATED 04.11.2022 AT ANNEXURE-A

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THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM

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NC: 2025:KHC:27987 WP No. 4017 of 2025

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HC-KAR

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ORAL ORDER

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This captioned petition is filed by a helpless Class-I Contractor who is made to run a pillar to post seeking release of his final bill for a sum of Rs.20,54,460/-(Rupees Twenty Lakhs Fifty Four Thousand Four Hundred and Sixty Only) from respondents. Therefore, a mandamus was sought at the hands of this court by filing the caption petition.

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Heard the learned counsel for petitioner and

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learned counsel for the respondents.

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Facts leading to the case are as under:

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The petitioner is a Class-I Contractor and was

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awarded a contract on 04.11.2022 for execution of civil works, specifically for the formation of a road in Ward No.28. Pursuant to the award, the petitioner entered into an agreement with Respondents No.2 and 3 on the same date. It is the case of the petitioner that the work entrusted under the contract was duly completed to the

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satisfaction of Respondents No.2 and 3. However, despite repeated representations, the petitioner contends that Respondents No.2 and 3 have failed to release the final bill amounting to Rs.20,54,460/-, along with interest at the rate of 18% per annum.

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Learned counsel appearing for Respondents No.2 and 3, on instructions, submits that the Commissioner (Respondent No.2) has addressed a communication to Respondent No.1 requesting the release of a total amount of Rs.2,000 Lakhs, which includes the petitioner's bill of Rs.20,54,460/-. The Standing Counsel appearing for the 2nd Respondent/Corporation further submits that the works were executed under the Special Financial Component (SFC) scheme for the year 2022-23, and upon completion of such works, the Corporation is entitled to the release of the said amount. However, as against the requested Rs.2,000 Lakhs, only Rs.941 Lakhs has been released so far under the said scheme.

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HC-KAR

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In light of the submission made by the counsel for Respondents No.2 and 3, this Court is of the opinion that the failure of Respondent No.1 to disburse the allocated funds to the 2nd Respondent/Corporation has directly impeded the settlement of legitimate claims such as that of the petitioner. There is a clear lapse on the part of Respondent No.1 in ensuring timely release of funds under the 2022-23 SFC scheme.

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The records placed before this Court clearly indicate that Respondent No.2/Corporation has addressed multiple communications to Respondent No.1, requesting the release of funds under the Special Financial Component (SFC) Scheme for the financial year 2022–23. Despite these repeated reminders, there has been no meaningful response or action from Respondent No.1. The inaction on the part of Respondent No.1 in disbursing the allocated funds has resulted in serious prejudice not only to the petitioner but also to other similarly placed Class-I Contractors who have executed public works under the

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HC-KAR

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said scheme. The delay in the release of funds has effectively stalled the settlement of final bills and has adversely affected the legitimate financial entitlements of contractors who have fulfilled their contractual obligations.

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In the present case, it is not in dispute that the petitioner has completed the work awarded to him under the agreement dated 04.11.2022. The records reveal that the work has been completed to the satisfaction of the Corporation and that no objections or deficiencies have been recorded in respect of the quality or execution of the said work. In the absence of any dispute regarding performance, and considering that the petitioner's final bill has not been settled solely on account of non-release of funds by Respondent No.1, this Court is of the considered view that the petitioner has established a clear legal right to seek a writ of mandamus. The obligation to release funds in a timely manner, once the project is completed and certified, squarely falls upon the funding authority, in this case, Respondent No.1. Consequently, this Court finds

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HC-KAR

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that a direction is warranted to Respondent No.1 to take

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immediate steps for release of the funds necessary to settle the petitioner’s final bill, in accordance with law. This is a fit case where the issuance of a writ of mandamus is justified to enforce the petitioner’s accrued rights.

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For the foregoing reasons, this Court passes the following:

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ORDER

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i. The Writ Petition is hereby allowed.

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ii. Respondent No.1 is directed to consider and take a decision on the communication dated 20.06.2025 sent by Respondent No.2, seeking release of funds

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under the 2022–23 SFC Scheme, and to pass appropriate orders within a period of two

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months from the date of receipt of a certified copy of this order. A copy of the order shall be served

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