Disposed

M/s. Sssipl, Sslcc, Rmmc v. The State of Telangana

Telangana HC12 Nov 2024WP/16584/2024

Case brief

AI extract

What is this about?

In a writ petition regarding non-release of Earnest Money Deposit (EMD) and balance arrears, the Telangana High Court observed that the state's delay in land acquisition prevented the petitioner from completing the project. Accepting the government's undertaking to clear land within four months, the court directed the state to adhere to contract terms for EMD release and pay arrears thereafter.

What did the court decide?

Directed the government to complete land acquisition within 4 months and release EMD/arrears 2 months thereafter if agreed; otherwise examine case for releasing EMD and pay arrears within 2 months.

M/s. Sssipl, Sslcc, Rmmc Vs The State of Telangana — Company and Corporate | Telangana HC (2024)

¶1

[^32e6 ]

¶2

HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

¶3

TUESDAY, THE TWELFTH DAY OF NOVEMBER TWO THOUSAND AND TWENTY FOUR

¶4

PRESENT

¶5

THE HONOURABLE SRI JUSTICE C.V. BHASKAR REDDY

¶6

WRIT PETITION Nos. 16584 and 16602 OF 2024

¶7

W.P.No.1654 of 2024

¶8

Between:

¶9

M/s. SSSIPL, SSLCC, RMMC,

¶10

a Consortium, formed by

¶11

M/s. Sri Satya Sai [nfrastructure P!,,1. Ltd.,

¶12

M/s. Sri Sai Lakshmi Constructions and Co.

¶13

M/s.R.M.Mohite and Co.

¶14

Represented by its leadpartner and GPA Holder

¶15

M/s. SSSIPL,A Private Limited Company incorporated under the^provisions of the Companies Act, 1956,having its registered office At^{H.No. 2-2-519} Kishanpura, Hanamkonda, Warangal, Rep.by its Managing Director,^Sri. Vemula Satyamurthy

¶16

...PETITIONER

¶17

AND

¶18

1 The State of Telangana, Rep by its Principal'Secretary lrrigation^and CAD Department, Secretariat Buildings, Hyderabad.

¶19

2 The Engineer-ln-Chief, (General) lrrigation and CAD Department,^Jalasoudha Mandal, Errum Manzil, Hyderabad,

¶20

The Chief Engineer, lrrigation, Warangal(FAC), K.C.Colony,^{Chinthagattu,} Hanamkonda Dist.

¶21

The Superintending Engineer, lrrigation Circle, Jangaon.

¶22

The Executive Engineer, Division 5, lrrigation, Jangaon

¶23

...RESPONDENTS

¶24

Petition under Article 226 of the Constitution of^{lndia praying that in the} circumstances stated in the affidavit filed^{therewith, the High Court may be} pleased to issue Writ, Order, or direction more particularly one in the nature of

¶25

and the balance^{Further Security Deposit (FSD)ofO 5 percentage to the extent of} work completed^{as per Government MemoNo' 896215-A/1851A 1fiFN 2O2O} daled2g-12-2O2othoughtheDefectLiabilityiscompletedon3l.os-2o22despite several extension of^{contractsand representations fromthe petitioner resultingin} hugelossandinconveniencetothepetitioner'asillegal,arbitrary,unconstitutional and against the^{principlesof natural justice apart from being contraryto G O Ms'} No. 146 dated^{OB-10-2015 andGovernmentMemo No8962'15-} A/185/41|TFR/2020^{dated 29-12- 2O2O.and consequentlydirect the respondents} to immediately^{preclosethe agreementand alsorelease the EMDbank} Guarantee, Further^{SecurityDeposit(FSD)'}

¶26

IA NO: 10F²⁰²⁴

¶27

Petitionundersectionl5lcPCprayingthatintheCircumstancesstatedin the affidavit^{filedin support of the petition, the High court maybe pleased to direct} the respondents^{to steps to releasethe Earnest Money Deposit (EMD) oI 2 5%} givenbywayofBankguaranteeatthetimeofenteringintocontractandthe balanceFurtherSecurityDeposit(FsD)of0.5%totheextentofworkcompleted as^per Government^{Memo No. 8962'15-A/1851A1tTFRl2020 dated 29-12-2020by} issuingthecompletioncertificateastheDefectLiabilityison3l-05-2022.

¶28

IA NO^' 20F 2024

¶29

PetitionunderSectionl5lcPCprayingthatinthecircumstancesstatedin theaffidavitfiledinsupportofthepetition,theHighCourtmaybepleasedtodirect the respondents^{to take steps for pre closure of the agreement dated1o'11-2017} entered between^{the petitioner and respondent No.4 for "KaleshwaramProject-} package 13 (Revised scope)- Execution of Lined Gravity^{canalwith discharge of} 255 Cumecs from sri^{KomaravelliMallanna sagar to Package 17 and its Right} Branch canal to^{irrigate an ayacutof 40, 000 acres by water conveyor system with} all associated components^{in Kondapaka (M), Siddipet District" lnterms of as per} clause4(g)ofG.o.Ms.No.146dated08..10-20lSsincetherespondentsdidnot hand over more than^{548 Acrestill date dulycompleting the land acquisition} process

¶30

Courrsel for the^{Petitioner:SRI v.M . M. CHARY}

¶31

Counsel for the Respondents: ADDL^{AOVOCATE GENERAL}

¶32

¶33

The Court made the following: COMMON^ORDER

¶34

¶35

¶36

THE HON'BLE SRI JUSTICE C.V. BHASKAR REDDY

¶37

WRIT PETITION Nos.15 584 & 16602 of 2024

¶38

COMMON ORDER:

¶39

Both the writ petitions have been hled aggrieved by the inaction of the respondents in pre-closing the agreements, dated 2g.lO.2OOg and 10. I L .2017 , respectively entered by the petitioner with the concerned Superintending Engineer and in releasing the Earnest Money Deposit (EMD) amount and also the balance amount payable to the petitioner as arrears for the works executed in pursuance to the agreement.

¶40

2, The issue involved in these writ petitions is intrinsically interconnected and therefore, they are taken up and heard together and are being disposed of by this common order.

¶41

Considered the submissions of the learned counsel for the respective parties and perused the record.

¶42

4 W.P.No. 16584 of 2024 is taken up as leading case to decide the /rc in both the cases.

¶43

It is stated that the petitioner is the contractor and carrying out the business for execution of various contract works in the state and Central Government undertakings. The petitioner has entered into a contract with the respondents on 2g.lo.2oo9 for execution of the

¶44

work of J.^{Chokkarao DevadulaLift IrrigationScheme - Phase ill -} Package^{No.VII, in respectof YashwantpurVagu near Nawabpet} Village, Lingala^{Ganpur Mandal, HanamkondaDistrict'It is further} stated that^{inpursuance of the said contract/agreement'the} petitioner has^{completed 80% of the work and the remaining2Oo/oof} the work^{couldnot be completed' since the State has failed to} handover ttre^{land in terms of the timespecified in the agreement'}

¶45

The grievance^{of the petitioneris thatsince the State has not} handed^{over the land to enablethe petitionerto completethe balance} work, it has^{made a representation requesting the State-authoritiesto} release the^{EMD amount and also pay the balance arrearsof the} amount^{for the works executedin terms of the contract' but the said} representation^{has not been consideredso far'}

¶46

Mr. A' Venkatesh,^{learned Senior Counsel appearingfor the} petitioner vehemently^{contendedthat since the failure to handover the} land is attributable^{to the State Government for various reasons and} there is no^{fault on the part of contractorto completethe work in} terms of the^{conditionsstipulated in the agreement' the petitioner} made a^{requestto the State-authorities to releasethe EMD amount} and also^{balance arrearsamount for the works executed in terms of} the contract.^{When theyhave not consideredthe said request'it was} constrained^{to submit variousrepresentations requestingto extend}

J/ /

,/\

-j

the benefit of^releasing the^{EMD amounton par with the other} contractors, whose cases have been^{consideredinsimilar} circumstances, but the same^{were not considered by the Government'}

¶51

Mr. Imran Khan, learned Additional^{AdvocateGeneral,} appearing for the State has^{not disputed the allocationof the workto} the petitioner and entering^{into an agreementdated 28-10'2009'He} has also not disputed that^{as per the time specified in the agreement,} the entire land^{required has to be handed over to the petitioner to} complete the work.^{The only contentionof the learned Additional} Advocate General is that^{since the land ownersare not coming} forward and in view of^{raising various disputesover the land which is} required to be acquired and^{the sub-divisionrecords have not been} properly tallying with regard to the^{classilicationof land, whichis} subject matter of acquisition,^{there was delay in handing overthe} land to the petitioner.^{The said delay cannot be attributableto the} State alone and it is beyond^{the controlof the State Government'}

¶52

g. Learned Additional Advocate^{General has placed before this} Court a letter addressed^{by the Chief Engineer (lrrigation),Warangal'} The relevant portion of^{the same is extracted hereunder:}

¶53

nln response to Para 7: It b to submit that, the total land required for Package^{VII JCRDLIS is 3718 Acres, out of uhich} 2953 Acres of^{lond alreadyactTtiredand the balance land} reqtired is 165Ac.^{of tuhich 95 Acres of land is required for} balance uorks^{of Naluabpet reseruoirond dbtibutarynettaork}

¶54

: :.1: :

¶55

sAstem and remaining 7O Acres of land for^{additionaluork} entrusted to the ogencA uiz., Construction^{of lTigh-LeuelMain} Canat of Gandiramaram Canal. The Gouemment is^paying special focus on acquiing balonce land to^{complete tLe} dktibutaies, minors and sub minors to irrigttte^{the balance} oAacut- Nou, the Gouernment is ready and wilting^{to complete the} balance land acquisition on top pioitg and the^{regularcourseof} land acquisition uill take its frame uork of^tu.toto four^months. Houteuer, euery effort is made to expedite the^{land acquisition} process and mitigate ang delags. Cordination efforls^tDith Reuenue department of Jangaon & Yadadri Bhuuanagii^District are ongoing, and. euery attempt is being made to^{resolue the} matter satisfactoilg and within the stipulated time^{to itrigatethe} remaining aAacut of 16877 Ac.

¶56

In response to pard 2: It is to submit that, there^{i-s no prouision} exi,st in the agreement to release EMD of^{2-S percentto the ertent} of toork done and the Petitioner ha-s^agreed to^executethe contract ualue of Rs.261.21 Crores for which^{thr:EarnestMoneA} Deposit (EMD) at 2.5o/o for an amount o/Rs.6.51^Crores furnAhed at tlle time of agreement bg th-e uay of bank^Guaranteeand agreed to retain the same till the completion of^{tLLedefectiue} liabilitg period of 2 geors from the date^of fi.nal^{payment as per} General Conditions of Contract, Clause 42.2 of^ogreement booklet, Volume I, Part A (page 115). Copg enclosed.

¶57

In response to pdrd 3: It b to submit that,^{tlaere i.s no prouision} exbt in the agreement to retease^FSD of 0.5^{percent to the extent} of unrk done, as per Clause 42.2.1 of agreement^{booklet,Volume} I, Part A (page 1 15), O.5%o Further Sea.Litg^{Deposit (FSD)and} 2.5ok Earnest Moneg Deposit^(EMD) uill be^{released afi.er} ampletion of the defect liabilitg of 2^gears Jiom^{the date of} closing the final pagment^to tle Petitioner'.

¶58

From the above, as per clause 42.2.1 of agreement^booklet, Volume I, Part A (page 115), O.5% FSD and^{2.5olo EMDwill be released} after completion of the defect liability of 2^{years from the date of} closing the hnal^payment to the^petitioner.

¶59

¶60

¶61

Learned Senior^{Counsel appearingfor the petitioner has not} disputed that in terms^{of the contract/ agreement,the petitioner has} to comply with the^{Clause 42-2.1 of the agreement'l'earned Senior} Counsel further submits^{that if the State atleast, as on the date,} comes forward to^{hand over the land, the petitioneris ready to} complete the^{work and after completionof the work in terms of the} agreement, the^{State maybe directedto releasethe EMDamount and} the arrears^{payableto the petitionerfor the works executedin terms} of the agreement.

¶62

¶63

In view of^{the abovesubmissions, this Court, without going into} the merits and^{demerits of the case and since the Governmenthas} given undertaking of the^{Chief Engineer (lrrigation) that they are} ready to release the^{EMD amountand also arrearspayableto the} works executed by^{the petitioner payable, subjectto the petitioner} completing the entire^{work and the Governmenthas given further} undertaking to deliver^{the remaining portion of the land on which the} work has to be executed,^{within a period of four (4) months from} today and on such^{delivery, the petitioneragreed to complete the work} and for the said^{reasons,this Court is of the opinion that ends of} justice would be met if the^{Government is directed to abide by the} terms and conditions^{of the agreement for releasingthe EMD amount} including the^{arrears payablefor the works executedin terms of the}

{

.:.

agreement to the petitioner within a^{periodof tu'o (O2) months} thereafter. In the event if the Government^{fails to handover the} remaining portion of the land, within a^{period of four (04) months} from today, the Government is^{directed to examinethe case of the} petitioner on par with the other contractors^{for releasing of the EMD} amount and also^{payment of balance of arrears payable for t]-e works} executed in terms of the agreement,^{within a period of two (O2)} months thereafter.

¶68

Accordingly, both the^{Writ Petitionsare disposedof}

¶69

As a sequel, miscellaneous applications^{pcndingif any,shall}

¶70

sl.and closed. No costs.

¶71

¶72

SD/.P.PAOMANABHA REDDY ASSISTANT REGI$TRAR ,TRUE COPY// aty SECTION OFFICER To, 1 The Principal secretary lrrigation and cAD Department. secretarial Buildings, The State of Telangana, Hyderabad. 2. The Engineer-ln-ChieJ, (General) lrrigation and CAD Department, Jalasoudha Mandal, Enum Manzil, Hyderabdd,^- 3. The Chief Engineer, lrrigation, Warapgat(FAC), K.C.Cotony, Chinthagattu, Hanamkonda Dist.

¶73

The Superintending Engineer, lrrigation Ciricle, Jangaon. 5. The Executive Engineei, Division 5, lrrioation. Janoaon 6. One CC to Sri V. M. M. Charv. Advoca=te IOpUCI" 7. Two CCs to The Additional Arjvocate Geneiral, Hidh Court for the State of Telangana, at Hyderabad[OPUC]

¶74

B. Two CD Copies TJ LS @,,

HIGH COURT

DATED:1211112024

1HE Si^- '
t A.
(.)
0g oEC 20a
(.(o,'2
A,
t
SpATCH 90

¶80

CONflMON ORDER

¶81

WRIIT PETITION Nos. 16584 and 16602 OF 2024

¶82

DISPOSING OF THE WRIT PETITIONS

¶83

WITHOUT COSTS

¶84

C)1 t,)"t w

M/s. Sssipl, Sslcc, Rmmc v. The State of Telangana

Case brief

What is this about?

What did the court decide?

M/s. Sssipl, Sslcc, Rmmc v. The State of Telangana

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Sri. Yalamanchilli Suresh and 2 Others Vs The State of Telangana and 13 Others

Countryside Realtors India Pvt. Ltd. Vs Telangana Real Estate Regulatory Authority (Tgrera)

Lekkala Vittal Reddy Vs The State of Telangana

Manthri Radha Vs The State of Telangana and 5others

Miryala Prathap Rao Vs The State of Telangana

D.Ravinder Rao Vs The State of Telangana