State cannot withhold admitted contractual liabilities for completed works due to internal fund allocation delays.

The Petitioner, a registered ‘A’ Class contractor, was allotted road restoration contracts in September 2014 following damage caused by heavy rains and flash floods

The Petitioner completed the works within two months

Despite communications from the Executive Engineer in February 2020 admitting a pending liability of ₹25.20 lakhs and recommendations for fund release, the respondents failed to clear the dues

The Public Works Department (PWD) contended that the funds were never placed at their disposal by the District Disaster Authority

The Petitioner filed this writ petition seeking payment of the admitted liability with interest, while the respondents raised the preliminary objection of delay and laches, as the work was completed in 2015

1. Whether the petition is barred by the doctrine of delay and laches given that the claim pertains to work completed in 2015

2. Whether the Petitioner is entitled to the release of the admitted liability of ₹25.20 lakhs along with interest for the delay in payment

The Court applied the principle of "recurring cause of action" to negate the plea of delay and laches in cases where the state admits to a pending liability

It further relied on the guidelines of the State Disaster Response Fund (SDRF) and the administrative responsibility of the District Disaster Authority to release funds for executed works

The court exercised its writ jurisdiction to ensure the settlement of admitted claims, noting that official "wrangles" between departments cannot be a ground to withhold payments to a contractor

The Court rejected the respondents' argument regarding delay and laches, observing that the PWD had continuously acknowledged the debt in internal communications, specifically as recently as February 2020, thereby creating a recurring cause of action

The Court noted that the Petitioner had been forced to run "from pillar to post" for over a decade due to administrative failures between the Disaster Management Authority and the PWD

Since the Executive Engineer had explicitly admitted the liability of ₹25.20 lakhs in official correspondence, the claim was deemed "admitted" and not a matter of factual dispute

The Court emphasized that withholding payment for work completed in 2015 for over ten years was a serious matter that caused undue suffering to the Petitioner

The District Development Commissioner (Respondent No. 6) was directed to release ₹25.20 lakhs from the SDRF to the Executive Engineer, PWD (R&B), within four weeks

The Executive Engineer was directed to pay the Petitioner within four weeks of receiving said funds

Furthermore, the Court ordered that if the payment is not made within the cumulative eight-week period, the Petitioner shall be entitled to simple interest at 10% per annum from the date of completion of the work until its realization