The Karnataka High Court has imposed a cost of Rs. 2 lakh on the Karnataka State Tourism Development Corporation (KSTDC) for ill-treating a contractor raising a make believe dispute to delay the payment of contract amount due to him, though having certified that the contract of renovating the building has satisfactorily completed.
The contractor on completion of renovation, handed over the renovated building to KSTDC on 4th April 2017 and he submitted a bill for Rs. 34.85 lakhs. The building was inaugurated in presence of ministers, MPs, MLAs on 10th April 2017 and was put to routine use.
In the month of July 2017 MD, KSTDC has acknowledged the completion of works and it’s handing over. After the submission of bill the KSTDC authorised architect approved the work for payment of bill in the month of November 2017. The MD wrote to Director, the Department of Tourism to release amount for payment to contractor.
Then he moved his representation in February 2018 complaining about the non-payment of the amount and then came a notice issued to him by KSTDC MD in 2018 April pointing out four defects in the work. The Assistant General Manager KSTDC also issued a notice in May 2018 identifying seven defects and with a warning of deducting 10% of amount if the defects are not addressed within 10 days.
Justice Krishna Dixit allowing the petitioner of class 1 contractor, Chiranjeevi Bengaluru observed, “even in plain matters like payment of contractors now a days it is observed that a kind of callousness and ‘come what may attitude’ on the part of public functionaries and their actions are manifestly arbitrary and absolutely unjust”.
Declining to accept the contention of KSTDC, directing the contractor to approach the civil court, the H.C., directed KSTDC to pay 34.85 lakh to him along with 12% interest p.a. If the amount with interest is not paid within 6 weeks,then he is eligible for additional 1% interest for month and also awarded cost of Rs. 2 lakhs.
