High Court of KeralaSingle JudgeWrit petition allowed; payment and interest ord...

Badaruddeen. K.K v. Kanhangad Municipality

Case / Petition Number:WP(C) NO. 30682 OF 2013

Case Details & Bench

Court
High Court of Kerala
Hon'ble Judges
  • C. Jayachandran
Judgment Date
2022-09-16
Court Decision / Holding
Writ petition allowed; Municipality directed to pay Rs.7,50,000/- with interest at 8% per annum from 24.01.2012 to date of payment, with tax deductions as per law.
Final Disposition
Writ petition allowed; payment and interest order issued.

Parties to the Case

Appellants / Petitioners

  • Badaruddeen. K.K

Respondents

  • Kanhangad Municipality

Legal Representation & Advocates

Counsels for Petitioners

  • • Sri. M. Ramesh Chander (Sr.)
  • • Sri. Aneesh Joseph
  • • Smt. Dennis Varghese

Counsels for Respondents

  • • Sri. T.K. Vipindas

Case Synopsis & Summary

This writ petition challenges non-payment by the Kanhangad Municipality for waste-removal work done at the trenching ground under Ext.R1(a) issued on 25.06.2011. The contractor completed the work by 24.01.2012, but the Municipality paid only Rs.6.61 lakhs of the due Rs.15 lakhs, withholding the balance based on Ext.R1(i) prepared by the Junior Health Inspector alleging incomplete removal of old waste. The petitioner relied on Ext.P4, minutes of the Municipality’s governing council, which record 95% completion. The court notes Ext.R1(i) predates Ext.P4 and does not indicate to whom it was issued. It rejects the Municipality’s technical plea under Sections 22(1)(l) and 22(3) of the Kerala Municipality Act, 1994, finding that the Health Standing Committee’s 24.09.2012 report and the all-party meeting of 10.12.2012 acknowledging 95% completion suffice, and that Council approval was not a valid prerequisite to disbursement in this context. Consequently, the court allows the writ petition, directing the Municipality to pay Rs.7,50,000 with 8% interest per annum from 24.01.2012 until payment, with statutory tax deductions as required. The decision emphasizes that once work is extracted, the contractor is entitled to due compensation and to interest for delayed payment.”

Provisions of Law Cited

Kerala Municipality Act, 1994 – Section 22(1)(l)Kerala Municipality Act, 1994 – Section 22(3)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends that Ext.P4 (minutes of the all-party meeting) shows 95% of the work was completed and that withholding payment on the basis of Ext.R1(i) (dated earlier) is unjustified. Ext.R1(i) predates Ext.P4 and does not specify to whom the payment was due. Section 22(1)(l) and 22(3) of the Kerala Municipality Act, 1994 cannot bar payment when 95% completion is evidenced by Ext.P4 and a Council record is not produced to contradict it. The petitioner seeks payment of the balance due with interest.

Contentions of Respondents

The Municipality contends that payment cannot be released without formal approval of the completion by the Municipal Council and that Ext.R1(i) justifies withholding. It relies on Sections 22(1)(l) and 22(3) to argue the need for Council endorsement of the Standing Committee’s conclusions.

Cited Precedents (2)

Case NameCitationTreatmentExplanation
Alok Shankar Pandey v. Union of India and Others2007 (3) SCC 545DistinguishedThe judgment is cited as authority for higher interest (12%), but the present case distinguishes on the basis of prevailing rates 2012-2015 and opts for 8% instead.
WP(C) No. 6164/2010WP(C) No. 6164/2010PositiveThe judgment in this Court (WP(C) 6164/2010) relied on Alok Shankar Pandey and a Division Bench decision to grant 8% interest, which the present court follows as persuasive authority for the rate.

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Extracted Judgment Text

Exact text extracted from official judgment records.

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE C. JAYACHANDRAN`** ``` FRIDAY, THE 16[TH] DAY OF SEPTEMBER 2022 / 25TH BHADRA, 1944 ``` ## **`WP(C) NO. 30682 OF 2013`** ## **`PETITIONER:`** ``` BADARUDDEEN. K.K AGED 38 YEARS S/O YUSUF, K.K. HOUSE, VADAKARAMUKKUM, KANNUR DISTRICT ``` ``` BY ADVS. SRI.M.RAMESH CHANDER (SR.) SRI.ANEESH JOSEPH SMT.DENNIS VARGHESE ``` ## **`RESPONDENT:`** ``` KANHANGAD MUNICIPALITY KANHANGAD 671315, KASARAGOD DISTRICT REPRESENTED BY ITS SECRETARY ``` ``` BY ADV SRI.T.K.VIPINDAS ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 16.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C) NO. 30682 OF 2013 ``` ``` 2 ``` ## **`JUDGMENT`** Pursuant to the tender issued by the 1[st] respondent Municipality, the work of removing waste from the trenching ground was given to the petitioner/Contractor vide Ext.R1(a) work order dated 25.06.2011. The period stipulated for performance was one month. This period was however subsequently extended by the 1[st] respondent Municipality. According to the learned counsel, on 24.01.2012, the entire work was completed. However, the payment due to him, to the tune of Rs.15 lakhs, was not paid by the 1[st] respondent Municipality. Instead, a sum of Rs.6.61 lakhs alone has been paid. The payment was withheld on the strength of Ext.R1(i) document, wherein, the Junior Health Inspector attached to the Municipality has reported that the old waste in the trenching ground has not been removed fully. In answer to the stand of the Municipality, the petitioner propounded Ext.P4, which is the minutes of the meeting of the governing council of the Municipality, wherein it is certified that 95 percentage of the work has been completed, which fact has been taken note of in the said meeting. 2. Having regard to the limited compass of ``` WP(C) NO. 30682 OF 2013 ``` ``` 3 ``` controversy, it is not necessary to narrate in detail the respective pleadings of the parties. This Court will straight away refer to Ext.P4 minutes, wherein it is recorded thus. "തീരുമാനം /മിനുറസ 24.09.201-ലെ ഹെ ൽതതസ്റ്റാന്റിംഗ്കമ്മിറ്റിയുടെ റിപ്പ ോർട്ടിന്റെ അടിസ്ഥാനത്തിൽ ട്രെഞ്ചിങ്‌ ഗ്രൗണ പരിശ ോധിച. സ്ഥല പരിശ ോധനയുടെ അടിസ്ഥാനത്തിൽ ആരരോഗ്യ സ്റ്റാന്റിംഗ് കമ്മിറ്റിയുടെ നിഗമനം ശെ രിയാണെ ന ബ . 95% ോധ്യപ്പെട്ടു ആയതനുസരിചചപ്രവൃത്തി പൂർത്തീകരിച്ചിട്ടുള്ള വിവരം ടെൻഡർ കക്ഷിയെ വിളിച്ചു നേ രിട്ടറിയിക്കാനും കൗണ്സിലിനനോട് വിവരംശുപാർശചെ യ്യാനുംതീരുമാനിച്ചു.” 3. This Court also takes note of the contents in Ext.R1(i). ## “submitted 05.03.2012 ചെ മ്മട്ടംവയൽ ട്രെഞ്ചിങ് ഗ്രൗണ്ടിൽ ശ്രീ.കുഞ്ഞിരാമനനൊപ്പം പരിശ ോധന നടത്തി. പഴകിയമാലിന്യംപൂർണ്ണമായുംനീക്കം ചെ യ്തിട്ടില്ല എന്നുകാണുന ആയതിന്റെ ചിത്രങ്ങൾഇതതോടൊപ്പംസമർപ്പിക്കുന്നു. അനന്തര നടപടികൾക്കുംഉത്തരവിനുമായി.” 4. It is relevant to note that Ext.R1(i) is dated 05.03.2012, whereas Ext.P4 is dated 10.12.2012. Therefore, going by the very showing as per the document of the Municipality vide Ext.P4, what stands established is that 95 percent of the work allotted to the petitioner has already ``` WP(C) NO. 30682 OF 2013 ``` ``` 4 ``` been executed/performed. The amounts due to the petitioner by virtue of Ext.R1(a) work order cannot be withheld on the strength of Ext.R1(i), which is prior in point of time and which does not contain any indication as to who submitted the same, to whom. All what is decipherable from Ext.R1(i) is that it is in the letter head of the 1[st] respondent Municipality. 5. Learned counsel for the respondent raised a technical contention based on Sections 22(1)(l) and 22 (3) of the Kerala Municipality Act, 1994. According to the learned counsel, the Municipal Council has not approved that the petitioner had completed 95% of the work allotted to him, in the absence of which, the petitioner cannot claim the amount due under Ext.R1(a) work order. This court finds little merit in the said contention. Section 22(1)(l) stipulates that the standing Committee for health shall deal with the matters of public health, health services, sanitation etc. A perusal of Ext.P4 minutes would indicate that the report of the Health Standing Committee dated 24.09.2012 has been reckoned and the trenching ground was inspected pursuant to the same. There is further reference in the minutes that ``` WP(C) NO. 30682 OF 2013 ``` ``` 5 ``` the conclusions arrived at by the Health Standing Committee was correct and it is accordingly, that the all party meeting held on 10.12.2012 took note that 95% of the work has been completed by the petitioner. This Court therefore finds that the 1[st] respondent Municipality cannot be gainsaid by propounding Section 22(1)(l) of the Act. 6. It is true that Section 22(3) mandates the resolutions passed by the Standing Committee to be placed before the Council and that the Council have the power to modify the same, if necessary. No record has been produced before this Court to show that the Municipal Council has not accepted the recommendation of the all party meeting of the Municipality, including the steering Committee, as regards the completion of 95% of the work allotted to the petitioner. That apart, in respect of a work order dated 25.06.2011, is it open for the respondent Municipality to come and submit at this point of time that the amount is not liable to be disbursed for want of approval by the Municipal Council? The answer which occurs to the mind of this Court is an emphatic 'no'. The said contention of the respondent Municipality is therefore rejected. Once the Municipality had extracted work ``` WP(C) NO. 30682 OF 2013 ``` ``` 6 ``` from the petitioner, needless to say that the petitioner should be compensated. 7. In these circumstances, this writ petition is only to be allowed. 8. The further point which requires to be addressed is the entitlement of the petitioner for interest in respect of the balance amount due. Learned counsel relied upon the judgment of this Court in WP(C) No. 6164/2010, wherein the learned single Judge has relied upon a judgment of the Hon'ble Supreme Court in **Alok Shankar Pandey v. Union of India and Others** [2007 (3) SCC 545] as also, a Division Bench judgment of this Court, to ultimately grant interest at the rate of 8% p.a. This Court has also perused the judgment in Alok Shankar Pandey, wherein interest at the rate of 12% is seen given. Having regard to the overall facts and circumstances, as also, the rates of interest which prevailed during the period from 2012-2015, this Court is of the opinion that interest at the rate of 8% p.a. would meet the interests of justice. 9. Accordingly this Court allows the writ petition, directing the 1[st] respondent Municipality to pay a sum of ``` WP(C) NO. 30682 OF 2013 ``` ``` 7 ``` Rs.7,50,000/-, together with interest at the rate of 8% p.a. from 24.01.2012 till the date of payment. It is clarified that amount of tax, if any, liable to be deducted from the said sum of Rs.7,50,000/-, as per law, can be effected. ``` sd/- ``` ``` C. JAYACHANDRAN JUDGE ``` Nsd ``` WP(C) NO. 30682 OF 2013 ``` ``` 8 ``` ## **`APPENDIX OF WP(C) 30682/2013`** ``` PETITIONER EXHIBITS ``` ``` EXHIBIT P1 PHOTOSTAT COPY OF THE REPLY GIVEN BY THE PETITIONER ON 27-05-2013 ``` ``` EXHIBIT P2 PHOTOSTAT COPY OF THE COMMUNICATION SENT TO THE RESPONDENT WITH COPY TO THE CHAIR PERSON ``` ``` EXHIBIT P3 A PHOTOSTAT COPY OF THE RESOLUTION PASSED BY THE STANDING COMMITTEE ON 24-09- 2012 ``` ``` EXHIBIT P4 THE PHOTOSTAT COPY OF THE RESOLUTION PASSEDON 10-12-2013 ``` ``` EXHIBIT P5 A PHOTOSTAT COPY OF THE APPLICATION SUBMITTED BEFORE THE RESPONDENT ```