Contract:
Work contract – For laying down sewer system – Assigned by Municipal Council under centrally sponsored Scheme – Nonpayment to the contractor even after completion of 35% of work – Writ petition seeking direction to Central Government and State Government to disburse the funds under the Scheme – Petition dismissed by High Court – Appeal to Supreme Court – Held: Contract was awarded by Municipal Council without sanction of funds by Central Government – Thus, there is no illegality in the impugned order – However, since sewage system is a necessity, it would be appropriate for the State to consider and approve the sewer scheme and seek funds from the Central Government. Disposing of the appeal, the Court
HELD: Respondent No. 1 Municipal Council has published public tender for giving contract of laying sewer without sanction of the funds by the Central Government. The State Level Sanctioning Committee under the Scheme approved the Sewage Scheme for the Yeola Municipal Council on July 20, 2013. Such Scheme was approved by the Ministry of Urban Development on December 24, 2013 but the concurrence of the Finance Ministry was sought. Since there was no approval from the Finance Department, the appellant cannot claim such amount on the basis of an inter-departmental communication where the Ministry of Urban Development has sought release of funds from the Ministry of Finance. Thus, there is no illegality in the order passed by the High Court. However, there cannot be any dispute that sewage system is a necessity in any urban area. The State Level Committee has approved the sewer for the respondent Municipality so as Ministry of Urban Development. The funds are to be allotted by the Central Government or the State Government according to the availability of funds and by maintaining balance of the requirement of various other local bodies. Therefore, it would be appropriate for the State Government to consider and approve the sewer Scheme for Yeola Municipal Council. If the State Government is unable to provide funds in terms of its policy, it shall seek funds from the Central Government under the present Scheme. This course of action is appropriate in view of approval of the Scheme earlier by the State Level Committee and by Ministry of Urban Development. [Paras 8 and 9] [649-C-H; 650-A-B]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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