Orissa High Court
M/S Pratistha Engineering vs State Of Odisha And Ors. …. Opposite … on 20 June, 2025
Author: S.K. Panigrahi
Bench: S.K. Panigrahi
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Location: ORISSA HIGH COURT, CUTTACK
Date: 24-Jun-2025 16:53:36
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No. 6634 of 2023
(In the matter of an application under Articles 226 and 227 of the
Constitution of India, 1950).
M/s Pratistha Engineering .... Petitioner(s)
Ltd.,, Bhubaneswar
-versus-
State of Odisha and Ors. .... Opposite Party (s)
Advocates appeared in the case throughHybrid Mode:
For Petitioner(s) : Mr. Merusagar Samantray, Adv.
Along with
Ms. J.J. Jyoti, Adv.
For Opposite Party (s) : Ms. Jyotsnamayee Sahoo, ASC
CORAM:
DR. JUSTICE S.K. PANIGRAHI
DATE OF HEARING:-15.05.2025
DATE OF JUDGMENT:-20.06.2025
Dr. S.K. Panigrahi, J.
1. In this Writ Petition, the Petitioner seeks a direction from this Court to
compel the Opposite Parties to pay interest on a delayed escalation
payment of ₹2.79 crore, alleging arbitrary denial despite admitted
liability, invoking principles of equity, Article 14, and settled judicial
precedents.
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I. FACTUAL MATRIX OF THE CASE:
2. The brief facts of the caseare asfollows:
(i) A tender bearing Bid ID No. CE-DPI&R-16/2010-11 was floated for the
construction of a Road Over Bridge near Lingaraj Road PH Level
Crossing No.190. The agreement for the work was executed on
28.05.2012 with M/s. Panda Infra Projects Ltd. The estimated value of
the contract was approximately ₹21.73 crore (₹21,73,61,511/- as per the
petitioner; ₹21,10,30,593/- as per opposite parties).
(ii) The work commenced shortly after agreement execution and was
completed on 27.06.2018, as acknowledged by both parties. The
project timeline was extended through official approval without levy
of penalty.
(iii) The final bill was submitted by the contractor on 29.06.2018 and
accepted by the Executive Engineer on 14.11.2018, though it excluded
the labour wage escalation component. The petitioner submitted a
separate escalation claim amounting to ₹2,87,63,236/- relating to
enhanced minimum wages.
(iv) The petitioner made multiple representations for the release of
escalation dues between January 2020 and August 2020, submitting
supporting documentation. Government authorities approved excess
deviation work on 25.08.2020, enhancing the contract value by 20.80%.
The Chief Engineer (World Bank Projects) acknowledged the
escalation claim on 16.10.2020.
(v) Due to administrative inaction, the petitioner approached this Court
in W.P.(C) No. 7545 of 2021. Pursuant to the Court’s direction dated
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29.07.2021, an amount of ₹2,79,92,792/- was paid towards the
escalation claim.
(vi) The petitioner filed a representation on 22.10.2022 seeking interest of
₹2,64,26,120.74 at 18% per annum for the period 29.06.2018 to
30.07.2021. The representation was rejected on 06.01.2023, prompting
the present writ petition.
II. SUBMISSIONS ON BEHALF OF THE PETITIONER:
3. Learned counsel for the Petitioner earnestly made the following
submissions in support of his contentions:
(i) Despite admitting and paying principal escalation dues, the interest
was arbitrarily denied, violating the Petitioner’s rights. The Petitioner
suffered financial losses and interest on borrowed capital during the
delay period.
(ii) Clause 31 of the Agreement entitles Petitioner to refund/escalation in
labour, material, diesel costs. Once escalation is admitted and paid,
interest is an implied contractual obligation when payment is delayed.
(iii) Once the government admitted and processed escalation dues, denial
of interest on grounds of absence of guidelines is unsustainable and
barred by estoppel. Government cannot take advantage of its own
delay and administrative inertia.
(iv) It is submitted that as per the case of S.K. Dua v. State of Haryana1,
the interest can be awarded even in absence of statutory rule, based
on constitutional rights or equity.
1
(2008) 3 SCC 44.
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(v) Administrative laches cannot deprive the contractor of rightful
compensation. Other contractors have been paid with interest;
discrimination here violates principles of equity and fair play.
(vi) The petitioners rely on the decisions in ABL International Ltd. v.
Export Credit Guarantee Corporation2 and Unitech Ltd. v. TSIIC
Ltd3.to contend that even contractual matters may be examined under
Article 226 of the Constitution where the conduct of the State or its
instrumentalities is arbitrary, unreasonable, or involves elements of
public law. It is further submitted that a monetary claim arising out of
such arbitrariness is maintainable in writ jurisdiction when directed
against the State or entities discharging public functions.
(vii) State’s refusal to pay interest despite full admission and prolonged
delay is disproportionate, mala fide, and biased. Petitioner is being
treated differently from similarly situated contractors.
III. SUBMISSIONS ON BEHALF OF THE OPPOSITE PARTIES:
4. Learned counsel for the Opposite Parties earnestly made the following
submissions in support of her contentions
(i) The petition is not maintainable under Article 226 as it pertains to a
purely contractual money claim (interest on delayed escalation
payment). The opposite parties argue that such disputes must be
adjudicated in a civil or commercial court, especially since the claim
does not involve any violation of a statutory or constitutional right.
Reliance is placed on Union of India v. PunaHinda4.
2
(2004) 3 SCC 553.
3
(2021) 8 SCC 497.
4
(2021) 10 SCC 690.
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(ii) The petitioner is not a party to the contract, which was executed with
M/s. Panda Infra Projects Ltd. Multiple variations in the name of the
contractor (e.g., Panda Infratech, Panda Infra Projects (India) Pvt. Ltd.)
create ambiguity regarding the petitioner’s legal identity and
entitlement. The writ is therefore challenged for want of standing.
(iii) There is no contractual provision allowing interest on delayed
payments. The escalation claim was processed and paid following
proper procedure and within reasonable time after final approval. The
petitioner allegedly accepted the payment without protest or
reservation, thereby settling the matter.
(iv) The payment of escalation dues was made in accordance with revised
government guidelines issued in 2019 and 2021 after earlier ones were
quashed by the High Court. The opposite parties assert that these
were duly followed, and no undue delay can be attributed to the
State.
(v) The petitioner is accused of misleading the court by suppressing facts,
particularly regarding full and final payment, and attempting to
create an artificial claim. The opposite parties contend that the writ
petition is frivolous and intended to extract interest without legal
basis.
IV. COURT’S REASONING AND ANALYSIS:
5. Heard Learned Counsel for parties and perused the documents placed
before this Court.
6. The petitioner seeks a writ of mandamus under Article 226 for interest
on delayed payment of an admitted escalation claim under a public
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works contract, alleging that the State unjustifiably withheld the
amount for over three years, causing financial loss. Though the
escalation amount of ₹2.87 crore was eventually paid in July 2021 after
court intervention, the petitioner contends that interest is payable for
the delay, which was not due to any fault on their part. The opposite
parties argue that the writ is not maintainable for a contractual
monetary claim, that the contract does not provide for interest on
delayed payments, and that the petitioner accepted the amount
without protest. They further submit that the delay was caused by
administrative procedures and revised guidelines, not arbitrariness or
malice. Accordingly, they pray for dismissal of the writ petition,
asserting that no further amount is due.
7. On the pleadings and arguments of the parties, the following key
issues arise for determination:
i. Whether the writ petition under Article 226 is maintainable for a
claim of interest arising out of a public contract, or whether the
petitioner should be relegated to alternate remedies (such as a
civil suit).
ii. Whether the petitioner is entitled to interest on the delayed
escalation amount, despite the absence of any express provision
for interest in the contract. This issue involves examining:
a) The legal right to claim interest in such circumstances
(under contract law or equity), and
b) Whether the delay in payment was unjustified or arbitrary
so as to merit interest as a compensatory measure.
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iii. Whether the actions of the opposite parties in delaying the
escalation payment violated Article 14 of the Constitution by
being arbitrary, unfair, or discriminatory, and if so, whether that
strengthens the petitioner’s case for relief in the writ jurisdiction.
8. It is well-settled that the existence of a contract with the State or its
instrumentality does not entirely oust the writ jurisdiction of
constitutional courts. Over the years, the Supreme Court has clarified
the contours of when a writ may lie in contractual matters. One such
case is that of Kumari Shri Lekha Vidyarthi and Ors. v. State of U.P.
and Ors.5wherein the Supreme Court held as follows:
“The impact of every State action is also on public interest.
It is really the nature of its personality as State which is
significant and must characterize all its actions, in whatever
field, and not the nature of function, contractual or
otherwise which is decisive of the nature of scrutiny
permitted for examining the validity of its act. The
requirement of Article 14 being the duty to act fairly, justly
and reasonably, there is nothing which militates against the
concept of requiring the State always to so act, even in
contractual matters.”
9. Likewise, the Supreme Court in the ABL International (Supra)
authoritatively held that a writ petition can be maintained against the
State even if the claim arises out of a contract, provided the facts are
not seriously in dispute and the claim involves enforcement of legal or
constitutional right. The relevant excerpts are produced below:
“From the above discussion of ours, following legal
principles emerge as to the maintainability of a writ petition
:-
5
1991 (1) SCC 212
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a) In an appropriate case, a writ petition as against a State
or an instrumentality of a State arising out of a contractual
obligation is maintainable.
(b) Merely because some disputed questions of facts arise for
consideration, same cannot be a ground to refuse to
entertain a writ petition in all cases as a matter of rule.
(c) A writ petition involving a consequential relief of
monetary claim is also maintainable.”
10. The abovementioned precedents make it clear that there is no bright-
line rule barring writs in contract cases. Each case must be assessed on
its own merits to see if a public law element or a clear legal right is
involved.
11. In the case at hand, the essential facts are largely undisputed: the
petitioner completed the work, a certain sum was found due as
escalation and the opposite parties delayed its payment for about
three years, releasing it only under court directions and without
interest. There is no controversy about the contract’s existence or the
completion of work. The dispute centers on the State’s obligation to
pay interest for the delay. This issue can be determined on the
admitted timeline of events and the contractual and legal framework,
without requiring any elaborate evidence. Thus, the factual matrix is
not so complex, as to demand a trial, it is suitable for adjudication in
writ proceedings since we are primarily interpreting the scope of
petitioner’s rights in law (and under Constitution) against the State’s
admitted conduct.
12. Moreover, the petitioner’s claim is predicated on alleged arbitrariness
by the State. When such allegations of unconstitutional behavior are
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made, the High Court is empowered to examine them under Article
226. The availability of an alternate civil remedy does not bar the writ
if the petitioner can show a breach of fundamental rights or gross
arbitrariness.
13. The Supreme Court in the S.K. Dua (Supra) dealt with a somewhat
analogous scenario: a retired government officer claimed interest on
delayed payment of retirement dues via a writ. The High Court had
dismissed his petition summarily, asking him to approach the civil
court. The Supreme Court set aside that dismissal and observed that
the writ should be heard on merits, noting that even in absence of a
specific rule, the claim for interest court be founded on constitutional
rights. The relevant excerpts are produced below:
“In the circumstances, prima facie, we are of the view that
the grievance voiced by the appellant appears to be well-
founded that he would be entitled to interest on such
benefits. If there are Statutory Rules occupying the field, the
appellant could claim payment of interest relying on such
Rules. If there are Administrative Instructions, Guidelines
or Norms prescribed for the purpose, the appellant may
claim benefit of interest on that basis. But even in absence
Statutory Rules, Administrative Instructions or Guidelines,
an employee can claim interest under Part III of the
Constitution relying on Articles 14, 19 and 21 of the
Constitution. The submission of the learned counsel for the
appellant, that retiral benefits are not in the nature of
“bounty” is, in our opinion, well-founded and needs no
authority in support thereof. In that view of the matter, in
our considered opinion, the High Court was not right in
dismissing the petition in limine even without issuing
notice to the respondents.”
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14. This reflects the judiciary’s evolving stance that when a citizen is
unjustly deprived of money or property by the State, particularly
when such deprivation stems from administrative inaction rather than
any dispute on entitlement, the constitutional courts are empowered
to step in and grant relief. The principle underlying this approach is
that the State, being a model litigant, must not act in a manner that
causes undue hardship to individuals, especially when no plausible
justification exists for the delay.
15. That said, this Court is mindful of the caution that not every contract
dispute should be converted into a writ petition. The ABL
International (Supra) judgment itself cautions that the extraordinary
power under Article 226 must be exercised with circumspection,
especially if the contract provides its own dispute resolution
mechanism or if the matter is better suited for trial. In the present
case, however, the contract does not appear to mandate arbitration or
any special forum for disputes (no such clause was pointed out by the
opposite parties). The only remedy suggested by the State is a general
civil suit. But a civil suit for recovery of interest in this scenario would
essentially traverse the same legal question we are equipped to decide
here: whether the law implies an obligation on the State to pay
interest for delayed payment of an admitted due. Relegating the
petitioner to a suit would cause further delay and expense, which,
given that the principal has already been paid after a court’s
indulgence, may not be efficacious.
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16. In view of the above, this Court holds that the writ petition is
maintainable. The case involves no complex factual inquiry, the claim
is against a State entity, and allegations of arbitrariness under Article
14 have been made out prima facie. The petitioner seeks enforcement
of his right to a fair treatment and full payment (including interest)
from the State, which is a justiciable issue in the writ realm.
Consequently, the preliminary objection of the opposite parties is
rejected. The Court will proceed to adjudicate the petitioner’s claim on
merits under Article 226, rather than directing him to a civil suit, to
avoid prolonging the injustice allegedly suffered.
17. As a side note, the objection regarding ambiguity in the petitioner’s
identity is not significant enough to affect maintainability. Upon
perusing the record, it is evident that the writ petitioner is indeed the
same legal person/entity that executed the contract. The petitioner has
filed an affidavit clarifying this aspect. The Court is satisfied that there
is no prejudice to the opposite parties on this count; the contracting
party and the petitioner are one and the same. This minor discrepancy
does not warrant dismissing the petition. Courts have the power to
allow correction of the cause title if needed, but here it is unnecessary
as the identity is substantively clear. This Court therefore proceeds to
examine the substantive claim for interest.
18. The crux of the matter is whether the petitioner has a right to be
compensated by way of interest for the period during which the
escalation amount remained unpaid. It is undisputed that the contract
does not explicitly provide for interest on delayed payments. The
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general rule in contract law is that interest is payable only if there is a
stipulation (express or implied) to that effect, or if some law or usage
applicable to the contract so mandates. In the absence of an
agreement, a party’s entitlement to interest would typically arise
under statutes like the Interest Act, 1978 or by discretion of the court.
However, when we are in the realm of public law and equity, the
approach can be nuanced.
19. The opposite parties have argued that silence of the contract on
interest implies no interest is payable. The petitioner, on the other
hand, urges that fairness and equity demand payment of interest for
the delay. The Supreme Court’s observations in S.K. Dua (Supra) are
instructive. In that case, concerning delayed retiral dues, the Supreme
Court held that if there are applicable rules or guidelines providing
for interest, those should be followed; but even “in absence of statutory
rules, administrative instructions or guidelines, an employee can claim
interest under Part III of the Constitution relying on Articles 14, 19 and 21″.
20. By analogy, a contractor (though not an “employee”) dealing with the
State can invoke the constitutional principle that arbitrary deprivation
of money that is due attracts the protection of Article 14. The notion is
that money legitimately due to a person is their “property” in a sense,
and unreasonable withholding of such property by the State may
violate Article 14 and Article 300A, and even implicate Article 21 if it
affects the person’s livelihood. Thus, even if the contract did not
promise interest, the law can impose an obligation to pay interest as a
facet of compensatory justice.
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21. It is also relevant to note that interest is not a penalty; it is a normal
accretion on capital. If A owes B a certain sum and pays it after three
years, A has lost the opportunity to use that money for those three
years. Conversely, A (the debtor) had the benefit of retaining that
money interest-free. In financial terms, this is an unjust enrichment of
the debtor at the cost of the creditor. Courts of law and equity often
step in to neutralize such unfair advantage by awarding interest. This
principle applies with greater force to the State, which is expected to
deal fairly. The State cannot retain money due to a citizen for long
periods and then turn around and say, “since the contract did not
mention interest, we can pay years later at no extra cost.” Doing so
would encourage indifference to timely performance of obligations.
Therefore, unless specifically prohibited by the contract, there is
nothing in law that prevents the Court from awarding interest on
delayed payments, especially against the State.
22. Clause 31 of the contract (the escalation clause) gave the petitioner the
right to be compensated for price escalation in inputs (like materials,
labor, etc.) over the course of the project. This clause essentially means
that the contract price was subject to adjustment and the petitioner
would not be forced to absorb cost increases beyond his control. By
submitting an escalation bill and having it accepted eventually, the
petitioner was exercising a contractual right. Once the amount was
determined as payable, it became an accrued debt from the opposite
parties to the petitioner. The contract may not explicitly specify a due
date for escalation payments, but by practice and necessary
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implication, such payments are expected to be made along with or
shortly after the final bill; in this case, accepted in November 2018, the
escalation ought to have been settled within a reasonable time
thereafter.Therefore, the Court views the escalation amount as money
that became due to the petitioner in late 2018. The failure to pay that
amount until July 2021 is a breach of the opposite parties’ implied
obligation to pay within a reasonable time. In the absence of any
justification that can legally excuse this delay, it follows that the
petitioner ought to be compensated for the value of money lost over
that period, i.e., by interest.
23. Importantly, the opposite parties have not pointed to any clause in the
contract that prohibits payment of interest. Some government
contracts do contain a clause like “no interest shall be payable on any
delayed payments or pending claims,” but no such clause from this
contract is cited before this Court. Thus, this Court is not confronted
with a situation of overriding contractual prohibition. Had there been
an explicit bar, the matter would be different, as courts generally
respect the terms of a contract freely entered. Here, the contract is
simply silent on the aspect of interest. That contractual silence, in the
opinion of this Court, does not mean the petitioner has waived his
right to interest per se. It simply means the contract did not stipulate
one way or the other. In such a vacuum, the Court is entitled to apply
general principles of law and equity to determine the entitlement.
24. The opposite parties argue that by accepting the principal amount
without protest, the petitioner acquiesced to the settlement of the
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claim. However, the facts show that the petitioner did make multiple
representations pressing for interest both before and after receiving
the principal sum. The acceptance in July 2021 was under compulsion
of a court order, as the petitioner had to fight to secure even that
payment.It was not a voluntary part-payment that the petitioner
agreed to treat as full satisfaction. On the contrary, immediately after
getting the Rs. 2.79 crore, the petitioner formally claimed interest for
the delay. This conduct negates the theory of “accord and
satisfaction.” There is no evidence that the petitioner executed any full
and final discharge voucher or gave up his claim to interest. Hence,
the door remained open for him to pursue this additional claim. The
Court would be slow to infer waiver of a constitutional or legal right
(here, the right to fair compensation for delay) unless it is clear and
express. In this case, no such clear waiver is present.
25. The petitioner has claimed interest at 18% per annum, which he terms
a “reasonable commercial rate.” This percentage no doubt appears on
the higher side, particularly in the current era of lower interest rates.
Courts, in their discretion, typically award interest in the range of 6%
to 12% in such matters, depending on the circumstances and the
period of default. The rationale for applying 18% interest could be
that certain public works contracts or statutory frameworks expressly
provide for higher rates to deter delays in payment. However, since
this is a writ proceeding and we are invoking equitable principles; the
rate of interest should be what is fair and not punitive. If it were
established that the opposite parties acted in bad faith or in willful
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defiance, a high rate might be justified as an example. Here, while this
Court finds the delay unjustified, it does not find any allegation of
malice or fraud, it appears to be governmental tardiness. Therefore,
interest should be compensatory, not penal.
26. That said, the delay of over three years is considerable, during which
the petitioner was deprived of a substantial sum of nearly ₹2.8 crore.
Had the petitioner borrowed this amount from a bank, he would
likely have paid interest close to commercial lending rates.
Conversely, if the petitioner had this money, he could have invested it
for returns. Considering these factors and the prevailing rates, an
interest rate in the range of 9% per annum simple would be
reasonable. This roughly corresponds to a median between a
conservative saving rate and a commercial borrowing rate over that
period. It also aligns with what many courts award in similar
situations as a fair measure. However, the final decision on rate will
be addressed in the Conclusion after examining the remaining issue
on arbitrariness, which may color the relief.
27. The last issue to be considered by this Court is whether the delay in
this case was indeed unjustified or arbitrary (as the petitioner says) or
whether it was a mere procedural delay excusable in the
circumstances (as the opposite parties claim).
28. The conduct of the State in contractual matters is not judged by the
standard of a private trader in a marketplace, but by the higher
standards of fairness and reasonableness mandated by the
Constitution. Even though the State may enter into commercial
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contracts, it cannot shed its character as State under Article 12, and
thus all its actions are expected to be free from arbitrariness.
Therefore, if a government department unduly delays payment of a
due amount without good reason, it can be regarded as acting
unfairly.
29. In the present case, the opposite parties have attempted to justify the
delay by pointing to revised guidelines and procedural requirements.
The Court certainly acknowledges that governmental processes can be
complex: file movements, approvals, audits, etc., can consume time.
However, the critical question is whether a delay of over three years
(July 2018 to July 2021) is reasonable or whether it betrays
administrative apathy amounting to arbitrariness. The petitioner’s
escalation claim was essentially a matter of accounting and
verification, which ought to have been concluded in a matter of
months, not years. The fact that the petitioner had to approach a court
to prod the authorities into releasing the payment strongly suggests
that the delay was not entirely innocent or unavoidable. Indeed, once
the court order was passed, the machinery moved and payment was
made. This sequence indicates that, absent judicial intervention, the
petitioner’s dues might have been stuck indefinitely. Such inertia in
paying an admitted due reflects arbitrariness, or at least unjustified
bureaucratic procrastination.
30. The opposite parties mentioned revised guidelines, but significantly,
they do not claim that those guidelines denied the petitioner’s claim
or found it ineligible. Ultimately, the amount (almost the entire claim)
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was paid, which implies the claim was valid all along. If the
guidelines were issued say in 2019, it should not have taken until mid-
2021 to apply them and process the payment. The opposite parties
have not pointed to any ongoing dispute or investigation that was
holding up the payment. For example, sometimes payments are
withheld due to allegations of overbilling or pending clarifications. Bu
no such reason is cited here beyond “waiting for guidelines”. Thus, in
absence of a clear, compelling justification, the extended delay must
be taken as unreasonable.
31. Arbitrariness under Article 14 is not confined to discriminatory
treatment vis-à-vis others; it also encompasses any action (or inaction)
that is not informed by reason or that is manifestly unfair to an
individual. Famously, the Supreme Court in the case of E.P. Royappa
v. State of Tamil Nadu6 held as follows:
“From a positivistic point of view, equality is antithetic to
arbitrariness. In fact equality and arbitrariness are sworn
enemies; one belongs to the rule of law in a republic while
the other, to the whim and caprice of an absolute monarch.
Where an act is arbitrary it is implicit in it that it is
unequal both according to political logic and constitutional
law and is therefore violative of Art. 14, and if it affects any
matter relating to public employment, it is also violative of
Art. 16. Arts. 14 and 16 strike at arbitrariness in State
action an( ensure fairness and equality of treatment. They
require that State action must be based on valent relevant
principles applicable alike to all similarly situate and it
must not be guided by any extraneous or irrelevant
considerations because that would be denial of equality.
6
1974 AIR 555
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Signed by: BHABAGRAHI JHANKAR
Reason: Authentication
Location: ORISSA HIGH COURT, CUTTACK
Date: 24-Jun-2025 16:53:36Where the operative reason for State action, as distinguished
from motive inducing from the antechamber of the mind, is
not legitimate and relevant but is extraneous and outside
the area of permissible considerations, it would :amount to
mala fide exercise of power and that is hit by Arts. 14 and
16. Mala fide exercise of Power and arbitrariness are
different lethal radiations emanating from the same vice : in
fact the matter comprehends the former.”
32. In this case, the petitioner’s money was held up for years without a
tenable explanation. This, in the Court’s view, amounts to arbitrary
action (or rather, arbitrary inaction) on the part of the State. The
petitioner, like all contractors, had a legitimate expectation to be paid
timely. By breaching that expectation without cause, the opposite
parties failed to act in a fair, just, and non-arbitrary manner. The
Court therefore finds that the opposite parties’ delay in disbursing the
escalation amount to the petitioner was unreasonable and arbitrary. It
violated the petitioner’s right to equal and fair treatment under Article
14 of the Constitution. This finding buttresses the petitioner’s
entitlement to interest, because when the State acts arbitrarily causing
monetary loss, the legal system’s response is to make the aggrieved
party whole, which in monetary terms means adding interest to cover
the loss.
V. CONCLUSION:
33. The Writ Petition is maintainable under Article 226. The Petitioner has
rightly invoked the public law remedy since the claim raises issues of
fairness of State action and does not require any elaborate fact-finding
beyond the admitted record.
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Signature Not Verified
Digitally Signed
Signed by: BHABAGRAHI JHANKAR
Reason: Authentication
Location: ORISSA HIGH COURT, CUTTACK
Date: 24-Jun-2025 16:53:36
34. The Petitioner is entitled to interest on the delayed payment of the
escalation amount. The contract’s silence on interest does not preclude
this relief, given the legal and constitutional principles that come into
play. The State cannot unjustly enrich itself by holding onto money
due to the Petitioner without consequences.
35. Accordingly, the Opposite Parties are directed to pay interest to the
Petitioner at the rate of 9% per annum on the amount of ₹2.79 crore
for the period from 29 June 2018 to 30 July 2021. The interest amount
shall be paid within two months from the date of receipt of this
judgment. In case of default, the said amount shall carry further
interest at 9 percent per annum until actual payment.
36. Accordingly, this Writ Petition is disposed of.
37. Interim order, if any, passed earlier stands vacated.
(Dr.S.K. Panigrahi)
Judge
Orissa High Court, Cuttack,
Dated the 20th June, 2025/
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