The High Court of Jammu & Kashmir and Ladakh has held that once contractual work stands executed and liability is admitted, the State cannot withhold payment on the ground of absence of codal formalities such as administrative approval, technical sanction or e-tendering.

The Court was dealing with a writ petition filed by M/s Krishna Engineering Works seeking release of ₹7,71,224 towards works executed for the Jal Shakti (PHE) Department. The petitioner asserted that job orders were issued by the department, the works were completed within the stipulated time, and the bills were duly verified by the competent authorities, thereby admitting liability.

Justice Wasim Sadiq Nargal, while rejecting the stand taken by the respondents during the pendency of the writ petition that the claim lacked prior codal compliance, observed that contractors execute works on the legitimate expectation that internal approvals and codal formalities are matters to be ensured by the department. Once work is executed pursuant to job orders issued by the competent authority and liability is admitted, the State cannot deny payment by raising post-execution objections.

The Court held that having admitted the liability, the respondents were estopped from questioning the contract at a belated stage on grounds such as lack of administrative approval or technical sanction.

Reliance was placed on the decisions of the Supreme Court in Ramakrishna Construction Co. v. Union of India and Surya Constructions v. State of U.P. to reiterate that writ jurisdiction under Article 226 can be invoked where admitted contractual dues are withheld without justification.

Accordingly, the writ petition was allowed and the respondents were directed to release the admitted amount of ₹7,71,224 in favour of the petitioner within four weeks, failing which interest at the rate of 6% from the date the amount became due would be payable.