Disputed Payment and Collusion Allegations: Legal Analysis

Explore the nuanced legal analysis in a recent case where disputed payment claims and allegations of collusion took center stage. The Court’s in-depth examination highlighted the challenges faced in adjudicating contractual matters and the significance of evidence presentation in legal proceedings. Stay tuned to unravel the complexities of this intriguing legal case.


  • The appellants had to approve the DPR and pay pending bills based on the Final Joint Survey/Measurement Report dated 24.10.2013 as their only option.
  • The Single Bench of the High Court allowed the writ petition by M/s. Puna Hinda, quashing certain letters and directing payment of Rs. 31,57,16,134/- with interest.
  • The Single Judge ordered payment based on the Final Joint Survey/Measurement Report for making a revised DPR, to be paid within four months.
  • The Division Bench of the Gauhati High Court upheld the Single Bench’s decision, stating that resurvey and DPR revision would not be fair due to the passage of five monsoons.
  • The writ petitioner claimed a sum of Rs.23,68,11,589/- on 12.8.2015 for objection to the constitution of the Board of Officers.
  • The work order was issued on 15.7.2009, and the writ petitioner filed a writ petition on or about 23.11.2015.
  • The writ petitioner submitted a final bill on 17.6.2014 claiming the aforementioned sum of Rs.23,68,11,589.02.
  • The Board of Officers made recommendations regarding road formation width and work division into Formation work, Permanent work, and Surface work.
  • Final bill was returned unactioned on 10.8.2014, and the bid of the writ petitioner was accepted at Rs.31,87,58,950/-
  • A Notice Inviting Tender (NIT) was issued on 22.10.2008 for road construction and improvement under SARDP.
  • Inter-departmental communication was sent to Head Quarters of Seema, and joint survey results were communicated to the writ petitioner.

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  • The officer who wrote the letter in question was not the competent authority to do so.
  • There are serious disputes regarding the authenticity of the Joint Final Report and the work done.
  • Disputed questions of facts could not be adjudicated by the Writ Court as they relate to the recovery of money.
  • The order of the High Court was considered unwarranted and untenable due to the availability of an arbitration clause to resolve disputes.
  • The claim was deemed to be based on imaginary and arbitrary grounds which were being enhanced over time.
  • Reference was made to a judgment where a similar situation was dealt with by informing the petitioner of the cancellation of the Board of Officers which was initially constituted at the petitioner’s request.

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  • The judgment of the Court in Joshi Technologies International Inc v. Union of India & Ors was relied upon
  • The Court placed reliance on the findings and reasoning of the aforementioned case
  • This case played a significant role in the decision-making process of the current case
  • The High Court’s order was based on the inability to ascertain final measurements after five monsoons, deeming the dispute unsuitable for a writ petition involving disputed facts.
  • No admission from the appellants implies that the amount in question is not finalized.
  • The report prepared after completion of work, not reflecting certain work in the measurement book from execution, appears to inflate the petitioner’s claim.
  • Pure contractual matters in private law are best resolved by the parties’ agreed forum rather than a writ court.
  • The attempt to resolve measurement disputes through a Board of Officers was thwarted by the petitioner for unknown reasons, indicating a lack of cooperation.
  • The lack of acceptance of the Joint Survey Report by the competent authority negates any rights the petitioner may claim due to the inability to undertake measurements over time.
  • The initial claim of Rs. 23,68,11,589.02 has increased to Rs. 35,51,80,651, but the petitioner cannot dispute earlier communications for the current proceedings.
  • The assertion that full payment against the work order claim has been made is contradicted by the increased final amount claimed.
  • Contemporary evidence and periodic measurement books can serve as a basis for determining liability when final measurements are unfeasible on-site.
  • The basis of the Joint Survey Report has been discredited, suggesting a potentially biased act in favor of the petitioner by certain appellant officers.
  • The lack of expertise in measurements or road construction prevents the Writ Court from accurately assessing the amount due and payable, making arbitration the appropriate forum.
  • The decision attributed to the competent authority was communicated by an officer on their behalf, adding a layer of complexity to the approval process.
  • The possibility of collusion between appellant officers and the contractor cannot be dismissed, potentially affecting the credibility of the Joint Survey Report.
  • The dispute over payment amount and whether it is owed at all remains contentious and hinges on disputed factual issues.
  • The argument presented in the memorandum of appeal was based on a specific assertion and lacked supporting evidence.
  • An affidavit from an appellant officer was notably absent from the appeal, raising questions about the thoroughness of the documentation process.
  • Collusion was found to be the basis of the writ petition filed before the High Court.
  • The present appeal was allowed while the writ petition filed by the petitioner before the High Court was dismissed.

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Case Title: UNION OF INDIA Vs. M/S. PUNA HINDA (2021 INSC 448)

Case Number: C.A. No.-004981-004981 / 2021

Click here to read/download original judgement

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