The High Court of Jammu & Kashmir and Ladakh has directed the authorities to establish an effective time-bound mechanism for the timely payment of admitted claims to contractors, observing that such payments cannot be delayed on grounds of pending approvals or alleged shortage of funds.
A Bench of Justice Wasim Sadiq Nargal made the observation while disposing of a petition filed by a local contractor and directed the authorities to release pending dues of ₹47.47 lakh in favour of the petitioner.
The Court reiterated that the State is legally bound to ensure the timely release of admitted and undisputed dues and cannot force parties to approach courts for recovery of such payments.
It also referred to its earlier ruling in M/s Saint Soldier Engineers & Contractors Pvt. Ltd. vs Union Territory of J&K & Ors., reaffirming the need for a structured and time-bound payment mechanism.
The Court observed that despite several judicial pronouncements and settled legal principles, authorities continue to withhold admitted payments on grounds such as administrative delays, pending approvals, or alleged lack of funds.
Such justifications, the Court said, amount to shifting the burden of internal inefficiencies onto contractors, which is not permissible in law.
It further stated that the State, being a welfare entity, is expected to act fairly, reasonably, and responsibly in all its dealings.
The Court also noted that forcing citizens to approach the judiciary for recovery of admitted dues cannot be justified and must be discouraged. Once the State has taken benefit of completed work, it is under a constitutional and legal obligation to ensure timely payment.
Highlighting constitutional principles, the Court observed that such delays violate Article 14 of the Constitution, which guarantees fairness and non-arbitrariness in State action.
It added that delayed payments particularly harm small contractors who operate with limited financial resources, affecting their financial stability and business viability.
The Court further held that the State cannot benefit from completed works while denying rightful payment to executing parties, and emphasized that proper financial planning must be ensured before allotting work to avoid such disputes. (Agency)
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