Contractors Can’t Misuse Public Money: High Court

The Karnataka High Court has rejected the plea of a construction company seeking return of bank guarantee encashed by the Karnataka State Police Housing and Infrastructure Development Corporation (KSPHIDC) for alleged construction of police quarters. The counsel for KSPHIDC (Karnataka State Small Industries Development Corporation Ltd) argued that the construction was of poor quality and the building cracked after completion. The petitioner said that the work was completed before the given period due to poor construction.
The High Court said in its judgment that public funds cannot be misused. The court said it was surprising how the corporation’s engineers or the concerned engineers paid the bills without checking the quality of construction as the complaints came after the completion certificate was issued. The High Court has also directed that legal action be taken against the engineers who are doing poor work using public money. Referring to these earlier Supreme Court judgments, the High Court held that the bank guarantees were not for show and the corporation had done the right thing. Here the High Court clarified another point that a bank guarantee was not provided for photo-framing and hanging on the wall, which served a purpose. But this too can be reclaimed by the corporation and there is no fault in it.
1,15,13,500 to KSPHIDC alleging poor performance of 144 police quarters in Mandya and Chamarajanagar districts. After encashing the bank guarantee, PG Setty Construction Technology Pvt. Ltd. filed an application in the High Court. The lawyer for the company argued before the bench of Justice M. Nagaprasanna and said that the construction work was completed and the bill was paid after checking the quality.