ORDER
1. The writ petitioner entered into an agreement in respect of the work of formation of Velugodu Balancing Reservoir earth work dam from Km. 8.00 to Km. 9.264 upto TBL. Since he quoted his tender at 28.36% less over 1992-93 SSR rates which was the lowest it was accepted and an agreement was entered into on 18-2-1994. As per the contract, the work was to be completed within 18 months which expired on 19-6-1995. The petitioner states that the fourth respondent Executive Engineer vide his letters dated 21-2-1998 and 6-3-1998 specifically recommended to the Superintending Engineer, Nandyal to apprise the matter to the higher authorities for taking necessary approval from the competent authority for revised rate with regard to the extra lead involved. It is specifically stated in the said letter that the actual lead involved for soils due to enrouting on D/S is 7 to 8 Km. against 3 to 4 Km. as per agreement for hearting soils and 6 to 7 Km. against 3 to 4 Kms. for casing soils and this was also once again certified by him on 18-2-1998 and the leads furnished in his office on 29-9-1997 were correct. It was also stated that the Superintending Engineer, Nandyal inspected on 25-2-1997 and noted by his communication dated 28-2-1997 that
the actual lead in respect of Hundri River for soils and rocky quarry was under submergence and presently it works out to 14 Kms. as against 10 Kms. as per the agreement. Considering the extra lead involved for all items, proposals were submitted to the Superintending Engineer, in letter dated 29-9-1997 with revised rates with SSR 1997-98. 28.58% less based on the contract in due and the same was submitted to the Chief Engineer by 29-9-1997.
2. It appears that the higher authorities have not taken any decision with regard to the said recommendations submitted to the Superintending Engineer vide his letters dated 21-2-1998 and 6-3-1998. Without taking any action on the representation of the pelilioner dated 27-4-1998 the impugned order has been passed by the Executive Engineer on 26-5-1998 terminating the conlract.
3. No doubt this Court should not interfere with the contractual work and all disputes are to be settled in civil Court but the Counsel for the petitioner submitted that this Court is vested with power to interfere with contractual work in exceptional cases. He relied upon a decision of Division Bench of this Court in Commissioner of Provident Fund, Hyderabad v. Dr. V.V.S. Ramesh, (DB), wherein this Court held that undoubtedly a contractual obligation is ipso facto not enforceable through the writ jurisdiction only because one of the parties to the contract is State or is State under Article 12 of the Constitution of India and while it is so yet all actions of the State inasmuch as they are administrative in nature are liable to be tested on the anvil of Rule of Law and with the tests of fair play, good conscience and equity applied, and this is so since unlike a private citizen a State is expected to act fairly in all its actions and not prompted by discriminatory or arbitrary considerations.
4. The learned Counsel appearing for the respondents submitted that previously the contract was terminated by the Executive Engineer and on the representation of the petitioner, the Superintending Engineer revoked the termination made on 27-6-1998 but in spite of that the petitioner has not completed the work. It is further stated that the Department has never assured the contractor that revised rates will be paid for the balance work. The Contractor has also given undertaking that he will not claim for compensation for completion of balance work and submission of proposals to higher officers is only a departmental internal transaction. The petitioner suspended the work since 17-3-! 998 and not resumed the work even after issue of final notice and hence this contract was closed under Clause 61 of PS to APSS by the Executive Engineer. It is pertinent to note that in the counter it is specifically stated that after the contract was closed no decision was taken regarding the revised rates with regard to extra leads.
5. The learned Counsel for the petitioner stales that if the higher authorities takes a decision on the recommendation of the Executive Engineer vide his letters dated 21-2-1998 and 6-3-1998 he has no grievance and if the authorities takes decision for revised rates with regard to the extra leads that will suffice.
6. Having regard to the facts and circumstances ofthe case, I am not inclined to set aside the impugned order but I deem it fit and proper to direct the respondents 1 to 3 to lake decision on the proposals sent by the Executive Engineer with regard to the revised rates for extra leads involved and of the higher authorities decides to revise the rates they may consider for continuance of the work by the petitioner otherwise it is open for the respondents to proceed further pursuant to the termination of contract made by the Executive Engineer vide his letter dated 26-5-1998.
7. Till the higher authorities take appropriate decision in the matter the interim stay granted by this Court earlier shall continue.
8. With the above direction writ petition is disposed of. No costs.