The Builders Association of India (BAI) has escalated its long-standing financial dispute with the state government by approaching the judiciary. On December 11, the association filed a writ petition in the Bombay High Court, seeking urgent clearance of pending government dues that are estimated to be between a staggering Rs 75,000 crore and Rs 80,000 crore.
From Legal Notices to High Court Intervention
This legal move follows a series of earlier attempts by contractors to recover their money. Prior to the court filing, the contractors had issued formal legal notices to the state government, at which time they had pegged the total amount of unpaid bills at an even higher figure of around Rs 90,000 crore. According to BAI members, the state government has so far cleared only a fraction of this colossal sum, releasing approximately Rs 10,000 crore to Rs 12,000 crore.
Expressing deep frustration over the impasse, Jagannath Jadhav, the state chairman of BAI, stated that the decision to approach the High Court was a last resort. He emphasized that the dues have remained unpaid despite numerous follow-ups, meetings, requests, and the earlier legal notices. The minimal payment received was deemed grossly inadequate, forcing the association to seek judicial intervention.
Mounting Financial Stress on Contractors
The non-payment of bills is creating severe financial distress across the construction sector. Anand Gupta, a former vice-president of BAI, explained to the Times of India that contractors are reeling under immense pressure. The outstanding payments are for work already executed, materials supplied, and equipment deployed since 2024.
This cash crunch has a cascading effect throughout the supply chain. Contractors are now facing relentless pressure from multiple fronts:
- Banks and Financial Institutions: For the repayment of loans taken for plant and machinery.
- Vendors: For clearing bills related to construction materials.
- Subcontractors and Labour: For ensuring timely wage payments.
Gupta highlighted that the partial release of funds has done little to alleviate the crisis, and the situation demands urgent attention from the state authorities to prevent a wider economic fallout in the infrastructure and construction industry.
A Call for Urgent Resolution
The writ petition in the Bombay High Court marks a critical juncture in this dispute. It underscores the failure of administrative channels to resolve a issue that threatens the financial viability of numerous contractors and allied businesses. The construction sector, a significant contributor to the economy and employment, is now looking to the judiciary to enforce accountability and ensure the release of funds that are legally owed for completed projects. The outcome of this case is being closely watched, as it will set a precedent for how such large-scale payment delays are handled in the future.
