Odisha Faces ₹262-Crore Liability in Road Project Dispute; Questions Raised Over Officials’ Handling of Contract

The Odisha government’s Works Department has come under scrutiny after a Commercial Court in Bhubaneswar directed the state to pay nearly ₹262 crore, including interest, to a contractor in connection with a long-pending road construction dispute.

The court, in its order dated June 20, directed the state government to clear the dues by July 3. It also reportedly issued notices for the attachment of the department’s bank accounts in case of non-compliance.

The order has sparked fresh debate over the functioning of the Works Department and the handling of major infrastructure contracts.

What Is the Case About?

The dispute relates to the construction of a two-lane road from Kanika Railway Siding to Baramati Road in Sundargarh district. The project was awarded in 2016 to GR Infra Projects under the Engineering, Procurement and Construction (EPC) model.

The project, valued at approximately ₹199.36 crore, was scheduled for completion by 2019.

According to available information, the contractor completed the project through another executing agency, and the road has since become operational. However, the company allegedly did not receive the full approved payment, leading it to approach the court for relief.

Following the legal proceedings, the Commercial Court ruled in favour of the contractor and directed the state government to release the pending amount along with applicable interest.

Why Is the State Facing a ₹262-Crore Liability?

The court’s order has raised a key question: how did a project originally valued at around ₹199 crore result in a liability of nearly ₹262 crore?

The additional amount reportedly includes accumulated interest arising from the prolonged dispute and delayed settlement of the contractor’s claims.

The development has also triggered concerns about the financial burden on the state exchequer and whether such liabilities could have been avoided through timely administrative action.

Allegations of Administrative Lapses

The case has also led to allegations regarding the conduct of certain officials who were associated with the project during its execution.

According to allegations cited in connection with the dispute, the then Superintending Engineer Narayan Patel and DPI (Roads) Manoranjan Mishra allegedly failed to resolve issues raised by the contractor in a timely manner. It has also been alleged that repeated delays in addressing contractual disputes contributed to prolonged litigation.

These allegations have not been independently verified, and no official finding of personal wrongdoing against the officers has been cited in the court order referred to in the report.

Questions Over Accountability

The court’s direction has reignited debate over accountability within government departments.

Critics argue that if delays or administrative lapses by individual officials contributed to the financial liability, responsibility should be fixed accordingly rather than allowing the burden to fall entirely on the public exchequer.

The case has also raised broader concerns about contract management, dispute resolution and administrative oversight in public infrastructure projects.

Government Yet to Respond

The Odisha government has not yet issued a detailed public response on the court’s order or clarified whether it will comply with the payment directive, challenge the verdict before a higher court, or initiate any departmental inquiry into the matter.

The case is expected to remain under close watch as the July 3 deadline approaches, with significant financial and administrative implications for the Works Department.