Swastika Infra challenges Rajasthan cable recovery order

Swastika Infra Limited has challenged Rajasthan orders that contemplate recovery of Rs 3.604674034 crore over alleged excess use of copper and aluminium cable and threaten encashment of Rs 1.0882 crore in performance bank guarantees. Swastika Infra says the project was completed on March 29, 2019, before the audit-based recovery action.

What do the Rajasthan cable recovery orders seek?

The Rajasthan cable recovery orders seek Rs 3.604674034 crore from Swastika Infra through coercive recovery measures. Swastika Infra filed Civil Writ Petition 6323 of 2026 before the Rajasthan High Court, Jaipur Bench, challenging orders dated November 26, 2025 and February 27, 2026 issued by the Office of the Superintending Engineer, Jaipur Vidyut Vitransr Nigam Limited.

Swastika Infra has named the State of Rajasthan, Jaipur Vidyut Nigam Limited and the Superintending Engineer’s office as respondents in the 2026 petition. The company says the orders followed a recent Accountant General, or AG, Audit, which alleged excess utilisation of copper cable between an inverter and a junction box, and aluminium cable between a junction box and a low-tension panel.

The Rs 3.604674034 crore figure is a proposed recovery stated in the challenged orders, rather than an amount the disclosure says has already been collected. Swastika Infra has asked the High Court to quash both orders, meaning to set them aside, and the disclosure reports no ruling on either the recovery claim or the underlying cable-use allegation.

Why does Swastika Infra contest the recovery claim?

Swastika Infra contests the recovery claim because it says it concluded the required work within the permitted time on March 29, 2019 and received a completion certificate in 2019. The company says the work was executed in accordance with the respondents’ directions and approvals, but those statements are grounds in its petition and not findings by the High Court.

Swastika Infra also says the respondents began recovery measures without giving it a pre-decisional hearing. A pre-decisional hearing is an opportunity to make submissions before an authority makes an adverse decision; the company presents this procedural objection separately from its disagreement with the alleged excess use of cable.

The AG Audit is the stated trigger for the November 2025 and February 2026 orders, while the project completion date was March 29, 2019. That seven-year sequence is central to the writ petition because Swastika Infra says the recovery action concerns a project for which a completion certificate had already been issued during 2019.

What is the risk to Swastika Infra’s bank guarantees?

The immediate stated risk is encashment of Rs 1.0882 crore in performance bank guarantees, or PBGs, connected with the concluded project. A PBG is a bank-backed security provided to support a contractor’s performance obligations, and Swastika Infra says the respondents’ actions create an immediate and credible threat to invoke these guarantees.

Swastika Infra says the PBGs were furnished after project completion for certain high-value items, despite the bid document containing no stipulation requiring such guarantees at that post-completion stage. The company states that it made a written representation on May 8, 2024 seeking release of the guarantees and followed up thereafter, but the guarantees were not released before the recovery measures began.

The recovery amount is about 3.31 times the Rs 1.0882 crore in specifically identified PBGs. These are different exposures: Rs 3.604674034 crore is the amount contemplated for coercive recovery under the challenged orders, while Rs 1.0882 crore is the value of guarantees that Swastika Infra says could be encashed; the disclosure does not state that any PBG has already been encashed.

What relief has Swastika Infra asked the High Court to grant?

Swastika Infra has asked the Rajasthan High Court to quash the November 26, 2025 and February 27, 2026 orders and restrain encashment of the Rs 1.0882 crore in specified PBGs. The petition also seeks an order preventing coercive steps, including invocation or encashment of other PBGs retained by the respondents for other projects, although no aggregate amount for those other guarantees is disclosed.

Swastika Infra further seeks a fair and reasoned determination of payments for work it executed, including consideration of price variation under the bid conditions. Price variation is a contractual adjustment in payment for specified changes in prices or quantities; the company also seeks refund of amounts it says were unlawfully recovered for alleged non-deposit of empty drums.

The petition asks the respondents to release and return subsequent PBGs furnished by Swastika Infra. This requested relief depends on the High Court’s treatment of the two challenged orders, the company’s arguments on post-completion guarantees and the respondents’ determination of amounts payable for the work, none of which has been adjudicated in the disclosure.

How does the case compare with Swastika Infra’s other disclosed matters?

The cable recovery case is one of two material civil proceedings filed by Swastika Infra, while the litigation summary records no material civil litigation against the company. The summary also records nil criminal proceedings involving Swastika Infra and nil actions by statutory or regulatory authorities against it, with amounts in the two company-filed civil proceedings listed as not ascertainable.

The other company-filed civil matter is Civil Writ Petition 8325 of 2021, another Rajasthan power-project dispute involving price variation for copper transformers under the Deen Dayal Upadhyay Gram Jyoti Yojana. In that case, Swastika Infra challenged a July 7, 2021 communication after a Comptroller and Auditor General audit objection concerning price variation, and the disclosure says that petition remains pending with no next hearing date notified.

Swastika Infra’s board adopted its materiality policy on March 24, 2025, setting Rs 2.1309 crore as the threshold for identifying certain material litigation. The Rs 3.604674034 crore recovery contemplated in the 2026 case exceeds that threshold, although the litigation summary still labels the amount involved in the two civil proceedings filed by Swastika Infra as not ascertainable.

The company’s four disclosed tax proceedings total Rs 44.62 lakh, comprising Rs 0.59 lakh in two direct-tax cases and Rs 44.03 lakh in two indirect-tax cases. Those tax amounts are categorised separately from the two civil writ petitions, and the comparison does not establish the potential outcome of the cable recovery dispute.

Conclusion

The combined disclosure shows that Swastika Infra is contesting an audit-based recovery action related to a Rajasthan power project completed on March 29, 2019. Its challenge addresses both the Rs 3.604674034 crore allegation of excess cable use and the asserted threat to Rs 1.0882 crore in PBGs, alongside claims about approved work, payment determination and procedural fairness.

The next disclosed event is the November 16, 2026 hearing in Civil Writ Petition 6323 of 2026, including the company’s Civil Miscellaneous Stay Application 5945 of 2026. The unresolved matters are whether the orders will be stayed or quashed, whether the specified PBGs will be protected from encashment, and whether the respondents will release retained guarantees or determine further payments for the completed work.