News
Commercial High Court orders AASSL to pay Rs 176 mn for unilateral termination of contract
By A.J.A. Abeynayake
The Colombo Commercial High Court has ordered Airport & Aviation Services (Sri Lanka) Ltd. (AASSL) to pay Rs 176 million, along with legal interest, to a private company for breaching a contract.
The court ruled that AASSL’s unilateral termination of an agreement to upgrade airport software systems—awarded to the private company—was unlawful. Additionally, the state-owned entity was directed to settle a Rs 24 million bank guarantee, including applicable interest. The ruling was delivered by Commercial High Court Judge K. Priyantha Fernando.
The plaintiff, E.W. Information Ltd., had secured the 2012 tender to modernise the airport’s operational systems in partnership with several foreign technology firms. The company successfully completed three project phases, including software installation and hardware integration, before handing over the system to AASSL.
However, despite a Cabinet directive granting an extension of 3.5 months for project completion, AASSL halted the extension, allegedly due to political influence. The plaintiff argued that such unjustified state interference undermined private enterprises and urged the judiciary to prevent similar unfair practices.
The court acknowledged that the project delays had been caused by AASSL’s own actions and that the contract timeline had been mutually extended. Furthermore, the defendant admitted that the plaintiff had successfully completed the initial three phases.
Judge Fernando ruled that the plaintiff had acted in compliance with civil contract regulations and that the damage claimed were reasonable, thereby upholding the compensation order.
In terms of the provisions of the Establishments Code on payment of festival advance to government officers, there’s a possibility of obtaining rupees 10,000/- as an advance for celebrating festivals of Theipongal, Ramazan, Sinhala and Hindu New Year, Wesak, Deepavali, and Christmas as well as for pilgrimages (Sri Paada pilgrimage and Hajj pilgrimage).
Provisions have been given to recover the said advance in 08 installments or if required earlier without interest. It has been proposed by the Budget 2026 to increase the said festival advance up to rupees 15,000/-.
Accordingly, the Cabinet of Ministers granted approval to the proposal submitted by the Minister of Public Administration, Provincial Councils and Local governments to revise the relevant provisions so that the festival advance can be increased up to rupees 15,000/- .
As per the approval given by the cabinet meeting held on 02-06-2025, action is being taken at present to offer the underutilized lands/properties of the Sri Lanka State Plantation Corporation, the Janatha Etate Development Board, and the Elkaduwa Plantation Company which are under the Ministry of Plantation and Community Infrastructure which have been identified under stage one to suitable investors.
Accordingly, the Cabinet of Ministers has approved the proposal presented by the Minister of Plantations and Community Infrastructure to provide following lands/properties on a lease basis to the suitable investors for optimal utilization following the prescribed procurement procedure.
• underutilized lands/properties identified under stage two owned by the Sri Lanka State Plantation Corporation, the Janatha Estate Development Board, and the Elkaduwa Plantation
Company,
• The Mawarala watte land and the Tea factory 40.48 hectares in extent, located in Matara District belonging to the Tea Shakthi Fund.
• The underutilized land of 1,541 hectares in extent of Kondachchi Estate is enjoyed by the Sri Lanka Cashew Corporation.
The drafting of the National Fisheries and Aquaculture Policy has commenced with the objective of equitable distribution of the benefits of the fisheries industry and the sustainable management of fisheries and aquaculture. This policy has been updated from time to time according to current requirements. However, steps have not been taken to obtain the approval of the Cabinet of Ministers for that purpose.
According to the policy declaration of the present government, ‘Vistas of Prosperity and Splendor’ the National Fisheries and Aquaculture Policy has been redrafted, updating the aforementioned policy in line with the economic and development objectives of the government.
The recommendations of the Department of National Planning have been received for the drafted policy.
Accordingly, the Cabinet of Ministers has approved the proposal presented by the Minister of Fisheries, Aquaculture, and Marine
Resources to implement the National Fisheries and Aquaculture Policy, integrating it with other relevant policies.
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Festival advance for government officers to be increased
Providing underutilized lands/properties to suitable investors for optimal utilization.
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