Mohd. Rafi vs Union Of India (Uoi)
2007 Latest Caselaw 1675 Del

JUDGMENT

Badar Durrez Ahmed, J.

1. Objections under Sections 30 and 33 of the Arbitration Act, 1940 have been filed on behalf of the respondent (Union of India) in respect of the award dated 09.07.1985.

The main objection taken by the learned Counsel for the respondent (Union of India) is that the learned arbitrator has allowed the claim of the petitioner for higher expenditure incurred by the petitioner/claimant for procuring earth through private sources and transporting by animal transport prior to 24.02.1981 on the ground that the temporary land for borrow areas was not provided by the respondent prior to 24.02.1981. The learned counsel for the respondent submitted, with reference to Clause 2A of the contract between the parties, that no claim whatsoever for not giving the full site on award of the work or for giving the site gradually in parts would be tenable. I am unable to agree with the submission made by the learned counsel for the respondent because the said Clause 2A of the agreement has reference to the site for execution of the work and does not have any reference to making the temporary borrow areas available to the petitioner/claimant.

2. In this context, it may be pointed out that the respondent had awarded the contract of raising and strengthening of RME from 10500 to 13500 metres to the petitioner/claimant by a letter dated 21.10.1980 for the tendered amount of Rs. 6,25,828.14. The claimant was directed to start the work at once and complete the same within six months. The work was to commence on 27.10.1980 and was to be completed on 26.04.1981. The learned arbitrator has considered all the facts and has come to the conclusion based on the documents produced by the parties before him that the possession of the temporary land for use as borrow areas was handed over to the petitioner only on 24.02.1981. Thus, although the work was to commence on 27.10.1980, possession of the temporary land for use as borrow areas was handed over only on 24.02.1981. Clause 2A of the contract referred to by the learned counsel for the respondent does not have any reference to the handing over of the temporary land for use as borrow areas and only bears reference to the site where the work is to be executed. There is no controversy with regard to the handing over of the site. The only controversy was as to whether because of the delay in handing over the temporary land for use as borrow areas, the petitioner/claimant was put to extra costs. In this regard, the learned arbitrator, while considering Claim Nos. 1 and 2, observed that the respondent intended to complete the flood embankment work by 26.04.1981, i.e. before the onset of the monsoon. The contractor had taken up execution of the work and had completed over 21% of the work before the respondent could provide him land for the borrow areas as per the contract. As a result, the petitioner/claimant incurred higher expenditure by procuring earth through private sources and transporting it by animal transport. The learned arbitrator held that this action of the petitioner helped to complete about 85% of the work before the onset of monsoon. It was found by the learned arbitrator that the contractor was entitled to payment towards extra costs for carriage of earth supplied up to 24.02.1981 and accordingly he awarded an amount of Rs. 76,914.67 in respect thereof. This conclusion of the learned arbitrator, in the circumstances narrated above, cannot be faulted.

3. The second contention raised by the learned counsel for the respondent was that the arbitrator has also awarded a sum for the extra expenditure incurred by the petitioner/claimant for doing work during the monsoon period. According to the learned counsel for the respondent, the petitioner did not carry out any work during the monsoon period and, therefore, no amount could have been awarded to the petitioner. The learned arbitrator had observed that after 24.02.1981, the petitioner continued the execution of the work from the borrow areas made available by the respondent and completed the work on 01.10.1981 against the stipulated date of completion of 26.04.1981 as per the agreement. However, the learned arbitrator noted that time extension had been granted to the contractor without levy of any compensation/penalty taking into consideration the non-provision of the temporary land for borrow areas by the department uptill 24.02.1981.

4. The petitioner/claimant had advanced an argument that the date of completion of the contract of the work was 26.04.1981, but this got extended up to 01.10.1981 on account of the respondent not providing the temporary land for the borrow areas. Consequently, it was contended on behalf of the petitioner/claimant that the winter-summer contract got converted into a monsoon contract which resulted in the incurring of higher expenditure by the petitioner for the execution of the same. It is noted in the award that there was a heavy rainfall on 29.06.1981 which resulted in the development of rain cuts throughout the length of the newly raised embankment which had to be made good by the petitioner involving substantial quantities of earthwork and expenditure by the petitioner/claimant. It is for this that the learned arbitrator has awarded a sum of Rs. 65,981.28 in respect of Claim No. 2. The learned counsel for the respondent drew my attention to Clauses 17, 25, 27 and 28 of the contract for the purposes of submitting that no extra amount was at all payable under the contract and the learned arbitrator has gone beyond the terms of the contract while awarding this sum. Clause 17 relates to the payment of sales tax and other material and, therefore, is not relevant for the present purposes. Clause 25 of the contract simply stipulates that the contractor's responsibility for the contract commences from the date of issuance of the order of acceptance of the tender. Clause 27 requires the contractor to verify all the plans and sanctions shown in the drawings and in case of any doubt, he needed to seek clarifications. It is also provided in Clause 27 that no allowance whatsoever would be made to the contract or for any alleged ignorance thereof. Clause 28 stipulates that before tendering the contract, the contractor should fully acquaint himself about the condition in regard to the acceptability of the site, etc. It also provides that no claim whatsoever of any amount shall be entertained on this ground by the respondent. None of these clauses in the contract bars the awarding of the said amounts to the contractor and, therefore, I am of the view that the objection raised by the learned counsel for the respondent on this ground also is not tenable. The learned arbitrator has considered both Claims 1 and 2 in detail and has given his reasons for making the award in respect of these claims. Those reasons are based on facts and are not arbitrary conclusions and, therefore, cannot be interfered with by this court.

5. The last and final point is with regard to the refund of security amount with interest. I find that the same has been discussed under Claim No. 8 and there is no infirmity in the conclusion arrived at by the learned arbitrator in awarding the amount refundable to the petitioner to the extent of Rs. 23,948 along with interest @ 12% per annum w.e.f. 01.04.1982. The interest has been allowed by the learned arbitrator because he has come to the conclusion that the security amount was wrongly withheld on and from 01.04.1982 when the same had become refundable to the petitioner/claimant.

6. In view of the foregoing discussion, I find no infirmity in the award. The objections are rejected. The award is made a rule of the court.

The suit stands disposed of.