JUDGMENT
A.K. Sikri, J.
1. Some disputes arose between the petitioner and
the respondents which were referred to Brig. T.K. Mittal
appointed as sole arbitrator. The learned Arbitrator
entered upon reference. After receiving the claims and
counter-claims of the parties and adjudicated upon the
same he made and published his award dated 18th
November, 1999. The petitioner, thereafter, filed
application under Sections 14 and 17 of the Arbitration
Act, 1940 (for short ‘Act’) for making the aforesaid
award as rule of the court which was registered as Suit
No. 2833 of 1999 and the arbitrator was directed to file
the award. On arbitrator’s filing the award, notice
thereof was issued to both the parties. The
respondents filed objections to this award under
Section 30 and 33 of the Act which are registered as IA
No. 8909/2000.
2. Mr. Sameer Aggarwal, learned counsel appearing
for the respondents pressed objections in respect of
the award on claims No. 2, 4, 5, 8, 12 and 14.
3. In so far as claim No. 2 is concerned, this
claim was made by the petitioner on account of
losses/damages caused due to non-handing over of the
sites in dust free condition as technically required
and due to delay in completion of the building by the
other agency. The arbitrator has awarded this claim to
the extent of Rs. 2 lacs holding that non-handing over
of unencumbered sites is established, and therefore,
the petitioner is entitled to compensation. It is
further stated that the contention of the respondents
to the effect that Clause 11(C) forbds any
compensation is not correct as that is applicable to
reasons covered by Clauses 11(A) & (B). Learned
counsel for the respondents submitted that by awarding
the aforesaid claim, the arbitrator has acted contrary
to the provisions of Clause 11 (C) inasmuch as the site
was not handed over due to the fact that other agency
was constructing the building, and therefore, delay was
in completion of the building. This is admitted by the
petitioner himself and the claim is founded on this
basis. In these circumstances, it was the submission
of learned counsel for the respondents, that Clause
11(A)(vi) gets attracted which reads as under :
“that by reasons of delay on the part of
the contractors or tradesman engaged by
Government in executing works not forming
part of the contract.”
4. The submission of the learned counsel for the
respondents is formidable. The arbitrator has simply
stated that this case is not covered by Clauses 11 (A)
& (B) without giving any further reason as to how it is
no so covered, particularly in the face of Clause
11(A)(vi) which specifically stipulates that the reason
for delay on the part of the tradesman engaged by
Government in executing works not forming part of the
contract. This is when the delay in handing over of
the site was on account of delay in completion of the
building by other agency. As admitted by the
petitioner himself, the case is clearly covered by
Clause 11(A)(vi) and in these circumstances, Clause
11(C) forbids any compensation payable on this account.
The judgment cited by the learned counsel for the
respondent, nemely, Union of India vs. M/s Om
Construction Company reported in 1997 (2) PLR 92 is
clearly attracted on the facts of this case. That was
also a case were the court was interpreting the same
clauses of the contract and it was held that in view of
Clause 11(C) no such claim was payable. It may be
mentioned that same view was taken by the Punjab &
Haryana High Court after referring to various judgments
of the Supreme Court as per which the arbitrator is
bound by the provisions of the contract. The award in
respect of claim No. 2 is therefore not sustainable and
is accordingly set aside.
5. In so far claim No. 4 is concerned, it was on
account of extra expenditure caused by MES due to
withholding the issue of completion certificate. For
same reasons, as mentioned in respect of claim No. 2,
this claim is also not maintainable as the arbitrator
himself recorded that the contractor was denied
electricity and water in addition to some systems to be
completed by the third agency which had not been
completed. Award on this claim is also set aside.
6. As far as claim No. 5 is concerned, the
arbitrator has granted interest at the rate of 12 per
cent per annum for delayed payment of running bills
i.e. RARs. The arbitrator has mentioned that the
payments were to be made within thirty days which he
considered as reasonable period. As the payments were
delayed, interest at the rate of 12 per cent per annum
for delayed payments is allowed. It was submitted by
learned counsel for the respondents that nowhere in the
contract it is provided that the payment is to be made
within fifteen days. This was countered by learned
counsel for the petitioner by referring to Clause 64 of
the contract as per which the running bills were to be
submitted at intervals of not less than thirty days.
His submission was that when the next bill becomes due
after thirty days, it is expected that the payment of
the last bill would be released before that, and
therefore, the arbitrator was justified in inferring
that the fifteen days period within which the payment
is to be made, is reasonable. This view drawn by the
arbitrator based on Clause 64 of the contract is a
possible one, and therefore, this court would not
substitute it’s own view even if the other view is
possible. Thus, I do not find any merit in this
objection and is rejected.
7. Claim No. 8 is again on account of payment of
interest on delayed payment against RARs. and final
bill. The objection of the learned counsel for the
respondents was two-folds:
a. On delayed payment interest has already
been awarded under claim No. 5 which records that the
interest is on account of ‘all the RARs’.
b. In so far as interest on final bill is
concerned, it was submitted that as per Clause 66, the
payment was to be made within six months. Final bill
was signed by the petitioner on 12th September, 1991
and the payment was made on 18th March, 1992 i.e.
within six months and therefore, no interest was
payable. In view of these objections, the learned
counsel for the petitioner conceded the position and
submitted that he had no objection if the award on this
account is set aside. Accordingly, award of interest
against claim No. 8 is set aside.
8. Against claim No. 12, the arbitrator has
awarded Rs. 20,000/- which was recovered by the
respondents on account of alleged defects. As per
Clause 44 of the contract, if there are any defects,
the respondents were permitted to make the recoveries
and get the defects removed at the risk and cost of the
contractor. However, the respondents could not show as
to any such amount was spent, after making the
recoveries, at the risk and cost of the petitioner and
it is for this reason, the arbitrator awarded this
claim. I do not find anything in awarding any such
claim as during the course of arguments also, learned
counsel was not able to substantiate as to how the
arbitrator was wrong in observing that the petitioner
could not prove the disposal of this money.
9. Against claim No. 14, interest is awarded by
the arbitrator in respect of claims 1 to 13 less claims
2, 5 & 8. This objection of the respondents was only
in respect of interest on claim No. 4. Since claim No. 4
itself is set aside, no interest thereon is payable.
10. The award as modified above is made rule of
the court. Decree shall follow. The arbitrator shall
also be entitled to interest at the rate of 12 per cent
per annum from the date of decree till payment.
11. Suit and IA stand disposed of.