{"id":20297,"date":"2006-09-21T00:00:00","date_gmt":"2006-09-20T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/the-state-of-tamilnadu-vs-k-ramachandran-on-21-september-2006"},"modified":"2017-11-18T03:24:42","modified_gmt":"2017-11-17T21:54:42","slug":"the-state-of-tamilnadu-vs-k-ramachandran-on-21-september-2006","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/the-state-of-tamilnadu-vs-k-ramachandran-on-21-september-2006","title":{"rendered":"The State Of Tamilnadu vs K.Ramachandran on 21 September, 2006"},"content":{"rendered":"
Madras High Court<\/div>\n
The State Of Tamilnadu vs K.Ramachandran on 21 September, 2006<\/div>\n
       \n\n  \n\n  \n\n \n \n           IN THE HIGH COURT OF JUDICATURE AT MADRAS\n                              \n                      DATED  : 21\/09\/2006\n                              \n                            CORAM\n                              \n            THE HONOURABLE MR. JUSTICE P.K. MISRA\n                             AND\n           THE HONOURABLE MR. JUSTICE R. SUDHAKAR\n                              \n                O.S.A. Nos.406 and 407 of 2000\n                              \n\n\nO.S.A. No.406 of 2000 (O.P. No.908 of 1999):\n~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~\n\n1. The State of Tamilnadu\n   represented by its Secretary to Govt.\n   Animal Husbandry & Fisheries Dept.\n   Chennai 9.\n\n2. The Director of Fisheries\n   Anna Salai\n   Teynampet\n   Chennai 6.\n\n3.The Superintending Engineer\n   Fisheries & Harbour Circle\n   Nagercoil\n   now at the office of \n         the Director of Fisheries\n   D.M.S. Office\n   Anna Salai\n   Chennai 6.                     \t\t..Appellants\/Petitioners\n\n\n           Vs.\n\n\n1. K.Ramachandran\n   Proprietor\n   Complex Pile Foundations\n   Chennai 600 014.\n\n2. Justice K.M.Natarajan (Retd.)\n   No.117\/1\n   L.B. Road\n   Kamaraj Nagar\n   Thiruvanmiyur\n   Chennai 600 041.                       ..Respondents\/Respondents\n\n\nO.S.A. No.407 of 2000 (Application No.1221 of 2000 in O.P. No.326 of 1999):\n\n1. The State of Tamilnadu\n   represented by its Secretary to Govt.\n   Animal Husbandry & Fisheries Dept.\n   Chennai 9.\n\n2. The Director of Fisheries\n   Anna Salai\n   Teynampet\n   Chennai 6.\n\n3. The Superintending Engineer\n   Fishing Harbour Project  Circle\n   Nagercoil\n   now at the office of the\n   \t\tDirector of Fisheries\n   D.M.S. Office\n   Anna Salai\n   Chennai 6.                             ..Appellants\/Respondents\n\n                             \n\tVs.\n\nK.Ramachandran\nProprietor\nComplex Pile Foundations\nChennai 600 017.                          ..Respondent\/Applicant\n\n\n\n\n\n      Both O.S. Appeals are filed under Order XXXVI, Rule  1\nof the High Court Original Side Rules read with Clause 15 of\nthe  Letters Patent against the Common Order dated 26.4.2000\npassed by a learned single Judge of this Court in O.P.No.908\nof  1999 and A.No.1221 of 2000 respectively in O.P.No.326 of\n1999.\n\n\n\n\nFor Appellants in O.S.A.Nos.406 and 407 of 2000 :\nMr.S.Senthilnathan, Government Advocate\n\nFor first respondent in O.S.A.406\/2000 and respondent in O.S.A. No.407\/2000:  \nMr.G.R.Swaminathan\n\nFor second respondent in O.S.A. No.406 of 2000:  \nNo appearance\n\n\n                              \n                       COMMON JUDGMENT\n                              \n\n (The Judgment of the Court was delivered by R.SUDHAKAR,J.)\n\n\n      Original  Side Appeal No.406 of 2000 is filed  by  the\n\nappellants\/petitioners in O.P.No.908 of 1999 challenging the\n\ncommon  order  dated 26.4.2000 passed by the learned  single\n\nJudge,  rejecting their claim for setting  aside  the  Award\n\ndated 27.3.1999 passed by the sole Arbitrator in Application\n\nNo.76 of 1995 in C.S.No.263 of 1987.\n\n\n     2.  Original Side Appeal No.407 of 2000 is filed by the\n\nappellants\/respondents in A.No.1221 of 2000   in  O.P.No.326\n\nof 1999 challenging the common order of learned single Judge\n\ndated  26.4.2000 allowing O.P.No.326 of 1999 to receive  and\n\nconfirm  the award and A.No.1221 of 2000 to pass  decree  in\n\nterms of the Award dated 27.3.1999.\n\n\n\n      3.   The parties, viz., the appellants are referred to\n\nas  Department  and the first respondent is referred  to  as\n\nclaimant\/  contractor in both the appeals for  the  sake  of\n\nconvenience.\n\n\n\n      4.  The sole Arbitrator was appointed in C.S.No.263 of\n\n1987 and he passed an award dated 27.3.1999.  The Arbitrator\n\nfiled  O.P.No.326 of 1999 before this Court to  receive  and\n\nconfirm the award dated 27.3.1999. The first respondent, the\n\nclaimant  filed  Application No.1221 of  2000  in  the  said\n\nO.P.No.326  of 1999 to pass a decree in terms of the  award.\n\nThe  appellants herein filed O.P.No.908 of 1999  challenging\n\nthe  award dated 27.3.1999.  The learned single Judge  by  a\n\ncommon order dated 26.4.2000 in both O.P.Nos.326 of 1999 and\n\n908   of  1999  and  the  A.No.1221  of  2000  allowed   the\n\nApplication  No.1221  of  2000 and O.P.No.326  of  1999  and\n\ndismissed the O.P.No.908 of 1999.  It is against this common\n\norder dated 26.4.2000, present appeals are filed.\n\n\n\n      5.    The  brief  facts of the case as stated  by  the\n\nclaimant  is as follows:-  The appellants  floated a  tender\n\nfor  the  formation  of   R.C. Jetty at  Valinokkam  Fishing\n\nHarbour  in  Ramanad  District.   The  nature  of  work  was\n\nprecasting  and driving of R.C.C. Piles.  The last  date  of\n\nreceipt of tender was fixed on 30.12.1983 as per the  tender\n\nschedule.   The  tender will be valid upto six  months  from\n\n30.12.1983 to 29.6.1984.  During the opening of the  Tender,\n\nthe first respondent\/claimant made the following conditions:\n\n\n\n(1)     Mobilisation  charges of Rs.2  lakhs  and   Electric\n     Power and Water Supply should be made available at  the\n     site by the Department and\n\n(2)    Required  cement  and  steel  for  the  casting  yard\n     should be supplied by the Department free of cost\n\n\n\nThe  first  respondent\/claimant submitted the lowest  quote.\n\nOn  the  request made by the Department by its letter  dated\n\n1.8.1984 claimant revalidated the tender and finally, it  is\n\nstated  that  the  claimant received the  work  order  dated\n\n26.3.1985.  Since the work order was issued after  lapse  of\n\n15  months, claimant sent a letter dated 28.3.1985  claiming\n\n30%  escalation   as against 20% claimed  earlier.   At  the\n\nrequest  of  the Superintending Engineer that the escalation\n\namount  will  be paid on receipt of formal orders  from  the\n\nGovernment,  claimant\/contractor accepted the contract  work\n\non 20.4.1985.  After accepting the agreement in the presence\n\nof Mr.G.Kaliasundaram, the then Superintending Engineer, the\n\nclaimant  brought all Pile Driving Equipment  and  machinery\n\nand  the  construction materials necessary for this  project\n\nwork  in  the site.  Some portion of Pile Driving machinery,\n\nwere hypothecated under the hypothecation agreement with the\n\nthen Superintending Engineer Mr.G.Kaliasundaram on 18.5.1985\n\nand  received the recoverable mobilisation charges  of  Rs.2\n\nlakhs as mentioned in the tender condition dated 30.12.1983.\n\nHowever,  it is only on 4.7.1985 that the Department  handed\n\nover the site.  On 4.7.1985 itself  casting of Pile work was\n\nstarted.   During the casting of piles, the  Department  did\n\nnot   supply  the  required  cement  and  steel  and  proper\n\ninstructions  were  not given.  However,  the  claimant  has\n\ncompleted the casting of piles.  Due to the aforesaid delay,\n\nthe claimant incurred  loss as the machinery and labour were\n\nkept  idle.    Further, 3rd appellant did not pay  the  full\n\nbill amount for the work done upto October, 1985 and has not\n\nprepared  the  escalation bill amount  according  to  letter\n\ndated  6.4.1984.    Due to non-payment  of  escalation  bill\n\namount  as  promised, the claimant  was unable to  make  any\n\nprogress   in  the  driving  of  piles.   After  many   oral\n\nrepresentations and several letters,  3rd appellant arranged\n\na Dredger in October, 1985 for the above work.  The Dredger,\n\nhowever, sunk on its way near Pamban Bridge at Rameswaram on\n\n30.12.1985.      After  several  oral  representations   and\n\nreminders, made by the claimant, the Superintending Engineer\n\nG.Kaliasundaram sent a letter dated 12.1.1986  stating  that\n\nthe  approval of the Government regarding escalation charges\n\nwill  be obtained within a month, however, even after  lapse\n\nof  four  months  the Department did not pay the  escalation\n\nbill   amount.      By  letter  dated  12.7.1986,   claimant\n\nrequested  the  third  appellant   to  settle  claim  amount\n\nincluding  the pending bill amount and also to  release  the\n\nmachinery  and equipment, in default to pay simple  interest\n\nat   18%   per  month  from  15.9.1986.   claimant   further\n\nintimated   that   failure  to  settle  the   claim   before\n\n31.12.1986,  the  claimant will seek  remedy  as  per   law.\n\nInspite  of  this, the  Department had not released  pending\n\nbills,  escalation bill amount and further did  not  release\n\nmachinery  and equipment, and thereby crippled the  claimant\n\nfrom  taking any other contract work.  Claimant stated  that\n\nhe  was incurring loss day by day.  The claimant, therefore,\n\nprayed  for   arbitration in terms of Clause 39  of  General\n\nConditions of the contract.  Since the department refused to\n\nappoint  an  Arbitrator, claimant approached this  Court  by\n\nfiling   C.S.No.263 of 1987 for appointment of an Arbitrator\n\nto  settle the claim amount and for release of machinery and\n\nequipment  and  other construction materials.  Mr.C.R.Gopal,\n\nthe  then Superintending Engineer promised to arrange for  a\n\nDredger  and  instructed the claimant to start Pile  Driving\n\nwork.   The  Department   paid  20%  escalation  amount   on\n\n27.7.1987   in   G.O.No.791.   However,  by   letter   dated\n\n14.1.1988,  the Executive Engineer directed the claimant  to\n\nrefund  the  above  said escalation amount.    Trusting  the\n\nwords  of  the  third appellant, claimant started  the  Pile\n\nDriving  work for which the bill amount was not paid to  the\n\nclaimant  inspite  of several requests and  reminders.   The\n\npile  driving  work  could not be  proceeded  as  the  third\n\nappellant   failed  to  arrange for a Dredger  during  1988.\n\nSince  the area was covered by sea sand, the jetty  was  not\n\nconstructed  as  the  seabed was not dredged.    Instead  of\n\nsupplying  a Dredger to enable the claimant to complete  the\n\nwork,  the  then 3rd appellant  terminated the  contract  on\n\n11.4.1989 while the piling work was in progress.  Because of\n\nthe  failure  on  the part of the appellants Department  for\n\narranging  a  Dredger and dredging the seabed, the  claimant\n\nwas  unable  to proceed further with the Pile Driving  work.\n\nAggrieved by the termination of the contract without  paying\n\nthe claimant the Pile Driving Bill amount, Pile Casting Bill\n\namount,  Escalation  Bill  amount  and  other  claims   made\n\nearlier,    as    illegal   and   arbitrary,    the    first\n\nrespondent\/contractor sought for arbitration of the dispute.\n\nAccording to the first respondent\/claimant   due to delay at\n\nvarious  stages he suffered huge loss and the    non-use  of\n\nmachinery, equipment and other materials from 30.12.1983  to\n\n11.4.1989,    he    suffered    further     loss.      First\n\nrespondent\/contractor  made  a  claim  for  Rs.2,46,42,498\/-\n\nunder various heads as follows:-\n\n\n\n\"CLAIM No.1:\n\nValue  of  work  done  not yet paid  -  Claim  according  to\n\nagreement rates\n\nCasting of 160 numbers of Piles:\n\n1. Shuttering, Centering, Seafolding,\n   Steel Rods Bending & Building &\n   Oiling the shuttering & concreting\n   and curing all the works:\n\n   Lumpsum Rate for each Pile:  Rs.5160\/-\n\nFor  160 numbers of Piles    : Rs.5160 x 160  Piles = Rs.8,25,000\/-\n\n\n2.Handlying & Driving the Precast Piles:\n\nLumpsum Rate for each Pile: Rs.5870\/-\n\n    For  10  Piles        : Rs.  5,870  x  10\t =  Rs. 58,700\/-\n                               -----\n<\/pre>\n
\t\t\t\t\t\t\t         ——–\n<\/p>\n
        Total amount                 =\t      Rs.8,83,700\/-\n\nMinus the Bill amount paid\t\t =  \t\tRs.2,20,000\/-\n                                               ---------------\n          Balance to be billed: Net amount due             =\n                                               Rs.6,63,700\/-\n                                               ---------------\n\n  Balance to be billed: Net amount due =\t      Rs.6,63,700\/-\n\n\n\n\n\nCLAIM No.2:\n\nEscalation Lumpsum @ 180% on the\ncompelled work during the extended\nperiod beginning from 4.7.1984 to\n11.4.1989\n\nCompleted work                  :  Rs.8,83,700\/-\n\nEscalation  @  180%      :   Rs.8,83,700  x  180    \n<\/pre>\n
                             ——————-\t=Rs.15,90,660\/-\n<\/p>\n
                        \t       100<\/span><\/p>\n
CLAIM No.3:<\/p>\n
\n\nNon  Recoverable  Mobilisation\ncharges  not  paid \t\t\t= Rs.3,00,000\/-\n\nCLAIM No.4:\n\nCompensation for Losses \nsuffered on account of \noverheads & Loss of profit\nduring the stipulated \nperiod of contract\nfrom 4.7.1985 to 3.1.1986 \t\t= 6 months\n\na) Amount of contract              \t=  Rs.33,25,500\/-\n\nb) Overheads component of (a) 20%\n   worked out during \n   quoting of tender:       \t\t=  Rs.6,65,100\/-\n\nc) Value of work done upto 3.1.89\n<\/pre>\n
   (contract period of six months) \t= Rs.8,25,000\/-<\/p>\n
\n\nd) Prorate (b) on (c)\n    20% on Rs.8,25,000\/- being\n    overhead & profit \n    for 6 months \t\t\t\t= Rs.1,65,000\/-\n\ne) Net loss on overheads\n     profits  on  =  (b) - (d)       = Rs.5,00,000\/- Rs.5,00,000\/-\n\n\n\n\n\nCLAIM No.5:\n\nLosses suffered during \nthe extended period\nfrom 4.1.86 to 11.4.89 \non account of overheads & \nloss of profits for \n39 months:\n\n(a)  Provision for overheads \n     & profits \n     made by the claimant while\n     working out the  revalidated\n     tender amount is     \t\t= Item (b) in claim No.4\n\t\t\t\t\t\t  ----------------------\n                                            6 months\n\n\n<\/pre>\n
     Contract period 6 months: \t Rs.6,65,100\/-\n<\/p>\n
\t\t\t\t\t\t ————-\n<\/p><\/blockquote>\n
                                        6 months<\/p>\n
     Overheads & Loss of Profit
\n     for each months            \t:  Rs.1,10,850\/-\n<\/p><\/blockquote>\n
(b) Overheads & Loss of profit
\n      during the extended period<\/p>\n
     per month                     :  Rs.1,10,850\/-\n<\/p>\n
      for  39 months               :  Rs.1,10,850\/- x 39=Rs.43,23,150\/-<\/p>\n
CLAIM No.6:\n<\/p>\n
Damages due to Idle of Machinery, Equipment &
\nother construction materials withheld by the
\nrespondents from 4.1.1986 to 22.6.93; Total 89 months:<\/p>\n
Machinery Component   \t\t:   35%\n\nContract value              \t:   Rs.33,25,500\/-\n\nFor 35% for 6 months in \nthe value of contract         :   Rs.11,63,923\/-\n                          \t    --------------\n\t\t\t\t\t\t 6 months\n\nLoss on account of idle of machinery\nfor each month             \t: Rs.1,93,987.50\n\nFor   89  months              : Rs.1,93,987.50 x 89 = Rs.1,72,64,888\/-\n\n                              \n                        CLAIM AMOUNTS\n\nClaim No.1                    :    Rs.   6,63,700\/-\n\nClaim No.2                    :    Rs.  15,90,660\/-\n\nClaim No.3                    :    Rs.    3,00,000\/-\n\nClaim No.4                    :    Rs.    5,00,000\/-\n\nClaim No.5                    :    Rs.  43,23,150\/-\n\nClaim No.6                    :    Rs.1,72,64,888\/-\n                                 ------------------\n            Total claim amount     Rs.2,46,42,498\/-\n                                 ------------------\n\n\n<\/pre>\n
Thus,   claimant   prayed   for   passing   of   award   for<\/p>\n
Rs.2,46,42,498\/-.\n<\/p>\n<\/p>\n
     6.  Respondents\/Department filed a counter with counter<\/p>\n
claim as follows:-    The value of  the claimant’s tender as<\/p>\n
submitted on 30.12.1983 was Rs.34,33,200\/- and the same  was<\/p>\n
reduced  to  Rs.33,25,500\/- to secure the work for  himself.<\/p>\n
After  the  reduction of rates, the Superintending  Engineer<\/p>\n
recommended   the  tender  to  Director  of   Fisheries   on<\/p>\n
9.2.1984.  The recommendation of the Superintending Engineer<\/p>\n
was  considered  at  various other  Departments  and  placed<\/p>\n
before   the   Tender  Committee.    The  Tender   Committee<\/p>\n
consisting   (i)   The  Commissioner    and   Secretary   to<\/p>\n
Government, Forest and Fisheries Department  (ii) The Deputy<\/p>\n
Secretary  to Government, Public Works Department (iii)  The<\/p>\n
Director  of Fisheries and (iv) Thiru G.Kaliyasundaram,  the<\/p>\n
Superintending  Engineer, Fishing  Harbour  Projects  Circle<\/p>\n
considered the  question of mobilisation advance and decided<\/p>\n
that a mobilisation advance of Rs.2 lakhs may be granted  on<\/p>\n
the  usual   terms  and conditions, which amount  is  to  be<\/p>\n
recovered  from  the claimant’s bills, while  accepting  the<\/p>\n
lower  tender  of  the claimant for Rs.33,25,500\/-  with  an<\/p>\n
excess  of 2.90% over the estimate amount.    Government  in<\/p>\n
their   G.O.Ms.No.268  P  &  F  Department,  dated  7.3.1985<\/p>\n
accepted the tender offer of the claimant for Rs.33,25,500\/-<\/p>\n
with  excess  percentage  of 2.90%  over  the  estimate  and<\/p>\n
mobilisation advance was also sanctioned under  usual  terms<\/p>\n
and  conditions.   In  the  G.O. there  was  no  mention  of<\/p>\n
acceptance  either to pay escalation at 20%  of  the  tender<\/p>\n
rates  or to grant Rs.3 lakhs (non-recoverable) mobilisation<\/p>\n
charges.   During  the interim period after  the  expiry  of<\/p>\n
revalidation  on  28.12.1984,  the  Superintending  Engineer<\/p>\n
again  requested the claimant in his letter dated 19.12.1984<\/p>\n
to extend the tender rates for a further period of one month<\/p>\n
from 29.12.1984.  Promptly, the claimant in his letter dated<\/p>\n
21.12.1984 revalidated his tender rates for a further period<\/p>\n
of  one  month  from  29.12.1984  to  28.1.1985.    Claimant<\/p>\n
referred  only  to  his  earlier revalidation  letter  dated<\/p>\n
2.10.1984  without any preconditions and not to  his  letter<\/p>\n
dated  31.8.1984 wherein preconditions had been  stipulated.<\/p>\n
The  Superintending Engineer in his letter  dated   9.1.1985<\/p>\n
submitted  revalidation  letter of  the  claimant   for  the<\/p>\n
further period from 29.12.1984 to 28.1.1985 to the  Director<\/p>\n
of  Fisheries.  The Director of Fisheries in turn  submitted<\/p>\n
the  copy of letter dated 21.12.1984 of the claimant to  the<\/p>\n
Government   revalidating   the   claimant’s   tender   upto<\/p>\n
28.1.1985,  whereas  the  claimant  has  alleged  that   the<\/p>\n
claimant  had not accepted for giving further revalidity  of<\/p>\n
tender,  because there was further escalation in the  prices<\/p>\n
of  materials  and  labour.  The allegation  that  the  then<\/p>\n
Superintending  Engineer Thiru G.Kaliasundaram  promised  to<\/p>\n
give work order within one month’s time is denied.  The work<\/p>\n
order was issued by the Superintending Engineer on 26.3.1985<\/p>\n
after  the Government accepted the tender vide G.O.Ms.No.268<\/p>\n
dated  7.3.1985.   There was no mention and  no  stipulation<\/p>\n
made   either   in   respect  of  grant  of  non-recoverable<\/p>\n
mobilisation charges of Rs.3 lakhs in the work  order.   The<\/p>\n
claimant on receipt of the work order dated 26.3.1985 raised<\/p>\n
objection   vide   his   letter   dated   28.3.1985.     The<\/p>\n
Superintending Engineer in his letter requested the claimant<\/p>\n
to  execute  the  agreement and introduce a  change  in  the<\/p>\n
agreement  that  escalation charges  will  be  paid  to  the<\/p>\n
claimant  on  receipt  of formal orders  of  Government  “if<\/p>\n
approved”.   There  was no whisper that the  non-recoverable<\/p>\n
mobilisation charges of Rs.3 lakhs as wanted by the claimant<\/p>\n
will  be  paid  to  the  claimant.  Claimant  requested  the<\/p>\n
Superintending Engineer to delete the word “if approved”  so<\/p>\n
as  to  pressure the Superintending Engineer to  accept  the<\/p>\n
escalation  stipulation of  claimant for 30% enhanced  rates<\/p>\n
while  the Superintending Engineer had no power or authority<\/p>\n
to  grant  escalation of rates.  Once the negotiated  tender<\/p>\n
offer  was  accepted by Government, the claimant   may  only<\/p>\n
accept  the work order and execute the agreement or  he  may<\/p>\n
reject  the  work  order and refuse to  sign  the  agreement<\/p>\n
whereupon  the  Department may forfeit the EMD.     Claimant<\/p>\n
added a further demand that the non-recoverable mobilisation<\/p>\n
charge of Rs.3 lakhs which had so far not been raised either<\/p>\n
in  the  claimant’s  revalidation upto  28.12.1984  or  upto<\/p>\n
28.1.1985  in  his  letters dated 2.10.1984  and  21.12.1984<\/p>\n
respectively  and  also in the minutes  of  meeting  of  the<\/p>\n
tender  committee  on  4.12.1984  and  G.O.Ms.No.268   dated<\/p>\n
7.3.1985.   The agreement dated 10.5.1985 was registered  as<\/p>\n
CR.No.5\/85-86.  No special conditions were stipulated in the<\/p>\n
agreement except to state that mobilisation advance of  Rs.2<\/p>\n
lakhs  shall  be  paid  for procuring machinery  and  making<\/p>\n
preliminary  arrangements at the site against  hypothecation<\/p>\n
of  machinery  to the Government.  This advance  was  to  be<\/p>\n
recovered   in  ten  equal  instalments  with  interest   at<\/p>\n
commercial  rates from the first 10 consecutive bills  after<\/p>\n
20% work is done.  G.O.Ms.No.268 dated 7.3.1985 provided for<\/p>\n
the   grant  of  mobilisation  advance  of  Rs.2  lakhs   on<\/p>\n
hypothecation  of machinery.  Accordingly, on  the  claimant<\/p>\n
bringing  his machinery to site and hypothecating the  same,<\/p>\n
claimant  was  sanctioned the mobilisation advance  of  Rs.2<\/p>\n
lakhs.  Thus, it will be clearly seen there was no breach by<\/p>\n
the    appellants  Department   in  either   accepting   the<\/p>\n
negotiated tender of the claimant as per G.O.Ms.No.268 dated<\/p>\n
7.3.1985  or in the sanction of the mobilisation advance  by<\/p>\n
the  Department  on 18.5.1985 as per the hypothecation  deed<\/p>\n
and  insurance  cover at pages 117 to 135 of the  agreement.<\/p>\n
The  mobilisation  advance  was  paid  to  the  claimant  on<\/p>\n
19.5.1985.\n<\/p>\n<\/p>\n
     7.   It is also stated that the claimant did not by any<\/p>\n
letter  during the period in question before 4.7.1985  state<\/p>\n
that  the  appellants Department delayed  handing  over  the<\/p>\n
site.   The  claimant did not withdraw from the contract  on<\/p>\n
the  basis  that site had not been handed over timely.   The<\/p>\n
agreement  was  signed  by claimant  on  10.5.1985  and  the<\/p>\n
claimant  took over the site on 4.7.1985.   With  regard  to<\/p>\n
supply  of steel, cement and other materials, the Department<\/p>\n
contended  that  there was no delay on their  part  and  the<\/p>\n
claim  of the first respondent\/ contractor was misconceived.<\/p>\n
The   fault   was  stated  to  be  on  the   part   of   the<\/p>\n
contractor\/first respondent.  The Department also  gave  the<\/p>\n
details  of   payments made to the contractor  refuting  the<\/p>\n
claim  that  amounts were not paid for the work  done.   The<\/p>\n
amount  claimed by the first respondent was disputed by  the<\/p>\n
Department.\n<\/p>\n<\/p>\n
      8.  After October, 1985 the claimant did not carry out<\/p>\n
any work till November and December, 1988 when 10 piles were<\/p>\n
driven by claimant.  There is no justification for this kind<\/p>\n
of  delay and piece meal work in the sense even the 10 piles<\/p>\n
driven have not been fully driven and cut off.  For handling<\/p>\n
10  piles, payment is due to claimant.  The payment  due  is<\/p>\n
Rs.15,000\/-  only.   This works was  not  carried  out    in<\/p>\n
October,  1985 but only later during November and  December,<\/p>\n
1988 and in February 1989.  The claimant has further falsely<\/p>\n
stated that third appellant  has not prepared the escalation<\/p>\n
bill amount according to the letter dated 6.4.1985.  As  per<\/p>\n
the  letter  of  Superintending Engineer  addressed  to  the<\/p>\n
claimant, it was informed that the representation  is  being<\/p>\n
submitted to the Government.   The Government considered the<\/p>\n
repeated request of claimant for escalation charges  of  20%<\/p>\n
over  tender  rates  and  sanction  escalation  charges   in<\/p>\n
G.O.Ms.791   F&   F   Department  dated  17.7.1987.    After<\/p>\n
20.10.1985 no work had been done by the claimant  till  date<\/p>\n
of  the said G.O.  On issue of the said G.O., the escalation<\/p>\n
charges for work done until then by the claimant was paid on<\/p>\n
27.7.1987.   The  payment so made was  Rs.1,65,439\/-.   Thus<\/p>\n
there  was no breach committed by the appellants Department.<\/p>\n
The  above payment has been accepted by the claimant without<\/p>\n
demur and protest.  Having been satisfied by such payment it<\/p>\n
is  not  left  open to the claimant now to seek  escalation.<\/p>\n
Hence  the  claim  of  the claimant  under  Claim  No.2  for<\/p>\n
escalation  once  again at 180% for work  already  done  and<\/p>\n
fully paid is not maintainable and liable to be rejected.<\/p>\n
      9.  The payment escalation charges was not a condition<\/p>\n
stipulated in the contract or in the agreement.  Even if  it<\/p>\n
were, non-payment of escalation charges for any duration  is<\/p>\n
not  a  cause  on the basis of which the claimant  may  stop<\/p>\n
work.   Claimant failed to discharge his duties as a lumpsum<\/p>\n
contractor  and  breached the contract  by  his  failure  to<\/p>\n
complete  the work.  Claimant further breached the  contract<\/p>\n
by  his failure to adhere to the rate of progress stipulated<\/p>\n
in  the agreement at pages 6 and 40.   The averment that the<\/p>\n
third  appellant  should arrange for a dredger for  dredging<\/p>\n
pile  driving  area  is not correct.  Claimant  should  have<\/p>\n
driven atleast 3 piles per day, but the claimant did not  do<\/p>\n
so and by his failure claimant breached the contract.  Since<\/p>\n
claimant  had  carried out only 24% of the work  even  after<\/p>\n
nearly  4 years, the Department  had no other option but  to<\/p>\n
terminate   the  contract  as  the  claimant  had  committed<\/p>\n
fundamental  breach of contract.    The fact  remains   that<\/p>\n
the  contract period expired as early as on 3.1.1986 and the<\/p>\n
same  has  not  been  extended.  As  such,  the  contractual<\/p>\n
obligations  between the parties did not extend beyond  this<\/p>\n
period  and  whatever work had been done by  the  contractor<\/p>\n
after  the efflux of the contractual period inspite  of  the<\/p>\n
conduct  of the parties the contractor is to be paid for the<\/p>\n
work  done as per the “Quantum Merit” enumerated in  Section<\/p>\n
70 of the Indian Contract Act 1872 (Central Act IX of 1872).<\/p>\n
After  expiry  of  contract  on 3.1.1986  the  claimant  has<\/p>\n
conveyed  and driven incompletely 10 piles only in November,<\/p>\n
1988 to February 1989.  The claimant has  claimed Rs.5,870\/-<\/p>\n
per  pile  for  handling and driving  the same  as  per  the<\/p>\n
agreement  rate  or his revised rate.  For the  purposes  of<\/p>\n
valuing  the  work thus carried out by him for handling  and<\/p>\n
driving  10 piles, the claimant even according to   his  own<\/p>\n
claim  became entitled to Rs.58,700\/-.  The piles  have  not<\/p>\n
been  driven  to the set point, but have been  stopped  much<\/p>\n
above  the  set point.  Therefore, the driving is incomplete<\/p>\n
and  payment  of  the same cannot be made.  Payment  can  be<\/p>\n
limited only to the handling of the piles for which  a  rate<\/p>\n
of  Rs.1,500\/-  per  pile  is  to  be  adopted  as  per  the<\/p>\n
stipulations  in the contract as there is no other  evidence<\/p>\n
available.      In  view  of the contract  having  ended  on<\/p>\n
3.1.1986  by efflux of time and further as affirmed  by  the<\/p>\n
claimant  himself by his letter dated 12.7.1986 the contract<\/p>\n
has undisputedly come to end as on either of these dates and<\/p>\n
the  same  was  further confirmed by the  claimant   in  his<\/p>\n
letter dated 29.10.1986.  There is no proof to show that the<\/p>\n
contract was kept alive beyond 3.1.1986.\n<\/p>\n<\/p>\n
     10.  The machinery of claimant had been hypothecated to<\/p>\n
secure  mobilisation advance and the question of release  of<\/p>\n
hypothecated  machinery does not arise.   It  is  stipulated<\/p>\n
under  Clause  39  of the agreement that the  contractor  is<\/p>\n
prohibited from going for arbitration till the completion of<\/p>\n
the  work.   The  claimant did not intimate  the  appellants<\/p>\n
Department  that he cannot (1) complete the contract or  (2)<\/p>\n
that  he had no intention of resuming work or (iii) that  he<\/p>\n
was frustrated on account of (a) lack of finance (b) lack of<\/p>\n
resources  (c)  lack of managerial and technical  skill  and<\/p>\n
expertise  to simultaneously manage and execute  work  at  3<\/p>\n
work  sites  in  the sea (Thondi, Valinokkam quay  wall  and<\/p>\n
these  RCC  Jetties at Valinokkam) (d) that appropriate  and<\/p>\n
necessary machinery and equipment  of good quality  and  (e)<\/p>\n
efficient  and  effective  labour,  and  therefore  he   was<\/p>\n
withdrawing from the contract.   Hence, the claimant is  not<\/p>\n
entitled to any relief at the hands of Arbitrator.  However,<\/p>\n
as  the  disputes  referred  to are  outside  the  scope  of<\/p>\n
agreement  and admittedly outside the scope of the  contract<\/p>\n
period, the claims are not arbitrable and are also liable to<\/p>\n
be rejected in toto.\n<\/p>\n<\/p>\n
      11.   The  Superintending  Engineer  by  letter  dated<\/p>\n
29.10.1986  informed the claimant that the  work  was  at  a<\/p>\n
standstill   and if work was not resumed by 10.11.1986,  the<\/p>\n
contract will be terminated with forfeiture of EMD etc.   To<\/p>\n
this  letter  the  claimant vide his letter dated  3.11.1986<\/p>\n
replied that he has resumed work on 27.10.1986, which is not<\/p>\n
correct.   Again the Superintending Engineer issued  notices<\/p>\n
to  the  claimant  vide  letters dated 1.6.1987,  22.7.1987,<\/p>\n
4.8.1987,  19.10.1987 and 24.11.1987 for  not  resuming  the<\/p>\n
work.    The  Director of Fisheries also  issued  notice  to<\/p>\n
claimant  instructing the claimant to resume work  vide  his<\/p>\n
letters dated 28.9.1987 and 3.11.1987.  To all these letters<\/p>\n
there  was  no  response from the claimant.  It  shows  that<\/p>\n
there were no labourers at site of work from 20.10.1985 till<\/p>\n
work  was resumed in November, 1988.  Hence claim made under<\/p>\n
Claim Nos.4 to 6 are false.  The claimant responded only  in<\/p>\n
his  letter dated 2.9.1988 stating that he was arranging  to<\/p>\n
resume  work.   Earlier  in  letter  dated  16.5.1988,   the<\/p>\n
claimant  had  furnished his “programme” for resuming  work.<\/p>\n
Claimant stated that he has to arrange two boats from Thondi<\/p>\n
to  Valinokkam and then set up his pile driving  machine  on<\/p>\n
these  boats and commence the pile driving.  Review  meeting<\/p>\n
was  also held on 16.5.1988, in which it is recorded at page<\/p>\n
No.2  of  the  minutes  that the pile  driving  machine  and<\/p>\n
equipment   at  Thondi  has to be moved  to  Valinokkam  and<\/p>\n
assembled and thereafter 7 piles driven in the quay wall and<\/p>\n
the  work  in  RCC  Jetty at Valinokkam resumed  thereafter.<\/p>\n
This graphically reveals that claimant neither had a working<\/p>\n
pile  driving machine could be mounted for carrying out work<\/p>\n
of  pile driving inspite of securing mobilisation advance of<\/p>\n
Rs.2  lakhs  with  the  tender and  paid  on  18.5.1985  and<\/p>\n
escalation  charges of Rs.1,65,349\/- in July  1987  and  the<\/p>\n
lack  of  machinery, equipment resources, labour and capital<\/p>\n
were  also the reasons why claimant could not carry out work<\/p>\n
apart from wilfully abandoning work as such the claimant  is<\/p>\n
totally  ineligible for any claim (i) for  idle  labour  and<\/p>\n
machinery  and (ii) for loss of profit (claim Nos.4  to  6).<\/p>\n
In   his   letter   dated   18.1.1989   addressed   to   the<\/p>\n
Superintending  Engineer,  the claimant  has  furnished  the<\/p>\n
reasons  as  to  why he did not do work after  October  1985<\/p>\n
stating “we stopped work as the escalation was granted  very<\/p>\n
late  in 1988”.  This is an unilateral and arbitrary  action<\/p>\n
of  the claimant and a clear breach of  contract without any<\/p>\n
justification for which the claimant is solely  responsible.<\/p>\n
Hence, the claimant is ineligible for any claim (i) for idle<\/p>\n
machinery  and labour and (ii) for loss of profit (claims  4<\/p>\n
to  6)  after  unilaterally  and  arbitrarily  and  wilfully<\/p>\n
stopping  work  and breaching contract when  claimant  could<\/p>\n
have executed the work.\n<\/p>\n<\/p>\n
      12.   The  contract was terminated for delay and  slow<\/p>\n
progress and breach of contract on 11.4.1989 vide the letter<\/p>\n
of the Superintending Engineer dated 11.4.1989.<\/p>\n<\/p>\n
      13.   Claimant has also secured escalation charges  of<\/p>\n
Rs.1,65,439\/- on 27.7.1987 which is Rs.97,506\/- in excess of<\/p>\n
the  actual  amount  due to claimant as escalation  charges.<\/p>\n
Considering the amounts due to the Department no  amount  is<\/p>\n
payable  to  claimant for the driving of the  10  piles  and<\/p>\n
payment  is due from claimant in respect of excess  payments<\/p>\n
received by claimant.\n<\/p>\n<\/p>\n
      14.   Since the work is incomplete no payment  can  be<\/p>\n
made.   There  is  no stipulation that dredging  has  to  be<\/p>\n
carried  out  first in order to carryout pile driving  work.<\/p>\n
From  February,  1989  until  termination  of  contract   on<\/p>\n
11.4.1989 the claimant did not drive any piles.  Hence,  the<\/p>\n
claim   Nos.3  to  6  are  not  maintainable  and  are   not<\/p>\n
arbitrable.\n<\/p>\n<\/p>\n
      15.  The abstract of the Department’s objection to the<\/p>\n
claim in the counter statement before the Arbitrator, is  as<\/p>\n
follows:-\n<\/p>\n<\/p>\n
      (i)  In respect of Claim No.1, it is stated  that full<\/p>\n
payment of Rs.8,25,195\/- has been made for the pile casting.<\/p>\n
      (ii)  In respect of Claim No.2, it is stated that  the<\/p>\n
claim is purely fictitious and imaginary.  Full payment  has<\/p>\n
been  made  for the work done then and there immediately  on<\/p>\n
completion  of the work for Rs.8,27,195\/-.  No further  work<\/p>\n
thereafter   was carried out for which payment is  due.   No<\/p>\n
escalation  is  payable.    It is  also  contended  that  no<\/p>\n
escalation  could be paid because there is no provision  for<\/p>\n
making  payment  for escalation in contract  and  agreement.<\/p>\n
The 20% escalation was granted in G.O.No.791 dated 17.7.1987<\/p>\n
and paid on 27.7.1987.\n<\/p>\n<\/p>\n
      (iii) In respect of Claim No.3, it is denied that  the<\/p>\n
non-recoverable mobilisation charges of Rs.3 lakhs  demanded<\/p>\n
by  the  claimant  was not a term of the contract.   It  was<\/p>\n
denied by the third  appellant  himself at the very time  it<\/p>\n
was  raised.   After the absolute denial of the  claim,  the<\/p>\n
claimant extended his tender validity vide his letters dated<\/p>\n
2.10.1984  and  21.12.1984  after  waiving  the  claim.  The<\/p>\n
Claimant  also waived the claim again unilaterally and  come<\/p>\n
forward   to  sign  agreement  and  execute  the   contract.<\/p>\n
Therefore, the Claim No.3 is unwarranted and denied.<\/p>\n
      (iv)  In respect of Claim No.4, it is stated that  for<\/p>\n
the  work  done and completed during the period of  contract<\/p>\n
from  4.7.1985 to 11.4.1989 the claimant has been fully paid<\/p>\n
and  no outstanding payment is due.   In this contract,  the<\/p>\n
claimant  is a defaulter who clearly defaulted and  breached<\/p>\n
the  contract  and  failed  to  execute  the  work.   He  is<\/p>\n
ineligible for profit on the promise that merely because  he<\/p>\n
had been awarded a contract he becomes eligible for a profit<\/p>\n
of   20%.   The claimant was not prevented from doing  work.<\/p>\n
Claimant  abandoned the work and his inaction brought  about<\/p>\n
termination of contract.\n<\/p>\n<\/p>\n
      (v)   In  respect of Claim No.5,  the loss  of  profit<\/p>\n
suffered  during  the period 4.1.1986 to  11.4.1989,  it  is<\/p>\n
stated   that   the   value  is  an  fictitious   value   of<\/p>\n
Rs.43,53,150\/-.  The claim is denied as entirely absurd  and<\/p>\n
in  the  realm  of  make believe.  During  the  period  from<\/p>\n
4.1.1986 till 11.4.1989, the claimant abandoned the work and<\/p>\n
unilaterally removed whatever machinery there was  and  left<\/p>\n
the  site  to  the wind and waves wilfully  except  for  the<\/p>\n
period November, 1988 to February, 1989 when he incompletely<\/p>\n
drove 10 piles.\n<\/p>\n<\/p>\n
      (vi)  In respect of Claim No.6, it is stated that  the<\/p>\n
claimant brought no pile driving equipment between  4.1.1986<\/p>\n
to  November,  1988.   As  per  the  claimant  letter  dated<\/p>\n
18.1.1989,  the  claimant brought boats from  Cuddalore  and<\/p>\n
pile driving equipment from Thondi and commenced driving  of<\/p>\n
piles  in  November,1988.  The claimant stopped  work  after<\/p>\n
February  1989.  It was open to the claimant to  redeem  his<\/p>\n
equipment by paying up the mobilisation advance and interest<\/p>\n
thereon.   Therefore  the  alleged  damages  due   to   idle<\/p>\n
machinery   equipment   and  other  construction   materials<\/p>\n
withheld  by  the Department  from 4.1.1986 to 22.6.1993  is<\/p>\n
entirely frivolous and absurd.\n<\/p>\n<\/p>\n
      16.  Counter claim of the appellants\/Department are as<\/p>\n
follows:-\n<\/p>\n
Counter Claim No.1:\n<\/p>\n<\/p>\n
      Claimant was paid a mobilisation advance of Rs.2 lakhs<\/p>\n
on  18.5.1985 after the acceptance of agreement on 10.5.1985<\/p>\n
as  per  the  provisions of the G.O.  accepting  the  tender<\/p>\n
G.O.Ms.No.268,   Forests  and  Fisheries  Department   dated<\/p>\n
7.3.1985.   This mobilisatoin advance amount of  Rs.2  lakhs<\/p>\n
and  interest thereon at 18% from 18.5.1985 to 17.9.1993  at<\/p>\n
Rs.3  lakhs in total Rs.5 lakhs has not been recovered  from<\/p>\n
the claimant and is due recovery.\n<\/p>\n
\nCounter Claim No.2:\n<\/p>\n<\/p>\n
      As  per  the  provision of G.O.Ms.No.791, Forests  and<\/p>\n
Fisheries  Department dated 17.7.1985 escalation charges  of<\/p>\n
Rs.1,65,439\/-  were paid on 27.7.1987.  There  has  been  on<\/p>\n
overpayment  of  Rs.97,506\/-   in  making  this   escalation<\/p>\n
payment  and  the  same was pointed out  by  the  Accountant<\/p>\n
General.   This  has  been demanded from the  claimant  vide<\/p>\n
Executive  Engineer letters to the claimant dated  14.1.1988<\/p>\n
and  19.5.1988.  Since it is not paid by the  claimant,  the<\/p>\n
Department is entitled to as follows:\n<\/p>\n
Overpayment made on 27.7.1987      = Rs.  97,506\/-<\/p>\n
Interest at 18% there on
\nfrom 27.7.1987 to 17.9.1993        = Rs.1,07,749\/-\n<\/p>\n
                                —————-\n<\/p><\/blockquote>\n
Total                                Rs.2,05,255\/-\n                                ----------------\n\nCounter Claim No.3:\n\n\n<\/pre>\n
      The  contract period for the work lapsed on  3.1.1986.<\/p>\n
The   claimant did not request extension of contract and  no<\/p>\n
extension  was  granted.  The claimant in his  letter  dated<\/p>\n
12.7.1986  has stated that as on 12.7.1986 he rescinded  the<\/p>\n
contract.   Such rescinding of contract without  just  cause<\/p>\n
when the Department  have acted faithfully and complied with<\/p>\n
every  contractual obligations stipulated in  the  agreement<\/p>\n
entitles  the  Department to forfeit the  EMD  and  security<\/p>\n
deposit  of  the claimant.  Further the claimant  failed  to<\/p>\n
complete  the work and also failed to maintain the  rate  of<\/p>\n
progress  stipulated  in agreement and  thus,  the  claimant<\/p>\n
committed  breach of contact.  For such breach  of  contract<\/p>\n
the  EMD  and Security deposit has to be forfeited   to  the<\/p>\n
Department  as per clause Nos.29 and 30(b) of  agreement  at<\/p>\n
page  61  and  clause  37(b) page 63 of  the  agreement  and<\/p>\n
relevant clauses of MDSS is as follows:-\n<\/p>\n<\/p>\n
     Value of EMD forfeited to respondents   – Rs.26,000\/-\n<\/p><\/blockquote>\n
     Additional EMD                          - Rs. 6,320\/-\n\n     Value of S.D.(WHA) forfeited to\n                         respondents\t   - Rs.41,360\/-\n                                             -------------\n                    Total                    - Rs.73,680\/-\n                                             -------------\n\n                    Total Counter Claims\n     Counter Claim No.1     :   Rs.5,00,000\/-\n     Counter Claim No.2     :   Rs.2,05,255\/-\n     Counter Claim No.3     :   Rs.  73,680\/-\n                              ---------------\n     Total                      Rs.7,78,935\/-\n                              --------------\n\n<\/pre>\n
In  view  of the above, it is prayed by the Department  that<\/p>\n
the  Claim of the claimant is to be rejected and the Counter<\/p>\n
Claim made by the Department is to be allowed.<\/p>\n
      17.  Before the Arbitrator on the side of the claimant<\/p>\n
Exs.A-1  to  A-207  were marked while  the  Department  have<\/p>\n
marked  Exs.B-1 to    B-31.  Claimant was examined as  P.W.1<\/p>\n
and  one  J.Venkatesan,  Special  Correspondent,  Hindu  was<\/p>\n
examined as P.W.2.  On the side of Department one Jayaraman,<\/p>\n
Junior  Engineer, Vallinokkam, Ramnad District was  examined<\/p>\n
as R.W.1.\n<\/p>\n<\/p>\n
      18.  After perusing the oral and documentary evidence,<\/p>\n
the Arbitrator awarded a sum of Rs.72,57,165\/- in favour  of<\/p>\n
the  claimant.   However, it is stated  that  on  return  of<\/p>\n
forfeited  machinery  and equipment  to  the  claimant,  the<\/p>\n
Department is liable to pay the claimant only Rs.62,57,165\/-<\/p>\n
.\n<\/p>\n<\/p>\n
     19.  Aggrieved against that award, the Department filed<\/p>\n
the Original Petition No.908 of 1999 to set aside the Award.<\/p>\n
In the original petition it is stated that the tender of the<\/p>\n
contractor\/claimant was accepted and a formal agreement  was<\/p>\n
signed.   The  time  for  completion  of  the  contract  was<\/p>\n
stipulated at six months from the date of handing  over  the<\/p>\n
site.  The claimant did not complete the work in time and so<\/p>\n
the   contract   was  terminated  on  11.4.1999.    Claimant<\/p>\n
commenced  arbitration proceedings by filing suit C.S.No.263<\/p>\n
of  1987. The second respondent, the sole Arbitrator  passed<\/p>\n
an  award on 27.3.1999 awarding a sum of Rs.72,57,165\/- with<\/p>\n
interest at 18% per annum.  It is stated that the Award  was<\/p>\n
passed  beyond  the terms of the agreement.  The  Arbitrator<\/p>\n
had  exceeded the scope of contractual authority  in  making<\/p>\n
the award.  Claim No.1, i.e., for recovery of Rs.6,63,700\/-,<\/p>\n
it  is  stated  that it  was made on the  footing  that  the<\/p>\n
claimant  had not been paid for the work done by  him.   The<\/p>\n
Arbitrator  had framed number of issues.  But he  failed  to<\/p>\n
appreciate  the  facts that the schedule of rates  for  each<\/p>\n
item given in Ex.B-2 agreement is the overall limit for  the<\/p>\n
purpose  of  each  and every item of  work  that  is  to  be<\/p>\n
complied  with.   As such, Rs.7,08,500\/- has been  shown  as<\/p>\n
the  value of work done by the contractor in respect of  160<\/p>\n
piles  completed which includes cutting, bending  and  tying<\/p>\n
grills  with  tor steel, plain M.S. Bars for  reinforcement,<\/p>\n
including the cost of binding wire.  The important aspect in<\/p>\n
this  item  of work as stated in the schedule  is  that  the<\/p>\n
steel  shall  be supplied by the Department to the  claimant<\/p>\n
for  the  execution of the work.  Therefore  the  amount  of<\/p>\n
Rs.7,08,500\/-  is  the overall value of  the  work  that  is<\/p>\n
involved  in the entire project as regards steel and  allied<\/p>\n
work.    The  Arbitrator has taken this value  unnecessarily<\/p>\n
for the purpose of arriving at the value of work done by the<\/p>\n
claimant.   The  Arbitrator in page 21 of  the  Award  dated<\/p>\n
27.3.1999  has made reference to the said quantity  of  work<\/p>\n
and  has  wrongly  interpreted the  items  of  work  in  the<\/p>\n
contract  and  has  applied the erroneous interpretation  as<\/p>\n
yardstick  for the purpose of arriving at the value  of  the<\/p>\n
work  done.   As  such,  the Arbitrator  under  Item  No.20,<\/p>\n
included a sum of Rs.7,08,500\/- and has added the same along<\/p>\n
with the claim made under Claim No.I(a) for making the award<\/p>\n
in  terms  of Claim No.I.  After deducting  the departmental<\/p>\n
recoveries,  a  sum of Rs.4,09,115\/- has been awarded  under<\/p>\n
Claim   No.I.    As  stated  earlier,  the  Arbitrator   had<\/p>\n
complicated  the listed items and their rates with  that  of<\/p>\n
the  claims made by the claimant and thereby had  awarded  a<\/p>\n
sum   of   Rs.4,09,115\/-  without  recourse  to  the  actual<\/p>\n
materials  placed before him.  He also failed to  take  into<\/p>\n
consideration  the estimated value of the  particular  work.<\/p>\n
He  also failed to segregate the expenditure incurred by the<\/p>\n
Department with regard to materials supplied before arriving<\/p>\n
at  the actual value of work done.  If only this distinction<\/p>\n
in  the value is made, then the exact value of work done  by<\/p>\n
the  claimant could be arrived at.  It is stated that  Ex.A-<\/p>\n
110  is a correspondence adjudicating upon the work involved<\/p>\n
in   Thondi  Jetty,  which  is  a  separate  contract.   The<\/p>\n
Arbitrator,  inspite of objection raised by the  Department,<\/p>\n
had  admitted the said exhibit and has placed relevance  for<\/p>\n
arriving  at  the conclusion upon which the award  has  been<\/p>\n
passed.   A sum of Rs.43,500\/- has been awarded under  claim<\/p>\n
No.I  in  respect of item No.6 being the cost said  to  have<\/p>\n
been  incurred  for driving 10 piles.  Arbitrator  has  also<\/p>\n
failed  to  take  into consideration the various  recoveries<\/p>\n
that  were  to  be made on the payments for the  contractor.<\/p>\n
Recoveries  as regards mobilisation advance of Rs.2,00,000\/-<\/p>\n
adding  interest on the  same and other recoveries a sum  of<\/p>\n
Rs.4,66,470\/-  ought  to  have  been  recovered   from   the<\/p>\n
contractor\/claimant.  Arbitrator has  failed  to  take  into<\/p>\n
consideration of the exact quantum of work before  deducting<\/p>\n
the  same from the overall estimated work as found in Ex.B-2<\/p>\n
agreement.   It has been pointed out to the Arbitrator  that<\/p>\n
the  steel  to the tune of 59 Mts. alone had been  utilised.<\/p>\n
The  Arbitrator without taking into consideration the actual<\/p>\n
expenditure,  has  given  credit  to  the  entire  estimated<\/p>\n
quantity of 109 Mts. and upon erroneous estimation fixed the<\/p>\n
value  of  work done in a sum of Rs.11,56,250\/-.  The  award<\/p>\n
with  regard  to Claim No.I is per se excessive besides  has<\/p>\n
been  passed  without  recourse to  materials  available  on<\/p>\n
record.   As  regards  Claim No.II, it  has  been  made  for<\/p>\n
escalation of the lumpsum contract amount at the rate of 180<\/p>\n
per  cent  of the completed work during the extended  period<\/p>\n
beginning  from  4.7.1985  to 11.4.1989.   The  contract  or<\/p>\n
agreement  does not provide for any such escalation  by  its<\/p>\n
express terms.  The very claim itself was opposed before the<\/p>\n
Arbitrator.   It  is  stated  that  under  Claim  No.I,  the<\/p>\n
Arbitrator had already found and awarded for the  work  done<\/p>\n
which  the claimant has made claim.  It is also stated  that<\/p>\n
casting  of  piles was completed as early as  on  28.10.1985<\/p>\n
itself.    The  contract awarded to the  claimant  could  be<\/p>\n
classified as follows:-\n<\/p>\n
     (a) Fabrication and casting of RCC Piles,<\/p>\n
      (b)  Driving  the  piles into the sea  at  the  marked<\/p>\n
positions and<\/p>\n
     (c) To cut off the piles and lay deck slabs.\n<\/p>\n
\nIt  is stated that the first part of work, viz., casting  of<\/p>\n
piles  does not require much of skill and labour.   As such,<\/p>\n
the  claimant  had completed the casting of piles,  however,<\/p>\n
had  failed  to  drive them in the sea and further  work  as<\/p>\n
contemplated  in  the contract.  Only 10 piles  were  driven<\/p>\n
that  too  at  the edge of the sea near to the  shore.   All<\/p>\n
these  aspects were explained to the Arbitrator.    However,<\/p>\n
overlooking  the  objections put-forward by the  Department,<\/p>\n
the  Arbitrator  has  awarded  a  sum  of  Rs.9,17,195\/-  as<\/p>\n
escalation  for  the  work which was  completed  during  the<\/p>\n
extended  period,  viz., from 4.7.1985 to  11.4.1989.    The<\/p>\n
Arbitrator  while accepting the contentions of  the  various<\/p>\n
assurance and promises said to have been given by  the  said<\/p>\n
Superintending   Engineer,  has   omitted   to   take   into<\/p>\n
consideration  the scope of the contract that was awarded to<\/p>\n
the  claimant.  It is settled law that in the interpretation<\/p>\n
of contract that too when the  other party is a Governmental<\/p>\n
agency, the written contract  alone will be the basis of the<\/p>\n
rates  and liabilities of the contracting parties.  Ignoring<\/p>\n
the  settled  principles, the Arbitrator  had  accepted  the<\/p>\n
contentions   put-forth   by  the  claimant   from   certain<\/p>\n
correspondences  and  assurances by Departmental  Engineers,<\/p>\n
who  did not have the sanction to make such assurances,  has<\/p>\n
come  to the conclusion about the entitlement of the various<\/p>\n
claims  by  the claimant.  Hence, the escalation granted  on<\/p>\n
the  completed work for the extended period is  de  hors  to<\/p>\n
contract\/  agreement and, as such, liable to be  set  aside.<\/p>\n
The   claimant  also  made  claim  of  Rs.5  lakhs   towards<\/p>\n
compensation for the losses alleged to have been suffered on<\/p>\n
account of overheads and loss of profit during the period of<\/p>\n
contract.   This  Claim is covered under  issue  No.4.   The<\/p>\n
Arbitrator has considered Claim Nos.4 and 5.  Claim No.5  is<\/p>\n
with  regard  to  losses suffered during  the  extended  and<\/p>\n
overheads during the said period.  A claim of Rs.43,23,150\/-<\/p>\n
has  been made in Claim No.5.  Arbitrator has awarded a  sum<\/p>\n
of  Rs.3,68,700\/-  under Claim No.4.    The  Arbitrator  has<\/p>\n
found  reasons for awarding the said sum on the  basis  that<\/p>\n
the Department has committed breach of contract and as such,<\/p>\n
the  Arbitrator is of the view that the claimant  could  not<\/p>\n
complete  the  work.   Arbitrator has  granted  15%  on  the<\/p>\n
balance  of work as award under this issue and as  such  has<\/p>\n
awarded  a  sum of Rs.3,68,700\/-.  However, Claim  No.5  has<\/p>\n
been rejected in total.  It is stated by the Department that<\/p>\n
under  Claim No.6 a sum of Rs.1,72,64,885\/- has been  sought<\/p>\n
for  by  the first respondent.  This claim has been made  as<\/p>\n
damages   due  to  idle  machinery,  equipment   and   other<\/p>\n
construction  materials  withheld  by  the  Department  from<\/p>\n
4.1.1986  to 22.6.1993 for 89 months.  Arbitrator  has  laid<\/p>\n
undue  emphasis on the right of the Department  to  exercise<\/p>\n
seizure of termination of the contract on the machinery that<\/p>\n
were  deployed by the contract.  Arbitrator has referred  to<\/p>\n
Ex.A-31,  the  order of termination that the  redemption  of<\/p>\n
hypothecation of machinery even on payment is ruled out.  No<\/p>\n
attempt   was   made  by  the  claimant  to  discharge   the<\/p>\n
hypothecation.    This being the case, it is ill-founded  to<\/p>\n
allege   that   the  Department  refusing  to  release   the<\/p>\n
hypothecation of machinery even on payment for the same.   A<\/p>\n
sum  of  Rs.29,48,400\/- has been awarded  under  this  head,<\/p>\n
which  is unjustified.  However, adverse inference has  been<\/p>\n
drawn  against  the  Department for the  reasons   that  the<\/p>\n
Engineers in-charge during the time of execution of the work<\/p>\n
have  not been examined.  Such inference shall not be  drawn<\/p>\n
particularly,  when  the  contract  is  entered  into   with<\/p>\n
Government,  since  the  officials in-charge  of  works  are<\/p>\n
subjected  to  transfer.  The compensation amount  has  been<\/p>\n
arrived at by the Arbitrator based upon Exs.A-196 and A-197,<\/p>\n
which  does not pertain to the contract work that  has  been<\/p>\n
the  subject matter of dispute.  They relate to  some  other<\/p>\n
contract  and have nothing to do with the present one.   The<\/p>\n
Arbitrator  has  taken Rs.546\/- as rate  per  hour  for  the<\/p>\n
machinery.  The award is a clear case of excess of contract.<\/p>\n
The   Arbitrator, while awarding the refund of earnest money<\/p>\n
deposit  and  security deposit, has omitted to consider  the<\/p>\n
counter-claims  made by the Department. The  Arbitrator  has<\/p>\n
awarded  the refund of mobilisation advance for  the  reason<\/p>\n
that   the   Department  has  committed  breach,  which   is<\/p>\n
unjustified.   Arbitrator  has  also  fixed  the  value   of<\/p>\n
machinery  at Rs.10 lakhs and has provided a concession   in<\/p>\n
the  award  that  if  the  machinery  are  returned  to  the<\/p>\n
claimant,  Rs.10,00,000\/- be deducted from the rest  of  the<\/p>\n
award.  In view of the reasons stated above, the award shall<\/p>\n
not  stand to legal scrutiny.  The interest at 18%  is  also<\/p>\n
thoroughly  unwanted.  Therefore, the Department  prays  for<\/p>\n
setting  aside  the  award  dated 27.3.1999  passed  by  the<\/p>\n
Arbitrator.\n<\/p>\n<\/p>\n
     20.  In the counter filed by the claimant in O.P.No.908<\/p>\n
of  1999,  it is contended that the Department received  the<\/p>\n
Award  in April 1999.  Petition for setting aside the  award<\/p>\n
should  have  been  filed within 30 days from  the  date  of<\/p>\n
receipt  of  notice  as  provided  under  Article   119   of<\/p>\n
Limitation Act of 1963.  But the  Department have taken time<\/p>\n
till 28th October, 1999 to file this O.P. after lapse of six<\/p>\n
months  from  23.5.1999  and  on  this  ground  alone,  this<\/p>\n
O.P.No.908  of  1999 will have to be dismissed.   Arbitrator<\/p>\n
passed  this  Award  on  issue-wise and  some   issues  were<\/p>\n
decided  in favour of the claimant and others rejected  that<\/p>\n
is  to say that the claimant succeeded in five issues, viz.,<\/p>\n
issue Nos.1, 2, 4, 5 and 10  for the amount of Rs.79,55,165\/-<\/p>\n
including  interest and allowing a sum of  Rs.6,98,000\/-  in<\/p>\n
favour of Department  including interest and after deducting<\/p>\n
the amount of Rs.6,98,000\/- from the award amount passed for<\/p>\n
Rs.79,55,165\/-  the amount passed in favour of the  claimant<\/p>\n
is   Rs.72,57,165\/-.    The claimant is entitled to get  the<\/p>\n
damages  by  way  of  hire  charges  for  idling  of  plant,<\/p>\n
equipment  and  machinery and other  construction  materials<\/p>\n
illegally withheld by the Department as per issue  No.5  and<\/p>\n
the  total claim amount in this regard is  Rs.1,72,36,320\/-.<\/p>\n
This  claim  was  worked out only based on  the  calculation<\/p>\n
sheets  for the hire charges for pile driving plant  by  the<\/p>\n
Department’s Superintending Engineer and Executive  Engineer<\/p>\n
and  the calculation sheets were marked as Exhibits  in  the<\/p>\n
Arbitration proceedings as Exs.A-196 and   A-197.   But  the<\/p>\n
Arbitrator  allowed only a sum of Rs.29,48,400\/- as  against<\/p>\n
claimant’s claim amount of Rs.1,72,36,320\/-.    It is stated<\/p>\n
by   the  claimant  that  he  is  accepting  the  award  for<\/p>\n
Rs.72,57,165\/-  with  interest.   The  claimant  prays   for<\/p>\n
dismissal of O.P.No.908 of 1999.\n<\/p>\n<\/p>\n
      21.  On considering the above contentions, the learned<\/p>\n
single Judge, by a common order dated 26.4.2000 received the<\/p>\n
Award passed by the Arbitrator and passed decree in terms of<\/p>\n
the Award by allowing  the application No.1221 of 2000 filed<\/p>\n
by  the  claimant.     Further,  the  learned  single  Judge<\/p>\n
dismissed  the  O.P.No.908 of 1999 filed by the  Department.<\/p>\n
Aggrieved by the common order, present Original Side Appeals<\/p>\n
have been filed by the Department.\n<\/p>\n<\/p>\n
      22.   Learned  counsel  for the  appellants\/Department<\/p>\n
contended  that the  Arbitrator committed an error  apparent<\/p>\n
on  the face of the record as he had incorrectly taken  into<\/p>\n
account  the  materials which have not  been  used  for  the<\/p>\n
completion of the work and further vital documents were  not<\/p>\n
considered.   It  is  contended  by  the  counsel  for   the<\/p>\n
appellants\/Department  that  the  award  of  the  Arbitrator<\/p>\n
relating  to the quantum of work done cannot be accepted  or<\/p>\n
sustained.    It   is   the  further   contention   of   the<\/p>\n
appellants\/Department counsel that the  Arbitrator   exceeds<\/p>\n
his  jurisdiction by awarding escalation charges  which  was<\/p>\n
not   contemplated  and  it  is  beyond  the  terms  of  the<\/p>\n
agreement.  Without prejudice, it was contended that even if<\/p>\n
escalation  is to be accepted, it can be only upto  20%  and<\/p>\n
that  has been paid by G.O.No.791 dated 17.7.1987.   It  was<\/p>\n
further contended that the Arbitrator is not correct and has<\/p>\n
mislead  himself to determine the escalation  cost  and  the<\/p>\n
quantum  of escalation by comparing other contract.  Another<\/p>\n
factor   is   that  the  Arbitrator  has  not   taken   into<\/p>\n
consideration the facts that the materials for  the  purpose<\/p>\n
of  executing the works were supplied by the Department.  It<\/p>\n
is further contended  that the Arbitrator has concluded that<\/p>\n
there    is   breach   of   contract   committed   by    the<\/p>\n
appellants\/Department.    The  plea   of   the   appellants\/<\/p>\n
Department  is that the first respondent\/claimant had by his<\/p>\n
own  conduct  had rescinded the contract and therefore,  the<\/p>\n
award  of  the  Arbitrator on the head, loss of  profit  and<\/p>\n
charges  for  the  period during which the contract  was  in<\/p>\n
operation  cannot  be accepted or sustained  in  law.    The<\/p>\n
further  contention of the appellants counsel  is  that  the<\/p>\n
award  of  the  Arbitrator for the  value  of  machinery  is<\/p>\n
unacceptable and unsustainable in law.\n<\/p>\n<\/p>\n
        23.     The   learned   counsel   for   the    first<\/p>\n
respondent\/claimant, however, contended that the  Arbitrator<\/p>\n
had  taken into consideration all relevant materials  placed<\/p>\n
before  him while determining the quantum of the award.   In<\/p>\n
the  facts and circumstances of the case, the learned single<\/p>\n
Judge accepting the reasonings of the Arbitrator upheld  the<\/p>\n
award  with  reasons and it should not be  interfered  with.<\/p>\n
The  issues now raised in appeals as also before the learned<\/p>\n
single  Judge  are  questions of fact which  should  not  be<\/p>\n
reagitated in appeals.\n<\/p>\n<\/p>\n
      24.   The claim was made on several heads as has  been<\/p>\n
extracted above.  The Arbitrator has rejected the Claim No.3<\/p>\n
in  respect of mobilisation charges and Claim No.5 for  loss<\/p>\n
suffered  during  the  extended  period  from  4.1.1986   to<\/p>\n
11.4.1989.   However, the other claims were allowed  in  the<\/p>\n
following  manner,  the details which have been set  out  in<\/p>\n
para 7 of the learned single Judge’s order  and the same  is<\/p>\n
extracted hereunder:-\n<\/p>\n<\/p>\n
               “7.  Exs.A-1 to A-207 were  marked
\n         on the side of the contractor and Exs.B-<\/p><\/blockquote>\n
         1  to  B-32 were marked on the  side  of
\n         the  department.  About 17  issues  have
\n         been    framed    in   the   arbitration
\n         proceedings   and  the  arbitrator   had
\n         elaborately discussed the oral  evidence
\n         as  well  as the documents and  given  a
\n         finding.   The contractor claimed  under
\n         item   No.1   a   sum  of  Rs.6,63,700\/-
\n         towards  the  value of work  done.   The
\n         arbitrator passed the award for   a  sum
\n         of   Rs.4,59,115\/-  with  interest.   In
\n         respect  of  issue No.2, the  contractor
\n         claimed  a  sum of Rs.15,90,660\/-  under
\n         the  head  escalation of  cost  and  for
\n         which,  the arbitrator awarded a sum  of
\n         Rs.9,17,195\/-   with  interest.    Issue
\n         No.4   relates  compensation  for   loss
\n         suffered  on  account  of  overhead  and
\n         loss  of  profit  during the  stipulated
\n         period of contract and claimed a sum  of
\n         Rs.5  lakhs and for which the arbitrator
\n         awarded  a  sum  of  Rs.3,68,700\/-  with
\n         interest.   In  respect  of  issue  No.6
\n         relating   to   damages  due   to   idle
\n         machinery,    equipments    and    other
\n         construction materials withhold  by  the
\n         department  for a period of  18  months.
\n         The   contractor  claimed   a   sum   of
\n         Rs.1,72,64,885\/- and for which a sum  of
\n         Rs.29,48,400\/- is awarded and, for  non-<\/p><\/blockquote>\n
         returning  of the machinery,  a  sum  of
\n         Rs.10   lakhs  has  been  awarded.    In
\n         respect  of  issue  No.10,  a   sum   of
\n         Rs.32,320\/-   has  been   awarded   with
\n         interest and in all, the award is for  a
\n         sum  of Rs.79,55,165\/-.  The amount  due
\n         to  the  department has  been  given  as
\n         Rs.6,98,000\/-  and  if   the   same   is
\n         deducted,   the  department  shall   pay
\n         Rs.72,57,165\/-.    If   the   department
\n         returned the forfeited machineries   and
\n         equipments, the sum of Rs.10 lakhs  will
\n         be  reduced and the department  will  be
\n         liable to pay only Rs.62,57,165\/-.   The
\n         department  has preferred the   petition
\n         only  in  respect of the claims, wherein
\n         the  amount  has  been  awarded  by  the
\n         arbitrator viz., issues 1, 2, 4,  6  and\n<\/p><\/blockquote>\n
         10.  The  arbitrator  had  also  awarded
\n         interest  at  18%  per  annum  for   the
\n         amount  awarded from 10.3.92  till  date
\n         of award.”<\/p><\/blockquote>\n
      25.   In this case, the tender notification was issued<\/p>\n
in  the  month   of  November, 1983 and  it  was  opened  in<\/p>\n
December, 1983.  The first respondent\/claimant was found  to<\/p>\n
be  the lowest tenderer.  The validity of the tender was for<\/p>\n
a   period  of  six  months  which  would  have  expired  by<\/p>\n
29.6.1984.   Therefore, the Department by its  letter  dated<\/p>\n
1.8.1984   requested   the   first  respondent\/claimant   to<\/p>\n
revalidate  the tender for a further period  of  six  months<\/p>\n
from  29.6.1984.  The first respondent\/ claimant   consented<\/p>\n
by  letter  dated  31.8.1984  on certain  conditions,  viz.,<\/p>\n
escalation    charges   and   mobilisation   charges    (not<\/p>\n
recoverable).  It appears that the first respondent\/claimant<\/p>\n
gave a letter dated 2.10.1984 extending the validity of  the<\/p>\n
tender  upto  29.1.1985.  Thereafter,  the  work  order  was<\/p>\n
issued on 26.3.1985 after the validity period.   Since there<\/p>\n
was   no  indication  with  regard  to  the  demand  on  the<\/p>\n
escalation  of 20% sought for, the first respondent\/claimant<\/p>\n
sent  a  letter dated 28.3.1985 pointing out  the  delay  in<\/p>\n
acceptance   of  the  tender  and  therefore,   prayed   for<\/p>\n
escalation  at  30% and for Rs.3 lakhs towards  mobilisation<\/p>\n
charges(non-recoverable).  This letter dated  28.3.1985  was<\/p>\n
responded  by  the third appellant stating that   the  first<\/p>\n
respondent\/claimant should proceed with  the  work  and  the<\/p>\n
representation  for  escalation  would  be  issued  if   the<\/p>\n
Government   approves  the  same.    However,    with   some<\/p>\n
objection  by  letter dated 20.4.1985, the  work  order  was<\/p>\n
accepted,  with  a  rider  that  the  escalation  should  be<\/p>\n
considered  and  the words “if approved by  the  Government”<\/p>\n
should   be  deleted.   Thereafter,  the  first  respondent\/<\/p>\n
claimant  entered into hypothecation agreement and the  site<\/p>\n
was handed over on 4.7.1985.  On 8.10.1985, cement and other<\/p>\n
materials were supplied during the period October,  1985  to<\/p>\n
December, 1985.  The casting of 160 piles were taken up  and<\/p>\n
completed and that is not disputed.   In December, 1985,  it<\/p>\n
appears  that  the  first  respondent\/  claimant  could  not<\/p>\n
complete   the driving of the piles as  dredging had  to  be<\/p>\n
done.    It  is not in dispute that the dredger,  which  was<\/p>\n
deputed for this work, sank near Pamban Bridge and there was<\/p>\n
some stalemate in the work.   In view of the same, the first<\/p>\n
respondent\/claimant started communicating   with  the  third<\/p>\n
appellant for payment of escalation charges, pending  bills,<\/p>\n
etc.,  which  was  not  agreed to by  the  third  appellant.<\/p>\n
Therefore, the claimant sought for arbitration of his claim,<\/p>\n
which  was  refuted  by  the third  appellant.   Thereafter,<\/p>\n
C.S.No.263   of  1987  was  filed   by  the   claimant   for<\/p>\n
appointment of Arbitrator for settling the claim amount  and<\/p>\n
for   releasing   machineries   and  equipments.    In   the<\/p>\n
meanwhile,  on  17.7.1987  G.O.No.791  was  issued  by   the<\/p>\n
Government granting escalation charges of 20% and  for  Rs.2<\/p>\n
lakhs  as mobilisation advance (recoverable).  On 27.7.1987,<\/p>\n
the  20%  escalation amount was paid.  Thereafter, in  July,<\/p>\n
1988,  the  claimant  started the pile  driving  work,  but,<\/p>\n
however,  did not complete the same as the dredger  was  not<\/p>\n
arranged by the Department.  On 11.4.1989, the contract  was<\/p>\n
terminated  by  the  Department  and  the  machineries   and<\/p>\n
equipments were not  returned.\n<\/p>\n<\/p>\n
      26.   In  this background of the case, the  Arbitrator<\/p>\n
took  up  Issue  Nos.12 and 13 which were relevant  for  the<\/p>\n
purpose  of  deciding  the rival claims.   The  issues  were<\/p>\n
whether  there  was delay in acceptance of  the  tender  and<\/p>\n
handing  over  the site for casting of piles and  therefore,<\/p>\n
whether  the  claimant  was  entitled  for  escalation   and<\/p>\n
compensation for loss of profits and damages.  In  paras  41<\/p>\n
to  52,  the Arbitrator has discussed the various  documents<\/p>\n
that  have been filed and also the oral evidence to come  to<\/p>\n
the  conclusion that the Department had taken  an  unusually<\/p>\n
long period of time to conclude the contract and sought  for<\/p>\n
revalidation of the tender from time to time.  In  para  52,<\/p>\n
the Arbitrator concluded that there was a delay of 16 months<\/p>\n
and 11 days in accepting the tender and further delay of two<\/p>\n
months in handing over the site.\n<\/p>\n<\/p>\n
      27.     In  Issue No.14, the Arbitrator went into  the<\/p>\n
question of delay in supplying the cement and steel  by  the<\/p>\n
appellants  and the consequence thereof.  The same was dealt<\/p>\n
with  in  paras  53 to 59 and based on oral and  documentary<\/p>\n
evidence,  particularly, the evidence of  P.W.1,  R.W.1  and<\/p>\n
Exs.B-5  and  B-32, the Arbitrator held that  there  was  no<\/p>\n
supply  of cement from 25.8.1985 to 8.10.1985 and there  was<\/p>\n
also  a  delay in cement supply immediately after in handing<\/p>\n
over  the site on 4.7.1985.  Insofar as the supply of  steel<\/p>\n
is concerned, the Arbitrator found that there was no delay.<\/p>\n
      28.   Issue  No.15  relates to  supply  of  water  and<\/p>\n
electricity and was found in favour of the Department.<\/p>\n
      29.   Issue No.16 relates to the plea whether dredging<\/p>\n
of  sand  was  essential for the Valinokkam Fishing  Harbour<\/p>\n
Project  and  if  so whether the claimant  was  entitled  to<\/p>\n
compensation on the ground of delay.   The  Issue No.17  was<\/p>\n
whether in terms of contract and plan, the Department handed<\/p>\n
over  the  site in the sea for pile driving work.  This  has<\/p>\n
been   dealt  with  in paras 66 to 88  of  the  award.   The<\/p>\n
Arbitrator went in detail considering the various  documents<\/p>\n
and  the  technical  material  in  Book  “Dock  and  harbour<\/p>\n
engineering” and the subject “Dredger and Dredging” to  come<\/p>\n
to  the  conclusion  that  the dredging  was  necessary  for<\/p>\n
completion of the project.  Reliance was placed on documents<\/p>\n
Exs.A-51  and A-52, first respondent’s letters that dredging<\/p>\n
should  be  done, the genuineness of which was not disputed.<\/p>\n
However, the Department tried to avoid the same stating that<\/p>\n
they  did  not  receive it.  As to the  genuineness  of  the<\/p>\n
letter  and  receipt  of  the same by  the  Department,  the<\/p>\n
Arbitrator  considered the same in Issue No.8  and  held  in<\/p>\n
favour of the claimant.  Reliance was also placed  on  Ex.A-<\/p>\n
55  letter dated 18.1.1989  written by the contractor to the<\/p>\n
Superintending  Engineer  that  only  after  completion   of<\/p>\n
dredging   work,  the  claimant  would  start  pitching   of<\/p>\n
boulders.   The Arbitrator noticed that the casting  of  160<\/p>\n
piles  was  over  by  October, 1985, but  the  dredging  was<\/p>\n
arranged  only  in  1988 and was not completed  even  as  on<\/p>\n
February,  1989.   As has been recorded in para  85  of  the<\/p>\n
award, the Arbitrator observed that 10 piles were driven and<\/p>\n
further  work  could not be completed for want of  dredging.<\/p>\n
In  para  88,  the  Arbitrator negatived  the  plea  of  the<\/p>\n
Department  that no dredging was essential for  construction<\/p>\n
of  the RCC Jetty.  He, however, came to hold that there was<\/p>\n
three  years  and three months delay from October,  1985  to<\/p>\n
December,  1988 in locating and handing over  the  site  for<\/p>\n
pile driving and arranging the dredger.\n<\/p>\n<\/p>\n
      30.   In  Issue  No.6, the Arbitrator  considered  the<\/p>\n
question   of   breach  and  recession  of  the   agreement.<\/p>\n
Arbitrator in para 105 observed that the Department has  not<\/p>\n
thought  it  fit to cancel the contract, on the contrary  it<\/p>\n
allowed  the  claimant to work upto 11.4.1989, the  date  on<\/p>\n
which  the  contract  was  terminated.   In  para  109,  the<\/p>\n
Arbitrator observed that at no point of time, the Department<\/p>\n
made    a    complaint    about    incompetency    of    the<\/p>\n
claimant\/contractor.  The Arbitrator also  noticed  that  in<\/p>\n
October,  1985, the casting of 160 piles were  over  and  if<\/p>\n
the  Department found that the claimant was not  progressing<\/p>\n
well  with  the   work,  they  should  have  terminated  the<\/p>\n
contract.  On the other hand they asked him to proceed  with<\/p>\n
the work.  A doubt was raised with regard to the capacity of<\/p>\n
the  claimant, experience and ability to undertake the work.<\/p>\n
However,  it was  negatived in paras 111, 112 and  113.  The<\/p>\n
Arbitrator in para 116 observing that while the pile driving<\/p>\n
work  was  under  progress and 10 piles were driven  between<\/p>\n
December,   1988  to  February,  1989,  the   contract   was<\/p>\n
terminated  in April, 1989 and in any event, the  Department<\/p>\n
did  not  pursue the construction of the project  in  effect<\/p>\n
they abandoned it for some reason.      For the above stated<\/p>\n
reasons,   the  Arbitrator  held  that  the  Department   is<\/p>\n
responsible  for  the  delay in executing   the  work.   The<\/p>\n
Arbitrator  considering the inordinate delay at every  stage<\/p>\n
of the contract and also with regard to payment and the fact<\/p>\n
that  at  the  time when the driving of the  piles  were  in<\/p>\n
progress and inspite of the specific plea of the claimant to<\/p>\n
extend  the  time, the Department for some reason terminated<\/p>\n
the  contract  on 11.4.1989.  The Arbitrator held  that  the<\/p>\n
attitude  on the part of the Department was responsible  for<\/p>\n
the  financial  crisis faced by the claimant and  therefore,<\/p>\n
came  to  hold that the Department had committed  breach  of<\/p>\n
agreement and the claimant is entitled for damages thereon.<\/p>\n
      31.   The  above  findings of the  Arbitrator  clearly<\/p>\n
establishes that the delay is on the part of the Department.<\/p>\n
Appellants  are  not  able  to show  any  material  to  hold<\/p>\n
otherwise  and  in  fact,  at the time  of  hearing  of  the<\/p>\n
appeals,  the  counsel  for  the  appellants  addressed  his<\/p>\n
arguments  only  on Issue No.1 and Issue No.2.   Issue  No.1<\/p>\n
relates to claim in respect of value of work done in casting<\/p>\n
160  piles  and for 10 piles driven into the seabed.   Issue<\/p>\n
No.2  is  whether the claimant is entitled to any escalation<\/p>\n
over  the  agreement rates at 180% on the value of the  work<\/p>\n
done between 4.7.1985 to 11.4.1989.  Therefore, the question<\/p>\n
that has to be decided in the present appeals is whether the<\/p>\n
award of the Arbitrator insofar as the Issue Nos.1 and 2  is<\/p>\n
concerned  is justified.\n<\/p>\n<\/p>\n
       32.    As  far  as  the  first  claim  of  the  first<\/p>\n
respondent\/claimant is concerned, it relates to  casting  of<\/p>\n
160   piles  and  the  cost  incurred  for  the  same.   The<\/p>\n
respondent\/claimant has not been fully  paid  for  the  work<\/p>\n
done.    The  Department’s  contention  is  that  the  first<\/p>\n
respondent\/claimant is not entitled for any amount in excess<\/p>\n
of  the  amount already paid. The Department while accepting<\/p>\n
that  the  claimant had in fact cast 160 piles  as  per  the<\/p>\n
agreement,  is  disputing the award only in respect  of  the<\/p>\n
cost  of the casting of 160 piles on the basis of the  value<\/p>\n
of materials supplied by the Department, after giving credit<\/p>\n
to the amounts already paid.\n<\/p>\n<\/p>\n
     33.  At the time of hearing of the appeals, the learned<\/p>\n
counsel  for  the  appellants referred to various  documents<\/p>\n
filed by the Department and the documents filed by the first<\/p>\n
respondent\/claimant  to state that the  Arbitrator  has  not<\/p>\n
properly   construed  the  documents  and  has   erroneously<\/p>\n
determined the amounts under the various heads.   The  first<\/p>\n
contention  was that the value of the pile was not  properly<\/p>\n
arrived  and the value of cement and steel supplied  by  the<\/p>\n
Department  were  not  considered.  The  conclusion  of  the<\/p>\n
learned Arbitrator and the order of the learned single Judge<\/p>\n
confirming  such  conclusion is based on a misinterpretation<\/p>\n
of  the  documents and the evidence.  The second  contention<\/p>\n
on  the same issue is that the number of piles cast was  160<\/p>\n
and what was embedded or driven into the sea was only 10 and<\/p>\n
the  quantum of fabrication done was 59 MT.  Considering all<\/p>\n
these factors, the Arbitrator awarded a sum of Rs.4,59,115\/-<\/p>\n
.   It is contended that the conclusion of the Arbitrator is<\/p>\n
erroneous  and he has not considered one or other  documents<\/p>\n
properly.   The Issue No.1\/Claim No.1, which is  strenuously<\/p>\n
disputed  by  the appellants, is relating to value  of  work<\/p>\n
done  and  the consequent claim.  This issue has been  dealt<\/p>\n
with  in  paragraphs  13 to 30 of the  award,  the  relevant<\/p>\n
portion of which is extracted hereunder:-<\/p>\n
               “Admittedly precasting of 160 piles
\n          are  are  completed.  Item No.20 relates
\n          to  the  said  work.  According  to  the
\n          claimant\/petitioner, as per Item  No.20,
\n          109 Mt. of works as per the instructions
\n          of  the  Engineer in-charge of the  site
\n          namely,  cutting, binding,  grills,etc.,
\n          except tieing and binding and hence  the
\n          claimed  the  bill amount  as  per  item
\n          No.20  at the rate of Rs.650\/-  for  100
\n          kg.  and  the total value for this  item
\n          No.20  i.e. Rs.7,08,500\/-.  Whereas  the
\n          department  had  valued  this  work   at
\n          Rs.3,82,041\/-.\n<\/p><\/blockquote>\n
               In view of the rates  prescribed in
\n          the  Exs.B.1 for this item of work after
\n          giving a margin of Rs.8,500\/- foe tieing
\n          and  binding,  I fix the value  for  the
\n          item at Rs.7,00,000\/-.\n<\/p><\/blockquote>\n
               As  regards item No.21,  supply  of
\n          M.S.   Angle  –  iron  shoes  for  piles
\n          including fixing charges at the rate  of
\n          Rs.250\/-  per  pile for 160  pile  shoes
\n          comes to Rs.40,000\/-.\n<\/p><\/blockquote>\n
               Thus, as regards precasting of  160
\n          piles under the above three items, I fix
\n          the value for this work as follows:-\n<\/p><\/blockquote>\n
              1)   Item No.4      .... Rs. 4,16,250\/-\n\t\t  2)   Item No.20     .... Rs. 7,00,000\/-\n\t\t  3)   Item No.21     .... Rs.   40,000\/-\n                                      ----------------\n               \n               \t\t\t\t   Rs.11,56,250\/-\n                                      ----------------\n                       \n               As regards the recoveries according\n<\/pre>\n
          to the  claimant petitioner,the value of
\n          materials like cement and steel supplied
\n          by   the  department  is  Rs.3,47,288\/-,
\n          while   according  to  the  department’s
\n          calculations  in respect  of  recoveries
\n          arrived at Department materials such  as
\n          supply   of  cement  and  steel,   water
\n          charges,   withheld  amount,  additional
\n          security  deposit income  tax,  cost  of
\n          gunny bags which comes to Rs.5,87,832\/-.\n<\/p><\/blockquote>\n
               28.  Since  the claimant\/petitioner
\n          admitted  the  receipt  of  cement   and
\n          steel  as  per  the entries  in  Ex.B.5,
\n          which  is supported by Ex.B.32,  wherein
\n          he  had signed, but he had only disputed
\n          the  dates, I accept the valuation given
\n          by  the department towards the supply of
\n          cement   and   steel  which   comes   to
\n          Rs.4,87,530.87  and also  water  charges
\n          Rs.1,239\/- and the price of  empty gunny
\n          bags    Rs.2,450\/-   and   income    tax
\n          Rs.16,544\/-  and  under  all  the  above
\n          heads  it  comes to Rs.5,07,771.87.   As
\n          regards  the recoveries with  regard  to
\n          withheld amount of Rs.41,359.05  p.  and
\n          additional security amount of Rs.38,700\/-
\n          total comes to Rs.89,059.05 p.  In  view
\n          of  my findings that the termination  is
\n          not legal and not valid, the respondents
\n          department  are not entitled  to  deduct
\n          the  same  out of the amount payable  to
\n          the claimant\/petitioner.\n<\/p><\/blockquote>\n
                  29.     According     to     the
\n          claimant\/petitioner,  he  had   received
\n          payment  of  Rs.2,20,000\/-  towards  the
\n          payment of bills while according to  the
\n          defendant  respondents, the net  payment
\n          is  Rs.2,39,369\/- under various cheques.\n<\/p><\/blockquote>\n
          Since    even    according    to     the
\n          claimant\/petitioner,  he  is  unable  to
\n          give  the  accurate amount for  want  of
\n          records  not  available  with  him.    I
\n          accept  the  version of  the  department
\n          that  they had paid Rs.2,39,369\/-.  Thus
\n          the     deduction    works    out     to
\n          Rs.5,07,771.87  p.  +  Rs.2,39,363\/-   =
\n          Rs.7,47,134\/87 p.  In the result,  after
\n          deducting  Rs.7,47,134.87  p.   out   of
\n          amount Rs.11,56,250\/- towards the  value
\n          of  work  for precasting of 160 piles  I
\n          find  that the contractor\/petitioner  is
\n          entitled  to Rs.4,09,115.13 p. which  is
\n          rounded up to Rs.4,09,115\/-.\n<\/p><\/blockquote>\n
               30.  Next  we have to consider  the
\n          value   of  work  to  be  paid  to   the
\n          claimant\/petitioner  towards  10   piles
\n          driven  and the value for this item  has
\n          to  be fixed as per item No.5 and  6  of
\n          schedule  specifications rates fixed  in
\n          Ex.B.1.\n<\/p><\/blockquote>\n
              1) In respect of item No.5:\n<\/p><\/blockquote>\n
              Handling and conveying the RCC
\n              precast piles pile 10 Nos.\n<\/p><\/blockquote>\n
              measurement according to
\n              claimant arrived at 152 RM at
\n              Rs.100 per R.M. 152 RM X 100
\n                   = Rs.15,200\/-\n<\/p><\/blockquote>\n
              While department value for this
\n              item comes to 154 RM x 100
\n                   = Rs.15,400\/-\n<\/p><\/blockquote>\n
          However,   the   value  given   by   the
\n          contractor which is low, is accepted.\n<\/p><\/blockquote>\n
          2) In respect of item No.6:\n<\/p><\/blockquote>\n
          According to claimant, total
\n          No.10, piles driven at 150 RM
\n          @  Rs.290\/- per RM = Rs.290  X  150
\n          RM.\n<\/p><\/blockquote>\n
          = Rs.43,500\/-\n<\/p><\/blockquote>\n
          Thus   the   contractor\/petitioner   has
\n          valued both items at Rs.58,700\/-.  While
\n          the   department\/respondents  has  given
\n          under these two items as Rs.47,296.05 p.
\n          giving allowance on exaggeration on both
\n          sides.  I fix the value for these  works
\n          at      Rs.50,000\/-.       Thus      the
\n          claimant\/petitioner is  entitled  for  a
\n          sum  of Rs.4,59,115\/- and this issue  is
\n          answered accordingly.”\n<\/p><\/blockquote>\n
From the above findings of the Arbitrator, the claim of  the<\/p>\n
appellants  Department is totally without any basis  as  the<\/p>\n
said  amount  has been determined based on Ex.B-1  agreement<\/p>\n
and  the Arbitrator has given appropriate deduction for  the<\/p>\n
value of cement and steel supplied by the Department and the<\/p>\n
amount received by the claimant also has been deducted.   It<\/p>\n
is  also  pertinent to note that the Arbitrator has  granted<\/p>\n
the  cost for work done only in respect of 10 piles in a sum<\/p>\n
of  Rs.43,500\/-.  Therefore, the contention of the appellant<\/p>\n
that  the  values have been erroneously arrived,  cannot  be<\/p>\n
accepted.\n<\/p>\n<\/p>\n
      34.   One  other  plea taken is that  vital  documents<\/p>\n
required  to  be  considered  were  not  considered  by  the<\/p>\n
Arbitrator  and  the  learned  counsel  for  the  appellants<\/p>\n
referred  to  the documents filed in the form of  additional<\/p>\n
typedset  of  papers.  He referred to document  Ex.B-32  USR<\/p>\n
Slip  and the memo of calculation and stated that these were<\/p>\n
not  considered.  This contention has to be rejected at  the<\/p>\n
outset  as  we  find  that the USR  Slip  Ex.B-32  has  been<\/p>\n
discussed in more than one place in paragraphs 16, 18 and 28<\/p>\n
of  the  award.   The memo of calculation was  submitted  on<\/p>\n
5.12.1998 belatedly and that has been dealt with in para  22<\/p>\n
of  the award.  The evidence of R.W.1 on 17.6.1997 was  also<\/p>\n
relied  upon  for the purpose of considering  Ex.B-32.   It,<\/p>\n
therefore,  follows that these documents were considered  by<\/p>\n
the  Arbitrator  in  detail  and  Issue  No.1  was  decided.<\/p>\n
Learned  single  Judge  also considered  the  same  and  the<\/p>\n
Department plea was rejected.  Therefore, the plea  of  non-<\/p>\n
consideration of vital documents cannot be accepted.  In any<\/p>\n
event,  at  this stage, it will not be proper to  look  into<\/p>\n
individual slip and rework the calculation.  The decision of<\/p>\n
the Apex Court in K.P.Poulose – v. – State of Kerala 1975 SC<\/p>\n
1259, para 6 referred to by the appellants’ counsel will not<\/p>\n
be  applicable  to  the facts of the  present  case  as  the<\/p>\n
Arbitrator  has  gone into those documents and  decided  the<\/p>\n
claim.  The learned single Judge has extensively dealt  with<\/p>\n
this issue and upheld the award.  We are constrained to  say<\/p>\n
so  only  for the reason that sitting in appeal against  the<\/p>\n
order of single Judge confirming the award, the Court is not<\/p>\n
expected  to  reappreciate   the  evidence,  documents   and<\/p>\n
records  unless  it  is  shown  that  the  conclusions   are<\/p>\n
palpably  erroneous   and unreasonable.   Even  as  per  the<\/p>\n
grounds  in both the appeals, the appellants’ contention  is<\/p>\n
on   the quantum of work done and the value which cannot  be<\/p>\n
canvassed  at  this  point  of time.   With  regard  to  the<\/p>\n
jurisdiction  of the Court to interfere with the  award  the<\/p>\n
learned single Judge has in para 15 referred to the decision<\/p>\n
the  State of U.P. – v. – Ramnath International Construction<\/p>\n
(P)  Ltd (1996) 1 SCC 18.  The learned single Judge has also<\/p>\n
referred to the decision in State of Rajasthan – v.  –  Puri<\/p>\n
Constructions Co. Ltd.  (1994)6 SCC 485 to state that  award<\/p>\n
cannot  be  set aside merely on the ground that there  is  a<\/p>\n
misreading,  misconstruction or misappreciation of  material<\/p>\n
on records, nor can it be set aside merely because on Courts<\/p>\n
own assessment and an alternative view is possible.    In so<\/p>\n
far  as Claim No.1 is concerned the Arbitrator  appreciating<\/p>\n
the claimant’s case and the stand of the Department based on<\/p>\n
oral  and  documentary evidence extensively dealt  with  the<\/p>\n
contentions  in  paras 13 to 30 of the award and  determined<\/p>\n
the  amount.   Even  if there is any minor discrepancy  that<\/p>\n
cannot be a ground for the appellate Court to reconsider the<\/p>\n
same.   Therefore, the conclusion of the Arbitrator  insofar<\/p>\n
as  Issue No.1 does not require reconsideration as contended<\/p>\n
by the learned counsel for the appellants.<\/p>\n
      35.   The  second contention that was  argued  by  the<\/p>\n
counsel for the appellants was regarding escalation charges.<\/p>\n
The  claimants made a claim for escalation 180% for the work<\/p>\n
done  during the period 4.7.1985 to 11.4.1989 and a  sum  of<\/p>\n
Rs.15,90,660\/-.  This was considered in Issue No.2 in  paras<\/p>\n
147  to  170  of  the  award.  The main  contention  of  the<\/p>\n
appellants  before  the Arbitrator as  well  as  before  the<\/p>\n
learned  single  Judge  is  that there  was  no  clause  for<\/p>\n
escalation  and the Arbitrator erred in granting   the  said<\/p>\n
sum of Rs.9,17,195\/- by referring to various other contracts<\/p>\n
and on account of  the alleged delay.  It was contended that<\/p>\n
the  escalation  was based on value of work  done.   Besides<\/p>\n
stating   that  the  raw  material  was  supplied   by   the<\/p>\n
Department,   it  is  contended that in  the  absence  of  a<\/p>\n
specific  clause in the agreement providing for  escalation,<\/p>\n
the  claimant  is not entitled to the same.  Even,  the  20%<\/p>\n
escalation  charges  was  requested  and  granted   by   the<\/p>\n
Government,  eventhough it was not part  of  the  agreement.<\/p>\n
This contention of the appellants has to be accepted in view<\/p>\n
of  the  decision of the Apex Court in the case of State  of<\/p>\n
Orrissa – vs. – Sri S.C. Roy (dead) by L.Rs. JT 2001 (5)  SC<\/p>\n
267.  Para 4 which is relevant is extracted hereunder:-<\/p>\n
               “4.  Both the issues are no longer
\n         res-integra.   Insofar as the  Award  of
\n         claim  of  escalation is  concerned,  it
\n         stands   settled  by   this   Court   in
\n         Secretary,     Irrigation    Department,
\n         Government  of Orissa & Ors. v.  G.C.Roy
\n         (JT<\/a>  1991  (6)  SC 349) wherein  it  has
\n         been   held   that   where   arbitration
\n         agreement    contains   no    escalation
\n         clause,  the  Arbitrator does  not  have
\n         any  jurisdiction  to Award  any  amount
\n         towards   escalation.   In  the  instant
\n         case,   we   find  that  there   is   no
\n         escalation  clause  in  the  arbitration
\n         agreement  and a specific objection  was
\n         raised  by  the  appellant  before   the
\n         Arbitrator  in that behalf.   That  part
\n         of  the  Award, therefore, which  grants
\n         escalation  charges is not  sustainable,
\n         as  it suffers from a patent error.  The
\n         decree   insofar   as   the   Award   of
\n         escalation    charges   is    concerned,
\n         therefore,  cannot be sustained  and  is
\n         hereby set aside.”\n<\/p><\/blockquote>\n
Eventhough  the agreement did not provide for an  escalation<\/p>\n
cost  and  the  Government has independently considered  the<\/p>\n
claim  for  escalation  at 20% and  granted  the  same,  the<\/p>\n
Arbitrator  has  decided the claim for  further  escalation.<\/p>\n
The  20% escalation was negotiated between parties and  paid<\/p>\n
separately  and  it  is  not  part  of  the  agreement   and<\/p>\n
therefore, the claim on this head cannot be accepted in law.<\/p>\n
The  Arbitrator  erred in awarding the sum of  Rs.9,17,195\/-<\/p>\n
under Issue No.2.  We are unable to accept this part of  the<\/p>\n
award,  particularly  in view of the decision  of  the  Apex<\/p>\n
Court stated above.\n<\/p>\n<\/p>\n
       36.   Insofar  as  counter-claim  is  concerned   the<\/p>\n
Arbitrator  discussed the same in paras 31  to  46   of  the<\/p>\n
award  and  allowed  counter  claim  No.1  for  mobilisation<\/p>\n
charges  paid  and  rejected the other  two  counter  claim.<\/p>\n
Though  a ground has been raised on this issue, the  counsel<\/p>\n
is  not able to substantiate the Department’s plea.  In  any<\/p>\n
event,  counter claim No.2 is regarding over payment to  the<\/p>\n
claimant  and is based on arithmetical calculation.   We  do<\/p>\n
not  propose to delve  on the same.  Counter claim  No.3  is<\/p>\n
for  refund  of  EMD  and  additional  EMD,  the  Arbitrator<\/p>\n
rejecting it on the ground that the claimant did not  breach<\/p>\n
the  agreement  and  the  termination  of  the  contract  by<\/p>\n
appellants  is  not  valid.   We have  concurred  with  this<\/p>\n
finding  in  Issue No.6 that the fault was on  the  part  of<\/p>\n
Department and the counter claim No.3 was rightly  rejected.<\/p>\n
The  counsel  for appellants pleaded that  compensation  for<\/p>\n
loss  suffered  by the claimant on account of overheads  and<\/p>\n
loss  suffered  during the period in question  and  loss  on<\/p>\n
account of damage due to idle machinery, equipment and other<\/p>\n
construction  materials withheld by the department  for  the<\/p>\n
period of 18 months and the Arbitrator awarded on this  head<\/p>\n
is  not  justified.   He,  further pleaded  that  a  sum  of<\/p>\n
Rs.10,00,000\/- is awarded for the machinery, which were  not<\/p>\n
returned, with a further direction that if the machinery are<\/p>\n
returned, the same can be deducted is also not correct.  All<\/p>\n
these issues have been dealt with  in detail in paras 171 to<\/p>\n
178 and 180 to 213 in the award.\n<\/p>\n<\/p>\n
      37.  The whole case of the claimant is only on account<\/p>\n
of the delay on the part of the department in not concluding<\/p>\n
the  contract  in time, not providing the material  and  not<\/p>\n
providing  the  site in time and delay  in  payment.     The<\/p>\n
Arbitrator has taken into consideration all these facts into<\/p>\n
consideration and dealt with the above issues in detail  and<\/p>\n
determined  the  claim.   Reasons  have  been  recorded  for<\/p>\n
arriving  at the amount in respect of each claim and  it  is<\/p>\n
based  on  oral and documentary evidence.  Unless appellants<\/p>\n
can  establish that the Arbitrator has misconducted  himself<\/p>\n
in  terms of Section 30(a) and 30(c) of the Arbitration Act,<\/p>\n
the  award  should  not be interfered  with.    The  learned<\/p>\n
single  Judge  while considering  the relevant  issues   and<\/p>\n
considering the documents and evidence confirmed the  award.<\/p>\n
As   stated   earlier    the   learned   counsel   for   the<\/p>\n
appellants\/Department,  confined  his  arguments  mainly  to<\/p>\n
issue Nos.1 and 2.  Except the ground relating to escalation<\/p>\n
we  do  not find any good reason to interfere with the award<\/p>\n
of  the  Arbitrator in other respects.   The  order  of  the<\/p>\n
learned  single Judge confirming the award of the Arbitrator<\/p>\n
is   correct  except  insofar  the  claim  with  regard   to<\/p>\n
escalation as decided in Issue No.2.\n<\/p>\n<\/p>\n
     38.    In the light of  the Apex Court decision and for<\/p>\n
the reasons as above we set aside that  portion of the Award<\/p>\n
regarding  Claim  No.2  Issue No.2  relating  to  claim  for<\/p>\n
escalation as confirmed by the learned single Judge.<\/p>\n
     39.   In the light of the above findings of this Court,<\/p>\n
the  award of the Arbitrator insofar as it relates to  Issue<\/p>\n
No.2 in a sum of Rs.9,17,195\/- with interest is concerned is<\/p>\n
set aside and the award on other heads are confirmed and the<\/p>\n
order  of the learned single Judge stands modified  to  that<\/p>\n
extent.   Both  the  Original  Side  Appeals  stand   partly<\/p>\n
allowed.  In the facts and circumstances of the case,  there<\/p>\n
will be no order as to costs.\n<\/p>\n
ts.\n<\/p>\n
To<\/p>\n
1.\tThe  Secretary to Government
\n   \tAnimal Husbandry & Fisheries Department
\n   \tChennai 9.\n<\/p>\n
2.\tThe Director of Fisheries
\n   \tAnna Salai
\n   \tTeynampet
\n   \tChennai 6.\n<\/p>\n
3.\tThe Superintending Engineer
\n   \tFisheries & Harbour Circle
\n   \tNagercoil
\n   \tnow at the office of the Director of Fisheries
\n   \tD.M.S. Office
\n   \tAnna Salai
\n   \tChennai 6.\n<\/p>\n
4.\tThe Sub Assistant Registrar
\n      (Original Side)
\n   \tHigh Court
\n\tMadras 104.\n<\/p><\/p>\n","protected":false},"excerpt":{"rendered":"
Madras High Court The State Of Tamilnadu vs K.Ramachandran on 21 September, 2006 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 21\/09\/2006 CORAM THE HONOURABLE MR. JUSTICE P.K. MISRA AND THE HONOURABLE MR. JUSTICE R. SUDHAKAR O.S.A. Nos.406 and 407 of 2000 O.S.A. No.406 of 2000 (O.P. No.908 of 1999): ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 1. The […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,13],"tags":[],"class_list":["post-20297","post","type-post","status-publish","format-standard","hentry","category-high-court","category-madras-high-court"],"yoast_head":"\nThe State Of Tamilnadu vs K.Ramachandran on 21 September, 2006 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/the-state-of-tamilnadu-vs-k-ramachandran-on-21-september-2006\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The State Of Tamilnadu vs K.Ramachandran on 21 September, 2006 - 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