Mukul Mudgal, J.@mdashThe present appeal u/s 39 of the Arbitration Act, 1940 has been preferred by the appellant against the judgment dated 04.09.1995, whereby the objections filed by the appellant/DDA were dismissed and the award dated 04.12.1987 passed by the Arbitrator was made rule of the Court by the impugned judgment of the learned Single Judge.
2. The facts, briefly stated are as follows. The respondent was awarded the work of construction of 324 LIG Flats at C-6/A, Janak Puri, New Delhi vide agreement No. 53/EE/HDVII/80-81. As per the agreement, the work was to start on 08.12.1980 and was to be completed by 07.09.1981. The work was completed on 03.04.1985, i.e., after a delay of 44 months.
3. Disputes arose between the parties as the appellant failed to make the payment. A sole Arbitrator was appointed to decide the disputes. The claimant made the following claims before the Arbitrator:
(i) Claim No. 1 for Rs. 45,000/- towards reimbursement under Clause 10C.
(ii) Claim No. 2 for Rs. 3,50,000/- for items of work done but not measured nor paid.
(iii) Claim No. 3 for Rs. 12,00,000/- due to increase of 25.25% in rates for work executed after stipulated date of completion.
(iv) Claim No. 4 for Rs. 1,50,000/- due to short measurements.
(v) Claim No. 5 for Rs. 1,50,000/- due to part rates paid.
(vi) Claim No. 6 for Rs. 75,000/- for extra items not paid.
(vii) Claim No. 7 for Rs. 4,50,000/- on account of damages.
(viii) Claim No. 8 for Rs. 50,000/- on account of rebate.
(ix) Claim No. 9 for Rs. 43,842/- recovered on account of labour employed by the respondent.
(x) Claim No. 10 for pendente lite interest.
(xi) Additional claim No. 1 for Rs. 1,00,000/on account of refund of security deposit.
4. The learned Arbitrator made the award on 04.12.1987 awarding an amount of Rs. 33,579/- under claim No. 1, Rs. 28,113/- under claim No. 2, Rs. 9,33,660/- under claim No. 3 and Rs. 1,16,359.75 under claims No. 4, 5 and 6. Interest @ 18% per annum from 30.03.1984 upto the date of payment or decree under claim No. 10 as well as an amount of Rs. 1,00,000/- was awarded under additional claim No. 1.
5. On 10.03.1988, the appellant filed objections against all the awarded amounts as well as against the additional claim No. 1. The learned Single Judge rejected the objections of the appellant and made the award rule of the Court.
6. The appeal in the present case is confined only to the claim No. 3 and relates to the interpretation of the Clause-10 and additional condition No. 1 of the general conditions and specifications, which read as follows:
Clause-10
Stores supplied by Delhi Development Authority. If the specifications or schedule or items provided for the use of any special materials to be supplied from Engineer-in-Charge''s stores or it is required that the contractor shall use certain stores to be provided by the Engineer-in-Charge as shown in the schedule of materials hereto annexed the contractor shall be bound to procure and shall be supplied such materials and stores as are from time to time required to be used by him for the purposes of the contractor only, and the value of the full quantity of material and stores so supplied at the rates specified in the said schedule of materials may be set off or deducted from any sums then due, or thereafter to become due to the contractor under the contract, or otherwise or against or from the security deposit or the proceeds or sale thereof if the same is held in Government securities, the same or a sufficient portion thereof being in this case sold for the purpose. All materials so supplied to the contractor shall remain the absolute property of Delhi Development Authority and shall not be removed on any account from site of the work, all shall be at all times open to inspection by the Engineer-in-Charge. Any such materials remaining unused and in perfectly good condition at the time of the completion or termination of the contract as shall be returned to the Engineer-in-Charge at a place directed by him, by a notice in writing under his hand, if he shall so require but the contractor shall not be entitled to return any such materials unless with such consent, and shall have no claim for compensation on account of any such materials so supplied to him as aforesaid not being used by him or for any wastage in or damage to any such materials. Provided that the contractor shall in no case be entitled to any compensation or damages on account of any delay in supply or on supply thereof all or any such materials and stores. Provided further that the contractor shall be bound to execute the entire work if the materials are supplied by the Delhi Development Authority within the scheduled time for completion of the work plus 50 percent thereof (scheduled time plus 6 months if the time of completion of the work exceeds 12 months) but if a part only of the materials has been supplied within the aforesaid period then the contractor shall be bound to do so much of the work as may be possible with the materials and stores supplied in the aforesaid period. For the completion of the rest of the work the contractor shall be entitled to such extension of time as may be determined by the Engineer-in-Chief whose decision in this regard shall be final.
GENERAL CONDITIONS
1. The contractor must get acquainted with the proposed site for the works and study specification and conditions carefully before tendering. The work shall be executed as per programme approved by the Engineer-in-charge. If part of site is not available for any reason or there is some unavoidable delay in supply of materials stipulated by the department, the programme of construction shall be modified accordingly and the contractor shall have no claim for any extra or compensation on this account. SPECIFICATION
4.1 The contractor shall carry out the work of sewer lines in close coordination with works of other services in the area. The contractor shall have no financial or other claims arising out of lack of coordination.
7. It is not disputed before us that the interpretation of the above Clause was the subject matter of a Division Bench judgment of this Court in M.L. Mahajan v. Delhi Development Authority, being FAO(OS) 298/1998 decided on 25th May, 2009. Since the issue involved in the present appeal is also covered by the aforesaid judgment of the Division Bench of this Court, by which we are bound, there is no merit in the appeal insofar as the claims are concerned.
8. The learned Counsel for the appellant has, however, pointed out that the learned Single Judge has affirmed the 18% interest granted by the Arbitrator. In India Furnishers v. Punjab National Bank, being FAO(OS) 261/2001 decided on 22nd April, 2009, this Court while referring to the judgments of the Hon''ble Supreme Court in
The interest of justice would be sufficiently met if the award is sustained, but, interest granted by the Award is reduced to 12% per annum and further in case the respondents makes the payments within four weeks from today then the interest would be at stand reduced to 9% per annum.
9. In view of the above law laid down by the Hon''ble Supreme Court insofar as the quantum of interest in the present day proceedings is concerned, the amount of 18% interest p.a. awarded by the Arbitrator and affirmed by the learned Single Judge is reduced to 9% p.a.. Save and except for the above modification in the quantum of interest by reducing it from 18% to 9% p.a., the appeal is dismissed.
