Hemant gupta, J.@mdashThis order shall dispose of C.R. No. 1602 of 1999 filed by the Union of India (hereinafter referred to as ''the Agency'')
and C.R. No. 918 of 2000 filed by M/s Pyare Lal and sons (hereinafter referred as ''the Contractor''). Both the revision petitions arise out of an
order passed by the learned trial Court 20.10.1997 making Award dated 29.12.1993 as rule of court. In appeal, the order passed by the learned
trial Court was modified and the Award in respect of Claim Nos. 1, 3 & 6 were set aside and the Award in respect of remaining Claims was made
rule of the Court.
2. The Agency is aggrieved against the Award being made rule of the court in respect of Claim Nos. 2 & 5, whereas the Contractor is aggrieved
against the Award being set aside in respect of Claim Nos. 1, 3 & 6
3. The Agency invited tenders for special repairs to O.T.M. accommodation at Chandimandir Cantonment on 17.01.1989. The tender submitted
by the Contractor was accepted. The total amount involved in the contract was Rs. 4,86,684/-. The work was to be completed within six months
from the date of commencement of the work. The work commenced on 07.02.1989, but could not be completed on or before 06.09.1989. The
period was extended upto 12.03.1990, but the work could not be completed even upto the extended date. The Agency cancelled the contract on
22.05.1990. The remaining work was got executed through some other Contractor. Since the dispute arose between the parties, Shri P.D.
Sharma, Superintending Engineer, was appointed as the sole Arbitrator in view of the arbitration clause in the agreement between the parties. The
Arbitrator announced his award and awarded the following amount against each Claim:
Claim Amount ClaimedDescription of Claim Amount Awarded
Number
1 `1,00,000/- For damages suffered on account of illegal Rs. 25,000/-
cancellation of contract when the work was in
progress
2 Rs. 50,000/- For loss suffered on account of non-handling 10,000/
over the dismantled and demolished Materials
of building No.T/3776 & Tent Plinths
3 Rs. 2,00,000/- For balance payment for work done includingRs. 70,674.18
escalation in wages and cost of materials
4 Rs. 25,000/- For work done in buildings not forming part NIL
of the contract agreement
5 Rs. 1,00,000/- For reimbursement of damages on account ofRs. 85,000/-
breach of contract by the Union of India
including illegal cancellation, delay in issue of
schedule �B� Stores, delay in handing
over sites, non-payment for escalation in cost,
delay and restrictions in payment of running
bills, non-supply of water due to scarcity,
non-ordering provisional quantities, delay in
measurement of work resulting in
underpayments etc. resulting in prolongation
of contract period.
6 Rs. 50,000/- For on account of loss suffered due to non- Rs. 50,000/-
payment and delay of running and final bill
7 Rs. 75,000/- For payment of materials and tools and NIL
plants.
8 For interest on above amounts unduly 12%
withheld @ 18% p.a.
9 Rs. 20,000/- For cost of reference to arbitration NIL
4. Learned first Appellate Court found that the claim awarded by the Arbitrator under Claim Nos. 1, 3 & 6 are, in fact, the claims awarded in the
Claim No. 5 and, thus, the Arbitrator has no power to allow duplicate claims on the same grounds and reasoning. Learned first Appellate Court
also found that the Contractor was paid Rs. 3,60,089/- for the work done by it, whereas on completion of total work, the Contractor would have
got Rs. 4,86,684/- in lump sum. But the Arbitrator has awarded him Rs. 2,40,674.18, which is more than the contract amount. Thus, the appeal
filed by the Agency was accepted partly.
5. Learned Counsel for the Contractor has vehemently argued that the finding recorded by the learned first Appellate Court that the Contract has
claimed Claims on the same account under different heads is incorrect. It is contended that each of the Claim of the Contractor is separate and
distinct and that finding recorded by the learned first Appellate Court is incorrect.
6. On behalf of the Agency, Ms. Shahi argued that the primary claim of the Contractor is on account of delay in handing over the sites, delay in
issue of Schedule ''B'' or for delay in completion of the contract. It is contended that for such delay the Contractor is not entitled to claim any
amount in terms of the specific Clause-11 of the General Conditions of the Contract.
7. Reliance is placed upon a judgment of Hon''ble Supreme Court reported as Ramnath International Construction Pvt. Ltd. Vs. Union of India
(UOI) and Another, and on an order passed by this Court in C.R. No. 2796 of 2000 titled ""Manohar Lal & Sons v. Union of India and Ors.
decided on 03.08.2010.
8. Before preceding further, the relevant clauses of Clause-11 of the Agreement are to be extracted. The said clause reads as under:
11. Time, Delay and Extension -
(A) Time is essence of the contract and is specified in the contract documents or in each individual works order.
As soon as possible after contract is let or any substantial Works Order is placed and before work under it is begun, the G.E. and the contract
shall agrees upon a Time and Progress Chart. The Chart shall be prepared in direct relation to the time stated in the contract documents or the
Works Order for completion of the individual items thereof and / or the contract or Works Order as a whole. It shall indicate the forecast of the
dates for commencement and completion of the various trade processes or sections of the work, and shall be amended as may be required by
agreement between the G.E. and the contract within the limitation of time imposed in the contract documents or Works Order. If the Works be
delayed:
i) by force majeure, or
ii) by reason of abnormally bad weather, or
iii) by reasons of serious loss or damage by fire or;
iv) by reason of civil commotion, local combination of workmen, strike or lockout, affecting any of the trade employed on the work, or
v) by reason of delay on part of nominated sub contractors, or nominated suppliers which the contractor has in the opinion of G.E. taken all
practicable steps to avoid, or reduce, or,
vi) by reason of delay on the part of contractors or tradesmen engaged by Government in executing works not forming part of the contract, or
vii) by reason of any other cause which in the absolute discretion of the Accepting Officer is beyond the contractor''s control;
then in any such case, the officer hereinafter mentioned may make fair and reasonable extension in the completion dates of individual items or
groups of items of Works for which separate periods of completion are mentioned in the contract documents or Works Order, as applicable.
xxx xxx xxx
(B) If the works be delayed:
(a) by reason of non availability of Government stores shown in Schedule ''B'' or
(b) reason of non availability or breakdown of Govt. Tools and Plant listed in Schedule ''C''
Then, in any such case notwithstanding the provisions hereinbefore contained, the G.E. may in his discretion grant such extension of time as may
appear reasonable to him, and the contractor shall be bound to complete the Works within such extended time. In the event of the contractor not
agreeing to the extension granted by the Garrison Engineer, the matter shall be referred to the Accepting Officer (or C.W.E. in case of contract
accepted by Garrison Engineer) whose decision shall be final and binding.
(C) No claim in respect of compensation or otherwise, howsoever, arising, as a result of extensions granted under conditions (A) and (B) above
shall be admitted.
9. A perusal of the brief description of the Claims reproduced above would show that Claim No. 3 is for balance payment for work done including
escalation in wages and cost of materials. Similarly, Claim No. 5 is in respect of reimbursement of damages on account of breach of contract
including illegal cancellation, delay in issue of schedule ''B'' Stores, delay in handing over sites, non-payment for escalation in cost, delay and
restrictions in payment of running bills, non-supply of water due to scarcity, non-ordering provisional quantities, delay in measurement of work
resulting in underpayments etc. Claim No. 6 is again on account of loss suffered due to non-payment and delay of running and final bill. Therefore,
Claim Nos. 3, 5 & 6 are on account of delay in issuances of schedule ''B'' stores, handing over sites, escalation in wages and cost of materials on
account of delay or loss suffered on account of non-payment of escalation in cost and delay and restrictions in payment of running bills. Clause
11(c) of the Contract agreement prohibits compensation or otherwise as a result of extension granted under Clauses (a) and (b) of Clause 11 of
the Contract. A perusal of the statement of claim further shows that the Contractor was granted extension in completion of project. Once, the
Contractor has been granted extension in completion of project, therefore, by virtue of Clause 11 (c) of the Contract Agreement, the Contractor
cannot claim compensation for delay in completion of the work. Not only the Contractor has claimed the amount on account of delay under Claim
Nos. 3, 5 & 6. Though the Contractor has claimed balance payment for the work done including escalation of wages under Claim No. 3, but since
the Arbitrator has given consolidated award under Claim No. 3, it is impossible to determine the amount awarded to the Contractor for the
balance work or for escalation of wages. Therefore, being the consolidated amount the entire claim is liable to be set aside. Similarly, under Claim
No. 5, the Contractor has claimed reimbursement of damages on account of breach of contract and delay of schedule ''B'' etc. Even the amount
determined under Claim No. 5 is not determinable as to how much amount is towards breach of contract and how much amount is towards delay
in issuance of schedule ''B'' stores. Therefore, the entire claim is liable to be set aside.
10. The learned first Appellate Court has set aside Claim Nos. 3 & 6 alone being duplicate claims, but in fact Claim No. 3, 5 & 6 all relate to
delay in completion of the work and, thus, compensation is not payable under any of these heads. This is the view taken by this Court in M/s
Manohar Lal''s case (supra) relying upon the judgment referred to by the learned Counsel for the Agency, wherein it was held to the following
effect:
However, in the present case, the Arbitrator has given Award claim wise. Claim No. 11 as reproduced above primarily falls within the scope of
Clause (B) or Clause (A)(vii) of condition No. 11 of the contract agreement. Claim No. 11 is specifically in respect of compensation on account of
delay in handing over site and other ancillary matter. Such delay in handing over site falls within Clause 11(C) of the contract which contemplates
that no compensation shall be admissible to the contractor. Clause (C) of the agreement is specific and is to the effect that no claim in respect of
compensation or otherwise arising as a result of extensions granted under conditions (A) and (B) shall be admitted. It is the terms of the agreement
which has to be kept in view while considering the claim of the contractor. Since the contract agreement specifically prohibit compensation on
account of delay falling in Clauses (A) and (B) of Clause 11 of the agreement, therefore, the petitioner is not entitled to compensation on account
of delay in completion of the work.
11. The argument of the learned Counsel for the Contractor that such amount is not claimed in none of the other claims, therefore, the reasoning
given by the first Appellate Court that the Contractor has claimed same amount under various claims is not sustainable. Claim No. 1 is for damages
on account of illegal cancellation of contract when the work was in progress.
12. I am of the opinion that the finding recorded by the learned first Appellate Court that amount claimed under Claim No. 1 is also amount
claimed under different heads, is not sustainable. The Contractor has not claimed damages on account of illegal cancellation of contract under any
other head. In view of the said fact, the order passed by the learned first Appellate Court not making the Award as rule of court in respect of
Claim No. 1 is not sustainable.
13. Therefore, both the revisions are partly accepted. Award of the Arbitrator in respect of Claim Nos. 3, 5 & 6 is set aside, whereas the Award
dated 29.12.1993 is ordered to be made rule of court in respect of Claim Nos. 1, 2 and 8 only. The Contractor shall be entitled to interest at the
rate of 12% from the date of decree till realization as well.
14. With the said observations, both the revision petitions stands disposed of.
