JUDGMENT

SABYASACHI MUKHARJI, C.J.I. :- The respondent R. V. Rayanim was, at all material times, a Class I contractor who had entered into an agreement with the Government of Andhra Pradesh for formation of earth dam in gorge portion from chainage 3360 to 3380-M of Raiwada Reservoir Project near Devarapalli village, Chodavaram Taluk, Distt. Visakhapatnam, Andhra Pradesh. Disputes and differences arose between the parties in respect of the aforesaid agreement. A reference was made to the arbitrator as per the arbitration clause in the agreement between the parties. The respondent made eleven claims claiming various amounts, particulars whereof have been set out by the arbitrator as follows :

"I. Payment for forming cross bund and refund of the amount recovered. (Rs. in lakhs)

15.89 (subsequently reduced to Rs. 14.89 lakhs).

II. Refund of Seigniorage charges 2.071 (withdrawn)

III. Escalation and damages 14.00

IV. Extra load for sand 1.075 (subsequently reduced to Rs. 0.575 lakhs).

V. Payment for excavation under water for probing diaphram wall. 1.030

VI. Compensation for loss suffered due to partial prevention by the department. 1.500

VII. Compensation for loss suffered due to non-paym