Judgment

RANGANATHAN, J.:- These are cross appeals by M/s. Hind Builders (hereinafter referred to as the contractors) and the Union of India, from an order of Division Bench of the Calcutta High Court in an arbitration matter.

2. The contractors had been awarded a contract for the execution of certain civil works in connection with the Metro Railway Project in Calcutta. Certain disputes arose between the Union and the contractors. These disputes were referred for decision to two arbitrators appointed by the High Court of Calcutta. The arbitrators entered upon the  reference on 27th June, 1983. The contractors had filed a claim before the arbitrators for a sum of Rs. 2,05,67,554/- On 26-3-1984 the arbitrators awarded a sum of Rs. 57,47,198 to the contractors.

3. The claim of the contractors filed before the arbitrators was an itemised claim in respect of various items of works executed by them. The body of the award made by the arbitrators reads as follows:

"We make and publish our Award, as below: -

(i) that the respondent shall pay the .Contractors a sum of Rs. 57,47,1981 only in full and final settlement of all their claims and dues under the abovementioned contract agreement. In addition, the three Bank Guarantees issued by Vijaya Bank, Cuttack, on behalf of the contractors, in favour of Metro Railway, Cuttack, shall be released by the respondent-Railway, as detailed in the Annexure to this Award.

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The Award shall be complied with within 60 (Sixty) days from the date of publication of this Award. failing which simple interest @ 11 per cent per annum on the amount of the Award (excluding interest vide item (1) of the Annexure i.e. Rs. 6,76,540/-) shall accrue till the date of payment or decree upon Award whichever is earlier."

In the annexure to the award, the arbitrators tabulated the various items of the claim before them, the amount claimed against each item and the amount awarded against each item. Under item (1) in the annexure, the Arbitrators had awarded an interest of Rs. 6,76,540/- and that is why the direction regarding interest by the arbitrators excluded this amount from the principal amount which was to bear interest. As stated earlier, the total amount awarded was Rs. 57,47,198/- in respect of items (a) to (q) of the award as against the claim of Rs. 2,05,67,554/ - made by the contractors.

4. On an application being made to the High Court of Calcutta on the original side for making the award a rule of Court, the learned single Judge sitting on the original side confirmed the award except to the extent of Rs. 5,20,000/-. This is no longer in issue. The learned Judge, however, concluded his judgment with the following words:

"The principal sum awarded stands reduced by Rs. 5,20,000/- as mentioned above. The respondent will be entitled to interest at the rate of 11 per cent per annum from the date of reference till the date of the award."

5. The Union of India preferred an appeal from the order of the learned single Judge. The Division Bench was of the opinion that the arbitrators were not justified in awarding a sum of Rs.23,96,000/- to the contractors (as against a claim of Rs. 42,65,957/- made by them) in respect of item (c) (xiii) viz. "cost towards consolidation of earth by ramming and rolling- and that they could have awarded under the contract only a sum of Rs. 2,39,600/- in respect of this item. The amount awarded to the contractors was thus further reduced by the Division Bench by a sum of Rs. 21,56,400/- (Rs. 23,96,000 - Rs. 2,39,600). The Bench then observed that the principal sum to be awarded to the contractors would now stand at Rs. 30,70,798/- and directed that the respondent-contractor should be entitled to interest at the rate of 11 per cent. per annum on the said amount from the date of the reference till the date of the award.

6. The contractors have appealed from the order of the Division Bench being aggrieved by the reduction. of the amount awarded under item (c) (xii) to Rs. 2,39,600 / from R