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Andhra Pradesh High Court
Judges : B.P.JEEVAN REDDY, V.NEELADRI RAO
State Of A.P. - Appellant
Versus
Associated Engineering Enterprises, Hyderabad - Respondent
Decided On : 03-24-89
JEEVAN REDDY, J. ( 1 ) THE appeal and the Civil Revision Pttition arise from a common judgment and order of the learned Subordinate Judge, Rajahmundry. making the award a rule of the Court and dismissing the petition filed by the appellant state for setting aside the award.
Fact of the Case:
An agreement was entered into between the State of Andhrapradesh and the respondent-contractor for execution of the work of constructing approaches to the rail-cum-road bridge across Godavari, at Rajahmundry. The agreement is dated 17-6-1970, and the value of the work is Rs. 70,29,925/ -. A period of 42 months was stipulated for completing the work, i. e. , on or before 21-12-1973. The respondent actually completed the work by 10-12-1974, after the period of contract was extended twice.
Finding of the Court:
The arbitrator exceeded his jurisdiction in awarding the amount of Rs. 2,81,800/- under claim no. 1. The award of the said amount is liable to be deleted from the Award. It is also held that the arbitrator had no power, in law to award interest for the period commencing from the date of award till the date of decree of the Civil Court.
Issues: Whether the arbitrator had the jurisdiction to award compensation for the delay in handing over the site.
Ratio Decidendi: Clause 59 of the APDSS specifically bars such a claim. The meaning of the said clause was considered by a Bench of this Courtof which one of us (Jeevan Reddy, J.) was a memberin A. A. O. No. 677/81 and C. R. P. No. 385/1982 disposed of on 19-4-82. It was held : "coming to Clause 59 of the preliminary specifications of "apdss", it provides that neither party to the contractor shall claim compensation "on account of delays or hindrances to work from any cause whatever". That the delays and hindrances contemplated by clause 59 include the stoppage, hindrances and delays on the part of the department as well, is clear front the following sentence in this first part of the said clause, viz. , "the Executive Engineer shall assess the period of delay or hindrances caused by any written instructions issued by him, at 25% in excess of the actual work period so lost". Indeed, the second para of the clause also contemplates delays and hindrances being caused on account of the failure of the Executive Engineer to issue necessary instructions. In such a case, the contractor has a right to claim the assessment of such delay by the Superintending Engineer of the Circle, whose decision is declared to be final and binding on the parties. But, any such claim has to be lodged in writing to the executive Engineer within fourteen days of the commencement of such delay, or hindrance, as the case may be. We find it difficult, therefore, to say that Clause 59 has no application to the present case. The words "from any cause whatever", occurring in Clause 59, are wide enough to take in delays and hindrance of all types, caused by the department, or arising from other reasons, as the case may be. Thus, by virtue of Clause 59, the contractor is precluded from claiming any compensation on account of delays or hindrances arising from any cause whatever, including those arising on account of the acts or omissions of the departmental authorities. . . . . . . . . ".
Final Decision: Accordingly, the Civil Miscellaneous Appeal and the Civil Revision petition are allowed in part, the amount awarded by the arbitrator under claim No. 1 shall be deleted. It is also held that the arbitrator had no power, in law to award interest for the period commencing from the date of award till the date of decree of the Civil Court. However, the respondent- contractor shall be entitled to interest from the date of the decree (i. e. , from 19-2-1985) at the rate of 15% per annum till realisation. We are awarding interest at the rate of 15% per annum since that happens to be the rate which was adopted Dy the arbitrator in the Award. There shall be no order as to costs.
( 1 ) THE appeal and the Civil Revision Pttition arise from a common judgment and order of the learned Subordinate Judge, Rajahmundry. making the award a rule of the Court and dismissing the petition filed by the appellant state for setting aside the award.
( 2 ) AN agreement was entered into between the State of Andhrapradesh and the respondent-contractor for execution of the work of constructing approaches to the rail-cum-road bridge across Godavari, at Rajahmundry. The agreement is dated 17-6-1970, and the value of the work is Rs. 70,29,925/ -. A period of 42 months was stipulated for completing the work, i. e. , on or before 21-12-1973. The respondent actually completed the work by 10-12-1974, after the period of contract was extended twice. The first letter of the contractor requesting for extension was addressed on 17-12 1973. Extension was granted upto 31-5-1974. By another letter dated 22-7-1974 the contractor requested another extension till the end of August, 1974. It was granted subject to imposition of penalty of Rs. 50/- per day, after 1-9-1974.
( 3 ) AL tcr the work was completed, disputes arose between the partieswith respect to the amount payable to the respondent. They were referred to the sole arbitration of the Superintending Engineer, R and B, Cuddapah circle, in accordance with the agreement. The arbitrator made his award on 25-3-1981. Apart from interest and costs, the respondent had preferred eight claims. The aibitrator awarded some or other amount under each claim. Claim No. 9 ielated to interest. The arbitrator awarded interest at the rate of 15% per annum from the date of award, till the date of payment. So far as costs are concerned (claim No. 10), he directed the parties to bear their own costs.
( 4 ) THE award is a non-speaking one. It does not give reasons forthe several amounts awarded under each of the claims. It reads as follows :"now, I, Sri P. Vishnu Rao, Superintending Engineer, (R and B), cuddapah Circle, Cuddapah, having taken upon myself the burden of reference and having examined and considered the statements of parties and arguments produced before me and having heard the parties, do hereby make and publish this day my award in writing of and concerning the matter referred to me. Claim No. 1 :this includes : (a) Compensation for delay in handing over site on Kovvur side involving Rs. 1,61,790. 93 towards escalation in price index and rs. 1,65,150-00 towards establishment and over-head charges. Total Rs. 3,26,940. 93. and (b) Compensation by way of reimbursement for extra expenditure incurred to an extent of rs. 14,330/- for removal and re-erection of the sheds, fencing etc. of railway contractors, Rs. 2,000;- for removal of caving in earth and forming temporary roads, and Rs. 30,000-00 towards compensation paid to owners of buildings, huts, etc. in the area and dismantling the same on Rajahmundry side. Award : 1 award the respondents shall pay to the claimants rs. 2,81,800/- (Rupees Two Lakh Eighty One Thousand Eight hundred only) towards this claim. Claim No. 2 :this includes : (a) Rs. 45,000-00 towards refund of recovery made, and (. b) Rs. 38,000-00 towards reimbursement of expenditure incurred regarding load testing. Total Rs. 83,000-00. Award:i award that the respondents shall pay to the claimants under (a) and (b), a total sum of Rs. 83,000-00 (Rupees eighty three thousand only) towards this claim. Claim No. 3 :this comprises of Rs. 22,441-00 towards cost of excavation of excess depth in foundations of Rajahmuudry. Award :i award that the respondents shall pay the claimants rs. 22,441-00 towards the claim. (Rupees twenty two thousand four hundred forty one only ). Claim No. 4:this comprises of Rs 2,000-00 being the cost of expenditure incurred for the footpath slab extension and coaxial centring. Award :i award that the respondents shall pay the claimants rs. 2,000-00 (Rupees two thousand only) towards this claim. Claim No. 5 :this comprises of Rs. 32,050-00 be
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