( 1 ) THESE Civil Miscellaneous Appeal and Civil Revision Petition are preferred by the Government of Andhra Pradesh against the judgment and order of the learned IV Additional Judge, City Civil Court, Hyderabad, in O. P. No. 280/1983 and O. S. No. 1543/1982. Under the said order, the learned Addl. Judge has rejected the petition filed by the Government to set aside the award made by a panel of arbitrators, and made the award a rule of the Court.

( 2 ) AN agreement was entered into between the Government and the respondent con tractor on 5-10-1978 pertaining ro earth work excavation and forming embankment of G. S. Main Canal beyond Lower Manair Dam from KM 148 to KM 149. It was a lumpsum contract. The approximate value of work to be done under the contract was estimated at Rs. 27,50,891. 05 Ps. Time for completing the work was 12 months from the date of delivery of the site. Site was delivered on 21-10-1978. A major portion of the work was completed before the expiry of twelve months, but not the entire work. The work was no doubt completed later. After completion of the work the contractor raised certain claims, which were not accepted by the Government. . Thereupon, a dispute was raised by the respondent, in terms of Cl. 73, which was referred to a panel of Arbitrators, comprising the chief Engineer (Investigation), Deputy Secretary to Government, Finance and Planning, and Director of Accounts.

( 3 ) BEFORE the arbitrators the respondent-contractor claimed a total sum of Rs. 13,96, 157/- under four heads, which we shall refer to as Claims (I) to (IV ). We shall mention the substance of each claim, and the Government s counter in that behalf:

( 4 ) CLAIM No. (1): The site was handed over to the respondent-contractor on 21-10-1978. Immediately he paid advances to the labour and transported them to the site. He provided housing accommodation and other amenities to them. Progress of the work was much ahead of the schedule. However, towards the end of June 1979 by which time 88% of the work was completed"there was a great scare that the Skylab debris would fall on or around the work area in Karimnagar District of andbra Pradesh, repeated by all Indian papers and the Government controlled All India Radio. Actually the propaganda blast about the fall out of Skylab created a great scare and all labour employed in the area including our labour ran away on 1-7-1979 for dear life". This scare not only interrupted the work, but resulted in loss of huge advances paid by the contractor to the labourers. The work had to be suspended, and could be recommenced only in October, 1979. The respondent had to bring fresh labour after paying advances to them. In this connection, the respondent suffered the following losses : (1)

Actual loss of advance money

and loss on hutting and mobilisation :

Rs. 2,92,400/

(2)

Loss due to loss of time, remobilisation

and hutting etc. ,

Rs. 2,40,000/

(3)

Loss due to idle machinery during the period which otherwise would not effect the contractor :

Rs. 45, 000/

(S)

Establishment etc.

Rs. 5,100/

Total

Rs. 5, 60,000/

( 5 ) THE Government in its counter submitted that the loss, if any, suffered by the respondent on account of the Skylab scare does not come within the purview of the agreement. The Government has nothing to do with the said scare. The respondent has to prove that the labour absconded, that they absconded with advances, and that he suffered loss on that account. The claim is liable to be rejected,

( 6 ) CLAIM No. (II) :"a further loss occurred in that it rained heavily in September and October, and when labour was recruited again to work in december, the canal was filled With water". The water had to be continually bailed out for a period of three months, on account of which the respondent incurred an expense of Rs. 20,000/ which he is entitled to be reimbursed "as this is also a cause beyond contractor s scope in the normal course".

( 7 ) THE Government s case in this behalf was that th