H. K. BOSE, C. J.

( 1 ) THIS is an appeal from an order of A. N. Ray, J. dismissing an application for setting aside an award. The appellant is a company incorporated under the Indian Companies Act, 1913 and carries on inter alia the business of building and construction at 6 Hasting Street, Calcutta. The appellant entered into a contract in writing, dated the 30th December, 1954 with the President of India represented by the Acting Chief Engineer, Eastern Command, for construction of a Canteen-cum-Rest Room for the Gun and Shell Factory at Cossipore for a lump sum of Rs. 2,11,827 in accordance with the terms, conditions and specifications set out in the documents constituting the contract The work to he done under the contract consisted of dismantling or demolishing the existing structure and construction of Canteen-cum-Rest Room building complete with sanitary fittings, fixtures, etc. The time for completion of the entire work was twelve months from the date of handing over of the site and the contract also contained clauses for deviations or alterations in the work and also for suspension of execution of the work during its progress. There was also a clause providing for compensation for delay in completion of the work. This is numbered as Clause (50) of the contract and provides that if the contractor fails to complete the work and clear the site on or before the date of completion, he shall without prejudice to any other right or remedy of Government on account of such breach be liable to pay as compensation an amount equal to one per cent of the contract sum for every week that the whole of the work remains uncompleted but the total amount of compensation shall not exceed ten per cent of the contract sum and the amount found due on account of such compensation may be adjusted or set off against any sum payable to the contractor under the contract. There is also a clause in the contract providing for cancellation for contractor's default. This is clause 54. There is a clause for arbitration being Clause 69. Pursuant to this contract the appellant received a Works Order, dated 31st January, J935 and under it the date of completion of the work was stated to be 30th January, 1950. But it appears that it was discovered shortly after this Works Order was given, that the site chosen by the Military Engineering Service (described hereinafter as M. K. S.) for the Canteen-cum-Rest Room interfered with the drainage of other existing structures in the vicinity and/or with drains already constructed. As a result of this faulty designing and planning of the part of the M. K. S. the latter had to direct suspension of the work and such suspension was made on 30th April, 1955. On 29th February, 1956 the appellant ultimately received written instructions that the original site was to be shifted 6'--9" to the North and 5'--7 1/2" to the East and the actual site was thus made over to the appellant on the 29th February, 1956. Thereafter for certain other reasons the progress of the work under the contract had to be suspended from time to lime, with the. result that the completion of the work was considerably delayed and the appellant was constrained to ask for increase of the rates and negotiation of fresh rates for execution of the work, but on 9th May 1957 the M. E. S. cancelled the contract on the. ground that the appellant had been guilty of default. Thereafter certain joint measurement was made in respect of the work executed by the appellant and for the unexecuted portion of the work a contract was entered into with another company known as Prakash Chandra (Private) Ltd. Thereafter the appellant required the respondent to appoint an Arbitrator in accordance with the terms of the contract and to refer the disputes between the appellant and the respondent for arbitration and on the 4th June 1958 the Engineer-in-Chief, Army Head Quarters, New Delhi, appointed M. L. Rahaja, Superintending Engineer as sole Arbitrator. In the meantime the a

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