I.P. MUKERJI, J.

BACKGROUND

This is an application challenging an award made on 31st January, 2005 by a retired Judge of this court. The learned Arbitrator was appointed by the Chief Justice of this Court on 6th December, 2001 to adjudicate the disputes between the parties arising out of their contract dated 20th January, 1995. As many as 70 sittings were held. Pleadings were filed. Documents were disclosed and produced. There was examination and cross-examination of witnesses. Thereafter, the award was made and published. Union of India is aggrieved by this award.

The contract between the parties was that the respondent was to construct two types of residential quarters. One type was described as Type I. Sixty four of them had to be constructed. The other was described as Type III. Eight of them had to be constructed. The total amount payable under the contract was Rs.1,81,33,584/-. Work was done to the extent that Rs.1,77,84,140/- could be claimed. Such amount was claimed by the Respondent Contractor and paid by the petitioner. The percentage of the total consideration or value of work which was not done was only 1.98%. According to the contract the work was to be completed on 3rd November, 1996. It was completed about 11 months later on 7th October, 1997. The usual claims that are made in a works contract were made before the learned Arbitrator for about Rs.25 lacs. The award is for Rs.22.95 lacs. The learned Senior Counsel for the petitioner showed exceptional fairness, which is seldom seen in counsel nowadays, in restricting his challenge to the award, to those made in claim Nos. 2, 6, 8 and 9. The others were not challenged because he was satisfied and in all probability he satisfied his client that there was no point challenging them as they were legally sound and tenable. This kind of advocacy is very beneficial for our legal system because it shows the integrity of the counsel and also cuts down the time of the court to hear a matter. It also has a cost saving result.

Case of the respondent:

The time period for completion of the work was twenty one months. The start date was to be reckoned as the fifteenth day from the date of formation of the contract. As the contract was entered into on 20th January, 1995, the start date was 4th February, 1995. It was to be completed on 3rd November, 1996. It was completed on 7th October, 1997. The Respondent Contractor had offered a rebate on their bills provided they were paid within time. They were not so paid, due to the fault of the petitioner. That is why they were entitled to payment of all the rebate given. The petitioner was in breach of their obligations under the contract, to supply working drawings and to make some decisions required to be made regarding execution of the work. 181 days were lost for non-availability of structural details for the roof slab of the type ‘I’ building consisting of 64 quarters. Furthermore, the petitioner took inordinate time up to 13th December, 1995 in finalizing the plan for steel windows with grill work. There was also substantial delay in finalizing the plan of the water supply line and for furnishing the details of the flooring. Furthermore, a substantial amount of extra work, beyond the contract was done by the Respondent Contractor. As a result of such breach on the part of the petitioner the performance of the contract got substantially delayed. The Respondent Contractor was obliged to keep their men, materials and establishment on the site for a substantially longer period than required under the contract, thereby incurring significantly higher expenses to perform the contract. Hence, they were entitled to reimbursement of those expenses.

The respondent claimant made their claims under 10 heads, the last being interest, in the following manner:

“Claim No. 1 : (a) Claim for refund of conditional rebates wrongfully realized from running account bills …… Rs.54,570.53

(b) Amount of conditional rebate wrongfully realised fr