( 1 ) THIS appeal is directed against the judgment of alearned single Judge of this court dated September 21, 1979. It was dismissed by us by means of a short order dared February 27, 1984. Now we proceed to give reasons for the said decision.

( 2 ) M/s Saraya Distillery, the contractor agreed to supply 3, 87, 666 litres of rum to the respondent-Union of India@ Rs. 2. 13 per litre vide agreement dated August 14, 1972. The stores were to be delivered in 5 instalments-90,000 litres rum by 21-9-1972, 90,000 litres rum by 21-10-1972, 90,000 litres rum by 21-11-1972 80,000 litres rum by 21-12-1972, and 37, 666 litres rum by 21-1-1973. The contractor supplied only 45,000 litres of rum out of the first lot. He failed to supply the remaining stores inspite of extension of time on his request and and thus committed a breach of the contract.

( 3 ) THE Union of India claimed a sum of Rs. 3, 35, 888. 00 as damages. Out of this amount a sum of Rs. 4005. 00 was claimed for loss suffered on account of repurchase of 16,020 litres of rum and the remaining amount as general damages. The contractor admittedly refuted this claim. In pursuant to an arbitration clause the dispute was REFERRED