AVADH BEHARI ROHATGI, J (ORAL ).

( 1 ) THIS is an award on a building contract. The Union of India objects to the award.

( 2 ) THE petitioner M/s. Rawla Construction Company, is a firm of contractors (the contractor ). By a contract in writing they were awarded by the Union of India work of making provision of accommodation for certain units of the mlitary at Meerut. Disputes arose between the parties. There was an arbitration clause in the contract. The matters in dispute were referred to the sole arbitration of Col. S. S. Virdi, Additional Chief Engineer. He took upon himself the burden of the reference. He heard the parties and examined the evidence produced before him. On 31st July, 1979 he made and published the award.

( 3 ) THERE were a number of claims of the contractor against the Union of India. The Union of India in their turn had certain claims of their own against the contractor. The arbitrator made his award on all of them. Mrs. Rao on behalf of the Union of India has confined her objections to the following three claims of the contractor. The first claim and arbitrator s decision thereon is in these words :

"claim of Rs. 2. 73,000. 00 revised to Rs. 10,05,000. 00 due to the increase in the cost of construction mate- rial in respect of works carried out after 14th July, 1973, the date of completion stipulated in the contract, due to prolongation of the period of the contract. The claim is partly justified. The respondent shall pay to the claimant a sum of Rs. 2,46,217. 03 (Rupees two lakhs forty six thousand two hundred seventeen and paise three only ). "the second claim of the contractor and the award thereon is this:

"claim of Rs. 4,63,944. 00 on account of expenditure on overheads and establishment, due to prolongation of the period of the contract. The claim is party justified. The respondent shall pay to the claimant a sum of Rs. 3,11,958 (Rupees three lakhs eleven thousand nine hundred fifty eight only ). "the third claim was regarding increase in wagas. This is the claim and the decision on it :

"claim of Rs. 3,90,657. 80 on account of increased wages paid to the labour due to a notification of the Central Government. The claim has been partly established. The respondent shall pay to the claimant a sum: of Rs. 2,13,771. 82 (Rupees two lakhs thirteen thousand seven hundred seventy one and paise eighty two only ). "i will take up the last claim first because it can be shortly disposed of on a reading of clause 58 of the Conditions of Contract on which counsel for Union of India relies. Clause 58 says:

"the contractor shall pay not less thin the fair wage as defined below or the minimum wage fixed under the Minimum Wages Act whichever is higher to labourers engaged by him on the work. fair Wage means wage whether for time or piecework notified at the time of inviting tenders for the work and where such wages. have not been so notified, the wages prescribed by the. Chief Engineer for the stations at which the work is dene. "the rest of the clause is not material for our purpose. In my opinion this clause only means that the contractor shall not pay to the labour anything less than the fair wage as defined in the clause or the minimum wage fixed under the Minimum Wages Act, whichever is higher. But it does not prohibit him from paying increased wages according to the notification of the Central Government. In fact, he is obliged to do so because the notification of the Central Government says to the contract : "you shall pay increased wages as notified by as. " If there is increase in wages by reason of the notification issued by the Central Government and the labour is actually paid increased wages by the contractor, I do not see why the contractor should not be entitled to claim the increase from the government. The government itself has increased the wages. They are bound to pay to the contractor the increase in wages. In my opinion the arbitrator was right in allowing the claim to the extent he thought it to

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