Honble GODARA, J. – This appeal has been preferred under Section 39(1)(vi) of the Arbitration Act, 1940(hereinafter referred to as the Act) against the judgment and decree dated 6.5.88 passed by the learned District Judge, Pratapgarh in Claim Case No. 56/80, whereby a decree for Rs. 17,942.53 with interest at the rate of 9% per annum from 24.7.76 till the date of realization,besides a sum of Rs. 500/- as expenses for arbitration proceedings on the basis of award dated 17.11.80, has been passed.

(2). Briefly stated, the facts giving rise to the present appeal are that the respondent -Food Corporation of India (for short the Corporation)invited tenders for handling and transportation of goods of Food Storage Depot, Chanderia for a period of two years beginning from 15.3.74 to 14.3.76. The appellant (contractor) also submitted his tender and the same was accepted and the acceptance was communicated by the respondent vide his telegram dated 19/20.12.73 and thereby the appellant was further requested that the amount of security, after adjustment of Rs. 1000/- already deposited with the tender, be deposited by the bank draft with the Depot Incharge, Chanderia and the work be started.

(3). Accordingly, the appellant deposited the security amount as required above but he did not start work right from 15.3.74 and , he started work at the site on 21.3.74.However, as regards the present dispute, it is further alleged that the appellant did not carry out the contracted work of handling and transporting goods as per terms of the contract and he stopped work on 31.3.74. The appellant was required to execute contracted work as per the agreement entered into between both the parties. Since the appellan did not carry out his work after 31.3.74 and hence the respondent terminated the contract forthwith and, thereafter, fresh tenders were invited and the work of handling and transportation of the goods was carried out through the new contractor.As per the terms of the contract, the appellant was responsible for the losses incurred by the respondent-Corporation for the work got done for the unexpired period of the contract at the risk and costs of the contractor and, therefore, the respondent, as per the terms of the contract, was entitled to claim amount of loss and damages because of the breach of cont- ract so committed by the appellant. This amount was worked out to Rs. 23336. 11 and, the respondent vide its letter dated 8.12.76 informed the appellant that the above amount along with interest thereon, at the rate of Rs. 9% be paid to the Corporation but the contractor did not oblige nor did he convey his consent or agreement for referring this dispute relating to the agreement so entered into in terms of clause(xix) of the agreement and, lastly, the respondent had to file an application under Section 20 of the Act in the court of District Judge, Pratapgarh camp Chittorgarh. The same was contested by the appellant, inter alia, pleading that the contractor was called by the Incharge of Chanderia Depot and, after accepting bank draft of Rs. 2000/-, as above, he took the contracted wor k for the period 21.3.74 to 31.5.74 and thereafter the Incharge of the Depost misbehaved with the employees of the contractor and, lastly,they were driven out from there and they were not allowed to work any more.

(4). So, the main defence of the present appellant (contractor) has been that the labour was not allowed to carry out the contracted work and he was ready and willing to carry out the contracted work from the very beginning but it was the officer-in-charge of the Food Storage Depot, Chanderia, who did not allow the labour of the Contractor to carry out the work.The Contractor claimed that he was entitled to get a sum of Rs. 5000/- for the work executed,admittedly, for the period 21.3.74 to 31.5.74.

(5). The vires of Section 20 of the Act under which the aforesaid application was filed, was also challenged.

(6). After hearing both the parties, the learned Distr

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