The main legal point established in the judgment is the court's interpretation of the termination of the contract under Clause 5(a) of Schedule C, the validity of termination, entitlement to compensation, and blacklisting.

1. This petition is filed against the award passed by the Arbitral Tribunal dated 3.5.2004. The petitioner herein was the respondent before the Arbitral Tribunal.

2. The petitioner herein awarded a contract to the first respondent in the matter of construction of eastern side wall of the Boat Basin of Chennai Port Trust. The work was awarded on 31.8.1994 at a ceiling price of Rs.2,57,21,122.50 and to be completed within 18 months. The petitioner herein terminated the contract under notice dated 8.9.1998 by invoking Clause 5(a) of Schedule C, ordered forfeiture of security deposit and blacklisted the first respondent for three years as well as for recovery of mobilisation advance, apart from encashing the bank guarantee. On 27.3.1999, the petitioner herein caused paper publication calling for fresh tender in respect of the unfinished work for a sum of Rs.2.49 crores. The first respondent moved this Court for an interim injunction against the petitioner calling for fresh tender as well as for a direction to the petitioner to issue the work order to the first respondent in respect of the balance of work, apart from certain monetary claims. The prayer was, however, rejected. In the meantime, the award in respect of the claim on the work done were made. The petitioner challenged the awards passed which, however, were rejected by this Court in O.P.Nos.425 of 1999 and 305 of 1999 on 31.1.2000. As against the same, the appeal filed by the petitioner in O.S.A.Nos.160 and 161 of 2000 were also rejected and the same is reported in 2004 (4) CTC 721 – THE CHIEF ENGINEER, CHENNAI PORT TRUST v. AMUDHA ENGINEERING CO., LTD. As against the termination ordered, the first respondent invoked the arbitration clause.

3. The present award now under challenge relates to a question of termination of the contract. The first respondent herein made a claim under seven heads, as regards which, the learned Arbitrator raised the following issues for its decision;-

"(1) Who committed the breach of contract of Agreement No. 14/96; Whether the claimant or the respondent?

(2) Is the order of termination of contract dated 8.9.98 valid and legal?

(3) Whether the claimant is entitled to the amounts claimed under the Heads A to E and G to J and if so, to the what amount?

(4) Whether black listing the claimant by the respondent is proper and valid? If not, whether the claimant is entitled to any compensation on the head under claim F? If so, to what amount?.

(5) Whether the earlier Award dated 24.4.99 is binding on this Tribunal?

(6) Whether the Respondent is entitled to the counter claim? If so, to what amount?

(7) To what other reliefs are the parties entitled to?"

4. The Arbitral Tribunal granted a unanimous award as regards Issues 1, 2, 3, 5 and 6. However, as regards the relief granted under Issue 4 relating to the Claim F and H, one of the members of the Tribunal rejected the plea of the first respondent.

5. On issues 1, 2 and 4 as to who committed the breach of Contract; whether the termination order passed was valid and legal and that whether black-listing of the first respondent was valid, learned Arbitral Tribunal pointed out that the contention of the petitioner that the letter between the parties showed that the first respondent had brought in technical staff to the work spot while the work was going on. While the contract itself was for 18 months, the petitioner took 17 months for approval of the changes in the drawing and the delay on the part of the petitioner was one for which the first respondent could not be held responsible. The Tribunal further pointed out to the inordinate delay of four months on the part of the petitioner in supply of the electricity connection in carrying out the work. The arbitral Tribunal pointed out that the total extent of work was 325 metres stretch. However, the same was reduced to 60 metres stretch 60 metres unilaterally on trial basis and later to 30 metres stretch. At every stage, there was hindran