The main legal point established in the judgment is the interpretation of contract clauses, the applicability of statutory provisions such as Section 7-B of M.P. Madhyastham Adhikaran Adhiniyam 1983, and the entitlement to compensation under Section 70 of the Indian Contract Act.

JUDGMENT :

VIVEK AGARWAL, J.

1. State of Madhya Pradesh through its instrumentalities has filed this Arbitration Revision being aggrieved by award dated 26.11.2008 passed in Reference Case No. 6/2008 by M.P. Arbitration Tribunal, Vindhyachal Bhawan, Bhopal, in the Case of M/s. S.E.W. Construction Ltd. vs. State of M.P. (Water Resources Department), whereby on the ground of expenditure incurred by the respondent in bringing sand from Mahuar river as per the terms and conditions of sanction granted by the Superintending Engineer in terms of the provisions contained in clause 3.11(A), Reference Case has been allowed and Arbitration Tribunal has directed to pay such difference amount on account of cost incurred by the contractor in bringing sand for the purpose of construction from a distant lead alongwith interest at the rate of 9% from the date of filing of the reference petition.

2. Learned counsel for the State submits that State had issued tender Notice No. 1/1992-93 for the construction of Masonry Dam from RD 80M to 543M of Madikhed Dam. The tender of the respondent/contractor was accepted on 6.11.1993 for an amount of Rs. 1,22,81,86,600/-. Thereafter a contract was entered into between the parties and as per Para 4.3.29.2 of the agreement for any kind of dispute, the respondent was to first approach petitioner No. 3 and in terms of such clause respondent/Contractor submitted an application dated 10.11.2006 raising claims for extra payment and same was rejected vide memo dated 14.12.2006. It is submitted that though the limitation for preferring his claim was 28 days as per the agreement, but the respondent approached the Tribunal on 10.12.2007, thus, the entire claim of the contractor is time barred.

3. It is also submitted by learned counsel for the State that whole controversy hinges on interpretation of clause 3.11(A) which reads as under:-

“3.11(A) The quoted rates of the contractor shall be inclusive of the leads and lifts and in no case separate payment for leads or lifts to any materials including water shall be payable. Similarly no leads or lifts for the materials issued by the department as prescribed in the tender documents shall be payable. The contractor shall bring approved quality of materials. Different quarries are shown in Annexure-C. The details shown in the Annexure-C are only as a guide to the contractor but the contractor before tendering should satisfy himself regarding the quantity and quality available and all other details of Annexure-C and provide for any variation in respect of leads, lifts, place and method of quarrying, type of rocks to be quarried and all such other aspects in his tendered rate. Later on any claim whatsoever shall not entertained except where any quarry is changed for circumstance beyond the control of contract under the written order of Superintending Engineer in-charge of work.”

4. Thus, placing reliance on clause 3.11(A) of the agreement, it is submitted that the details of different quarries are shown in Annexure-C which are to be used only as a guide. The claimant/contractor had entered into contract with open eyes after satisfying himself and had accepted the quarry. Therefore, plea of the contractor in his reference petition that as lot of water had flown through the Nala in past rainy season eroding the sand quarries necessitating the contractor to approach the competent authority in terms of the clause 3.11(A) with a request to transport sand from Mahuar river quarry (Chandrapetha) and demanding extra expenditure incurred in extra lead in transportation of sand could not have been permitted by the Arbitration Tribunal. It is submitted that learned Tribunal erred in shifting the entire burden on the State for such extra lead having failed to appreciate the fact that principle of pari materia is attracted because the terms and conditions of the contract agreement and othe