J U D G M E N T

R. BANUMATHI, J.

These appeals have been filed against the impugned judgment dated 28.01.2009 in W.P.(C) No.31108 of 2007 and order dated 23.06.2009 in R.P.No.542 of 2009, passed by the High Court of Kerala at Ernakulum in and by which the High Court directed the appellant- Kerala State Electricity Board (KSEB) to pay an amount of Rs.12,92,29,378/- with simple interest at the rate of 9% per annum in the dispute arising out of a contract between the appellant-Board and the respondent-Contractor.

2. The dispute between the appellant-Board and the respondent- contractor had a chequered history. Brief facts which led to filing of these appeals are as follows:- Appellant-Kerala State Electricity Board (KSEB) entered into an agreement on 16.09.1981 with respondent- contractor for construction of a composite dam across Karamanthodu at Padinjarethara in connection with Banasura Sagar Scheme (Kuttiyadi Augmentation Scheme). After commencement of work, Government of Kerala issued a notification dated 30.03.1983, by which minimum wages payable to certain categories of workers employed in works mentioned in notification was revised with effect from 01.04.1983. The respondent- contractor claimed labour escalation charges from 01.04.1983 to December, 1984. The Government of Kerala referred the matter to the industrial tribunal for adjudication of the dispute with regard to the claim of workmen employed for the construction of dam for the wage rates and other benefits fixed in the Minimum Wages Notification issued by the State Government. The industrial tribunal passed the award dated 14.10.1993 holding that the notification of Government of Kerala was applicable to workmen employed by the respondent-contractor.

3. Respondent-contractor filed O.P.No.283 of 1995 claiming an amount of Rs.6,32,84,050/- towards labour escalation charges and an amount of Rs.7,66,35,927/- being interest at the rate of 18% per annum payable under Ex.P20 in respect of various bills issued by the respondent-contractor for the period 15.01.1985 to 31.10.1994. When the said writ was pending, the appellant-Board terminated the contract with respondent-contractor, which again came to be challenged before the High Court by filing O.P.No.10759 of 1997 against termination of contract and for the payment of works done (Ex.P59) by respondent- contractor. The High Court disposed of both the petitions by a common judgment dated 02.04.1998 holding that the termination of contract was arbitrary and directed the appellant-Board to pay the amount claimed by the respondent-contractor for payment of labour escalation as per Ex.P20 with interest at the rate of 18% per annum which the contractor claimed separately. The High Court also directed the appellant-Board to pay the amount claimed by the respondent-contractor under Ex.P59 towards additional work done by the respondent-contractor.

4. Being aggrieved, KSEB approached this Court by way of appeal in C.A.No.4092 of 2000 reported in Kerala State Electricity Board and Another v. Kurien E. Kalathil and Others, (2000) 6 SCC 293. In para (11) of the judgment, this Court observed that the contract between the parties is in the realm of private law and not a statutory contract and the matter could not have been agitated in the writ petition. However, having regard to the fact that the contract was of the year 1981 and that the notification for minimum wages was issued in 1983 and in the peculiar facts and circumstances, this Court did not interfere with the order of the High Court directing the payment of amount to the respondent-contractor as per Ex.P20; but reduced the rate of interest claimed under Ex.P20 from 18% per annum to 9% per annum. So far as Ex.P59 is concerned, there was no direction by this Court. Review petition filed by the appellant-Board came to be dismissed by this Court vide order dated 07.12.2000. Appellant-Board has so far paid an amount of Rs.12,82,96,320/- under Ex.P20 which was accepted by the respond