REPUBLIC CONSTRUCTION CO. Vs. DDA

JUDGEMENT

(1.) THE petitioner (M/s Republic Construction Company) has filed objections against the award dated 1st November 1993 passed by the learned Arbitrator adjudicating the disputes that arose between the parties in respect contract for construction of 228 three bed rooms, 152 two bed rooms, 132 servant quarters, 82 car garage and 166 scooter garages for SFS at Hauz Khas, Mehrauli Road, New Delhi and other construction work. The objections have been stated claim -wise so are being dealt as such.

(2.) CLAIM No. 1 was made by the claimant for Rs. 8 lac on account of balance payment and Claim No. 3 was made by the claimant for Rs. 15 lac on account of under payment/wrongful recoveries. Learned Arbitrator dealt with claim No. 1 and 3 together. He found that the final bill raised by the claimant was for the work done to the tune of Rs. 1,68,45,920/ - excluding deduction items. The amount already paid was Rs. 1,66,45,130/ -. The due payment thus came to Rs. 2,00,790/ -. From this amount the respondent (DDA) deducted reduction items, work done at risk and cost of contractor and recoveries for materials. While claimant contended that the bill had not been prepared correctly, the respondent per contra contended that the bill was correct. The Learned Arbitrator considered the different deductions item -wise. The first claim of deduction was for overhead tank. The claimant had demanded a rate of Rs. 764.56 per overhead tank. Respondent had sanctioned a sum of Rs. 345.28 per overhead tank. The Learned Arbitrator found that the agreement provided for construction of brick masonry tank at the terrace level. Instead of brick masonry tank, an RCC tank was built by contractor at the terrace. He observed that since the tanks had not been constructed as per specifications applicable to schedule rate, therefore, rate was to be analyzed and he assessed the reasonable rate for RCC tank at terrace including fittings at Rs. 500/ - per tank. He therefore observed that since the final payment was made at a rate of Rs. 345.28 per tank, the claimant be paid a further sum of Rs. 45,488/ -. After allowing this amount, he again held that the claimant was entitled to Rs. 59.78 per tank as fitting charge for 294 tanks. Obviously, the two observations made by the learned arbitrator are self - contradictory. The rate assessed by him at Rs. 500/ - was inclusive of fittings, as stated by him, he could not have awarded additional amount of Rs. 17,575 for fittings. He then further awarded Rs. 15 per tank for construction of the tanks on the terrace. It is surprising that on one hand, he awarded Rs. 500/ - per tank for construction of tank on the terrace and on the other hand he awarded additional amount of Rs. 15 each tank on the ground that the RCC tanks were not hoisted but were constructed on the terrace. Thus, again there was no ground for awarding this additional amount once he had awarded Rs. 500 per tank for construction of RCC tank on the terrace.

(3.) SIMILARLY , the learned Arbitrator observed that the rates for brick work for substituting item numbers 2 and 3 and flush door in substituting item No. 8 was not correctly assessed by DDA (petitioner herein) and he was assessing the correct rates. It is not understood as to wherefrom the learned arbitrator got this power. The contract between the parties specified the rates as applicable. The rates cannot be changed or varied by the learned Arbitrator himself. If there are any unjustifiable or unacceptable rates in the contract, the contractor at the time of signing the contract was at liberty to raise the issue about the rates being not proper and could have sought amendment in the contract itself. The rates, as agreed between the parties, cannot be changed by the Arbitrator and the arbitrator cannot substitute his own rates in place of rates as provided in the contract. Awarding an amount of Rs. 12, 4428.28, therefore is not tenable.