STATE OF KERALA Vs. YOHANNAN ABRAHAM

JUDGEMENT

(1.) The appellants are the plaintiffs in a suit for realization of money.

(2.) The appeal is filed challenging the rejection of the plaint as per Order VII Rule 11(d) of the Code of Civil Procedure, 1908. The defendant -Contractor was engaged by the plaintiffs for execution of certain works under the Kallada Irrigation Project. But, the defendant abandoned the work after receiving the part bills and materials. Hence, the plaintiffs terminated the contract and initiated revenue recovery proceedings to realize the difference in the rearrangement of the work and the cost of the materials. The contract contained an arbitration clause. The revenue recovery proceedings were challenged before this Court by the Contractor and as per the judgment in W.A No. 2116 of 2000, it was ordered that the revenue recovery proceedings shall continue only after finalisation of arbitration proceedings. The State had in the meantime enacted the Kerala Revocation of Arbitration Clauses and Reopening of Awards Act, 1998 ('Act, 1998' for short) nullifying all arbitration clauses and awards in Government contracts. The validity of the Act, 1998 was challenged before this Court. This Court declared the Act, 1998 to be unconstitutional. Thereafter, the Honourable Supreme Court stayed the said order. But, subsequently, the Honourable Supreme Court upheld the judgment of this Court that the Act, 1998 is unconstitutional. The plaintiffs had filed the suit when the Honourable Supreme Court stayed the order of this Court declaring the Act,1998 as unconstitutional.

(3.) Heard the learned Special Government Pleader appearing for the appellants and the learned counsel for the respondent.