STATE OF KERALA Vs. ANTONY

JUDGEMENT

(1.) THIS appeal under S. 39 of the Arbitration Act arises from the judgment of the Sub Court, Parur in O. P. (ARB.)No. 20 of 1982 and I. A. No. 1747 of 1982. The former was an application filed by the present respondent, hereinafter referred to as the 'contractor', under S. 17 of the Arbitration Act. I. A. No. 1747 of 1982 was filed by the present appellants under S. 30 of the Arbitration Act to set aside the award of the Arbitrator.

(2.) THE contractor entered into an agreement with the 2nd appellant on 12-3-1976 for construction of a bridge at Pathalam Kadavu. THE total cost of the work was Rs. 25,67,646/ -. THE period of the work was 24 months from the date of handing over the site. THE site was handed over on 19-3-1976. THE contractor did not complete the work within the stipulated period. He sought revised rates since there was stoppage of work and alteration of alignment etc. THE appellants, however, extended the term of the work till 31-5-1979 on the original terms. THE contractor proceeded with the work for some time but stopped later. THE appellants again offered to extend the period of the contract till 31-12-1979 on the original terms, but the contractor did not accept the offer. He maintained that the contract had come to an end due to the breach committed by the appellants. THE appellants thereupon terminated the contract with effect from 15-10-1979 at the risk of the contractor for costs for rearrangement of the balance work. THEy also proceeded to realise the security deposits in terms of the contract.

(3.) THE Arbitrator found that the appellants were right in terminating the contract due to breach of its terms committed by the contractor. Apparently for this reason, he also found that the contractor was not entitled to any interest.