STATE OF ANDHRA PRADESH Vs. SUBBA REDDY

JUDGEMENT

(1.) THIS Civil Miscellaneous Appeal and the Civil Revision Petition filed by the State of Andhra Pradesh and its officials of the Irrigation Department arise out of an arbitration matter. The CMA is against OP 132 of 1992 on the file of the Additional Subordinate Judge, Ongole under Section 30 of the Arbitration Act to set aside the award dated 17-9-1992 passed by the Arbitrator. The CRP is against OS No.4 of 1993 on the file of the same Court filed by the contractor/respondent under Sections 14 and 17 of the Arbitration Act to make the award dated 17-9-1992 rule of the Court. By a common judgment dated 17-1-1994, the lower Court dismissed OP No.132 of 1992 and decreed OS No.4 of 1993 making the award rule of the Court for a sum of Rs.2,73,025.00with subsequent interest at 6% per annum on Rs.1,06,390.00 from the date of decree till realisation and for costs of Rs.7,790.00.

(2.) THE State entered into an agreement with the respondent on 1-5-1983 for the construction of a vented cause-way on Inagaleru Drain. THE value of the work was estimated at Rs.1,07,057.00. THE work site was handed over to the respondent on 8-5-1983. THE time stipulated for completion of the work was six months from the date of handing over of the site i.e., 7-11-1983. THE respondent executed the work up to the end of May, 1983 by which time only 14% of the work was executed. According to the respondent, the work could not be completed within the stipulated time solely on account of the delays and defaults committed by the Department and he was not at all at fault. On 20-11-1983 the respondent notified the Department that since the agreement period was over and as there is steep increase in the prices, rates quoted in the agreement arc not workable and he should be allowed the current Standard Schedule Rates (SSR) for executing the work further. If the Department is not willing to allow the current Standard Schedule Rates, the contract should be closed without penalty. THE Department did not agree for the same and instead it invited fresh tenders. After some correspondence, the respondent moved the Court for appointment of a sole Arbitrator invoking the arbitration clause in the agreement. By an order of the Court dated 9-10-1991, a retired Chief Engineer was appointed as the sole Arbitrator to decide the claims and disputes raised by the respondent. THE Arbitrator finally passed the award dated 17-9-1992.

(3.) THE learned Government Pleader, appearing for the State has contended that the respondent is not entitled to any of the reliefs claimed by him, that the award of the Arbitrator is illegal and without jurisdiction as it is contrary to the specific terms and conditions of the agreement which expressly prohibit the grant of any compensation or interest, that the Arbitrator exceeded his powers, that most of the claims made by the respondent are imaginary and baseless and that the award is vitiated by error apparent on the face of the record.