UNION OF INDIA Vs. PURAN CHAND DIWAN

JUDGEMENT

(1.) Puran Chand Diwan filed a petition that the award dated 24.3.1995 passed by the Arbitrator be made rule of the Court. The Senior Sub Judge vide judgment and decree dated 10.8.1998 held as under:-

(2.) Learned counsel for the petitioners has submitted that as per clause 11 (C) of the agreement executed between the parties, the contractor could not have been granted compensation qua the delay which had occurred on account of extension sought by him to complete the work. In support of his arguments, learned counsel has placed reliance on Ramnath International Construction (P) Ltd. v. Union of India, 2007 2 SCC 453 wherein it was held that the Arbitrator could not have allowed compensation/damages in view of specific provisions in the agreement i.e. Clause 11(C). There was a specific bar against the award of damages on account of delay. Hence, the Arbitrator had exceeded his jurisdiction.

(3.) Learned counsel for the respondents, on the other hand, has submitted that the Arbitrator had the power to grant compensation to the contractor on account of delay in completion of the work allotted to him. Learned counsel has submitted that in M/s. Shyama Charan Agarwala & Sons v. Union of India,1999 1 ArbLR 483 view had been taken by the Bombay High Court that in view of clause 11(C) (as in the present case ) of the contract neither party to the agreement was entitled to claim compensation or otherwise howsoever arising as a result of extensions granted under conditions (A) and (B) of Clause 11. The Apex Court in Special Leave to Appeal (civil) No. 5757/98 filed in the abovesaid case had set aside the judgment passed by the High Court and it was held that there will be a decree also in respect of claim 8 of the award.