B G SHIRKE CONSTRUCTION TECHNOLOGY LTD Vs. NATIONAL INSTITUTE OF MENTAL HEALTH AND NEURO SCIENCES

JUDGEMENT

(1.) THE appellant is questioning the concurrent findings of the arbitral Tribunal/sole arbitrator respondent No.3 in this appeal which has been confirmed by the VI Additional City Civil Judge, Bangalore, in Arbitration suit 42/2005 dated 5th September, 2008.

(2.) HEARD the learned counsel appearing for the parties. This is an appeal filed under Section 37(1) of the Arbitration and Conciliation Act, 1996.

(3.) THE facts leading to this appeal are as hereunder: - The appellant is a contractor. He is in the field of construction work for a period of 50 years. Construction of Conference Complex consisting of 3 auditoriums having 800, 250, and 150 seating capacity along with an exhibition hall, dining hall and other associated facilities were entrusted to the appellant by the 1st respondent pursuance to the acceptance of the tender. The work order was issued on 3 -1 -2001. As per the tender it is an item rate contract. The said agreement was executed on 24 -1 -2001. The time stipulated for completion of the work was 18 months. The first respondent being a public sector undertaking was supervising the work and to the satisfaction of respondent No.1, the appellant constructed the building. During the course of the commencement of the work the appellant found a massive volume of hard rock on the surface. The additional expenses and the time consumed in extracting the massive volume of hard rock was not included in the quantum of the work while entering into an agreement which resulted in the escalation of the rate from 8.91 to Crores to 12.54 Crores. Consequently the time to complete the work was extended from 18 months to 20 months. On account of overwhelming of cost and due to execution of extra items the work as directed by the respondent from time to time the appellant was entitled for escalation rates. Therefore invoking the Arbitration Clause the sole arbitrator was appointed to consider the claim of the appellant. The respondent also filed counter claim and sought for a set off. The set off was in regard to Item No.1 made by the appellant in claim No.1 in regard to the extra work carried out in excess of item rate. According to the appellant, the appellant was entitled for extra rate of work of plus or minus of 20% of Item rate. In regard to claim no.1 the appellant made a claim of Rs.1,31,48,247/ - with regard to the said item. The respondent contending that the excess payment has been made claimed set off to an extent of Rs.12,77,018/ - and in addition to that the respondent also filed a counter claim. After recording the evidence the award was passed allowing the claim of the appellant inpart and so also allowing the counter claim of the respondent in -part.