Case: M/S. Asian Techs Ltd Vs. Union Of India

alterations or additions (other than those authorised to be executed by day work or for an agreed sum) have been covered up by the Contractor without his having given notice of his intention to do so, the Engineer-in-Charge shall be entitled to appraise the value thereof and in the event of any dispute the decision of the G.E. Thereon shall be final and binding." 12. In the present case it is apparent that the delay in the execution of the contract was solely due to the default of the respondents. In this connection we may refer to the following facts. (1) The Assistant Garrison Engineer sent letter dated 21.06.1988 admitting suspension of works of beams and of main roof slab building, due to non-finalization of design. (2) The user of the building i.e. NPOL directed stoppage of many items of work pending their final decisions on them by letter dated 17.09.1988. (3) On 26.9.1987 the appellant notified the respondents about the idling due to non-finalization of various structural particulars, and demanded compensation. The appellant again sent notice dated 9.2.1988 intimating the respondent about idling at the site and losses due to non-finalization of designs and particulars. The Assistant Garrison Engineer sent a letter on 21.6.1988 admitting suspension of works of beams and of main roof slab building due to non-finalization of design. (4) On 17.9.1988 the user of the building i.e. NPOL directed stoppage of many items of works pending their final decision on them. Also, by letter dated 26.9.1988 respondent No. 3 directed stoppage of construction of many items of work pending their final decision on structural particulars. (5) On 10.11.1988 respondent No. 3 intimated unconditional grant of extension of time from 8.9.1988 to 31.1.1989 by respondent No. 2. (6) The appellant by letter dated 24.11.1988 requested respondent Nos. 2 & 3 to settle accounts of the value of the works already carried out, to make payment in terms of the agreement and to close the agreement due to continued suspension of works and increased cost of construction due to efflux of time so as t arrange the remaining works through separate work orders. (7) The Assistant Garrison Engineer of respondent No. 3 sent a letter dated 11.10.1989 assuring the petitioner to settle rates across the table and directed to carry out such items, agreeing to take up objections as to rates, for settlement by the appropriate authority. (8) Respondent No. 3 on 23.11.1990 wrote to the appellant directing it to forward paid vouchers for items to take up the objections as to rates before the respondent No. 2, who was the Accepting Officer. (9) The last bill amount of Rs. 7,87,143/- was paid by respondent No. 3 which was received by the appellant under protest. (10) The appellant issued demand notice for payment of Rs. 1,24,58,108/- being the unpaid amount allegedly due and payable to it. All the above facts show the repeated defaults by the respondents due to which the contract could not be completed in time. 13. The letter dated 24.11.1988 makes it clear that the appellant was not ready to carry out the work beyond the contracted period otherwise than on separate work orders, and the subsequent correspondence like the letter dated 11.10.1989 makes it clear that it was on the specific assurance given by the respondent to the appellant to continue the work and that the rates would be decided across the table that the appellant went ahead with the work. Hence, in our opinion it is now not open to the respondent to contend that no claim for further amount can be made due to clause 11(C) and that the arbitrator would have no jurisdiction to award the same. 14. Clause 62(G) read with clause 7 make it clear that the finality provided under clause 62(G) applies only to cases of deviation and not in a case when there is a material alteration and addition in the work done, as is clear from the correspondence between the parties in the present case. 15. Moreover, Regulation 439 of the MES Regulations 1968 fixes the pecuniary jurisdiction of the CWE at Rs. 20,000/- only. It is evident that the CWE has no jurisdiction to decide the dispute where the valuation is above Rs. 20,000/-, as in the present case. The finality of the decision of the CWE applies only where the dispute is not exceeding Rs. 20,000/-. Hence, in our opinion, the arbitrator was within his jurisdiction to decide the matter in question. 16. It is well-settled that in the case of non-speaking awards under the Arbitration Act, 1940 the Court has very little scope of interference vide State of Rajasthan vs. Nav Bharat Construction Co. (2006) 1 SCC 86 , Raipur Development Authority vs. Chokhamal Constructions (1989) 2 SCC 721 , Arosan Enterprises Ltd. vs. Union of India (1999) 9 SCC 449 , Ispat Engineering vs. Steel Authority of India (2001) 6 SCC 347 , D.D. Sharma vs. Union of India (2004) 5 SCC 325 . 17. It has been held by this Court in National Insurance Company Ltd. vs. Boghara Polyfab Pvt. Ltd. (2009) 1 SCC 267 that even in the case of issuance of full and final discharge/settlement voucher/no-dues certificate the arbitrator or Court can go into the question whether the liability has been satisfied or not. This decision has followed the view taken in Chairman and Managing Director, NTPD Ltd. vs. Reshmi Constructions, Builders and Contractors (2004) 2 SCC 663 (vide paragraphs 27 and 28). 18. Apart from the above, it has been held by this Court in Board of Trustees, Port of Calcutta vs. Engineers-De-Space-Age (1996) 1 SCC 516 , that a clause like clause 11 only prohibits the department from entertaining the claim, but it did not prohibit the arbitrator from entertaining it. This view has been followed by another Bench of this Court in Bharat Drilling & treatment Pvt. Ltd. vs. State of Jharkhand & others in Civil Appeal No. 10216 of 2003 decided on 20th August, 2009.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]13. The letter dated 24.11.1988 makes it clear that the appellant was not ready to carry out the work beyond the contracted period otherwise than on separate work orders, and the subsequent correspondence like the letter dated 11.10.1989 makes it clear that it was on the specific assurance given by the respondent to the appellant to continue the work and that the rates would be decided across the table that the appellant went ahead with the work. Hence, in our opinion it is now not open to the respondent to contend that no claim for further amount can be made due to clause 11(C) and that the arbitrator would have no jurisdiction to award the same14. Clause 62(G) read with clause 7 make it clear that the finality provided under clause 62(G) applies only to cases of deviation and not in a case when there is a material alteration and addition in the work done, as is clear from the correspondence between the parties in the present case15. Moreover, Regulation 439 of the MES Regulations 1968 fixes the pecuniary jurisdiction of the CWE at Rs. 20,000/only. It is evident that the CWE has no jurisdiction to decide the dispute where the valuation is above Rs., as in the present case. The finality of the decision of the CWE applies only where the dispute is not exceeding Rs.. Hence, in our opinion, the arbitrator was within his jurisdiction to decide the matter in question16. It isd that in the case ofg awards under the Arbitration Act, 1940 the Court has very little scope of interference vide State of Rajasthan vs. Nav Bharat Construction Co. (2006) 1 SCC 86 , Raipur Development Authority vs. Chokhamal Constructions (1989) 2 SCC 721 , Arosan Enterprises Ltd. vs. Union of India (1999) 9 SCC 449 , Ispat Engineering vs. Steel Authority of India (2001) 6 SCC 347 , D.D. Sharma vs. Union of India (2004) 5 SCC 325 17. It has been held by this Court in National Insurance Company Ltd. vs. Boghara Polyfab Pvt. Ltd. (2009) 1 SCC 267  that even in the case of issuance of full and final discharge/settlements certificate the arbitrator or Court can go into the question whether the liability has been satisfied or not. This decision has followed the view taken in Chairman and Managing Director, NTPD Ltd. vs. Reshmi Constructions, Builders and Contractors (2004) 2 SCC 663 (vide paragraphs 27 and 28)18. Apart from the above, it has been held by this Court in Board of Trustees, Port of Calcutta vs.e (1996) 1 SCC 516 , that a clause like clause 11 only prohibits the department from entertaining the claim, but it did not prohibit the arbitrator from entertaining it. This view has been followed by another Bench of this Court in Bharat Drilling & treatment Pvt. Ltd. vs. State of Jharkhand & others in Civil Appeal No. 10216 of 2003 decided on 20th August, 2009.