Short Note The petitioner has filed the revision aggrieved by the Award of Rs. 21,822/- passed by Madhya Pradesh Arbitration Tribunal, Bhopal in Reference Case No. 80 of 1998. The respondent No. 1 filed a dispute before the Arbitration Tribunal, claiming a total sum of Rs. 95,106/- on various counts alongwith interest at the rate of 18% per annum. Respondent's tender for the work of construction of Class Rooms at P.T.S. Pachmarhi was accepted by M.P. Police Housing Corporation Limited. An agreement was executed on 19.5.95 and the work order was issued. Estimated cost of work as per Tender was Rs. 2,84,000/- and contract price of the accepted tender was Rs. 3,38,386/-. Time allowed was six months from the date of the work order. Earnest Money Rs.3,000/- was deposited. The final bill was settled on 19.2.97. The security deposit of Rs. 11,193/- deducted from the running bills was refunded to the petitioner. The case of the respondent No.1 was that due to defaults and breaches of the respondent No.3, the respondent remained tied up with the work upto 30.3.96. The payment of final bill was also delayed and Rs. 16,000/- were arbitrarily deducted from the running bills by way of penalty and this amount was not refunded. Respondent No.1 claimed a sum of Rs. 95,106/-. On account of delayed payment of final bill, interest from 1.7.96 to the date of payment calculated at Rs. 2,679/- was claimed. Interest on delayed refund of Security Deposit, calculated at Rs. 1,025/- was also claimed, and the refund of Rs. 16,000/- which were arbitrarily deducted from the running bills and final bill was also claimed, alongwith interest. Several other items were also put forth which have been disallowed by the Tribunal. The Tribunal has allowed part of the interest claimed by the respondent No.1. On delayed payment of Security Deposit, out of the amount claimed i.e. Rs. 1,025/-, a sum of Rs. 287/- has been awarded, as the refund of Security Deposit was belatedly made to the respondent and security amount was withheld for no valid reasons for quite sometime. On account of delayed payment of final bill, a sum of Rs. 2,679/- as interest has been awarded on the amount of the final bill of Rs. 34,985/-, on the basis that the work was completed on 30.3.96 and the amount of the final bill was paid on 19.2.97. On account of delayed payment of final bill, a sum of Rs. 2,679/- as interest has been awarded on the amount of the final bill of Rs. 34,985/-, on the basis that the work was completed on 30.3.96 and the amount of the final bill was paid on 19.2.97. Interest from 1.7.96 to 18.2.97 has been awarded i.e. for the period after three months of the completion of the work. An amount of Rs. 16,000/- alongwith interest has been ordered to be paid as this amount was deducted by way of penalty on the ground that a sum of Rs. 1,500/- was deducted as extra deposit for delay; an amount of Rs. 3,000/- was deducted as extra deposit, without specifying as to for what purpose this amount of Rs. 3,000/- has been deducted for extra deposit. Further from the final bill a sum of Rs. 14,747/- was deducted as extra deposit. Out of this amount, an amount of Rs. 3,247/- was for roof and Rs. 11,500/- was for time extension. These facts have been culled out by the Tribunal from the Measurement Book. Before imposing these penalties, the Tribunal has found that no adjudication was made by the Managing Director for levy of compensation under Clause 2 of the agreement and the penalty order involves civil consequences and should not have been passed in a mechanical manner. A reasoned order should have been passed in accordance with the principles of natural justice and no justification was put forth before the Tribunal for deducting the amount on account of the penalty. Hence, the payment of the amount of Rs. 16,000/- illegally deducted by way of penalty, has been ordered by the Tribunal alongwith interest of Rs. 2,856/- thereon. In the revision, the learned counsel for the petitioner has urged that penalty provision could be invoked in view of Clause 2 of the Agreement. The reasons adopted by the Tribunal appear to be sound that for invoking penalty provision, there should be a reasoned order and there should be adequate notice before invoking the penalty provision. No reasoned order was passed and the amount was deducted in a mechanical manner, without affording proper opportunity of hearing to the respondent. Before invoking the penalty provision, it was necessary for the petitioner to settle and finally adjudicate upon the matter, which was not done even after about a year, without any justifiable cause. No reasoned order was passed and the amount was deducted in a mechanical manner, without affording proper opportunity of hearing to the respondent. Before invoking the penalty provision, it was necessary for the petitioner to settle and finally adjudicate upon the matter, which was not done even after about a year, without any justifiable cause. Thus, the amount of interest awarded on account of delayed payment of final hill does not call for any interference. Similarly, amount of Rs. 287/- awarded on account of delayed refund of Security Deposit is also just and proper. Thus, the decision of the Tribunal calls for no interference. We find no merit in the revision. The same is dismissed in limine.