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2011 DIGILAW 248 (MP)

State of M. P. v. R. R. Agarawal

2011-02-22

A.M.NAIK, SHANTANU KEMKAR

body2011
ORDER Naik, J. -- L This is a revision petition under section 19 of the M.P. Madhyastham Adhikaran Adhiniyam, 1983 against the award dated 9.12.1993 passed in Reference Case No. 95/1989 by the Madhya Pradesh Arbitration Tribunal, Bhopal. 2. Briefly stated relevant facts are that the respondent is a contractor with Department of Water Resources, Madhya Pradesh registered as A Class-III Contractor. His tender of construction of temporary residential building and permanent rest house at Phata was accepted. Necessary agreement was executed between the parties. Work was to be completed within eight months, excluding rainy season. Period for completion of work was extended. Payment was made after preparation and finalization of the final bill to the respondent. Thereafter, reference was made by respondent to Madhya Pradesh Arbitration Tribunal, Bhopal, claiming escalation. Respondent also made an additional claim on the ground of revised rates for extra items. This was opposed by the revisionist on the ground that the revised rates in respect of extra items would be applicable only to the quantity in excess of 30% over the tendered quantity. 3. The Madhya Pradesh Arbitration Tribunal Bhopal vide its award dated 9th December, 1993 held that the respondent is not entitled to the claim to the tune of Rs. 77,167.60/- on the basis of escalation. It is noteworthy that cross-objection or cross-revision has not been preferred by the respondent in respect of the amount claimed on the basis of escalation. Thus, the same attained finality. 4. As regard the claim for difference of rates of extra items, under Clause 31 and 32 of the agreement, it may be seen that the respondent has claimed in all Rs. 82,243,171- which has been awarded vide paragraph 8.20 of the impugned award. Clauses 31 and 32 are reproduced below :- "CLAUSE 31 SCHEDULE OF QUANTITIES "Variation in the quantities of work in Schedule...............shall not vitiable the contract. The rates quoted for the individual items shall apply for the quantities of work increased or decreased by note more than thirty percent for each of the items. Should the quantities of work actually involved under any item vary by more than thirty percent, the rate for such item of work shall be revised in accordance with the procedure indicated under clause "EXTRA ITEM". The payment for the items will however, continue to be made at the original rate till the revised rate is decided. Should the quantities of work actually involved under any item vary by more than thirty percent, the rate for such item of work shall be revised in accordance with the procedure indicated under clause "EXTRA ITEM". The payment for the items will however, continue to be made at the original rate till the revised rate is decided. CLAUSE 32-EXTRA ITEMS - Extra items of work shall not vitiate the contract. The contractor shall be bound to execute extra items of work as directed by the E.E. The rates for extra items are to be mutually agreed." The Arbitration Tribunal has considered Government Circular dated 10.5.1985 (Ex. D/2), which is to be following effect :- "SCHEDULE OF QUANTITIES" Variation in the quantities of work in schedule 'K' shall not vitiate the contract. The rates quoted for the individual items shall apply for the quantities of work increased or decreased by not more than thirty percent for each of the items should the quantities of work actually involved under any items vary by more than thirty percent, the rate for such item of work shall be revised in accordance with the procedures indicated under clause "EXTRA ITEMS". The payment for the items will, however, continue to be made at the original rate till the revised rate is decided." 5. The Tribunal did not accept the applicability of the said circular in the present case on account of it being unilateral. A bi-party document contained in Ex. D/3 dated 18.5.1987 has been considered by the Tribunal in paragraph 8.7 of the impugned award. Without adverting to its true implication (which is at page 85 of the paper book). Under the head of subject, it has been clearly mentioned as claim case of M/s. R.R. Agrawal, contractor for the construction of building and permanent Rest House at Phata, agreement No. 1/85-86. This document has been admitted by the petitioner. It clearly mentions that the respondent has agreed and accepted the rates sanctioned by the office as signed on the note-sheet of the case. Ex. D/3 further contains approval of rates for extra items and rates for quantities exceeding by 30%. Thus, revised rates for extra items were approved and accepted by the respondent for quantities exceeding by 30%. There is no whisper in record that the respondent has ever objected to Ex. D/3 or had ever made protest against it. Ex. D/3 further contains approval of rates for extra items and rates for quantities exceeding by 30%. Thus, revised rates for extra items were approved and accepted by the respondent for quantities exceeding by 30%. There is no whisper in record that the respondent has ever objected to Ex. D/3 or had ever made protest against it. This being so, the same is clearly binding on the respondent in its entirety. The Arbitration Tribunal is found to have committed a legal error in not considering Ex. D/3 in correct perspective. It is true that the condition about extent of payment in respect of extra items was not fully clear in Clause 31 and 32 of the agreement. However, there is no bar that such terms and conditions may not be made clear mutually by the parties. Same is found to have been clarified vide Ex. D/3, which is in consonance with Ex. D/2. Respondent cannot be now permitted to take u-turn with regard to it, without requisite objection and proof. Respondent has failed even up to the stage of this Court to demonstrate that he had any objection to Ex. D/3, which was in respect of the agreement in question (agreement No. 1/1984-86) and was admitted by it. Accordingly, we find that the respondent was entitled to the revised rate for extra items and rates only for the quantities exceeding 30% as mentioned in Ex. D/2 and Ex. R/3. The Arbitration Tribunal has granted claim for the revised rates for extra items and rates in respect of quantities below 30% which is not sustainable in law, in view of Ex. D/3. The impugned award to this extent is not sustainable in law and is hereby set aside. 6. In the result, civil revision to the impugned extent is hereby allowed.