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4, Pune-Satara stretch from Satara (Km 725) to Wathar (Km 760), Package-I. The respondent herein had preferred six claims. The petitioner herein is aggrieved by the decision of the Arbitral Tribunal in respect of the claim Nos. 1-5.

2. As indicated in the impugned Award a contract bearing agreement No. NHAI/13011/17/97-P1/182 dated 10.05.2001 had been entered into between the petitioner and the respondent for the execution of the work of widening the existing two lane highway to four lanes as well as rehabilitation of the existing two lane carriageway of National Highway-4 in the Pune-Satara stretch. The contract was in respect of the portion of the road between Satara (Km 725) and Wathar (Km 760) which, in other words, implied a stretch of 35 Km. The contract value was Rs 95,97,02,707/-. It may be pointed out that initially the contract was between the National Highway Authority of India (employer) (hereinafter referred to as the ‗NHAI') and M/s Skanska Cementation India Limited (contractor), whose name was subsequently changed to the present name -- ITD Cementation India Limited (hereinafter referred to as ‗ITD Cementation').

(1) Claim No.1: Amounts payable by NHAI for varied work done by claimant (ITD Cementation) and payment due under price adjustment on the basis of rebate offered in the tender.
The modified claim under claim No.1 was of Rs 9,14,71,312/-. As against this, the Arbitral Tribunal awarded an amount of Rs 2,34,23,656/-.
(2) Claim No. 2: Payment due on account of redesigning of pavement layers.

This claim was split into four parts being claim Nos. 2(a), (b), (c) and (d). Claim No. 2(a) related to the effect of deletion of CTSG (cement treated sub-grade). The amount awarded by the Arbitral Tribunal was a sum of Rs 41,57,025/- in respect of the claim 2(a) as against a modified claim of Rs 1,05,49,494/-. Claim No. 2(b) was in respect of the effect of deletion of CTUSB (cement treated upper sub-base). The Arbitral Tribunal awarded an amount of Rs 32,73,618/- under this head as against the modified claim of Rs 1,27,49,618/-. Claim No. 2(c), which pertained to under utilization of key plants and equipments and quarry infrastructure was withdrawn by the NHAI by their letter dated 29.03.2006. Claim 2(d) pertained to additional cost of borrow material. The Arbitral Tribunal awarded an amount of Rs 51,41,202/- to the claimant (ITD Cementation) on account of additional cost incurred towards additional borrow material against the modified claim of Rs 1,48,79,786/-.

4. I shall take up the objections to the Award claim-wise. Claim No. 1: Amounts payable by NHAI for varied work done by claimant (ITD Cementation) and payment due under price adjustment on the basis of rebate offered in the tender.

5. In the summary of bill of quantities, which is Annexure P-2 to the impugned Award, as against the total bid amount of Rs 115,07,22,670/-, the respondent (ITD Cementation) had offered a rebate of 16.6% on all items and, therefore, the final bid amount, after rebate, was indicated as Rs 95,97,02,707/-. The issue that arises under claim No. 1 is whether the rebate of 16.6% would be applicable only to the bill of quantities (BOQ) or it would also extend to any variations and/ or additional work. According to the claimant (ITD Cementation), it gave a rebate of 16.6% on the BOQ items only and the rebate did not extend to variations. Furthermore, the rebate definitely did not extend to additional structures. Since the petitioner (NHAI) had made payment to the respondent (ITD Cementation) on the basis of 16.6% rebate not only on the BOQ items but also on variations and additional structures, the respondent (ITD Cementation) was seeking a refund of such rebate on the variations and additional structures.

12. In the present case the Arbitral Tribunal has examined clauses 51.1, 51.2, 52.1 and 52.2 and has, upon such examination, gleaned a distinction between an instructed variation and an increase or decrease in the quantity of any work which is not a result of an instruction given by the engineer but is the result of the quantities exceeding or being less than those stated in the bill of quantities. Clause 51.1 indicates that any variation in the work, as indicated therein, will not, in any way, vitiate or invalidate the contract but the effect, if any, of all such variations are to be valued in accordance with Clause 52. Clause 52.1 deals with valuation of variations. It specifically provides that all variations referred to in Clause 51 shall be valued at the rates and prices set out in the contract if, in the opinion of the engineer, the same shall be applicable. According to the Arbitral Tribunal, the expression ―rates and prices set out in the contract‖ referred to the unit prices mentioned in the BOQ prior to the application of rebate of 16.6%. Interpreting the clauses in such manner, the Arbitral Tribunal came to the conclusion that the respondent (ITD Cementation ) was entitled to a refund of the rebate only in respect of instructed variations which fell within the expression ―varied work‖ as appearing in Clause 52.1 of the GCC. The Arbitral Tribunal, therefore, rejected the respondent's claim of refund of rebate in respect of the increase in the quantity of work which was not consequent upon any instruction issued by the engineer, but was the result of quantities exceeding those stated in the bill of quantities. According to the Arbitral Tribunal, such increase was to be expected as was apparent from the preamble of the bid document and, therefore, when the contractor (ITD Cementation) made the bid it was aware that the 16.6% rebate would apply to such increase or decrease in quantities.