TMI Blog1986 (11) TMI 385X X X X Extracts X X X X X X X X Extracts X X X X ..... ing B.T. Macadam wearing coat and seal coat along two stretches of the Hyderabad-Vijayawada National Highway. While the work was in progress, the contractor made certain claims in respect of the loss suffered on account of delay, escalation of rates and other heads. The claims were referred to arbitration. On September 4, 1979 the Arbitrator held the contractor entitled to a sum of ₹ 99,00,000 under five heads of claim. The contractor applied to the Civil Court for making the award a rule of the Court while the State Government prayed for setting aside the entire award. The Civil Court set aside the award and refused to pass a decree in terms of the award. The contractor appealed to the High Court, and on April 19, 1982 the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the State Government was not entitled to claim adjustment in execution proceedings. It was pointed out that the sum of ₹ 22,91,332 of which adjustment was sought by the State Government against the amount for which the contractor had taken out execution, consisted of (a) an amount of ₹ 10,21,800 claimed by the State Government as due to it upon the preparation of the final bill in respect of the contracts covered by the award and (b) an amount of ₹ 12,69,532 claimed by the State Government under a separate contract on the ground that the contractor had committed a breach of that contract. The contractor disputed both claims. He contended that the final bill in respect of the earlier contract had been prepared in his ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... propriate cases, and the High Court was therefore justified in making the order which it did. 7. We have no doubt that in certain cases the Court has the power to allow a set off even in cases which do not strictly fall within the terms of Order 21 Rule 18 of the Code. A Full Bench of the Andhra Pradesh High Court has discussed the matter in Bhoganadham Seshaiah v. Budhi Veerabhadrayya (died) and Ors. AIR1972AP134 and has examined at some length the circumstances in which such set off may be granted. The facts before us, however, call for a somewhat different consideration. So far as the first claim to adjustment is concerned, the matter is covered by Clause 68 of the contract. What was awarded to the contractor under the decree was an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only if the amount sought to be retained is an ascertained sum, an amount which can be readily adjusted against the amount payable under the other contract. Here, the amount sought to be adjusted has yet to be determined as a liability against the contractor. It has been disputed by the appellant. Accordingly, Clause 71 cannot be invoked. In the result, the decision of the High Court in respect of the adjustment of ₹ 12,69,532 cannot be sustained. 9. In the circumstances, the appeal is allowed in part, the judgment and order of the High Court is modified in so far that while the adjustment claimed by the State Government on the basis of the final bill relating to the contract covered by the award is maintained, the direction in res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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