In Brief
Chandigarh Construction Co. entered a 1985 contract with Punjab for canal construction work. The company claimed additional payments for extra work. An arbitrator awarded most claims at a 93.12% premium calculated from the difference between estimated and contract costs, but the High Court rejected these claims as unreasoned. The Supreme Court held the arbitrator's award unsustainable due to lack of stated reasons (required by contract), but found the underlying work proven. It allowed claims at the contractually sanctioned 35.02% premium rate instead, calculating interest at 12% annually (18% if delayed). The judgment emphasizes that arbitrators must provide reasons when contracts require them, and technical procedural violations should not entirely bar meritorious claims backed by evidence.
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