SC rejects NTPC's plea against contractor

The Supreme Court has dismissed NTPC's plea against the Jharkhand High Court's order asking the public sector power company to pay around Rs 8 lakh with interest to a construction firm for termination of contract.

A Bench headed by Justice Altamas Kabir rejected NTPC's contentions that the high court's order should be quashed on the ground that the arbitrator had failed to give any reasoning.

Engineers Enterprises had claimed around Rs 23 lakh as compensation from NTPC for termination of the contract for carrying out construction work at K V Jamshedpur sub-station.

NTPC had alleged that the construction company had failed to complete work within the stipulated period.

NTPC had executed a contract in 1988 for construction work at K V Jamshedpur sub-station to Engineers Enterprises.

However, during the course of the contract disputes arose between the parties leading to appointment of an arbitrator by a lower court.

Former NTPC general manager, who was appointed as the sole arbitrator, had asked the power company to pay around Rs 8 lakh to the contractor.

Both High Court and the lower court had rejected NTPC's objections and upheld the arbitrator's award in favour of Engineers Enterprises.