approved the findings of the Arbitrator, without appreciating the appellant’s stand. In response Mr. PR Ramasesh, learned counsel for the respondent contends that ESIC’s action of invoking the bank guarantee after illegally terminating the contract was impermissible in law; and ESIC was therefore not entitled to withhold the bank guarantee money. Counsel for the respondent further contends that ESIC had failed to establish any lack of failure of performance on RA’s part and that therefore the invocation of the bank guarantee, which was in the nature of a performance guarantee, was contrary to the terms of the contract. RA further contends that it was paying interest of Rs.48,750/- per month to the Oriental Bank of Commerce, Bengaluru from the date of encashment of bank guarantee i.e. 23.02.2010 ; and therefore had claimed the loss thereby suffered at Rs.48,750/-p.m. from 23.02.2010 till the date of payment. It is RA’s contention that the Arbitrator had held forfeiture of performance security amount/bank guarantee amount to be contractually invalid as a sequitur to the termination of the contract having been held to be invalid and not in accordance with the contract. The Arbitrator had further upheld RA’s claim of interest @ Rs.48,750/- per month which works-out to 9% per annum, not being unreasonable ; and thereby awarded simple interest @ 9% per annum on the bank guarantee amount of Rs.65,00,000/- from 23.02.2010 till the date of award, being a period of 5 years, 9 months and 24 days, aggregating to a total interest amount of Rs.34,02,750/-. The Single Judge had upheld the award relating to claim No. 4 on the basis that ESIC had terminated the contract 21 months prior to the date of expiration of the term, and
