Compensation by whom payable

(1) While making the award under this Act the Collector shall indicate therein whether the damage is avoidable or unavoidable. (2) Where the damage is unavoidable the compensation shall be paid by the Government or any other person or agency on whose behalf the work is being executed, to the persons interested in accordance with the award made by the Collector and where the damage is avoidable it shall be payable by the contractor within such time as may be specified in the notice issued by the authorised officer. (3) The authorised officer shall issue or cause to be issued a notice upon the contractor calling upon him to deposit with such officer the amount of the award within such time and in such manner as may be specified in notice. (4) Where the contractor fails to comply with the notice issued under sub-section (2), it shall be lawful for the authorised officer to recover the amount on account of damage as given in the award from the payments due to the contractor or from the earnest money or security deposit of the said contractor lying with the Government whether or not under the said contract. (5) The authorised officer may pay to the person interested the amount of compensation on execution of indemnity bond by the person concerned. (6) It shall be the duty of the Government to make available to the authorised officer the amount of compensation payable for unavoidable damage and the authorised officer shall distribute the said amount in the manner specified in sub-section (4). (7) Where any amount of compensation lies undisbursed with the authorised officer, he shall keep the same in deposit in the bank as may be directed by the Government.