JUDGMENT
B.A. Khan, J.
1. Appellant was allotted a
contract for construction of T.V. Tower at A.B.
Road, Indore. The contract also stipulated barbed
wire fencing for 60 meters at the rate of Rupees
120/- per meter. Appellant, however, outstepped
the contract stipulation and extended the fencing
up to 1854.24 meters contrary to the instructions
of respondents. A final work bill was prepared
accommodating the deviation committed by him
and he was paid at market rate of Rs. 1.94 per
meter for excess quantity barbed wire. He accepted it in full and final settlement without any
objection or protest. Later he raised dispute that
he was entitled to Rs. 120/- per meter as per
contract rate, leading to the appointment of arbi
trator who entered reference on 26-10-89. Re
spondents resisted this claim amongst others on
the ground that no arbitrable dispute had arisen as
appellant Had accepted the final bill without any
objection. The arbitrator overlooked the objec
tion and published the award on 7-5-1990 up-
holding the claim of the appellant on this count
and awarded him Rs. 2,12,064/- at the rate of Rs.
120/- per meter. He, therefore filed award in the
Court of District Judge for making it a rule of
Court.
2. Appellant filed his objection and prayed for a decree in terms of award. But respondents, asked for its setting aside on the plea that it was vitiated as appellant had accepted the final bill without any protest or objection resulting in the closure of the cbntract and death of arbitration
clause. It was also pleaded by them that arbitrator had committed an error/mistake, apparent on the
face of the record by ignoring and overlooking
Clause 12 of the contract and by mis-applying it’s Clause 8(e)(ii). It was also alleged by them that he had gone out of way contravening explicit provisions of the contract and had committed misconduct by disregarding crucial documents like letter dated 9-10-1985 filed by appellant himself, and passing ad hoc award of Rs. 17,800/- without notice to Engineer-in-Chief under Clause 10(e) of contract and by disallowing interest on award amount first and then allowing it.
3. Learned Dist. Judge deriving support from judgments of the Supreme Court and that of Bombay High Court has held as under :
“I am of the opinion, firstly the award passed in the case is without jurisdiction. There is nothing on record to indicate that after having accepted the final bill in full and final satisfaction of the claim, arbitration agreement was invoked not simpliciter but by making relevant allegations at the time of invoking it. Secondly, there is an error apparent on the face of record inasmuch as Clause 8(e)(ii) appearing on page 190 and 191 meant for all works has been made applicable in the matter of an individual trade and the clause relating to any individual trade included in the contract has not been considered, as if it is’not in existence. Further, in respect of the fact that there was no proof that the department had received the information alleged to have been sent by the contractor, it was held that department did resist the said information. In view of the said reasoning it is held that the award is liable to be set aside under Section 30 of the Act.”
4. l/C for appellant Mr. Mathur assailed this on the plea that the Dist. Judge had out-stepped his jurisdiction by converting himself into a Court of appeal and embarking on appraisal of evidence on record and by returning his own findings. He explained that it was not the case where the arbitrator had ignored or contravened any term of the contract. He had considered all relevant clauses including 8 (2) (e) and 12 of the contract agreement and in his wisdom had applied the first clause and in such a case Court could not take a contrary view. He asserted that even as appellant had accepted the final bill in full and final settlement of his claim he could still raise the dispute which was arbitrable. He sought support from AIR 1995 SC 2423 : (1995 AIR SCW 3584) AIR 1991 SC 945 and AIR 1998 SC 1172 (sic).
5. Mr. Neema on the contrary submitted that the award was vitiated because arbitrator had failed to determine the tenability of the reference arising out of appellant’s acceptance of final bill which went to the root of the matter. He had also committed glaring mistakes by changing his position on issues rendering the award suspect. He had misapplied Clause 8(2)(e) and ignored clause 12 of the contract agreement which had a crucial bearing in the matter and his award thus suffered from error apparent on the face. He placed reliance on AIR 1990 Bombay 45; 1993 (2) MPJR 83.
6. It goes without saying that the arbitrator being the chosen Judge of the parties was also the sole and final Judge of all questions of law and fact. He was under no obligation to give reasons for his award. It was for him to appreciate evidence, scrutinise record, place interpretation on terms of contract which may be erroneous and take his own view on matters. The Court had a little role to play in all this. It could not convert itself as Court of appeal and embark on reappraisal and reappreciation of evidence to return its own findings and conclusions. Its judgment was confined and limited to cases falling within the parameters of Section 30 of Arbitration Act, viz (a) if the arbitrator had misconducted himself or the proceedings; (b) where the award was made after the Court had superseded the arbitration agreement or where arbitration proceedings had become invalid; (c) where the award was improperly procured or was otherwise invalid or (d) where the award suffered from an error apparent on the face of the record.
7. It is also established that an error apparent on the face of record contemplated by Section 16(1)(c) as well as Section 30(c) was an error of law and not of fact which meant such error which could be gathered from the award itself or from any allied document. An arbitrator cannot ignore law or misapply it in order to do what he thinks as just and reasonable. Similarly he may interpret the terms of contract, the way he likes but he cannot contravene or overlook, ignore or sidetrack these.
8. Cases are conceivable where arbitration clause in a contract would subsist and survive despite acceptance of final bill in full and final settlement of the claim but this would hold good only where the party invoking it alleged that final
bill was accepted or receipt was given under coercion, or misrepresentation, without prejudice and under protest. An arbitrable dispute arises in such cases. But if no such allegation exists the contract itself comes to an end and so does the arbitration clause and any reference made therefrom becomes incompetent. (See : AIR 1990 Bom 45; AIR 1990 SC 1246 (sic); AIR 1955 SC 468).
9. Going by all this, it remains to be seen whether award in question was vitiated because of arbitrator’s failure to come to grips with respondent’s objection about invalidity of reference because of appellant’s acceptance of final bill in full and final settlement of his claim and because of his alleged misapplication of Clause 8 (2) (e) of the contract ignoring Clause 12 altogether.
10. The answer has to be in affirmative in both cases. It is a common ground that appellant had accepted the final bill vide which he was paid at the rate of Rs. 1,94/- meter of barbed wire for the excess quantity in full and final settlement of his claim without any protest or abjection. He had also executed an undertaking that he would not make any more claim in this regard. He had not alleged that Final bill was accepted or the receipt was given by him under some coercion, threat or misrepresentation, etc. He could not have therefore, invoked the arbitration clause simpliciter because the contract itself had become to an end and so had the arbitration clause. Any reference made pursuant thereto was incompetent and any award passed thereon without jurisdiction. It is surprising that arbitrator should have sidetracked this aspect when it was specifically highlighted by respondents before him. He ought to have dealt with the issue to determine the maintainability of the reference. His intriguing silence on this makes the whole exercise suspect.
11. The arbitrator’s approach in dealing with the terms of the contract again leaves much to be desired. It is apparent that he had misapplied Clause 8(2) (e) of the agreement to carve out basis for the award by overlooking the terms of clause 12 which related to deviation in case of an individual trade. It is not a case of erroneous interpretation having been placed on terms of contract but a case involving contravention of its terms, tantamounting to an error apparent on the face of record within the meaning of Section 30(e) of the
Act.
12. Moreover, a cursory reading of the award shows that it makes no head and tail. It is full of major contradictions and discrepancies. In fact arbitrator does not seem to be sure of what he was doing. He finds, in one breath that under Clause 8 (2) (e) deviation limit was 50% of the tendered work and in the other he holds that appellant had not caused any deviation in it, forgetting that quantity of allotted work involved only 60 meters of barbed wire whereas appellant had on his own exceeded the limit up to 1854.24 m meters when he could have only gone up to 90 meters under the prescribed deviation limit. As if this was not enough, he again strangely draws the presumption without any material or basis that appellant had committed deviation as no deviation statements were produced before him and that he must have accepted the final bill under duress. All this points to the wayward approach adopted by the arbitrator to pass the award which lacked in jurisdiction and suffered from an apparent error of record. Learned District Judge had therefore, rightly set it aside. We affirm his judgment to dismiss this appeal.