JUDGMENT
S.K. Chattopadhyaya, J.
1. This appeal under Section 39(IV) of the Arbitration Act, 1940 (the Act) is directed against the decision of the Subordinate Judge, No. 1, Chaibasa making the Award a rule of the court.
2. Before dealing with the contentions raised by the parties, it would be appropriate to portray the factual backgrounds.
The parties to this appeal entered into a contract for making certain construction, time limit for completion of the work being sixteen months from the date of commencement of the work. This time limit was the essence of the contract. The respondent undertook to execute the work as per the agreement from 27.9.84. Immediately after commencement of the work the respondent detected that though two erstwhile contractors had been paid their amount in full, they did not complete the two abutments upto the desired height. The matter was reported to the department then and there and on verification the assertion of the respondent was found to be correct. The respondent was directed to complete the construction of the said abutments by raising it upto the desired height. This was, however, ordered to be done outside the agreement. Subsequently under a written order dated 12.9.87 the work of the respondent was stopped by the Department. Certain differences arose between the parties and the dispute, as per the agreement, was referred to the sole Arbitrator, Sri Kedar Nath, retired District & Sessions Judge, Daltonganj. The parties filed their statement of facts and fully participated in the proceeding before the Arbitrator. Ultimately Award was made on 10.9.92 and was filed in the court. The appellant raised several objections against the Award and a suit was, therefore, registered being Title Suit No. 18/92. In the suit the contractor-respondent was described as the plaintiff and the appellant-State of Bihar as the defendant.
3. It is not in dispute that no particular dispute/claim was referred to the Arbitrator
by the court by its order of appointment and the parties were at liberty to refer their points/claims by their respective statements of claims and counter claims. It is also not controverted that both the parties admitted the documents filed by each of them by waiving formal proof thereof. Both the parties admitted that the work was to be completed within sixteen months from the date of its commencement but the work was stopped under a written order of the authority dated 12.9.87. It was also admitted by the appellant that the respondent had to raise the height of the abutment which was left incomplete by the previous contractors as per the order of the authorities though not specifically provided in the contract. The fact that the payment on this account was accepted by the respondent is also admitted.
4. After hearing the parties at length the Arbitrator gave his Award against which the appellant filed its objection under Section 30 of the Act and the respondent also filed his rejoinder to the same. The learned court below,-after considering the objection, its rejoinder and the Award, made the Award a rule of the court which order has been impugned in this appeal.
5. Before this Court oral submissions were made on behalf of the parties and subsequently written arguments have been filed.
6. Mr. Eqbal, learned Govt. Advocate appearing on behalf of the appellant-State of Bihar, in his oral submission, has criticised the order of the court below mainly on two grounds i.e. the order is bad because while the Arbitrator did not allow cost, the trial court allowed cost of Rs. 25,000/- which was beyond his jurisdiction. Secondly the court having found that the Award was a speaking one, it was required to meet all the reasonings given by the Arbitrator. However, in the written argument another point has been raised to the effect that the Arbitrator travelled beyond the contract and awarded the amount which was not payable under the contract. The Arbitrator awarded so much of the amount which was admittedly not payable or due against the appellant. Further it has been urged that the Arbitrator has misconducted the proceedings by ignoring two material documents to arrive at the just decision to resole the controversy between the department and the contractor. According to the appellant, even if the department did not produce these documents before the Arbitrator, it was incumbent upon him to get hold of all the documents including these two documents for purpose of a just decision. In support of his contention, Mr. Eqbal has relied on the decisions (i) in the case of Associated Engineering Co. v. Govt. of Andhra Pradesh and Anr. (ii) in the case of Jajodia (overseas) Pvt. Ltd. v. Industrial Development Corporation of Orissa Ltd reported in 1993 (4) SCC 106 (iii) in the case of Tarapore & Co. v. State of M.P. and (iv) in the case of Union of India v. Jain Associates and Anr. .
7. Further contention of Mr. Eqbal. is that the respondent was allotted the construction work for the remaining portion of work over the bridge, Koyama and the agreement was for a sumpsum value of Rs. 22 lacs. This work was allotted earlier to two other contractors who failed to execute the entire portion of the work and for final and full completion of the remaining work, agreement was entered into between the appellant and the respondent. Drawing my attention to different clauses of the agreement mentioned in the written submission, Mr. Eqbal submits that the agreement was on the specific terms and conditions and, as such, the Arbitrator has misconducted by not considering the different clauses of the agreement.
8. Mr. M.M. Banerjee, learned Counsel appearing on behalf of the respondent strongly refuting the argument of Mr. Eqbal contends that the Award being a non-speaking one, it is not open to the appellant to ask this Court to scrutinise the clauses of the agreement. It is urged it is futile for the appellant to argue that the Arbitrator has awarded the amount beyond Rs. 22 lacs i.e. the total contractual amount. His argument is that the claim was with regard to the work already done with the prior approval of the department, inasmuch as the agreement was for the work to be done and not already one. Referring to the operative portion of the Award, Mr. Banerjee submits that most of the claims made by the respondents have been disallowed by the Arbitrator against which the learned Government Advocate has no grievance to the effect that the Award is the result of non-application of mind; but where the Arbitrator, considering the facts and circumstances, allowed some of the claims, that has been challenged on the ground that the Arbitrator has not applied his mind and this argument should no be entertained by this Court. He further submits that uncontrovertedly the erstwhile two contractors did not execute the work in compliance of the agreement but even they were paid the amount in to. On the contrary the respondent was directed to complete the construction by raising the abutments to its desired height. This was ordered to be done outside the agreement though by that time the respondent had invested huge amount in this work, he obeyed the direction of the department keeping in mind the interest of the State. Further, after completing the abutment, it is urged, when the respondent took up the construction of piers and one pier was completed and construction of other pier was being taken up from underground level which rose up to the water level of the river, the under ground of the pier got titled as the under ground condition of that portion of the river was not suitable for the construction of the same. This fact was also brought to the notice of the department and the Executive Engineer agreed with the respondent in this regard. The department, admittedly, was the sole authority to select the site and construction and to furnish the layout plan and design of the bridge but the under ground condition of the site was not properly verified which was revealed on inspection and further verification. It was found that the under ground condition of the site was not on hard rock and the earlier verification of the under ground condition made by the department prior to selecting the site, was incorrect and wrong. The Executive Engineer in spite of such technical difficulty directed the respondent to carry on the construction work which the respondent was bound to do in view of the agreement. However, to overcome the difficulty and defect of tilting the Superintending Engineer of the department after inspection and verification of the work site directed the respondent to stop the work immediately on the ground that remedial measures could be adopted and resorted to only after obtaining the sanction of the higher authorities from Patna. By a written order the respondent was stopped to work till further approval is obtained from Patna. By the same written order the Executive Engineer also directed the respondent not to remove anything from the work site failing which he was threatened with penal consequences. However, the said approval of the higher authorities was not received by the department till the matter was brought to the court at the instance of the respondent for arbitration. According to the respondent all these orders which were incorporated in the site order book, which is maintainable by every contractor under the rules of the department, were placed before the Arbitrator and after going through the relevant documents filed by the parties, he awarded the amount which cannot be said to be beyond his jurisdiction. Awarding of cost by the court, Mr. Banerjee continues, was quite justified inasmuch as on the facts and circumstances, it is clear that for no fault of the respondent, he was unnecessarily dragged into a long term arbitration proceeding. Lastly, Mr. Banerjee has submitted that the power of the appellate court under Section 39 of the Act is very limited and more so, when the Award is a non-speaking one.
In support of his argument Mr. Banerjee has relied on the following decisions : (i) in the case of Bihar State Electricity Board v.
Khalsa Brothers reported in 1987 PLJR 322(ii) in the case of Hindustan Tea Co. v.
Shashikant and Co. (iii) in the case of Food Corporation of India v. Jogindra Pal Mohindrapal and Anr. reported in 1989 SC (2) 1263 (iv) in the case of
Puri Construction v. Union of India (v) in the case of Sudarshan Trading Co. v. Government of Kerala and Ors. and (vi) in the case of Bijendra Nath Kothari v. Mayank Srivastava .
9. In the backdrops of the above facts the contentions urged on behalf of the parties may now be considered. It is true that the court below has termed the Award as a ‘speaking one’ taking into consideration the discussions made by the Arbitrator in his Award. Mr. Eqbal, on these premises, based his argument that as the Award is a speaking one, the court below ought to have considered the terms of the agreement before making the Award a rule of the court.
10 . In the case of Jajodia (Overseas) Pvt. Ltd (supra) while dealing with this aspect, the Supreme Court has observed as follows:
A speaking and reasoned Award is one which discusses or sets out the reasons which led the Arbitrator to make the Award. Setting out the conclusion upon the question or issues with a reason in the arbitration proceeding without discussing the reasons for coming to these conclusions, does not make an Award reasoned or speaking Award. In the Award in this case the Arbitrator only answered the issues that were framed without discussing or setting out the reasons for the answers. The Award is, therefore, not speaking or reasoned Award.
Similarly in the present case after narrating the backgrounds of the respective claims, the Arbitrator posed a question to the following effect:
Therefore, the crucial issue formulated was as to who was at fault for the stoppage of work and for committing breach of contract and whether the claimant is entitled to any of the claims even if the opposite party is found guilty of breach of contract.
After formulating the above issue the Arbitrator, however, has not come to a finding on the wordings of the contract. If he would have done it, it could be said that the Arbitrator had impliedly incorporated the contract or a clause in it, whichever be the case. The Arbitrator merely referred the pleadings filed before him and such reference, in my opinion, does not mean that the clauses of the contract are incorporated in the Award. In the case of Allen Berry & Co. v. Union of India, , the Supreme Court has quoted with approval a passage from the judgment of Diplock, L.J. in Giacomb Costa Fu Andrea v. British Itallian Trading Co. Ltd. which reads as thus:
…It seems to me, therefore, that, on cases, there is none which compels us to hold that a mere reference to the contract in the award entitles us to look at the contract. It may be that in particular cases a specific reference to a particular clause of a contract may incorporate the contract, or that clause of it, in the award, I think that we are driven back to first principles in this matter, namely, that an award can only be set aside for error which is on its face. It is true that an award can incorporate another document as part of the award and, by reading them together, find an error on the face of the award.
11. In the present case the Arbitrator has nowhere discussed any of the clauses of the agreement. On the other hand, he has only narrated the necessary facts in regard to the proceeding before him. In this view of the matter I am unable to accept the contention of the learned Govt. Advocate that as because the court below has treated the Award as a reasoned one, the Award can be said to be so. Again in the case of Jajodia (Overseas) Pvt. Ltd. (supra) their lordships have held that even assuming the incorporation of the agreement, an error apparent upon the face of the Award has to be shown. Their lordships quoted the well known passage from the judgment of Lord Dunedin in Champsey Bhara and
Co. v. Jivraj Balloo Spinning and Weaving Co. Ltd. which reads thus:
An error in law on the face of the award means, in their lordships’ view, that you can find in the award or a document actually incorporated thereto, as for instance a note appended by the Arbitrator stating the reasons for his judgment, some legal proposition which is the basis of the award and which you can then say is erroneous. It does not mean that if in the narrative a reference is made to a contention of one party, that opens the door to seeing first what that contention is, and then going to the contract on which the parties’ rights depend to see if that contention is sound.
It went on to observe:
An award may be set aside by the court on the ground of an error of law apparent on the face of the award but an award is not invalid merely because by a process of inference and argument it may be demonstrated that the arbitrator has committed some mistake in arriving at his conclusion.
12. In a recent decision, in the case of State of Rajasthan v. Puri Construction Com. Ltd. and Anr. reported in 1995(1) U.J. (SC) 179, their lordships of the Apex court again reiterated the settled principle of law that the validity of the Award made under the Act can be challenged only within the parameters of the Act. According to their lordships the Arbitrator is the final Arbiter for the dispute between the parties and it is not open to challenge the award on the ground that the Arbitrator has drawn his own conclusion or has failed to appreciate the facts. There is a distinction between the dispute as to the jurisdiction of the Arbitrator and the dispute as to in what way that jurisdiction should be exercised. There may be a conflict as to the power of the Arbitrator to grant a particular remedy. One has to determine the distinction between the error within the jurisdiction and an error in excess of the jurisdiction. Their lordships were of the firm view that the court cannot Substitute its own evaluation of the conclusion of law or fact to come to the conclusion that the Arbitrator had acted contrary to the bargain between the parties. Whether a particular amount was liable to be paid is a decision within the competency of the Arbitrator. By purporting to construe the contract the court cannot take upon itself the burden of saying that this was contrary to the contract and, as such, beyond jurisdiction. If on a view taken of a contract, the decision of the Arbitrator on certain amounts awarded is a possible view though perhaps not the only correct view, the award cannot be examined by the court.
13. In the present case the parties to the contract filed their statement of claims and counter statements and respective documents in support thereof. There was no specific reference about the dispute before the Arbitrator, rather, it could be called as an open reference. Because of the absence of the opposite party or his representative the hearing had to be adjourned on a number of occasions. Though the opposite party wanted to record the statements of three officers of the department, one of the officers informed the Arbitrator by his registered letter dated 6.6.92 expressing his unwillingness to attend the hearing on the ground that he had nothing to say in the matter. Other two officers remained absent as a result of which the proceeding was a gain adjourned by giving another opportunity to those officers for their appearance. Finally the matter was heard and the Arbitrator ultimately passed the Award by observing as follows:
AND WHEREAS I perused the statement of claims and counter statement, submitted by the parties and considered their respective case.
AND WHEREAS I considered the oral submission of the claimant and the opposite party made before me.
AND WHEREAS I looked into all and every document filed before me and considered the same including the site order book and the agreement.
AND WHEREAS I have finally heard the parties on 2.8.92 and in my view, on consideration of all the materials, I find that the work was stopped by the Department for a very long time with no prospect of its resumption and for this the department is at fault because this action of the department (opposite party) frustrated the contract.
14. After considering the respective contentions of the parties and going through the award, in my opinion, the Arbitrator has not taken into consideration any matter outside the scope of reference. The dispute and differences covered by the written agreement had been referred to the Arbitrator. It is nobody’s case that the Arbitrator is incompetent to enter into the reference. It is not the case of either of the parties that any extraneous matter has been taken into consideration by the Arbitrator. There is no allegation that reasonable opportunity of being heard was not given to the parties. It, prima facie, appears to me that in basing his finding the Arbitrator has referred and relied upon the materials on record and Mr. Eqbal has not been able
to. point out that there was no basis, whatsoever, to base the finding made by the Arbitrator upon consideration of all the materials on record. It is now well settled that it may be possible that on the same evidence,, the court may arrive at a different conclusion than the one arrived at by the Arbitrator but that by itself is no ground for setting aside the award. The word ‘reasonable’ has not been exactly defined. To quote, their lordships with advantage, “Reason varies in its conclusion according to the idiosyncrasis of the individual and the time and circumstances in which he thinks.”
15. The scope of interference by the appellate court has been settled by several decisions of the Supreme Court as well as different High Courts and I need not refer to all those cases. However, I am tempted to quote a passage from the case of State of Rajasthan v. Puri Construction Ltd. (supra) which reads as follows:
A court of competent jurisdiction has both right and duty to decide the lis presented before it for adjudication according to the best understanding of law and facts involved in the lis by the judge presiding over the court. Such decision even if erroneous either in factual determination or application of law correctly, is a valid one and binding inter parties. It does not, therefore stand to reason that the arbitrator’s award will be per se invalid and inoperative for the simple reason that the arbitrator has failed to appreciate the facts and has committed error in appreciating correct legal principle in basing the
award. An erroneous decision of a court of law is open to judicial review by way of appeal or revision in accordance with the provisions of law. Similarly, an award rendered by an arbitrator is open to challenge within the parameters of several provisions of the Arbitrator Act. Since the arbitrator is a judge by choice of the parties and more often than not a person with little or no legal background, the adjudication of disputes by an arbitration by way of an award can be challenged only within the limited scope of several provisions of the Arbitration Act and the Legislature in its wisdom has limited the scope and ambit of challenge to an award in
the Arbitrator Act. Over the decades judicial decisions have indicated the parameters of such challenge consistent with the provisions of the Arbitrator Act. By and large the courts have disfavoured interference with arbitration award on account of error of law and fact on the score of misappreciation and misreading of the materials on record and have shown definite inclination to preserve the award as far as possible. As reference to arbitration of dispute in commercial and other transactions involving substantial amount has increased in recent time the courts were impelled to have fresh look on the ambit of challenge to an award by the arbitrator so that the award does not get undesirable immunity. In recent times, error in law and fact in basing an award has not been given the wide immunity as enjoyed earlier by expanding the import and implication of legal misconduct of an arbitrator so that award by the arbitrator does not perpetrate gross miscarriage of justice and the same is not reduced to mockery to of a fair decision of the lis between the parties to arbitration. Precisely for the aforesaid reason, the erroneous application of law constituting the very basis of the award and improper and incorrect findings of fact, which without closer and intrinsic scrutiny, are demonstrable on the fact of the materials on record, have been held, very rightly, as legal misconduct rendering the award as invalid. It is necessary, however, to put a note of caution that in the anxiety to render justice to the party to arbitration, the court should not reappraise the evidence intrinsically with a close scrutiny for finding out that the conclusion drawn from some facts by the arbitrator is, according to the understanding of the court, erroneous. Such exercise of power which can be exercised by an appellate court with power to reverse the finding of fact, is alien to the scope and ambit of challenge of an award under the Arbitration Act. Where the error of finding of facts having a bearing on the award is patent and is easily demonstrable without the necessity of carefully weighing the various possible viewpoints, the interference with award based on erroneous findings of fact is permissible. Similarly, if an award is based by applying a principle of law which is patently erroneous, and but for such erroneous application of legal principle, the award, could not have been made, such award is liable to be set aside by holding that there has been a legal misconduct on the part of the arbitrator. In ultimate analysis, it is question of delicate balancing between the permissible limit of error of law and fact and patently erroneous finding easily demonstrable from the materials on record and application of principle of law forming the basis of the award which is patently erroneous. It may be indicated here that however objectively the problem may be viewed, the subjective element inherent in the judge deciding the problem, is bound to creep in and influence the decision. By long training in the act of dispassionate analysis, such subjective element is, however, reduced to minimum. Keeping the aforesaid principle in mind, the challenge to the validity of the impugned award is to be considered with reference to judicial decisions on the subject.
16. The contention of Mr. Eqbal that the Arbitrator has wrongly awarded excess mount, in my considered opinion, is not borne out from the Award. In this context it is necessary to notice the Award given by the Arbitrator:
________________________________________________________________
Sl. No. Item of Claim Amount Amount
claimed allowed
________________________________________________________________
(1) (2) (3) (4)
_________________________________________________________________
1. Cost of raising the Rs. 66,000/- Rs. 25,000/-
abutments to the
required height
2. Cost of cutting hard Rs. 34,560/- Rs. 34,560/-
rock.
3. (a) Cost of materials used
in shuttering and
centring, which were
lost by flood because
the same were not
allowed to be removed. Rs. 5,71,200/- Rs. 2,85,600/-
(b) Construction of
establishment store,
central godown etc. Rs. 3,39,000/- Disallowed.
(c) Cost of clearing jungel. Rs. 64,000/- Disallowed.
(d) Construction of stairs
of carrying materials Rs. 55,000/- Disallowed.
(e) Construction of wooden
jetty. Rs. 30,000/- Disallowed.
(f) Construction of damaged
coffer-dam. Rs. 40,000/- Disallowed.
(g) Cost of 30 truck of sand
@ Rs. 600/- truck (washed
away by flood) Rs. 18,000/- Rs. 18,000/-
(h) Cost of stone chips of
two sizes Rs. 22,600/- Rs. 22,600/-
(Washed away by flood) Rs. 19,200/- Rs. 19,200/-
4. Unpaid value of work done. Rs. 6,05,000/- Rs. 6,05,000/-
5. Loss on account of
paying hire charges
and maintenance of
machines. Rs. 4,00,000/- Rs. 1,15,000/-
6. Idle wages and
retrenchment benefits Rs. 3,65,557/- Rs. 50,000/-
7. Security Deposit Rs. 1,38,983/- Rs. 1,38,983/-
8. Interest Rs. 8,00,000/- Rs. 3,21,750/-
@ 9%
9. Loss of business. Rs. 8,00,000/- Disallowed.
_____________________________________________________________________
Total Rs. 16,35,693/-
_____________________________________________________________________
(Award Rupees sixteen lacs thirty five thousand six hundred ninety three only).
17. From a bare perusal of the Award it appears that several claims of the respondent have been disallowed by the Arbitrator. It is the case of the contractor that because of stoppage of work by a written order, he could not complete the work. He was directed not to remove any of his machineries from the work-site and was asked to wait for resuming the work further till the approval is obtained from the higher authorities at Patna.
18.I have already stated that the Arbitrator has not given any reason in support of his conclusion and the jurisdiction of the court to examine its correctness is limited by the provisions of the Act which are based on the general principles applicable to the arbitration proceedings. An Arbitrator is a -tribunal selected by the parties and his adjudication is binding on them. If it were permissible for the court to re-examine the correctness of the Award, the entire proceeding would amount to an exercise in futility. The grounds on which an Award can be set aside are limited by statutes and Section 30 of the Act in mandatory terms declares that an award shall not be set aside on other ground. It is not open to the court to speculate where no reasons are given by the Arbitrator as to the reason which led him to his conclusion. The court cannot proceed to determine whether the conclusion is right or wrong on an assumption that the Arbitrator must have proceeded by a certain process of reasoning. In the case of Jivaraojibhai Ujemshi Sheth and Ors. v. Chintamanrao Ralajia and Ors. , it has been held by the Supreme Court that it is not open to the court to attempt to approach the mental process by which the Arbitrator has reached his conclusion, where it is not disclosed by the terms of his Award. The court cannot sit in judgment on the Arbitrator and a reappraisal of the evidence is not permissible.
19. The decision relied on by Mr. Eqbal in the case of Associated Engineering Co. (supra), in my opinion, does not help the appellant though it that case the award was a non-speaking one. In that case the claim of extra amount towards additional lead for water i.e. for 3 Kms. over and above specific lead of 2 Kms. was awarded by giving reasons. In that context their lordships were of the opinion that a dispute as to the jurisdiction of the Arbitrator is not a dispute outside the award. The Umpire or the Arbitrator, according to their lordships, cannot widen his jurisdiction by deciding the question not referred to him by the parties or by deciding the question otherwise than in accordance with the contract. The award was set aside by the court as because, according to it, the Umpire decided the matters strikingly outside the jurisdiction and he stepped the confines of the contract. From a reading of the judgment it appears that in the said case agreement was specifically incorporated and not that any recital or narrative portion of the agreement was referred. This is not the case here.
20. In the case of M/s Sudarshan Trading Co. (supra) it has been held that in the absence of any reason for making the Award it is not open to the court to interfere with the Award. Further more, in any event reasonableness of the reason given by the Arbitrator cannot be challenged. Their Lordships continued by observing that appraisement of the evidence by the Arbitrator is never a matter which the court questions and considers. If the parties have selected their own forum, the deciding forum must be conceded the power of appraisement of the evidence. The Arbitrator is the sole judge of the quality as well as the quantity of evidence and it will not be for the court to take upon itself the task of being a judge of evidence before the Arbitrator.
21. It is not in dispute that an award may be set aside on the ground of error on the face of it when the reasons given for the decision, either in the award or in any document incorporated in it, are based upon legal proposition which is erroneous. But where a specific question is referred, an award is not liable to be set aside on the ground of an error on the face of the award even if the answer to the question involves erroneous decisions on the point of law. There are two different and distinct grounds involved in many of the cases. One is the error apparent on the face of the award and the other is that the Arbitrator exceeded his jurisdiction. In the latter case, the courts can look into the arbitration agreement but in the former, it cannot, unless the agreement was incorporated or recited in the award. But even then an award is not invalid merely because by process of inference and argument it may be demonstrated that the Arbitrator has committed some mistake in arriving at his conclusion. In the present case I have already noticed that specific question was not referred to the Arbitrator, rather, the reference was open. Under these circumstances, whether the Arbitrator has exceeded his jurisdiction or not, cannot be looked into because if the parties set limits to action by the arbitrator, then the arbitrator had to follow the limits set for him and the court can find that he exceeded his jurisdiction on proof of such excess. However, it is now settled law that it is not open to the court to probe the mental process of the arbitrator and speculate, where no reason are given by
the arbitrator, as to what impelled the arbitrator to arrive at his conclusion. In the instant case the Arbitrator has merely given the history of the claims and he has awarded certain amount. He has spoken his mind indicating why he has done, what he has done. He has narrated how he came to make the award. I may usefully refer in this context the observation of the Supreme Court in the case of A/A. Sudarsan Trading Co. (supra) which reads as follows:
But, in the instant case the court had examined the different claims not to find out whether these claims were within the disputes referable to the arbitrator, but to find out whether in arriving at the decision, the arbitrator had acted correctly or incorrectly. This, in our opinion, the court had no jurisdiction to do, namely, substitution of its own evaluation of the conclusion of law or fact to come to the conclusion that the arbitrator had acted contrary to the bargain between the parties. Whether a particular amount was liable to be paid or damages liable to ‘be sustained was a decision within the competency of the arbitrator in this case. By purporting to construe the contract the court could not take upon itself the burden of saying that this was contrary to the contract and, as such, beyond jurisdiction. It has to be determined that there is a distinction between disputes as to the jurisdiction of the arbitrator and the disputes as to in what way that jurisdiction should be exercised. There may be a conflict as to the power of the arbitrator to grant a particular remedy.
22. Similarly in the case of A/A. Chahal Engineering and Construction Co, (supra) a particular reference was made to the arbitrator for its decision. The arbitrator was directed to proceed to complete the unfinished part of the award after looking into the background of the case and by hearing the parties to the extent he in his discretion considers necessary. In that context when the arbitrator referred definite clause of the contract in his award, the court scrutinised the award in the light of the agreement. In this view of the matter, in my opinion, that case also does not help the appellant.
23. In the case of Union of India v. Jeewan Associated and Anr. (supra) the facts and circumstances were entirely different. In that case the Umpire refused to consider the counter claim on the ground of belated counter claim. Moreover, the Umpire had given damages twice against the same claim by showing them as two claims.
24. The last decision relied by Mr. Eqbal is in the case of Tarapore and C.
v. State of M.P. (supra). Here also a specific question was referred for determination by the arbitrator and the award was speaking one. Under these circumstances their lordships interfered with the award by scrutinising the reasons given therein.
25. The law regarding interference with an award made by an Arbitrator under the Act is well settled. The Arbitrator’s award is generally considered binding between the parties because the is the tribunal selected by the parties. The power of the court to set aside the award is restricted on the grounds set out in Clauses (a)(b)(c) of Section 30 of the Act. The award may be set aside on the ground of error on the fact of it when the reasons given by the Arbitrator either in the Award or in any document incorporated therein are based upon illegal proposition which is erroneous. However, in absence of any reason for making the award it is not open to the court to interfere with the award. I have already indicated above that the court cannot probe the mental process of the Arbitrator and speculate where no reason has been assigned by the Arbitrator. In this context the observations in the case of Brijendra Nath Srivastva v. Mayoak Srivastva and Ors. (supra) is to be borne in mind which reads thus:
the court should approach an award with a desire to support it, if that is reasonably possible, rather than to destroy it by calling it illegal.
26. On the other hand, in my view, the decision in the case of State of Maharastra v. Nav Bharat Builders is more apt for considering the argument of Mr. Banerjee that the contractor was stopped from further work by a written order of the department and he was even restrained from shifting his machineries from the work site as a result of which he sustained heavy loss. In this reported case also the Arbitrator had come to the conclusion that there had to be different rate of compensation for the long stoppage of work. As in this case, in the aforesaid case volumnous record was placed before the Arbitrator to consider the actual damage suffered by the contractor for the long stoppage. Under these circumstances their Lordships held that “If, therefore, the arbitrator taking into consideration the said records had fixed a particular rate for different periods, it cannot be said that he had committed any error apparent on the face of the record.’ Their Lordships did not interfere with the award by concluding that” in any case we cannot go behind the quantum so awarded particularly when it is non-speaking award.”
27. In the aforesaid premises, in my considered opinion, in the instance case also the impugned award cannot be interfered being a non-speaking award.
28. The last submission of Mr. Eqbal that the learned court below has acted illegally by allowing cost to the respondent, is also not sustainable for the simple reason that the contractor had to approach the court for a reference to the Arbitrator and the Arbitration proceeding also was a long drawn affairs in which he had to suffer a heavy financial loss.
29. In the result, I find no merit in this appeal which is, accordingly dismissed. Parties to bear own costs.
