Arun Kumar Goel, J.
1. Brief facts giving rise to this case are that the State of Himachal Pradesh entered into an agreement for construction of 16.50 mtrs. effective span RCCT-Beam bridge over BhatkaNallah on Bodh Chakki Dhar road Km.52/825. After the tender submitted by the plaintiff-non-objector for the said work had been accepted by the department, agreement No. 20/1987-88 was entered into. The agreement/contract was for Rs. 5,71,234.20 and the date of the completion as per agreement was 8-6-1988. However, is is not disputed between the parties that this time was extended from time to time till Januray, 1990.
2. Since disputes had arisen between theparties, plaintiff claimed reference of disputes and Chief Engineer (North), H.P.P.W.D. Dharamshala vide his letter dated 9-3-1993 appointed Superintending Engineer, Arbitration Cell, H.P. P.W.D., Solan as sole Arbitrator to decide and make award regarding the claim and counter-claim between the parties in respect of the said work. Arbitrator entered upon the reference on 1-6-1993 and finally made his award on 25-6-1994, whereby a sum of Rs. 1,01,766/- in all has been held payable by the defendant in favour of the plaintiff in full and final settlement of all his claim and counter-claim of both the parties with respect to the contract in question.
3. Vide his letter dated 9-9-1994, Arbitrator submitted the Award to the Court and sent its copy under certificate of posting to the parties. Matter came up before the court on 30-12-1994 when notices were ordered to be issued to the parties. From the record it appears that the defendant had preferred objections to the award in question after the receipt of the intimation of filing of the award by the Arbitrator vide his letter dated 9-9-1994 and consequently, objections under Sections 30 and 33 of the Arbitration Act were filed on 4-10-1994 in the Registry of the Court which have been registered as OMP No. 633 of 1994. After the objections have 'been replied to by the plaintiff, rejoinder was filed by the defendant and on 29-6-1995. Following issues were framed by this Court on 29-6-1995:
1. Whether the objections as framed do not disclose any legal ground for setting aside the award under Section 30 of the Arbitration Act, as alleged? If so, its effect?
OP Non-Objector
2. Whether the objections have been filed within the period of limitation?
O.P. Objector
3. Whether the Arbitrator has misconducted himself and the proceedings, as alleged?
O.P. Objector.
4. Whether the Award submitted by the Arbitrator is beyond the scope of arbitration agreement, if so, its effect?
5. Relief.
4. As per order of the court dated 29-6-1995, parties were directed to produce evidence in the form of affidavit(s). On the aforesaid issues, the plaintiff filed his own affidavit and the defendant has filed affidavit of Shri J.S. Katoch, Executive Engineer, Nurpur Division, H.P. PWD, Nurpur.
5. After hearing the learned counsel for the parties and going through the record issue-wise findings are as under:
Issue No. 1
Shri J.S. Bhogat, learned counsel for the plaintiff has submitted that the objections as framed by the defendant do not disclose any legal ground on which those can be set aside and they do not fall within the ambit of Section 30 of the Arbitration Act. He further submits that even if without conceding it be admitted that the decision of the Arbitrator is errnoneous, it calls for no interference unless the objector is in a position to demonstrate that the Arbitrator has mis-conducted himself and the proceedings. He further submits that during the course of arguments with reference to the award in question nothing has been pointed out which in law cart be construed so as to say that the Arbitrator has misconducted himself and the proceedings in respect of the award in question. In this behalf, learned counsel appearing for the plaintiff has placed reliance on AIR 1987 SC 81, M/s. Hindustan Tea Co. v. M/s. K. Shashikant & Co. An extract from the said judgment relevant in the present case is to the following effect:
'......... Under the law, the arbitrator ismade the final arbiter of the dispute between the parties. The award is not open to challenge on the ground that the Arbitrator has reached a wrong conclusion or has failed to appreciate facts. ........'
6. In the present case nothing has been pointed out so as to enable this Court to hold that there is a mis-conduct on the part of the Arbitrator. It may be pointed out in this context that the award in the present case is a reasoned award and the Arbitrator in thepresent case as in the face of the material on record of the arbitration file has neither misconducted himself nor has he mis-conducted the proceedings. That being the position. Issue No. 1 is decided in favour of the plaintiff.
Issue No. 2
7. During the course of the arguments, Sh. J. S. Bhogal, has clearly conceded that the objections being within time, he does not press these objections and further the record also reveals that from the date of intimation i.e. letter dated 9-9-1994 from the Arbtirator, the objections having been filed on 4-10-1994, as such those are within time, and accordingly this issue is decided in favour of the defendant.
Issues Nos. 3 and 4
8. Both these issues being inter connected are being taken up together for determination. Shri M.L. Chauhan, learned Assistant Advocate General, has drawn the attention of this court to paras 3, 4 and 6 of the affidavit of Shri J.S. Katoch and Annexure R-3 attached with the affidavit as well as Clause 10(c) and Clause 12(A) of the Arbitration Agreement and further submits that the award given by the Arbtirator is liable to be set aside and the mis-conduct on the part of the Arbtirator is writ large and therefore, objections deserve to be upheld and he has prayed accordingly. Annexure R-3 filed with , the affidavit of Sh. J.C. Katoch to my mind does not improve his case as it is simply the extract from the agreement in respect of Clause 29(1). It is not understood as to in what manner the defendant objector could withhold payment when admittedly the time has been extended till January 1990 by which time the work had been concluded. Power to extend the time was with competent authority and the same having been extended is no more in controversy. In this context, it may not be out of place to mention here that when the period for completion of work in question was extended by the defendant, they are liable to pay wages in terms of Clause 10(C) of the agreement. In these circumstances, the amount awarded under claim No. 4 by the Arbitrator is perfectly justified and the submissions to the contrary made by the learned Assistant Advocate General do not hold the ground. Shri M.L. Chauhan further submits that wages are not payable, however, a perusal of the clause shows that price of any materials incorporated in the works, and/or wages of labour increases as a direct result of the coming into force of any fresh, law, or statutory rule or order, in respect of that materials such increased price and/or in respect of labour engaged on the execution of the work such increased wages, then the amount of the contract shall accordingly be varied. This plea is subject to certain rider and the authority to determine this question is finally with the Superintendending Engineer. Shri Chauhan submits that on the material on record, the award has been procured by the plaintiff and it deserves to be set aside by deciding issues Nos. 3 and 4 in favour of the defendant.
9. On the other hand, Shri J.S. Bhogal has submitted that the defendants have failed to point out any mis-conduct by referring to any specific portion of the award and/or to any material from the file of the arbitration proceedings. He further submits that this court is not sitting as a court of appeal on the award of the Arbitrator. According to him, the report submitted by the arbitrator on law and fact is final and even erroneous findings if on preponderance, on the basis of the material can be upheld, do not tentamount to mis-conduct and thus call for no interference. He has further submitted that jurisdiction of the court is very limited in the matter of interferring in the award of the arbitrator, because forum as well as the Judge is chosen and appointed by the authorities with the consent of the parties, and according to him the court has no jurisdiction to sit in appeal and examine the correctness of the award. In this behalf, he has made reference to AIR 1989 SC 777 Puri Construction Pvt. Ltd. v. Union of India and observations made in paras 7,13 and 15 which are extracted below, support his submissions and he prays that findings on Issue Nos. 3 and 4 may be decided against the defendant.
'7. Referring to the objections of the Union of India filed before the arbitrator to claim No, 21 of the contractor, Mr. Sibal contended that no objection was taken at all to the resale value of the salvaged steel. It was pleaded on behalf of the respondent that this item must be deemed to be included in the work originally allotted and no extra payment could be allowed. This objection, however, was rejected by the arbitrator as also by the High Court and since there is no appeal filed on behalf of the respondent and the plea has not been pressed before us, the point stands concluded. The objection petition was referred to by Mr. Sibal for the purpose of his argument that there was no denial to the resale value of the salvaged steel as mentioned in the contractor's claim and it was, therefore, not open to the High Court to go into the additional argument belated addressed by the Union of India. The learned counsel further supported the decision of the arbitrator on merits, by reference to the evidence available before the arbitrator. The arbitrator who was a retired Chief Engineer of the respondent held that value of the salvaged steel was approximately half the price of the new steel. According to the contractor the price of the new steel was Rs. 900/ - per metric tonne while the respondent claimed that it was Rs. 1400/ -per metric tonne. The arbitrator held that the rate varied between Rs. 1100/- to Rs. 1200/-, per metric tonne and taking the higher figure of Rs. 1200/-, the arbitrator held that the salvaged steel should be valued at the rate of Rs. 600/- per metric tonne, and the amount payable to the contractor should be reduced accordingly. The Union of India examined its Executive Engineer, Sri M.L. Wadhwa, as one of the witnesses before the arbitrator and thus he in his evidence expressly stated thus:--
'The market inquiry was made by the site staff for the sale of dismantled steel and was assessed at Rs. 700/- per M.T. which was adopted in the analysis finally approved.'
The High Court while dealing with this item referred to the Bill of the appellant mentioning the rate of 'staged steel' at Rs. 2,553.98 per metric tonne and on thatbasis held that the contractor's claim ought to have been reduced by the arbitrator for the salvaged steel at that rate. It was pointed out by Mr. Sibal that the aforementioned claim in the Bill was not accepted by the arbitrator and the award could not be characterised as inconistent on that basis. Relying upon Sri Wadhwa's statement, it was urged that while the Union of India itself led evidenc to show the salvaged value at Rs. 700/- per metric tonne, the High Coutt was in gross error in allowing the higher rate of Rs. I250/- per metric tonne. It was further pointed out that in its statement before the arbitrator there was no reply on behalf of the Union of India at all to the corresponding Claim No 63 with reference to the Hall of Industries, Mr. M.M. Abdul Khader, learned counsel for the respondent, could not point out any acceptable material in support of the finding of the High Court except relying on the judgment itself. With respect of Claim No. 63 he said that since it was similar to Claim No. 21, the objections raised to Claim No. 21 should be read to apply to Claim 63 also. Even on accepting the suggestion and interpreting the objection petition of the respondent liberally, the decision of the High Court cannot be maintained. When a court is called upon to decide the objections raised by a party against an arbitration award, the jurisdiction of the court is limited, as expressly indicated in the Arbitration Act, and it has no jurisdiction to sit in appeal and examine the correctness of the award on merits. However, so far as the present case is concerned, the decision of the arbitrator is supported by the evidence led before him including the evidence of the Union of India, and appears to be correct on merits also.
13. Although Mr. Sibal relied upon various other parts of the records, we do not think it necessary to consider merits of the claim in further detail, specially because no detailed reply was attempted on behalf of the respondent. Besides, a court while examining the objections taken to an award filed by an arbitrator is not required to examine the correctness of the claim on merits. The scope is very limited and none of the points which can be entertained has been substantiated by the objectior-respondent Mr. Sibal dealt with the merits of the claim, as he put it, only forsatisfying the conscience of the Court that the award was fair. He went to the length of saying that -actually by refusing further relief to which the contractor is entitled to (which will be dealt with hereafter), the arbitrator acted very strictly in allowing the claims.
15. On behalf of the apellant Mr. Sibal pressed the contractor's objection to the award with respect to Counter-Claim No. 3. On account of the change in the design, it became necessary to resort to weilding at places in the structures referred to as joints instead of using binding wires. The contractor was, therefore, entitled to additional payment. The learned counsel criticised the award by saying that the rate allowed by the arbitrator was far less than the market rate, and the difference in the amounts would be very large. It was suggested that since the arbitrator is now dead a fresh arbtirator may be appointed by this Court for deciding the claim on this item. We 'are afraid, for the reasons as indicated earlier, it is not open to the court to examine the correctness of the award on a re-appraisal of the evidence. Further the records also show that at one stage the contractor had indicated its willingness to execute the weilding work at the lower rate. The learned counsel for the appellant attempted to meet this aspect by saying that this offer was withdrawn. However, Mr. Sibal himself, in the course of his argument, while dealing with the other items, rightly pointed out that the arbtirator was a highly qualified Engineer, fully conversant with the nature of the work and should be presumed to correctly evaluate the additional work done. For similar reasons the contractor's claim, for higher rate of interest has also to be rejected.'
10. Shri Bhogal has further placed reliance on AIR 1995 SC 2423, Trustees of the Port of Madras v. Engineering Constructions Corporation Ltd. and he submits that in the present case the award is a reasoned award and the defendants want the same to be set aside on the ground that the arbitrator has misconducted himself and the proceedings. In order to sustain its plea, objector must show that the error should be such which must appear from the award itself or from document or note incorporated in it or appendedto it and it is not permissible for this court to travel beyond the same. Not only this, but he has gone a step further by submitting that the findings of fact recorded by the arbitrator which according to him are supported from the material on record cannot be reappraised, simply because court would come to a different conclusion. According to learned counsel for the plaintiff, there is no error apparent on the face of the record so as to warrant interference therewith has been pointed out by the learned counsel for the defendant-objector and as such, there is no question of mis-conduct either of the proceedings or himself against the arbitrator. In support of this submission, he has placed reliance on decision of the apex Court as (sic) further submitted that scope of Clause 25 of the Agreement is very wide and it covers all the matters of disputes between the parties. Therefore, on this ground also the award deserve to be upheld.
11. After considering the respective submissions of the learned counsel for the parties, it is manifestly clear that nothing has been pointed out on behalf of the objector-defendant regarding mis-conduct of the proceedings as well as by himself by the Arbitrator and similarly nothing has been pointed out to show that the award submitted by the Arbtirator is beyond the scope of arbitration agreement and accordingly both these issues are decided against the objector-defendant.
12. Though no issue has been framed regarding interest allowed by the Arbitrator, yet Shri Chauhan has referred to para 5 of the objection petition (OMP No. 633 of 1994) as well as para 5 of the affidavit of Shri J.S. Katoch. In this behalf it is submitted that question is no more in dispute in view of the authoritative pronouncement of the Apex Court in case reported in AIR 1992 SC 732, Secretary, Irrigation Department, Government of Orissa v. G.C. Roy, With Secretary to Government of Orissa v. Ragunath Moha-patra. As per this judgment it can be safely presumed that it is an implied term of contract and arbitrator has the power toaward pendente lite interest, as such the contention raised by Shri Chauhan is repealed. Incidentally, it may be pointed out that merely a issue has not been framed, will not prejudice any of the parties as both the parties as both the parties were aware of their respective pleadings and have gone to the trial, being well aware of their respective case as pleaded in the objection/reply.
13. So far the interest relating to the period after the date of the award is concerned, this Court is competent to grant it under Section 29 of the Arbitration Act. Accordingly, it is ordered that the plaintiff would be entitled to interest at the rate of 10% p.a. on the awarded amount with effect from 1-3-1996 till the date of payment. The objections are dismissed with costs which are quantified at Rs. 2000 -.