Bombay High Court
Municipal Corporation Of Greater ... vs Madhav Structural Engineering Ltd on 10 January, 2017
Author: N.M.Jamdar
Bench: N.M.Jamdar
ARBP873-09-JUD.doc
sas
I N THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION PETITION NO.873 OF 2009
Municipal Corporation of Greater Mumbai,
through its Executive Engineer (Sewerage
Project) having office at Annasaheb Vartak
Market Building, First floor, Vallabhbhai
Road, Ville Parle (West), Mumbai-400 056. ..Petitioner.
V/s.
Madhav Structural Engineering Limited,
a Public Limited Company duly
incorporated and registered under the
Companies Act, 1956, having office at
29/1, Juhu Supreme Shopping Centre,
Gulmohar Cross Road, J.V.P.D. Scheme,
Mumbai - 400 049. ..Respondent.
Mr.A.Y.Sakhare, Senior Advocate with Ms.Nikhita Trivedi and
Mr.R.Y. Sirsikar i/b. Mr.V.K. Khatu for the Petitioner.
Mr.Udayasankar Samudrala with Ms.Dhanushree Jairam Telhure,
Ms.Steffi Antony, Ms.Brinda Barnes, Ms.Natasha, Ms.Sukhada
Dalvi for the Respondent.
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ARBP873-09-JUD.doc
CORAM : N.M.Jamdar, J.
DATED : 10 Januar y, 2017
ORAL JUDGMENT
By this petition under section 34 of the Arbitration and Conciliation Act, 1996, the Petitioner Municipal Corporation of Greater Mumbai has challenged the Award of the sole Arbitrator dated 20 June, 2009. The learned Arbitrator has directed the Petitioner to pay a sum of Rs.3,26,36,994/- together with interest at the rate of 10% p.a. from 16 May, 2005 till realization and in addition to pay costs of the arbitration quantified at Rs.4,95,00,000/-.
2. The Petitioner-Municipal Corporation of Greater Mumbai is established under the Maharashtra Municipal Corporation Act. The Respondent-Claimant is a public limited company incorporated under the provisions of the Companies Act, 1956. The Respondent company-Claimant is in the business of construction as engineers for contract of civil nature. On 8 June, 2001, pursuant to the tender, the Petitioner-Corporation awarded the work of laying drainage and sewer lines in the suburbs of Mumbai to the Petitioner-claimant. The contract was for Rs.1,79,79,370/-. It was to be completed within a period of twelve 2/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc months from 1 October, 2001. The stipulated date for completion of the work was 30 April, 2003. Before entering into the contract, the Claimant made inquiry and investigation of the site condition and also made relevant inquiries regarding the labour, material, fuel, etc and entered into the contract. The primary nature of the work was to lay RCC pipes. The layout of the alignment was provided for by the Corporation along with the tender documents. The Claimant was also required to construct around 40 manholes. The work of excavation was to be carried out. The General Conditions of the Contract and Special Conditions of Contract formed part of the contract that was entered into between the parties. Parties were governed by the same. The Bill of Quantities appended to the contract provided for the quantity, nature of work. The rates were specified. Dispute arose between the parties as regards the work carried out. According to the Claimant, the work far exceeded provided in the Bill of Quantities and the alignment was changed by the Municipal Corporation on several occasions. According to the Claimant, it encountered hard rock more than what was expected and specified. Special machinery and extra manpower had to be deployed to undertake the work. According to the Claimant, it entered into correspondence calling upon the Corporation to make the payment, both for the work stipulated in the Bill of Quantities and the excess work and there was no response.
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3. The Claimant issued Advocate's letter on 16 May, 2005 to the Chief Engineer (Sewerage Project) calling on the Corporation to make payment as per the details, enumerated in the said letter. Since the Corporation did not take steps and accept the name of the Arbitrator suggested by the Claimant, the Claimant filed an Arbitration Application No.177 of 2005 in this Court. The learned Single Judge by order dated 17 February, 2006, appointed a learned retired Judge of this Court as the sole Arbitrator to decide the claim raised by the Claimant narrated in the letter dated 16 May, 2005.
4. A preliminary meeting was held on 28 March, 2006. On 22 April, 2006, the Claimant filed his statement of claim on 30 June, 2006 the Corporation filed written statement and disputed the claim. On 24 August, 2006 the Claimant filed a rejoinder. Documentary evidence was produced by both the parties before the learned Arbitrator. The Claimant led evidence of its Director, Ram Mahadev Chavan and of T.V.Ramchandran, an accountant and financial consultant. The Corporation led evidence of Nainash K.Cyclewala, a Sub-Engineer A.D.Belwalkar, Executive and Manish Kumar Patel, Assistant Engineer. The parties engaged advocates and argued their case.
5. On 1 November, 2006, an application under section 23 of the Arbitration & Conciliation Act, 1996 ('the Act' for short) 4/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc was made by the Claimant for amending the claim. The Claimant stated that the claim No.1and claim No.3 were required to be modified inter se. The amount of Rs.78,23,323/- which was included in claim No.1 needed to be shifted to claim No.3. Accordingly, the claim No.1 was sought to be reduced from Rs.1,68,78,466/- to Rs.90,55,143/- and claim No.3 was sought to be enhanced to Rs.2,35,81,815/-. This application was opposed by the Corporation. The learned Arbitrator, holding that what was sought was only internal adjustment without exceeding the total amount, allowed the application and amendment was directed to be carried out.
6. The learned Arbitrator heard the contentions. On behalf of the Claimant, it was contended that admittedly the work had exceeded and in spite of submitting detailed accounts and measurements, the Municipal Corporation had not taken any decision and the Claimant is entitled to the fair rate for the work in excess. According to the Claimant, the work exceeded ten times from what was stipulated in the Bill of Quantities. It was contended that since the Corporation had neither decided the dispute nor made any payments, the calculation submitted by the Claimant need to be accepted and appropriate amount need to be paid to the Claimant. On behalf of the Corporation, it was contended that an amendment by which additional claim was sought is beyond jurisdiction. It was contended that the Claimant 5/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc cannot seek any higher rate, as the Claimant had not submitted the measurements along with the final bill. In the correspondence as well as in the meeting, the Claimant had agreed to accept the tender quoted rate even for the excess work. Minutes of meeting and various endorsement show that the Claimant accepted the tender quoted rates. The measurement tendered by the Claimant was disputed. The Corporation sought dismissal of the claim of the Claimant.
7. Though various claims were made in the letter dated 16 May, 2005, before the Arbitrator what was pressed were claims No.1 and claim No.3. The learned Arbitrator held the amendment was properly granted and there was no error of jurisdiction. There was no acceptance by the Claimant that the excess work will be paid for on the basis of tender quoted rate and that the the so- called minutes of the meeting were not binding on the Claimant. The learned Arbitrator held that the measurements and the calculations quoted by the Claimant were not seriously disputed by the Corporation and that the claim made by the Claimant was more acceptable than the one advanced by the Corporation and the calculations made by the Claimant was more authentic. Accordingly, the learned Arbitrator passed the impugned Award on 20 June, 2009 directing the Corporation to pay the sum of Rs.3,26,36,994/-along with interest at the rate of 10% p.a. from 16 May, 2005. Challenging the same, the present arbitration petition 6/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc has been filed.
8. Heard Mr.A.Y.Sakhare, the learned Senior Advocate for the Petitioner-Corporation and Mr.Udayshankar Samudrala, the learned Advocate for the Respondent-Claimant.
9. Mr.Sakhare, the learned Senior Advocate for the Corporation, in short, made the following submissions: The Arbitrator exceeded the jurisdiction while granting the amendment and permitting a claim to be raised beyond the claim made by the Claimant by letter dated 16 May, 2005. The learned Single Judge of this Court, while referring the dispute to the Arbitrator referred to the letter of 16 May, 2005 and had categorically indicated the scope of the dispute. The amendment application which was filed on 1 November, 2006 was filed after the cross-examination of the Claimant's witness had started and such amendment in the midst of a hearing is not permissible. In cases of 1Sahyadri Earthmovers V/s. L and T Finance Ltd. & Anr. , 2Prakash Kumar Sinha V/s. Konkan Mercantile Co-operative Bank Ltd. & Ors . and 3J. Sameul & Ors. V/s. Gattu Mahesh & Ors., Courts have held that principal analogous to the Civil Procedure Code are applicable and, therefore, such amendment could not have been granted without proof of due diligence. It is a choice of the Claimant to reduce the claim but enhancement could not have been granted. The finding 1 2011 (4) Mh. L.J. 200 2 2013 (4) Bom. C.R. 688 3 (2012) 2 Supreme Court Cases 300 7/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc that there was no change in the ultimate amount does not confer jurisdiction on the Arbitrator to exceed the terms of the reference. The Arbitrator had also exceeded the jurisdiction by adjudicating upon the non arbitral items such as BOQ item 10, 11, 14, 15, 17, 22, 23 to 29, 31 and 51. Since the other items 8, 9, 16, 21, 43 and 49 were not pressed, there was no question of granting claim No.3. While passing the Award, the pro-rata cost was also not taken into consideration. The Claimant was estopped from claiming fair rate or higher rate than the tender quoted rate as the Claimant by his conduct and as in the correspondence had accepted that any excess work will be paid as per the tender quoted rate (BOQ rates). Authorised Officer of the Claimant Sanjay Udani had made endorsement on the measurement of the Corporation and when the Director of the Claimant had accepted the signing of the letter, there was no question of the Arbitrator holding that said Udhani was not authorised as the authority letter was not proved,. The Arbitrator needlessly came to the conclusion that the amounts were accepted and the words 'under protest' were scored off on the part of duress of the Municipal Corporation, when no such evidence was led by the Claimant. The finding that the Claimant did not accept that the tender quoted rates will be applicable, is perverse. The Arbitrator also did not take into consideration the Minutes of the Meeting dated 22 March, 2002. There was no certificate of measurement of hard rock resistance. The final bill which was submitted by the Claimant was clearly disputed even 8/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc before the arbitral proceedings and during the arbitration. The learned Arbitrator erroneously discarded the measurement recorded in the Corporation's final bill on the ground that they were not authentic because of difference in quantity. The excess payment statement was signed by the Claimant. There were various admissions by the witness of the Claimant accepting the signing of the bill accepting the statement. A simplicitor finding was recorded that the statement submitted by the Corporation is not realistic and that the fair rate submitted by the Claimant is realistic. The Arbitrator has proceeded on the basis that measurement and calculation of the Claimant are accepted which is contrary to the record and there are no such admissions. There is complete non application of mind by the learned Arbitrator. The rates quoted and measurement submitted are simplicitor accepted and no adjudication based on settled parameters is held. In view law laid down in the decisions in 4Swan Gold Mining Limited V/s.
Hindustan Copper Limited, Satyanarayana
5
Constructions
Company V/s. Union of India & Ors. and 6Associate Builders V/s. Delhi Development Authority, the Award is perverse, being based on no evidence. The learned Arbitrator has exceeded his jurisdiction by travelling beyond the contract and that is complete arbitrariness by the learned Arbitrator as to the issue and the dispute. The interest which has been granted by the learned Arbitrator was not correct and proper and, therefore, the Award 4 (2015) 5 Supreme Court Cases 739 5 (2011) 15 Supreme Court Cases 101 6 (2015) 3 Supreme Court Cases 49 9/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc needs to be set aside. The Claimant is not entitled to a fair rate as the clauses of contract contemplate only grant of BOQ rates for the works exceeding 125%. Even otherwise, this decision has to be taken by the Engineer by following certain well established parameters and if the arbitrator had to take the said decision then same parameters had to be adopted. Instead the arbitrator has simply accepted one figure. The Award is perverse and passed beyond jurisdiction and thus be set aside.
10. Mr.Udayshankar Samudrala, the learned counsel for the Respondent -Claimant submitted, in brief as follows: Under section 23 of the Act of 1999, amendment is permissible unless the parties have agreed to the contrary. There is no contra agreement between the parties that the amendment to the claim or the supplementary claim shall not be permitted. As per the calculations tendered, it is clear that the internal reworking of the amount claimed for claim Nos.1 and 3 was only to reduce the confusion. The claim No.1 originally had two components, first, work done and not paid as per the BOQ rates, second, the amount sought by way of rate difference in respect of excess quantity. Since claim No.3 was for rate difference between the excess quantity, it was thought prudent to shift the component of excess work from claim No.1 to claim No.3 to facilitate uncomplicated adjudication. Therefore, there is neither any change in the claim sought nor there is any excess claim made. Even if the excess claim is made, it 10/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc is not impermissible to do so in absence of any agreement to the contrary, as per the law laid down in the cases of 7Maharashtra Industrial Development Corporation V/s. Goverdhani Construction Co., 8State of Orissa V/s. Asis Ranjan Mohanty . At no point of time, the Claimant has accepted that the excess work carried out will be paid as per the tender quoted rate. The endorsement 'under protest' was scored off were only to see that the amounts due are not needlessly withheld and the endorsement was made under a typed sentence already provided by the Corporation. The witness of the Corporation has accepted that unless such endorsements were made, the final bill will not be sanctioned and the bank guarantees will not be sanctioned. The so called Minutes of the Meeting of 22 March, 2003 are not minutes but only an internal memo of the Corporation. Therefore, there is no error or perversity in finding of the Arbitrator that there was no complete Accord and Satisfaction on the part of the Claimant. Merely relying on few stray admissions of the witness, the entire evidence led before the Arbitrator cannot be discarded. The measurements have been submitted and the statement in the evidence that it has not been so submitted along with the final bill is only to indicate the procedure. At no point of time, the measurements were disputed. The learned Arbitrator considered the evidence wherein both the parties have placed on record the calculations and the measurements and has held that the 7 2008 (4) All MR 278 8 1999 (9) Supreme Court Cases 249 11/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc measurements of the Claimant are more reliable. The Arbitrator was well within his jurisdiction to arrive at this conclusion. The stand of the Corporation that the clauses contemplate only contractual rate is not correct. The fair rate can be arrived at by the Engineer and in spite of submitting all the material, no decision was taken. For absence of any challenge, the Arbitrator was not in error in accepting the claim of the Claimant. Neither Sanjay Udani nor Sandip D'costa, were authorized. The witness of the Municipal Corporation has clearly accepted the position that the work has exceeded the stipulated quantity. The Municipal Corporation did not counter the final bill within 60 days as specified in the contract and, therefore, they were precluded from raising any defence thereafter. The learned Arbitrator has taken into consideration that Poclain machine was used and the extent of hard rock was such that it was not anticipated by the Corporation. The Arbitrator has rightly accepted the fair rate. The scope of interference in Arbitral Award under section 34 of the Act is extremely limited. The Apex Court in 9J.G. Engineers Pvt. Ltd. V/s. Union of India & Anr., 10 Shri Lal Mahal Ltd. V/s. Progetto Grano Spa, 11Ravindra Kumar Gupta and Company V/s. Union of India and 12 McDermott International Inc. V/s. Burn Standard Co. Ltd. and Ors. has indicated the limited jurisdiction that is available and none of the grounds indicated in the law laid down by the Apex Court are 9 (2011) 5 Supreme Court Cases 758 10 (2014) 2 Supreme Court Cases 433 1 1 (2010) 1 Supreme Court Cases 409 1 2 (2006) 11 Supreme Court Cases 181 12/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc available and, therefore, the Award needs to be upheld.
11. First to deal with the contention of Mr.Sakhare regarding the amendment of the claim by the Claimant and the resultant excess of jurisdiction of the Arbitral Tribunal, the claim initially was made by the Claimant for nine claims. The details are as follows: Work done, not paid as recorded - Rs.1,68,78,466/-; Payment of extra items - Rs.40,60,800/-; Rate difference in excess quantity of rock cutting - Rs.1,57,58,528/-; Under utilization of overheads - Rs,25,19,358/-; Under utilization of labour force Rs.62,98,395/-; Under utilization of machinery - Rs.27,71,291/-; Loss of business opportunities - Rs25,19,358/-; Interest - 24% on the above claim amount from 01/05/2003 and Cost- Rs.5,00,000/-.
12. In respect of clause No.1, the amount claimed was Rs.1,68,78,466/-. In respect of the claim No.3, it was Rs.1,57,58,528/-. By amendment, the claim No.1 was reduced to Rs.90,55,143/- and claim No.3 was enhanced to Rs.2,31,851/-. According to the Corporation, it was beyond jurisdiction of the Arbitrator to grant. It was contended that since the provisions of Civil Procedure Code are applicable, an amendment without demonstrating due diligence in the midst of cross-examination could not have been granted. As regards the decision of the learned Single Judge in the case of Sahyadri Earthmovers and 13/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 ::: ARBP873-09-JUD.doc Prakash Kumar Sinha, the learned Single judge has not laid down an absolute proposition of law as sought to be advanced on behalf of the Corporation. In the case of Sahyadri Earthmovers, the learned Single Judge was considering a petition under section 9 read with section 19 of the Act. The learned Single Judge rejected the petition as not maintainable and thereafter, indicated certain guidelines in the absence of any particular procedure to be followed by the Arbitral Tribunal. The learned Single Judge noted that, the Arbitral Tribunal, which is not be bound by the Code of Civil Procedure, can formulate its own procedure and indicated certain guidelines to incorporate principles natural justice and fair opportunity in absence of any fixed statutory guidelines.
13. The Act of 1999 includes a specific provision in the form of section 23 in respect of amendments. Section 23 (3) reads as under:-
"23. Statements of claim and defence.-
(1)...
(2)...
(3) Unless otherwise agreed by the parties, either party may amend or supplement his claim or defence during the course of the arbitral proceedings, unless the arbitral tribunal considers it inappropriate to allow the amendment or supplement having regard to the delay in making it."14/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:56 :::
ARBP873-09-JUD.doc Therefore, this provision contemplates that subject to the agreement between the parties, there is no bar upon either of the parties to seek amendment of their claim or defence. In the present case, there is no agreement between the parties that the parties will not seek any amendment to the claim or defence. The argument that since this Court in the order dated 17 February 2006 referred to the letter dated 15 May 2005, the ambit of the arbitration proceedings stood circumscribed, cannot be accepted. For the failure of the parties to agree upon name of the Arbitrator, the parties invoked jurisdiction vested under section 11 of the Act. This jurisdiction is limited. In the order dated 17 February 2006, the learned single judge only made a reference to the letter dated 15 May 2005 to indicate the controversy. Once section 23 of the Act confers a specific right on the parties to seek amendment in absence of contrary to the contrary, unless there was a negative mandate in the order dated 17 February, 2006, such right cannot be taken away, assuming that such directions can be issued in the proceedings under section 11 of the Act. Mr.Samudrala, the learned counsel for the Respondent in this context has rightly relied upon the decision of the Division Bench of this court in the case of Maharashtra Industrial Development Corporation, wherein the identical argument regarding the power and jurisdiction of the Arbitrator in granting amendment was considered and negated. In that case even an additional claim was permitted. In the case of State of Orissa, the Apex Court following the decision in the case 15/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc of Santokh Singh Arora V/s. Union of India reported in A.I.R. 1991 SC 441 did not entertain the challenge to the Award which contained an amendment granted by the Arbitrator. Thus, it cannot be said that the Arbitrator did not have any powers to grant amendment and neither there is any agreement to the contrary or any specific curtailment of this right in the order passed by the learned single judge on 17 February, 2006.
14. The amendment could have been rejected if the Arbitrator had considered it inappropriate to grant it in respect of delay. The question whether, in view of the fact that cross- examination had commenced, the amendment was inappropriate. In this context, the exact nature of the amendment will have to be looked at. The claim No.1, before the amendment was Rs.1,68,466/- which contained two components. One of Rs.90,55,143/- and second of Rs.78,23,323/-. The first component was in respect of the work in which BOQ rates were claimed and in respect of second component of fair rate in respect of excess quantity was claimed. The claim No.3 was towards the amount of the rate difference in respect of excess quantity. This component of excess work was simply shifted. The stand taken by the Claimant that it will aid in speedy resolution of the dispute if one category is grouped together, was not inappropriate. Therefore, the learned Arbitrator permitted segregating and grouping of one type of claim, even though such request was made in the midst of 16/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc the cross-examination. Neither there was any jurisdictional error in granting an amendment nor any perversity in exercise of discretion in granting such amendment by the learned Arbitrator. Therefore, the argument advanced by the Corporation that the Arbitrator exceeded the jurisdiction, having allowed the amendment and permitted changing and enhancing claim No.3, cannot be accepted.
15. It is the contention of the Corporation that the Claimant was estopped from seeking any fair rate having agreed to the BOQ rates in correspondence as well as in the meeting. Secondly, it is contended that even assuming it is permissible to seek fair rate, the decision will have to be taken by the Engineer by following well settled parameters.
16. Firstly, it will have to be considered whether the Claimant was precluded from making any claim for payment as per fair rate for the quantity exceeding the Bill of Quantities. If no, then whether the conclusion of the Arbitrator that the work exceeded the quantity specified in Bill of Quantities and that the Claimant was entitled to Fair rate and the amount claimed, can be interfered with under section 34 of the Act.
17. Shorn of all details, the basic case of the Claimant is thus. Having done excess work beyond the one stipulated in the Bill of Quantities, the Claimant was entitled to fair rate and since 17/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc the Corporation did not take any decision, the arbitration clause was invoked and the matter was referred to the Arbitrator. The fair rate was to be decided by the concerned Engineer. Since the Engineer did not do so it was, therefore, it was necessary to appoint an Arbitrator to undertake this task. On the other hand, it is the Corporation's stand is that having accepted BOQ rates, fair rate cannot claimed even assuming there was any excess work, which there was none.
18. With these stands of the parties, three areas of adjudication arose before the Arbitrator. The first one was whether the Claimant was precluded from seeking fair rate, secondly what was the extent of the excess work that was carried out and thirdly what would be the fair rate per cubic meter to be applied to the excess work. The learned Arbitrator is a learned retired Judge of this Court and not a structural Engineer. A methodology has been provided under the terms of contract and parameters are well settled for the measurements and calculating the fair rate. Therefore, it was for this specialized exercise that an arbitration clause was invoked and arbitration proceedings were conducted. Keeping this prefix in mind, the arguments advanced of the learned counsel for the parties will have to be analysed.
19. The first argument that was advanced by the Corporation is regarding Accord and Satisfaction of the Claimant.
18/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 :::ARBP873-09-JUD.doc This is based on the endorsement by Sanjay Udani in respect of the measurement book, participation of the Claimant in the meeting dated 22 March, 2003 wherein the Claimant has stated to have accepted that excess work will have to be paid as per BOQ rates, endorsement rendered by the Claimant 'under protest' which was subsequently cancelled and statements made by the witness of the Claimant such that authority letter was signed and that the Director of the Claimant had attended the meeting on 22 March, 2003. The learned Arbitrator had come to the conclusion that the endorsement 'under protest' was scored off under duress of the officers of the Municipal Corporation and the witnesses of the Corporation had agreed to the suggestions that unless such endorsement was scored off, the final bill could not have been paid nor the amount of bank guarantee returned. The learned Arbitrator also held that the authority letter in respect of Mr. Udani was manipulated. Serious exception has been taken to this observation by Mr.Sakhare. According to Mr.Sakhare, there is no evidence to show any kind of undue influence by the Corporation. In this context, firstly, the Minutes of the Meeting dated 22 March, 2002, upon which heavy reliance has been placed by the Corporation, will have to be noticed. On the face of it, this document does not indicate that these are minutes signed by both the parties who attended the meeting. This document is signed by an Engineer of the Municipal Corporation and endorsed by the superior officer. It does not contain any signature of the Claimant.
19/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 :::ARBP873-09-JUD.doc If this document styled as Minutes of Meeting is put forth as a ground to deny the Claimant a fair rate as sought for, the conclusion of the learned Arbitrator not accepting this document as binding on the Claimant, cannot be stated to be impossible view. It is not that this document is signed by the Claimant with an unequivocal admission whereby the Claimant can be stated to have bound itself to have accept the BOQ rate for excess work.
20. Next facet relied upon by the Corporation is the scoring off the endorsement 'under protest'. According to the Corporation, this was done voluntarily by the Claimant and there was no such duress nor any admission by witness regarding the duress. Mr.Samudrala, the learned counsel for the Respondent has drawn my attention to this endorsement. The endorsement appears at one place as a signature of the Claimant that there are typewritten sentence. As far as the letter authorising Udani is concerned, the learned Arbitrator has stated that it is manipulated. Mr.Sakhare may be right in making a grievance, that having accepted the signature on the undated authority letter of the Director, the conclusion that the authority letter which is acted on, cannot be said to be manipulated. Considering the nature of jurisdiction invoked, only question is whether the conclusion drawn by the Arbitrator that this stand had to be taken by the Claimant to ensure speedy payment by the Corporation and it cannot be considered a clear conscious decision restrict the 20/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc Claimant's BOQ rates, can be stated as an impossible view or a completely perverse finding.
21. The learned Arbitrator took note of series of correspondence entered into by the Claimant calling upon the Corporation to make payments, which according to the Claimant were unjustly withheld. The Claimant had submitted the final bill and also the amount of bank guarantee was to be received. It not impossible, that a particular stand may be taken by a prudent businessman at a point of time if it leads to speedy disbursement of the payment. Therefore, the learned Arbitrator took a view that the situation which the Claimant found itself to be in, led the Claimant to make such a statement and cannot be considered as all time binding that the Claimant cannot claim fair rate any time thereafter. Apart from this, question was put by the Claimant, Shri Ajit Belwalkar, Executive Engineer of the Corporation as to whether the payment would not have been released to the Claimant if the Claimant had not signed the statement. To this question, the reply is given by the Engineer that in such a situation after sanction from the higher authority and after obtaining legal advice, he might have released the payment. This clearly indicates that had the document not been signed, an elaborate procedure would have entailed and that too the payment ' might' have been released. Therefore, the witness did not rule out not releasing the payment and an objection could be taken by the legal department 21/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc and the higher authorities.
22. It is no doubt true as urged by Mr.Sakhare, that there is no such admission by the other witnesses as referred to by the learned Arbitrator and that except such statement and such other relevant document has an endorsement of the Claimant. It is not open consider the individual merits of each piece of evidence in the limited jurisdiction under section 34 of the Act. If the conclusion of the Arbitrator is a possible one and for which some material exists, it is not open for the Court to interfere with such finding of fact. In the present case, the learned Arbitrator has taken note with the resultant situation of admission of Mr.Belwalkar regarding the proceeding to be followed in case of 'under protest' endorsements. The conclusion of the Arbitrator that the Claimant was not precluded at all from raising any claim for fair rate cannot be said to impossible conclusion. Thus, it cannot be said that the Claimant was precluded from raising any claim as per the terms of contract for the excess work before the Arbitrator.
23. The question whether the Claimant was entitled for payment for excess work at the rate quoted by the Claimant and whether the Award in respect of this claim can be sustained, is another matter altogether. In the claim before the Arbitrator, the proceedings were initiated by the Claimant based on the letter dated 16 May 2005. In this letter, the Claimant called upon the 22/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc Chief Engineer, narrating the scope of work, the basis of price bid, made a grievance regarding change of alignment and it was stated that the Claimant was required to carry out the work as per the contract, referred to variation in quantity, narrated the delay and hindrances and accordingly sought various claims. Claim Nos.1 and 3, sets out the work done and not paid and rate difference for excess quantity of rock cutting respectively. According to the Claimant, in spite of submitting the final bill, since there was no response, the Arbitral proceedings had to be invoked.
24. The parties are governed by the terms of the contract between them which has been executed on 8 June, 2001. The contingency of excess work is contemplated and dealt with by the general conditions of contract of civil work as well as the conditions of contract annexed to the tender document. The condition of contract in clause 37 speaks of the Bill of Quantities which contains the items for construction, installation, testing etc. The Bill of Quantities is used to calculate the contract price and the Contractor is paid for the quality of the work done at the rate of Bill of Quantities for each item. Clause 38 deals with changes in quantity. It states that if final quantity and the work done differs from the quantity of Bill of Quantities by more than 25% provided the change exceeds 1% of the initial contract, the Engineer will adjust the rate. If the initial contract price exceeds more than 15%, except with prior approval of the employer, the contractor will 23/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc provide the detailed cost breakdown if the requested by the Engineer. Clause 39 deals with the variation to be included in the updated programs. Clause 40 deals with payment for variations. For ready reference clause 37 38, 39 and 40 are reproduced below :-
" Bill of Quantities 37.1 The Bill of Quantities shall contain items for the construction, installation, testing and commissioning work to be done by the contractor.
37.2. The Bill of Quantities is used to calculate the Contract Price. The Contractor is paid for the quantity of the work done at the rate in the Bill of Quantities for each item.
38. Changes in the Quantities 38.1 If the final quantity of the work done differs from the quantity in the Bill of Quantities for the particular item by more than 25 percent provided the change exceeds 1% of initial Contract Price, the Engineer shall adjust the rate to allow for the change.
38.2 The Engineer shall not adjust rates from changes in quantities if thereby the initial Contract Price is exceeded by 24/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc more than 15 percent, except with the Prior approval of the Employer.
38.3 If requested by the Engineer, the Contractor shall provide the Engineer with a detailed cost breakdown of any rate in the Bill of Quantities.
39. Variations 39.1 All Variations shall be included in the updated Programs produced by the Contractor.
40. Payments for Variations.
40.1 The Contractor shall provide the Engineer with a quotation (with breakdown of units rates) for carrying out the Variation when requested to do so by the Engineer. The Engineer shall assess the quotation, which shall be given within seven days of the request or within any longer period stated by the Engineer and before the Variation is ordered.
40.2 If the work in the Variation corresponds with an item description in the Bill of Quantities and if, in the opinion of the Engineer, the quantity of work above the limit stated in sub clause 38.1 or the timing of its execution do not cause the cost per unit of quantity to change, the rate in the bill of Quantities shall be used to calculate the value of Variation.25/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 :::
ARBP873-09-JUD.doc If the cost per unit of quantity changes, or if the nature or timing of the work in the Variation does not correspond with items in the Bill of Quantities, the quotation by the Contractor shall be in the form of new rates for the relevant items of work.
40.3 If the Contractor's quotation is unreasonable, the Engineer may order the Variation and make a change to the Contract Price which shall be based on Engineer's own forecast of the effects of the Variation on the Contractor's costs.
40.4 If the Engineer decides that the urgency of varying the work, would prevent a quotation being given and considered without delaying the work, no quotation shall be given and the Variation shall be treated as a Compensation Event.
40.5 The Contractor shall not be entitled to additional payment for costs which could have been avoided by giving early warning. "
Clause 57 deals with the final account and clause 78 of the general condition of the contract of civil work deals with records and measurement, which stipulates that the measurements will have to be taken jointly by the Engineer or his authorized representative and by the Contractor or his authorized representative.
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25. As regards the Bill of Quantities, item No.5 was regarding the excavation. The quantity was stipulated 660 cubic meters and item No.6 was extra over excavation which was provided for 360 cubic meters. The rate for item No.5 was Rs.340/- and item No.6 was Rs.1,416/- and item No.7 of excavation by Splitter machine is Rs.240/- cubic meter at the rate of Rs.1,625/-.
26. The argument advanced by the Municipal Corporation firstly, is that, there is no concept of Fair Rate at all and the rules contemplates that only an amount as per Tender Quoted Rate even for excess work will be paid. For this purpose, clauses of the contract which are reproduced will have to be analysed. The gist of clause 38 is that if the work exceeds over and above which is stipulated under the clause, the Engineer is empowered to fix the rate for such excess work. It is open to the Engineer to call for the detailed cost breakdown in the Bill of Quantities. Clause 40.1 contemplates that the Contractor will provide the Engineer with quotation with breakdown of unit rates. The Engineer will access the quotation. Clause 40.2 deals with the variation with the Bill of Quantities and to work out the new rate for the relevant item of work. Neither of these clauses support the contention of the Corporation that the contract only contemplates that the additional / excess work can be paid only as per the BOQ rate. It is open for the Engineer to call for information, such as detailed cost breakdown from the Contractor. The argument of the Corporation 27/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc that in no circumstances Fair Rate can be claimed and granted, cannot be accepted. The Engineer is empowered to carry out this exercise.
27. It is also the stand taken by the learned counsel for the Claimant that the Engineer has to carry out the exercise. It is his contention however that since the Engineer failed to do so and the matter had been referred for arbitration. The adjudication of the rate of excess work by the engineer would depend upon the determination of extent of excess work, if any and secondly, the working out the fair rate. The determination of fair rate is a complicated exercise. The counsel for the Claimant agrees that it will depend on various parameters, such as nature of the work, the equipments used, manpower deployed, extent of excavation, type of soil, amount of hard rock encountered market rate, profit margin, etc. In the present case,this exercise is admittedly not undertaken by the Engineer. The decision making shifted to the learned Arbitrator. The decision making, which involves determination of the exact amount excess work and the working of the fair rate, had to be done as per the parameters indicated above. The quality of decision making and the parameters will not be changed even if the decision making shifts from the Engineer to the Arbitrator. It is the contention of the learned counsel for the Claimant that since the Arbitrator had carried out this exercise and the material placed on record by the Claimant was uncontroverted, 28/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc the conclusion of the Arbitrator ought not to be interfered. As stated above, the Arbitrator was not called upon to decide whether the fair rate already determined was proper or not. The original decision making of the determination of fair rate and working of the exact quantum of excess work was referred to the Arbitrator.
28. First is the question of quantum of excess work, stated to be carried out. The Bill of Quantities provided for specific work. In the final bill that was submitted by the Claimant, it was stated that 7000 cubic meters which according to the Claimant, was more than 1000%, which claim was disputed by the Municipal Corporation. According to the Corporation, the work was not 7000 cubic meters and as per the clauses of the contract, it had to be determined by a joint measurement. It is also the case of the Corporation that having accepted the payment for the work as determined by the Corporation, the Claimant could not claim higher rate for any excess work. In the earlier part, I have already held that the Claimant was not precluded from claiming higher rate, but at the same time, the contract between the parties contemplated that the measurement will have to be jointly done. This area of adjudication regarding the measurement arose for consideration before the Arbitrator.
29. Turning now to the Award and the manner in which the learned Arbitrator has dealt with these two issues. In the initial 29/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc part the learned Arbitrator has narrated on facts of the proceedings as they stand and the arguments of the parties regarding the amendment. Thereafter, the learned Arbitrator dealt with claims 1 and 3 from paragraph 9 onwards. In the earlier part of this discussion, the learned Arbitrator considered the arguments of the Corporation that the Claimant was precluded from claim recording additional work and deals with the documentary evidence. As regards the measurement book, the evidence of Mr.Cyclewala, the Sub-Engineer of the Corporation was noted, wherein endorsement 'seen' in the measurement book was noted. This statement was clarified that the work 'seen' does not mean a certificate. As regards the argument that the final bill was not accompanied out by measurement, the witness of the Claimant clarified that it may not have been be submitted with the final bill but it was submitted earlier. Be that as it may, the learned Arbitrator had to find that the measurement submitted by the Claimant were expressly admitted by the Corporation, if it not so to carry out the exercise to determine the actual excess work. Most of the discussion in the award is only to state what was the material on record. The learned Arbitrator has noticed that it is an undisputed fact that the Claimant came across a very hard strata. Thereafter, the learned Arbitrator considered the remarks that has been placed by the Engineer on hard rocks book register and has referred to the letter dated 16 May, 2005.
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30. The crux of the discussion and the conclusion of the learned Arbitrator is that the Respondent has not denied the fact that quantity in respect of BOQ item exceeded and except the evidence of witness Cyclewala, the Respondent had not contradicted the calculations. Mr.Sakhare made a serious grievance that there is no such unequivocal admission on the part of the Corporation by any of the witness and even prior to the Arbital proceedings the Corporation has disputed the figures. The learned counsel for the parties have read the evidence of the all the witnesses of the Corporation. There is no admission on their part that the measurement submitted and rates claimed by the Claimant are correct. Such questions have been specifically denied. In response to the letter dated 11 July, 2002 of the Claimant, wherein the Claimant has submitted a bill for the work done, by letter dated 29 August, 2002, the Corporation had specifically denied the claim. In this letter the Corporation stated that the quantity of rock by chiselling as well quantities of rock by splitter machine shown in the bills were not tallying with the office record and they are shown abnormally high. It is also stated for certain works stated to be carried out material, detailed measurements have been sought but were never submitted and needless disputes are sought to be raised.
31. Whether the Corporation was justified in taking the above stand is not the question, but it is clear that the Corporation 31/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc was all along disputing the measurements and the amount claimed by the Claimant. In spite of this stand, which continued in the arbitral proceedings by way of a written statement as well as in evidence of the witnesses of the Municipal Corporation, the learned Arbitrator came to the conclusion that the Corporation had not controverted the calculations. The learned Arbitrator mixed up the contentions as to the statement made by the witnesses of the Corporation that the work had exceeded to stipulated quantum with the actual quantum. Though the witness of the Corporation had stated that the work exceeded the stipulated quantum, there was no admission as to the exact extent thereof and the calculation of the payment. This was the very dispute that was referred to the Arbitrator. The learned Arbitrator having come to the conclusion that the Corporation itself has stated that the work has exceeded permissible limit, straightaway accepted the measurement submitted by the Claimant observing that they were not disputed by the Corporation.
32. Various challenges, therefore, arise with such approach of the Arbitrator. Firstly, the terms of the arbitration, even according to the learned counsel for the Claimant, were to determine the excess work and the fair rate. If no adjudication is done and the conclusion proceeds on the premise that claim was accepted by one party, which is not borne out by the record at all, then it will be a finding based on no evidence and it will lead to 32/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc perversity in the Award. Therefore, the position is that neither there is a joint measurement, neither there is unequivocal admission by the witnesses of the Corporation neither there is adjudication as to the exact extent of the work. The finding of the exact amount of work done is an independent exercise and it may be found that the figures supplied by either party are not correct. Therefore, unless a figure supplied by one party is unequivocally admitted by the other, the Arbitrator cannot side step such primary adjudication.
33. In the case of fair rate to be decided, similar approach is adopted by the learned Arbitrator. The fair rate has to be determined by the Engineer under the terms of contract depending upon the parameters enumerated above. The Claimant had sought for approving five times higher rate than the BOQ rate. Determination of fair rate had to be an independent decision and could not have been mere acceptance of rate indicated by either of the parties unless agreed by another. The learned Arbitrator, in respect of fair rate also held that, it was not controverted by the witnesses of the Corporation. The admission which have been taken note of are only regarding the change of alignment of the work encountering of hard rock and that poclain machines were used. These statements do not exempt the arbitrator from the primary responsibility of arriving at a correct fair rate. Throughout the Award all that has been referred to are the admissions of the 33/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc Corporation that the work exceeded the permissible limits. The core of the reasoning is found in paragraph 9 (xxiv) of the Award, which reads thus :-
"9. (xxiv) The Respondent produced a statement showing the calculations of fair rates made by the Respondent. Such statement of the Respondent is based on certain assumptions which are neither realistic nor pertain to the relevant period. Admittedly, such a statement of the Respondent pertain to a later period whereas the contract work is of the period 2001- 2002. The assumptions made by the Respondent in such statement are erroneous and cannot be related to the subject contract. The calculations of fair rates made by the Respondent thus cannot be relied upon. The Claimant has submitted a statement showing the comparison of fair rates as submitted by the Respondent pointing out the reasons for not accepting the fair rate calculations submitted by the Respondent through its witness in respect of the contract work. The fair rates demanded by the Claimant are authenticated and are based on the true and correct nature of the rock conditions and execution of the work thereof and as also as per the expenses incurred in execution of the work by the Claimant. "
34. In the above reproduced paragraph, the Arbitrator has stated that the statement submitted by the Claimant are 34/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc authenticated and based on true and correct nature of the rock condition and the statement made by the Corporation are based on assumptions which are not realistic. Firstly,there is no admission by the Corporation of the rate and the quantity specified by the Claimant. Secondly, why the rates submitted by the Claimants are authenticated and genuine, is nowhere to be found in the Award, except referring to the so called admissions of the witnesses of the Corporation. The determination of fair rate, as stated earlier, is a complicated and specialized exercise. It was this exercise that was referred for adjudication. A simplicitor edict cannot be issued that the rate submitted by one party is correct and one supplied by the other party is not proper. The award need not be detailed one nor lengthy reasons need to be given, but the underlying reason for the award should atleast be discernable. It is not possible to understand the rationale behind determining the excess work at 7000 cubic meters that is 1000 times more than the original work and granting at Rs.5,032/-, almost five times more than the BOQ rates. There had to be an adjudication with reference to various parameters. This exercise is completely missing from the Award.
35. The Apex Court in the case of Associate Builders has taken a review of various earlier decisions and has laid down various principles in respect of the scope of section 34 of the Act. The Apex Court has expounded the principle of fundamental policy of Indian Law, which is one of the parameters for 35/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc interference in an arbitral award. The Apex Court referred to its decision in the case of 13 ONGC Ltd. V/s. Western Geco International Ltd., wherein it was held that the expression Fundamental Policy of Indian Law would include the principles which provide for basic administration of justice and enforcement of law. The Apex Court stressed on the judicial approach and emphasized that while deciding the rights and obligations of the parties, the authority must apply its mind to the attending facts and circumstances before taking one view or the other. Non application of the mind is a defect that is fatal to any adjudication and the requirement that adjudicating authority must apply its mind, is a soul of our jurisprudence that it is fundamental policy of Indian Law. When the dispute was referred to the Arbitrator in the present case to determine the exact measurement and fair rate, the Arbitrator was expected to apply his mind to the parameters of determination of the fair rate. Simiplicitor accepting the case of one party on a mistaken belief that the case has been admitted, is a defect, as laid down by the Apex Court in the case of ONGC Ltd., contrary to the to the Fundamental policy of Indian Law. The Apex Court has also held that the Court is entitled to interfere in an Award which is perverse. It has been held that award is perverse when finding is based on no evidence. As stated earlier, the Arbitral Tribunal has proceeded that the measurement submitted by the Claimant and the fair rate are admitted. This finding is based on no evidence. In the present case, there is a clear dispute 13 (2014) 9 Supreme Court Cases 263 36/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc raised by the Corporation and, therefore, the finding of the Arbitrator that this position was accepted by the Corporation is based on no evidence.
36. Even assuming an adjudication was done, if the parties had referred a particular dispute to the Arbitrator and the parameters of resolving such dispute are known, then by not applying such parameters in decision making, the Arbitrator would be acting beyond the jurisdiction. If this process is not undertaken and all factors are not looked at then the end product is purely arbitrary. When the Engineer failed to perform the task and the Arbitrator was called upon to adjudicate, the parameters of adjudication did not change, only the decision making authority changed. The parameters, as per the arguments of Claimant itself, are nature of the work, the equipment used, manpower deployed, extent of excavation, type of soil, amount of hard rock encountered market rate, profit margin, etc. Therefore, it was implicit in the terms of reference to the Arbitrator that the adjudication will be done as per the same settled parameters. Since the learned Arbitrator did not analyse these parameters before passing the award, he had acted beyond the terms of reference. Mere existence of material on record is not a substitute to actual decision making. The learned counsel for the Claimant has failed to show that any such task undertaken by the Learned Arbitrator.
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37. As regard the decisions, which has been relied upon by the learned counsel for the Claimant in the cases of McDermott International and Ravindra Kumar Gupta and Company, various tests have been indicated by the Apex Court. As far as the case of Mcdermot International is concerned, the Apex Court in the case of Associate Builders has taken note of the same and has after considering the same has culled out the principles which are indicated above. The same is the position in the case of J.P. Engineers Private Limited where the decision has been considered in the case of Associate Builders and commented upon. In the case of Shri Lal Mahal Limited though the Apex Court was considering a challenge to a foreign award, enumerated the principles of public policy of India. This position is not in deviation from the law laid down in the Associate Builders wherein non application of mind and perversity in rendering an Award being grounds of challenge, were reiterated. In the case of Ravindra Kumar Gupta and Company, the arbitrator therein had given an award after elaborate discussion of the entire evidence and the division bench of the high court cursorily had recorded that the arbitrator has acted unreasonably and irrationally and had set aside the award. The Apex Court in that case categorically rendered a finding that the arbitrator had given an elaborate reasoning and therefore, findings of the arbitrator was not found to be perverse or based on no evidence. This case, therefore, is clearly distinguishable on facts. In the case of Satyanarayana Construction Company relied by the 38/39 ::: Uploaded on - 02/02/2017 ::: Downloaded on - 27/08/2017 12:42:57 ::: ARBP873-09-JUD.doc Corporation, dispute arose in respect of a contract of earthwork which was granted by the Union of India. For resolution of the dispute arbitrator was appointed. The arbitrator had granted additional rate. The award of the arbitrator was challenged. Though this decision was rendered in the context of work done within the contract, the observation that any figure or any measurement quoted by the Claimant cannot be ipso facto taken to be correct and granted, applies to present case. Once the Corporation had disputed the figures and measurement, the learned Arbitrator had to decide the dispute as per the parameters. In the present case, the learned Arbitrator has simply accepted the rates given by the Claimant as true and correct and the rates and discarded the measurements of the Corporation as not trustworthy and arrived at a figure without taking into consideration the accepted norms.
38. In these circumstances, the Corporation has made out a case for interference in the Award under section 34 of the Act. The Arbitration Petition is allowed. The Award by the sole Arbitrator dated 20 June, 2009 is quashed and set aside. No order as to costs.
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