Delhi High Court
R.S. Avtar Singh & Co. vs National Projects Construction ... on 31 March, 1992
Equivalent citations: 47(1992)DLT599, 1992(23)DRJ184
JUDGMENT Usha Mehra, J.
(1) Shri T.S. Murthy, the sole arbitrator was appointed to adjudicate the matter between M/s. R.S Avtar Singh and Co. Vs. M/s. National Projects Construction Corporation Ltd. He made and published his award on 31st July, 1990 and filed the same in this Court. Notice of the filing of the award was issued to both the parties. M/S.R.S. Avtar Singh & Co. did not file objections. However, the respondent/NPCC has filed the objections inter alia on the grounds that:
1.The arbitrator has misconducted himself and the proceedings by depriving the objector reasonable opportunity of hearing and also by omitting to record the minutes of the meeting held on 25th May, 1990.
2.The arbitrator has ignored the material document i.e. the final bill while publishing the award. The arbitrator acted behind the back of the objector by asking the petitioner to purchase the stamp paper on 25th May, 1990 while the proceedings were still going on.
3.The arbitrator has ignored the admitted facts regarding the cost of material. He made and published his award in haste even without waiting for his fees from the objector. He received respondent's part of the share of his fees from the petitioner without the knowledge of the respondent, and hurriedly published the award. The arbitrator had been biased.
(2) It is in this background that the objections have been filed challenging the a ward made by Mr. Murthy. The reason for seeking the arbitration by the petitioner was that responden. committed breach of the contract. The facts on the basis of which breach had been alleged were that the contract was entered into between the parties. Petitioner was to construct four godowns of total capacity of 19,580 metric tonnes with ancillary buildings e.g. canteen block, lavatory block and isolation shed at Partapur at a cost of Rs. 97,73,738.90 p. These godowns were meant for use by Food Corporation of India and the same were to be used for the deposit work undertaken by the Objector on behalf of the Food Corporation of India. The stipulated date for completion of this work was seven months. The site was handed over along with the lay out as per the drawings. The allegation before the arbitrator was that the objector started effecting major changes right from the very beginning which effected the mobilisation of resources, which had been planned on the basis of original drawings as well as the pace of construction. It was further the grievance of the petitioner that the objector did not supply the drawings for steel structural work in time nor supplied the drawing for ancillary buildings namely Isolation Shed, Lavatory Block and Canteen Block. The drawings were supplied almost after three months. Meanwhile, the price of the steel was increased. Since the drawings were supplied three months after, therefore, the work could not be completed within the stipulated period. The mobilisation advance amounting to Rs. 5,00,000.00 was sanctioned in favor of the petitioner. Payments were also delayed against the running bills. Further grievance of the petitioner was that after commencement of the work, it came to light that the quantities required to be executed at ground had practically no co-relation whatsoever to the quantities given in the document annexed to the contract. Some of the items were drastically curtailed or deleted and majority of the items were abnormally annexed. This was done entirely due to deliberate under assessment of quantities. The reduction of quantities in certain items of the contract was also deliberate as a result of which the petitioner was unable to meet their commitments and the work came to a stand still. Even the respondent failed to extend the schedule period of completion and categorically refused to grant the extention of time. This the objector did in order to avoid discharging his responsbility. With all these allegations the petitioner raised the following claims: 1.On account of work bill for work done amounting to Rs. 68,88,740.47p. 2. On account of refund of rebate illegally deducted by the respondent for quantities of work executed beyond the contract agreement quantities amounting to Rs. l,52,277.73p. 3. On account of interest on delayed payments amounting to Rs. 23,56,935.63 p. 4. On account of escalation of cost of material, labour and fuel amounting to Rs. 31,77,203.83p. 5. On account of abnormal increase in quantities beyond agreement quantities at enhanced rates amounting to Rs. 3,88,071.07p. 6. On account of loss of profit due to abnormal reduction of quantities amounting to Rs. 8,01,512.68 p. 7. On account of chowkidari charges continued to be incurred on the godowns amounting to Rs. 2.40,000.00 8. On account of prolongation of contract due to breach of contract by the respondent amounting to Rs. 1,67,05,188.89p. 9. On account of refund of security deposit amounting to Rs. 1,00,000.00 . 10. On account of release of performance bank gurantee amounting to Rs.1,67,000.00 11. On account of interest pendente lite and pre-suit at the rate of 19-1/2% per annum and finally on account of cost of arbitration amounting to Rs. 2,00,000.00 (3) These claims were refuted by the objector on the ground that it was the petitioner who could not complete the work inspite of the site having been handed over in time. It was the claimant who started the work late. The objector even extended time for completion of the project but still the petitioner could not complete the work in time. Moroever, the work executed by the petitioner was defective and defects had not been retified. Because of the non fulfillment of obligations on the part of the petitioner, the objector suffered financially at the hand of Food Corporation of India who recovered from the objector. L.D. @ 5% and also sent notice for recovering damages due to non completion of awarded work. The work executed was not only defective but was sub standard and it had to be done again involving expenses, and therefore, the performance guarantee was liable to be encashed. On account of the prolongation of the work beyond the schedule time the objector had to maintain its establishment and keep chowkidar at the site of the work and thus had to incur extra expenditure. There is in fact no financial burden on the petitioner nor the objector reduced the tender quantities while entering into formal contract.
(4) The arbitrator after going through the relevant contention raised by the parties made and published his award on 31st July, 1990. It is not a reasoned award nor the arbitrator has dealt individual claims of the claimant. By the impugned award the arbitrator has awarded a sum of Rs. 19,91,418.00 to the petitioner, M/s R.s. Avtar Singh against all its claims. While awarding this amount, he has observed that this amount includes the cost of material lying at site which will become the property of the respondent.
(5) It is against this award that the above objections have been filed as enumerated above.
(6) It is a well settled principle of law that the award of the arbitrator who is a choosen Judge of facts and of law, between the parties, cannot be set aside unless the error is apparent on the face of the award or from the award it can be inferred that the arbitrator has misconducted himself or the proceedings or that he has not applied his mind to the material facts. The court is not sitting in appeal on the award of the arbitrator nor can re-assess and re-examine the material which was adduced before the arbitrator. The Court cannot examine the correctness of the award on merits nor it is obligatory for the arbitrator to give detailed reasons. The Court unless come to the conclusion that the award is preposterous or absurd cannot set it aside nor can substitute its own decision in place of the arbitrator. It will be for the arbitrator to interpret the contract between the parties. If the arbitrator takes a reasonable view on the construction of a clause, the Court will not interfere unless the view is perverse. The award is not open to challenge on the ground that the arbitrator has reached a wrong conclusion or has failed to appreciate the facts. The arbitrator being the final judge of facts and law, the Court will interfere only if the arbitrator arrives at inconsistent conclusion even on his own finding or arrives at a decision ignoring the material document. The Court may differ in arriving at the decision but unless as pointed out above, the Court cannot set aside the award. That being the settled legal position, what we have to see in the facts and circumstances of this case is whether there is any error pointed out by the objector for which the award could be set aside?
(7) Mr. Taneja learned counsel appearing for the Objector contended that the arbitrator deprived the objector reasonable opportunity to present his case for which purpose he drew my attention to the various minutes of the arbitration proceedings. In the meeting held on 30th May, 1990 directions were issued to both the parties to file statement showing the materials lying at site. The objector was also directed to submit the original of the final bill and other bills together with photo copy of the final bill. The claimants were to submit the original bills of all the structural and re-enforcement steel purchased from time to time. These were to be submitted before 25th June,1990. In the minutes of the meeting issued on 31st May, 1990, the arbitrator asked the objector/ respondent to check up the 44 discrepencies regarding the statement showing the date of payment and the amount and submit the correct statement before 25th June, 1990. The arbitrator thereafter found that in the statement submitted separately by the claimant and the respondent/objector, there were discrepencies regarding the material lying at site. He, therefore, directed both the parties to jointly submit the statement of the material lying at site by 13th July,1990. Thereafter, the arbitrator vide letter dated 24th July,1990 pointed out that on scrutiny of the final bill and measurement submitted by the respondent/objector, he found certain discrepencies. The letter of 24th July, 1990 is crucial and has been relied upon by both the parties. The objector is relying on this letter to prove that having called upon the objector to explain the discrepencies vide this letter, the objector ought to have been given reasonable opportunity to explain the same. Having not done so objector has been prejudiced. Whereas according to the claimant/petitioner, the letter dated 24th July,l,990 only contained observations or best comments made by the arbitrator on the final bill submitted by the objector. Arbitrator did not seek any clarification on the same. Therefore, this letter being a crucial and important letter having bearing on the award of the arbitrator, it would be relevant to produce the same. "T.S.Murthy Arbitrator Ref.Arb-O11/89 In the matter of Arbitration between M/s R.S. Avtar Singh 19,Deepak 13, Nehru Place.New Delhi 110019 and N.P.C.C.Ltd. Raja House,30-31,Nehru Place, New Delhi-110019 The final bill of the partapur works was submitted by the respondent on 9.7.90. On scrutiny of the final bill and measurements the following observations were made: I. There is no signature of the claimant either in the detail measurements or in the bill. 2, There is no date of measurement either in the bill or in the measurements. 3. There is signature of the officer preparing the bill-signature of E.E. with date 28.6.90. 4. The executive Engineer has singed with date 28.6.90 at the end of the detailed measurement. At the end of the abstract there are two signatures with dates 28/6 and 2/7/90. If is not clear whose signatures is that of the other. 5. The gross amount of the bill is Rs.1,08,22,973.60 and that of 16th R.A.biU is Rs. 1,08,19,590.00. 6. The quantities shown in the bill under various items of work do not tally with the quantities indicated in the reconciliation statement of quantities jointly signed by both the parties and submitted to the arbitrator on 11.12.89. T.S. Murthy Arbitrator."
(8) Mr. Taneja contended that so far as the points raised at Serial Nos. 1,2 and 3 of this letter are concerned, these may or may not require any clarification but so far as items at Serial Nos. 4,5 and 6 are concerned, the arbitrator without getting the clarification could not have given his award. In fact vide this letter he had sought for the clarification from the objector. Against serial No.4, he had pointed out that it was not clear whose signature was there. Similarly, against Serial No.5, he found discrepency of figures in amount in the 16th running bill which also required clarification and finally against item No.6, according to him the quantity shown in the bill did not tally with the quantities jointly recorded by both the parties and submitted to him. Therefore, it was incumbent on the part of the arbitrator before publishing the award to have called upon the objector to clarify the difference in quantites. But he did not do so. No time was given to reconcile the same. The letter on 24th July, 1990, which according to arbitrator and the petitioner was handed over personally, in fact was delivered on 30th July, 1990 in the office of the objector. This letter was neither handed over to Mr. S.K. Taneja, Advocate of the objector nor to the unit officer of the objector on 24th July, 1990.Similarly,on the same date i.e. 24th July, 1990, Arbitrator issued another letter asking for his balance payment from both the parties or by any one of the party in the case the other fails to pay his share of the fee by or before 31st July, 1990. The said letter is reproduced as under: M/SR.S. Avtar Singh & Co. Contractors, 19, Deepak, 13, Nehru Place. New Delhi-110019 2. M/s National Projects Construction Corporation Ltd., Raja House, 30-31, Nehru Place, New Delhi -110019. I have to receive a balance payment of Rs. 13,000.00 (Rs. 6,500 from each party after adjusting the advance payment of Rs. 10.000.00 paid by each party. The balance amount ofRs. 13,000.00 shall be paid by both the parties (Rs. 6500 by each party) or any one of the party on or before 31st July, 1990. T.S. Murthy Arbitrator"
(9) This letter which is also alleged to have been handed over in person, according to Mr. Taneja, learned counsel for the Objector, never reached him nor was handed over to the Unit Officer. At that relevant time, Mr. A.P. Dhamija, Manager, Law was the Unit Officer. He was on leave from 23rd July to 27th July, 1990 and had not attended the office during this period. Therefore, the petitioner's contention that the letter was personally handed over to Mr. A.P. Dhamija, Unit Officer on the face of it is wrong. The copy of the office order dated 17th August, 1990 sanctioning the leave along with the leave application has been placed on record to prove that Mr. Dhamija to whom it is alleged that the letters dated 24th July, 1990 were handed over in person, was on leave. The Deputy Law Officer, Mr. Anil Mendiratta has filed his affidavit stating that he did not receive any letter nor the same could have been received by Mr. A.P. Dhamija as Mr. Dhamija was on leave. Mr. Taneja drew my attention to the affidavit of Mr. Ashok Dilwani, According to him on 30th July, 1990, the copies of these two letters dated 24th July, 1990 were found on his table in his office. One letter related to the clarification sought by the learned arbitrator and the other related to the directions given for the payment of arbitrator's fees. These two letters he forwarded to the advocate as well as to the Unit Officer dealing with the case. These two letters were handed over to the respective officers on 30th July, 1990. According to him these letters were never received in the office of the objector on 24th July, 1990. Since the letters were never received on 24th July, 1990, therefore, there was no time left with the objector to furnish the clarification or pay the fee of the arbitator. The arbitrator's letters were served on the objector only on 30th July, 1990 and on 31st July, 1990 the arbitrator without waiting for the reply from the objector, made and published his award in hurry. This thus deprived the objector the opportunity of explaining the discrepencies pointed out by the arbitrator. The arbitrator, therefore, when published the award, had no clear picture about the facts before him and was misguided by his own observations which is an error apparent on the face of the award. According to the objector, there is no affidavit by any of the officer or the employee who handed over the letter dated 24th July, 1990 in the office of the objector. Rather the petitioner had taken an inconsistent stand in this regard. Mr. Taneja has drawn my attention to the reply filed by the petitioner to the objection petition where the stand taken by the petitioner is that the "the copy of the said letter was also delivered by the arbitrator personally in the corporate office of the respondent/corporation. " (underlining is mine.) The letter dated 24th July, 1990 is alleged to have been delivered personally by the arbitrator at the corporate office of the respondent-corporation to Mr. A.P. Dhamija, Manager Law of the respondent/corporation. It has further been pleaded that the arbitrator had made his observation known to the parties in respect of the final bill submitted by the respondent-corporation. There was no necessity to forward the copy of the letter dated 24th July, 1990 to the advocate of the respondent/corporation or to its unit officer. The arbitrator did not require any further explanation from the respondent/ Corporation. After having stated so petitioner took a different stand when he filed the affidavit of Shri M.S. Bindra, duly constituted attorney of the petitioner. Wherein he stated that "that the letter dated 24th July, 1990 was also delivered at the office of Shri A.P. Dhamija, Manager Law on 24th July, 1990, which is irrelevant and beside the point as to whether Mr. Dhamija was on leave, his office was functioning. The observations made by the arbitrator in his letter dated 24th July, 1990 were inconsequential." This statement made in the affidavit of Mr. M.S. Bindra is contrary to the reply affidavit filed by the petitioner. Therefore. Mr. S.K. Taneja, contended that this affidavit shows that the petitioner and the arbitrator were in collusion. Mr. Bindra Realizing that Mr. Dhamija was on leave changed his stand. He had now pleaded that the said letter was delivered in the office of Mr. Dhamija even if he was on leave whereas in the reply affidavit, a clear and categorical stand was taken by the petitioner that the arbitrator personally handed over the letter to Mr. Dhamija. Tills is not only an inconsistent stand but proves the false-hood of the petitioner's case as well as misconduct of the arbitrator who inconvince with petitioner deprived the objector the opportunity to explain his part of the case with discrepencies pointed out by the arbitrator. The observations of the arbitrator in his letter dated 24.7.90 were not inconsequential but required explanation. The objector had always been ready and willing to explain and reconcile the quantities, but was not afforded any time. This tentamounts to depriving opportunity to the objector to dislodge the confusion working in the mind of the arbitrator. The arbitrator without getting the explanation and clarification on the points raised had no right to make and publish his award. In fact by doing so he had ignored the material facts i.e. the final bill and measurements. Final bill was submitted on 9.7.90 on which date there was no hearing on the final bill nor was discussed on 10.7.90 nor it find mention in arbitrator's letter dated 12.7.90. Therefore, it amounts to misconduct of proceedings by the arbitrator for which the award is liable to be set aside. In this regard, Mr. Taneja has placed reliance on the decision of Mt. Amir Begam Vs. Syed Badr-Ud-din reported in A.I.R.1914 Privy Council page 105 where it is held that "If irregularities in procedure can be proved which would amount to no proper hearing of the matters in dispute. There would be misconduct sufficient to vitiate the award without any imputation on the honesty or partiality of the arbitrator but the onus of proving the irregularities in procedure is on the person alleging the same." In this regard reference can also be made to the observation of the Andhra Pradesh High Court in the case of Chinoy Chalani and Co. V. Anjiah reported in Air 1958 Andhra Pradesh 384. In that case defendant was given an opportunity to file statement within three days and though that statement was filed the arbitrator without going through the same and without giving an opportunity to the defendant to be heard or fixing a further date for hearing gave their award and no date was fixed even for the award. In this view of the matter, Andhra Pradesh High Court held that it is impossible to hold that the award was passed after full enquiry and held the arbitrator guilty of judicial misconduct. It was further observed that the arbitrator should perform his quasi-judicial functions in a judicial manner and should not make a farce of the enquiry before him. Reference can also be made to the similar observation made by the Punjab High Court (Delhi Bench) in the case of Prem Nath Vs. 0m Parkash in the words of Chief Justice Bhandari, "although an arbitrator is allowed considerable latitude in the procedure adopted by him at the hearing it is essential that he should afford the parties a reasonable opportunity of being heard and of presenting their case. If he makes an award without complying with this essential requirement he does so at the serial of his award being declared invalid and inoperative in the eye of law." Same view has been expressed by the Patna High Court in the case of Sadhu Singh and others vs. Ramdeo Singh reported in Air (30) 1943 Patna page 318 as well as by this Court in the case of Union of India Vs. Puri Cons traction (P)Ltd. reported in 26 (1984) Delhi Law Times (SN) 26. Supreme Court in the case of K.P. Poulose Vs. Stale of Kerala and another has also while interpreting Section 30(a) of the Arbitration Act defined "Misconduct". Misconduct has not a connotation of moral lapse. According to Supreme Court, ignoring of material documents by the arbitrator amounts to misconduct. Relying on this judgment Mr. Taneja contended that the arbitrator ignored the final bill because he did not afford opportunity to the objector. Letter dated 24th July, 1990 indicate that the arbitrator compared the final bill with reconciliation statement and found discrepancy but never bothered to get it explained shows he ignored the final bill.
(10) On the other hand, petitioner's learned counsel placed reliance to a decision of our own High Court in the case of MadanLal Vs. Union of India &. Others . I am afraid this decision is of no help to the petitioner. The Court in that case was not concerned with depriving a party reasonable opportunity of being heard by the arbitrator. There is no quarrel with the proposition of law laid down in that case that this Court cannot reappreciate the evidence but that is not the case in hand. Similarly petitioner cannot take any advantage of Supreme Court observation in the case of M/s. Sudarshan Trading Co. Vs. The Government of Kerala & Anr. reported in Judgments Today 1989(1) S.C. 339. In that case the Supreme Court was concerned with a non speaking award where the objector wanted the Court to go behind the reasoning and probe the mental process of the arbitrator and speculate. And also his misconduct because arbitrator exceeded this jurisdiction. In this view of the matter Supreme Court observed that arbitrator being the judge of quality as well as of the quantity of evidence and it will not be for the Court to take upon itself the task of being a judge on the evidence before the arbitrator. But that is not the objection by the present objector. In the case in hand objector is not wanting this Court to probe the mental process of the arbitrator or reappreciate the evidence adduced before him. Nor they wanted to adduce any evidence uniti and unless arbitrator wrote the letter dated 24.7.90 what the objector in this case is pleading denial of reasonable opportunity. Hence the decision of the Supreme Court quoted above is of no help to the petitioner. Similarly the decision of this Court in the case of C-L. Misra Vs. Nehru Bhawan Trust & Others , is of any help to the petitioner because in that case Court was not concerned with the allegation of being deprived reasonable opportunity of being heard. Nor it is the case of the objector before this Court that the decision of the arbitrator is erroneous in law or fact as was observed in the case of Union of India Vs. M/s. Commercial Metal Corporation and another reported in Air 1982 Delhi page 267. In the instant case the whole emphasis of the objector is that he was not heard after the arbitrator pointed out the discrepancies and sought clarification and further ignored the admitted facts on record regarding payment by the objector to the tune of 75% cost of material and still the arbitrator has awarded full cost to the petitioner of the material lying at the site.
(11) Mr. Sethi contended that the arbitrator vide letter dated 24th July, 1990 never sought any clarification. He only made his observation on the final bill submitted by the objector. The perusal of the letter dated 24th July, 1990 nowhere shows that he wanted any clarification from the objector. To my mind, this argument is full of falanccies. Once the arbitrator points out the discrepencies in the final bill and measurements submitted by the objector after comparing the same he ought to have given opportunity to the objector to clarify the same with the reconciliation statement submitted by the parties jointly. This discrepency was material for determining the amount of petitioner's claim. Therefore in the absence of any explanation, it amounted to depriving the opportunity of being heard. Having pointed out these discrepencies it was necessary for the arbitrator to await the reply or the clarification and atleast afford a reasonable opportunity to the objector to explain the discrepency in this regard. It cannot be said that these observations were inconsequential. They in fact needed explanation.
(12) That from the affidavit which is on record supported by the documentary evidence placed on record i.e. the leave application of Mr. Dhamija, and the sanction order it is apparent that the letters dt. 24.7.1990 were not delivered personally by the arbitrator to Mr. Dhamija, as he was on leave from 23rd July, 1990 to 27th July, (13) From the affidavit of Mr. Ashok Dilwani, it is apparent that the letters dt. 24th July, 1990 were received in his office on 30th July, 1990, and on 31st July, 1990 the award was published. This conduct of the arbitrator shows that he was in great hurry to deliver the award even though it amounted to depriving reasonable opportunity of being heard the view point of the respondnt/objector. This is nothing but a misconduct on the part of the arbitrator. The claim No. 1 amounting to Rs. 68,88,740.47 p. pertain to the work done but not paid and therefore, the clarification regarding the quantities mentioned by the respondent/objector in the final bill and measurement, which according to the arbitrator did not tally with reconciliation statement jointly furnished by the parties required explanation. It was only when the objector failed to furnish any explanation that the arbitrator could have given the award. But without giving any reasonable oportunity, the arbitrator having published the award in a hurry, to my mind, amounted to misconduct.
(14) As regard the objection of the objector that the arbitrator did not record the proceedings held on 25th May, 1990, to my mind non recording of proceedings which were subsequently recorded on 10th July,1990 could not prejudice the cause of the objector nor it amounted to miscarriage of justice' nor the award on this ground can be vitiated. It this regard I am supported by the decision of our own High Court in the case of Sudhir Brothers Vs. Dda in S. 1522-A/87 decided on 21st December. 1990.
(15) Mr. Taneja then contended that there is an error apparent on the face of the award because the arbitrator ignored admitted facts on the record. It is not disputed by the parties that 75% of the price of the material purchased by the petitioner was advanced by the respondent/objector. But while awarding the amount, the arbitrator has allowed the full amount of the material lying at the site to the petitioner. The material lying at site belonged to the respondent/objector because only 25% i.e. the balance price of the material was to be paid by the objector whereas from the award it is apparent that the arbitrator has allowed the full cost of the material twice to the petitioner, there is an error apparent on the face of the award. During the course of the arbitration proceedings and in particular the proceeding held on 10th January, 1990, the arbitrator observed that the material for which the advance has been given by the respondent be removed by the respondent, meaning thereby that the arbitrator and the petitioner had admitted that the advance for the steel and other material had been given by the objector and the said material was lying at the site. It was the property of the respondent. Having observed in the proceedings of 10th January, 1990 and the claimant having already received 75% of the cost of the material, the arbitrator could not award any amount against the said material. The arbitrator while making the award has held. "the said amount of Rs. 90,91,4801- includes the cost of the material lying at site which will become property of the respondent". This shows double payment for the same material to the claimant which is not permissible under law. I find force in this submission of Mr. Taneja. The arbitrator's award to this extent is against the record. Having recorded in his minutes of of 10th January, 1990 that against these material advance has already been paid by the respondent to the petitioner to the extent of 75% of the cost of the material and the respondent could remove the material, the arbitrator without applying his mind has awarded the cost of the material lying at the site. This amounts to double payment. From the reading of the award it is apparent that the arbitrator has ignored this material admitted fact and awarded the full amount of the material. Otherwise he would have clarified in his award the above amount of Rs. 19,91,480.00 does not include the amount of advance made by the respondent/objector. Having not observed so there is definitely an error apparent on the face of the award and it can also be said that the arbitrator had not applied his mind properly while making and publishing his award. The contention of Mr. Sethi, learned counsel for the petitioner, that from the award it cannot be inferred as to how much amount against the material lying at site has been awarded, is on the face of it an untenable argument . The award of the arbitrator includes the amount towards the cost of material lying at the site. By no statute of imagination it can be said that it was balance cost i.e. 25%. The bare reading of the language of the award indicate that the full amount of the cost of the material has been awarded. The fact that from the award it cannot be inferred how much amount has been awarded towards the cost of the material shows that the award is vague hence bad in law. The admitted facts on record were that 75% advance for the cost of the material lying at site was received by the petitioner and only 25% was to be paid by the respondent, no justification has been given by the arbitrator for awarding the full amount of the material. Therefore, to my mind the argument of Mr. Sethi does not cut any ice. mr. Sethi's argument is based on surmises and conjuctures. Sofaras the award is concerned, Mr. Sethi's argument cannot be substantialed.
(16) Finally it was contended by Mr. Taneja that the petitioner knew the mind of the arbitrator and at the back of the objector the arbitrator asked the petitioner to purchase the stamp paper and submit the same which in fact the petitioner did. The stamp paper on which the award has been published was purchased by the petitioner on 25th May, 1990 while the arbitration proceedings were still going on. This shows that there was a collusion between the arbitrator and the petitioner. There is no letter on record by which the arbitrator asked the petitioner to purchase the stamp paper on 25th May, 1990. In the absence of any such letter, how the petitioner purchased the stamp paper is not known. Perusal of the file of the arbitrator does not indicate that the stamp paper was demanded by the arbitrator, in the absence of the .same it cannot be said that the arbitrator was responsible for the purchase of stamp paper by the petitioner nor the arbitrator can be held guilty for the same.
(17) Having observed that the proceeding never came to an end on 25th May, 1990 and these were continuing and the arbitrator having pointed out the discrepencies in the final bill and measurement and having called clarification, it was necessary for him to wait for the reply from the respondent but having not done so, the arbitrator misconducted himself and the proceedings thereby depriving reasonable opportunity to the objector. Hence in view of my above observations, the award is liable to be set aside on these accounts. Since the award is inseparable, therefore, the whole of the award has to be set aside.