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9.1 This claim related to construction of the embankment of the Faizabad by-pass. The BOQ contemplated construction of the said embankment using fly-ash. Contending that the quantity of fly-ash stipulated in the contract was insufficient to construct the embankment, the respondent addressed a communication, dated 11th February 2006, to the Engineer-in-charge of the contract, requesting for revision of the rates mentioned in Item No. 2.08 of the BOQ (supra).

9.2 The Engineer, in his response dated 28th December 2006, stated that the fly-ash to be used in the construction of the embankment would be restricted to the BOQ quantity. In a subsequent communication dated 6th February 2007, the Engineer stated that the action of restricting the quantity of embankment construction with fly- ash upto 1,10,000 cu.m. (which was the quantity stipulated in the contract) had been taken in the interests of the appellant, in order to avoid huge additional financial cost.

9.9 Adjudicating on the issue, the Arbitral Tribunal found that there was a clear distinction between construction of the embankment of the project road of low height (up to 2.5m) by earth, and of the embankment of the Faizabad bypass (which was normally more than 3m in height) with fly-ash. It was also observed that the Government notifications dated 5th November 2002 and 4th December 2003 unambiguously provided for the use of fly-ash in the Faizabad bypass road, as it was within 100 km of thermal plants. These notifications had been included in the IRC specifications, which provided that any deviation therefrom could be agreed to only for technical reasons, if approved by the Chief Engineer (Design) or Engineer-in-Chief of the concerned agency or organisation. Given these facts, the Arbitral Tribunal opined that it was clear that the Faizabad bypass embankment had to be constructed using fly-ash for which rates were required to be quoted by the bidders under BOQ Item 2.08; on the other hand, shallow reaches of the main road were to be constructed using earth only. In view of the stipulation that no change, regarding usage of fly-ash, could be effected by the Engineer/employer except on a technical ground by approval of the competent authority, it was not possible for any bidder to anticipate construction of the embankment using anything other than fly-ash. Taking stock of the FAO(OS) 192/2017 & FAO(OS) 195/2017 Page 20 communications amongst the respondent, the Engineer and the appellant, regarding inadequacy of the quantity of fly-ash stipulated in BOQ Item 2.08 for construction of the embankment at the Faizabad bypass and how permission to use additional fly-ash was not granted only in the economic interests of the appellant, the Tribunal held that the appellant could not be expected to vary the BOQ items to derive financial benefits, to the prejudice of the interests of the respondent, by decreasing high cost items and increasing low cost items, without technical or compelling practical considerations. It was noted that Clause 51.1 of the GCC only empowered the Engineer to make variations, and not to change the very item with which the embankment was to be constructed. This change, in contravention of the contractual stipulations, it was noted, had been effected only to benefit the appellant financially. It was held that, after bidding and finalisation of the contract agreement, the basic structure of the bid could not be altered, and that it was not permissible for an employer, "to call for bid involving earth embankment and concrete dam structure, and during execution replace one with the other without any consequence".

9.14 Having perused the Award and the judgement of the learned Single Judge, we express our entire concurrence with the decision, of the learned Single Judge, not to interfere with the findings of the Arbitral Tribunal. On the face of it, it is clear that the contractual FAO(OS) 192/2017 & FAO(OS) 195/2017 Page 23 clauses contemplated construction of the Faizabad bypass embankment using fly-ash, and that the quantity of fly-ash stipulated in BOQ Item 2.08 was insufficient for construction of the embankment. The respondent appropriately requested for sanctioning of additional quantity of fly-ash to construct the embankment but, in order to minimise its own cost, the appellant directed the respondent to use earth from its own borrow area, instead of fly-ash, to construct the remainder of the embankment. There can be no manner of doubt that such alteration was not contemplated by the contract and had, in fact been directed in contravention of the existing Governmental instructions on the subject. While accepting the said request made by the appellant, the respondent made it unambiguously clear that it would be entitled to a new rate to carry out the said work, as it involved huge additional costs on its part, inter alia for procuring the said borrow earth and transporting to the site of the embankment. The attempt, of the appellant, to apply the rates contained in BOQ Item 2.02, to make payment against the work thus done, was obviously totally misguided, as BOQ Item 2.02 dealt with construction of roads of low height and not of the Faizabad embankment. There was, as the Tribunal correctly noted, a clear distinction between the two items of work. Equally ill conceived was the reliance, by the appellant, on Clause 52.2 of the GCC, which covered only changes in quantities of the material used in carrying out a particular item of work and not where the scope of the work itself was fundamentally altered by substituting one material by another.

10.2 The dispute in this case arose because the respondent claimed payment, for the work of fly-ash embankment, as a composite item under BOQ Item No. 2.08, whereas the Engineer, (whose decision was accepted by the appellant) certified and paid for part of the embankment, which comprised earth cover/intermediate soil lawyers under BOQ Item 2.02 and for the remaining part, having fly-ash in FAO(OS) 192/2017 & FAO(OS) 195/2017 Page 25 core, under BOQ Item 2.08. This distinction was sought to be explained, by the Engineer (and the appellant) on the ground that the contract contemplated separate rates in the BOQ Items for work done using earth and fly-ash. The matter was referred to the DRB, which accepted the claim of the respondent, stating that it was entitled to payment for the embankment construction with fly-ash as a composite section at the rates mentioned in BOQ Items 2.08. The decision of the DRB being unacceptable to the appellant, the dispute was referred to arbitration.