STATE OF MADHYA PRADESH Vs. SATYAPAL WASSON

JUDGEMENT

(1.) THE State has preferred this appeal under Section 39 of the Arbitration Act, 1940, against the judgment and decree of the District Judge setting aside the award given by the Arbitrator under Section 30 of the Act.

(2.) THE respondent is a contractor and his tender for construction of Hasdeo project Main Canal, excavation and forming embankment from R.D. 12301 M. to R.D. 12720 M. and R.D. 13921 M. to R.D. 14160 M. Group No. IV for an amount of Rs. 1,38697.60p./- was accepted by the superintending Engineer, Hasdeo Project, Circle Korba, and the acceptance was conveyed to the respondent on 17-3-1969. It appears that before execution of the contract some dispute arose between the parties regarding interpretation of the rate for item No. 11 of the tender and the superintending Engineer wanted to put his own interpretation by way of clarification but the same was not accepted by the respondent. So on 21-5-69 a written contract was executed by the parties on the basis of the tender accepted without adding any clarification, Clause 29 of the contract provided that the decision of the Superintending Engineer would be final, conclusive and binding on the parties in respect of all disputes arising out of the contract. Items Nos. 4, 5 and 6 were for excavation work in different soils and for disposal within 60 meters. Item No. 9 provided for a lead for disposal beyond 60 meters upto 210 meters on extra payment of Rs. 80/- per 10 cubic meters. Item No. 10 provided for a lead for disposal beyond 210 meters upto 0.5 Kilo- ' meter on extra payment of Rs. 80/- per 10 cubic meters and item No. 11 provided for a lead for disposal beyond 0.5 kilometer upto 2 kilometer on extra payment of Rs. 4/- per 10 cubic meters, According to the respondent, for payment of Item No. 11 the amount has to be calculated by adding the rate provided for items Nos. 4, 5 and 6 and added to items Nos. 9 and 10, while the Department insisted that item No. 11 was an independent and a separate item and only Rs. 4/- has to be added to the rata provided for items Nos. 4, 5 and 6 in case the lead was from 0.5 kilometer to 2 kilometers. THE respondent put up his claim but the same was not accepted by the Superintending Engineer. A reference was, therefore, made to the sole Arbitrator i.e. the Superintending Engineer, for deciding the dispute. THE respondent then submitted his claim for Rs. 3,23,734.92p. in respect of the following 3 items; Claim No. 1 for Rs. 2,81,120/- towards additional payment due towards item No. 11, claim No. 2 for Rs. 16,259.92p. towards interest at 12 per cent per annum and claim No. 3 for Rs. 26,355/- for additional expenses incurred for re-excavating dump material from the site as the dumping area was not made available. THE claim was opposed by the State stating that for item No. 11 the respondent was responsible for quoting a very low rate ie. Rs. 4/- per 10 cubic meter, in addition to the rate provided for items Nos. 4, 5 and 6, towards the lead. THE respondent, therefore, cannot be paid anything extra. THE respondent is also not entitled to any isterest or extra payment for re- excavating the dump material. THE rate for items Nos. 9 and 10 cannot be added together for calculating the rate for item No. 11. THE Arbitrator after framing issues recorded evidence of the parties. THE respondent was permitted to cross-examine the witnesses of the opposite party. On 3-12-1970 the Arbitrator gave his award of Rupees 30,000/- for claim No. 1 and Rs. 1500/-for claim No. 3 while disallowing the claim No. 2 for interest.

(3.) UNDER Section 30 of the Arbitration Act an award shall not be set aside except on one or more of the following grounds namely:-- (a) that an arbitrator or umpire has misconducted himself or the proceedings, (b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under Section 35, and (c) that award has been improperly procured or is otherwise invalid. The Supreme Court in Alopi Prashad v. Union of India, AIR 1960 SC 588 has held as under (at p. 592):--