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Judgment
Heard Mr. S.J. Roy, counsel appearing on behalf of the appellant.
Heard Mr. Shivam Kumar Advocate assisted by Ms. Kumari Sugandha, counsel appearing on behalf of the respondents.
This appeal under Section 37 of Arbitration & Conciliation Act, 1996 is directed against the order date 02.05.2005 passed in Misc. Case No. 08 of 2001 by learned Subordinate Judge-I, Chaibasa, West Singhbhum, whereby the award dated 28.02.2001 passed by sole Arbitrator has been set-aside.
SUBMISSIONS OF THE APPELLANT
The counsel for the appellant, on facts, submits as under:-
A. The appellant is the claimant/contractor who used to undertake various contract work in the State of Bihar now the State of Jharkhand. The claimant in response to a bid invited by the respondents for the work of rehabilitation of gravity and lift schemes of Chakradharpur and Bandgaon Blocks, District - West Singhbhum, (a 'World Bank' sponsored project) on 13.08.1996 participated in the tender which was cancelled on account of certain technical reasons. Thereafter, the work was put for re-bidding on 13.03.1997 in which the claimant had participated and ultimately the bid was allocated to the claimant. The agreement was drawn between the parties and initially the period of completion was only three months. The period of completion was made 12 months as revised by the 'World Bank' and thereafter the period for completion was extended twice i.e. up to 05.03.1999 and thereafter till 31.03.2000. Ultimately, the work was completed within the extended period. The claimant put forward a claim for payment of price adjustment and his claim was based on Clause 47 of the General Conditions of Contract read with the Contract Data. The claim was declined on the ground that Clause 47 of the Condition of Contract read with the Contract Data was not available to the claimant. Thereafter, the dispute was referred to the designated Adjudicator Shri A. K. Basu, retired Engineer-in-Chief, Bihar, who recommended for payment of price adjustment. When the authorities refused to honour the award of the adjudicator, a proposal for decision regarding the dispute involving the claim through arbitration proceeding was proposed and the parties agreed for arbitration.
B. Accordingly, the learned Arbitrator, a retired judge of Hon'ble Patna High Court, was selected as the sole Arbitrator with the consent of both the parties.
C. The learned Arbitrator while adjudicating the claim between the parties recorded the salient features of the agreement as follows:-
(i) Date of Bid
(a) Initial bidding date
- 13.08.1996
(ii)
(b) Rebidding date
- 13.03.1997
(iii) Clearance of World Bank vide Chief Engineer No. 414 dated 28/02/1998
(Annexure A-1)
(iv) Acceptance of bid
(vide CENo. 454 dt. 05-03-1998)
- 05/03/1998.
(Annexure A-2)
(v) Agreement
- IDA-CR2439-IN dt.06/03/98
For Rs. 1,09,63,898.00
(vi) Date of Commencement
06/03/1998
- 06/03/1998
Vide E.E., M.I. Divn., Chakradharpur Letter No. 223 dt.
(Annexure A-5).
(vii) Contract date of completion.
15/06/1998
(Three Calender Months)
(viii) Revised date of completion.
05/03/1999 (vide CE No. 951 dt. 21/05/1998).
(ix) Extended date
- 31/03/2000
The extended date vide CE No. 400 Dated 24/03/2000.
D. The learned Arbitrator recorded that the claim on account of price adjustment was to the extent of Rs. 14,11,398/-. The specific case of the claimant was also recorded in para 22 of the award, wherein it was stated by the claimant that when the matter went to 'World Bank' the authorities at Delhi, the time was raised from three months to twelve months and when the work could not be completed within twelve calendar months on account of no fault on the part of the claimant, the extensions were allowed from time to time up to 31.03.2000 vide Superintending Engineer's letter no. 499 dated 0206/99 (Ext-16) and also that of Chief Engineer No. 400 dated 24.03.2000 (Ext-34).
E. The specific case of the claimant before the learned Arbitrator was that the delay in completion of the work was wholly attributable to the respondents and the claimant had specifically asserted that the Chief Engineer, Ranchi through his letter dated 24.03.2000 had himself recommended for payment on account of price adjustment to the claimant and pursuant to this letter, the period of completion was extended till 31.03.2000 within which the claimant had completed the work. The calculation of the claim on account of price adjustment was also furnished by the claimant.
F. The respondents had objected to the claim of the claimant for price adjustment on the basis of Clause 47 of the conditions of contract by citing two reasons , firstly, the contract was for a period of less than one year and accordingly Clause 47 was not applicable as per the norms of 'World Bank' and secondly, there was no provision for price adjustment in the relevant agreement for which the claimant did not raise any grievance in the pre-bid meeting and accordingly, the claim of the claimant was beyond the scope of agreement.
G. The learned Arbitrator specifically considered the objection of the opposite parties and framed one of the issues, as to whether the period for completion of work was three months, twelve months or twenty four months and considering the recommendations for extension of time and the extension of time actually granted, held that the period of completion of work was twenty four months and accordingly held that the World Bank's norm in connection with the work, where completion period was less than 1 year would not apply.
H. Further, learned Arbitrator also framed an issue as to whether Clause 47, which was applicable at the stage of the first bid will be applicable to the work completed by the claimant pursuant to re-bid and whether the claimant would be entitled for the claim of price adjustment in spite of the fact that the space between Clause 46 and 48 was left blank and so far as other clauses, which were not made applicable, were specifically deleted by striking them off.
I. The learned Arbitrator after holding that the period of completion was twenty-four months, held that Clause 47 would apply and price adjustment would be available to the claimant. While examining the bid documents as well as the agreement, the learned Arbitrator found that so far as Clause 47 is concerned, the space was blank and the serial number had jumped from Clause Nos. 46 to 48, although, other clauses which were not applicable, like Clause 50 and a few others, the same were specifically struck off. The learned Arbitrator considered the Letter No. 125 dated 28.02.2000 and also Letter No.190 dated 14.03.2000 both relating to extension of the period of contract, held that from these documents, payment of price adjustment was an admitted fact.
J. The learned Arbitrator after considering the facts and circumstances of the case, including the space of Clause 47 being blank and also the letters in connection with extension of the period and recommendations for payment towards price adjustment, held that the claim of price adjustment as provided in Clause 47 is fully available to the claimant and also held that the claim of price adjustment of the claimant was also based upon principles of justice, equity and good conscience. The issue of limitation was also framed and the same was decided against the respondents.
K. Against the said Award, a petition under Section 34 of Arbitration and Conciliation Act, 1996 was filed for setting aside the award on the ground that both the learned Adjudicator as well as the learned Arbitrator had travelled beyond the bounds of the agreement and exceeded their jurisdiction and if a matter is decided in conscious disregard or against the term of contract, it may be stated that the matter is beyond the scope of submission to arbitration and such a defect would be covered under Clause (a) (iv) of sub-section 2 of Section 34 of the aforesaid Act of 1996.
L. The learned Subordinate Judge issued notice to the parties and after hearing the parties held that there is no question of interpretation of Clause 47 i.e. the price adjustment clause, as this clause was not in existence in the agreement and the claimant had neither protested nor objected at the time of signing the agreement. Accordingly, the learned Subordinate Judge held that by ignoring the same, the learned Arbitrator had traveled beyond his jurisdiction and has accordingly set-aside the award.
Counsel for the appellant while assailing the impugned order passed by the learned Subordinate Judge, submitted that after considering all the materials on record, the learned Arbitrator held that the claimant would be entitled to price adjustment not only by recording a finding that price adjustment is available in view of Clause 47 of the contract, but also by recording that the claimant would be entitled to price adjustment on the principles of justice, equity and good conscience also. He submits that even it is assumed for a moment, though not admitted, that the claimant was not entitled to price adjustment by specific reference to Clause 47, then also there was no negative covenant in the contract that price adjustment will not be available. He further submits that the case of the respondents before the learned arbitrator was that the Clause 47 of the contract was not available mainly due to the reason that for contract having period of completion less than one year, price adjustment is not available but the learned arbitrator held that the period of completion of contract was 24 months and held that price adjustment under Clause 47 would be available to the claimant.
Counsel for the appellant has relied upon para 15 to 18 of the judgment passed by the Hon'ble Supreme Court reported in AIR (2017) SC 3336 (Assam State Electricity Board v. Buildworth Pvt. Ltd.) referring to para 15 to 18 and also the judgment passed by the Hon'ble Supreme Court reported in (2007) Arb. W.L.J. 1 (SC) (K.N. Sathyapalan (Dead) by legal representatives vs. State of Kerala and Another) to submit that the learned Arbitrator had the jurisdiction to award price adjustment, even if it is assumed that there was no such stipulation in the contract. He further submits that the jurisdiction of learned Subordinate Judge is confined to Section 34 of the Arbitration and Conciliation Act, 1996 and he does not sit in appeal against the Award and it is not open to him to re-appreciate the evidences and come to a different finding.
Counsel for the appellant further submits that the learned Subordinate Judge, while setting aside the award, has only considered the clauses in the agreement and has totally over-looked the documents relating to extension and the recommendations in connection with payment of price adjustment, which were made even prior to last date of completion of the agreement and thus extension of time was granted after being conscious of the fact that price adjustment would be claimed by the claimant. The counsel further submits that the learned court below has also not dealt with the finding recorded by the learned Arbitrator that from the documents filed, price adjustment was an admitted fact. Accordingly, the counsel for the appellant submits that the impugned order is perverse and is fit to be set aside.
SUBMISSIONS OF THE RESPONDENTS
Counsel appearing on behalf of the respondents, on the other hand, submits that when Clause 47 was specifically missing from the agreement, although by way of blank space and parties having signed the contract with open eyes, it is not open to them to contend that Clause 47 is still existing in the contract. He also submits that merely because other clauses of the agreement referring to Clause 47 of the contract were existing, Clause 47 being the main clause and that being absent, the other clauses referring to Clause 47, were meaningless and redundant and merely because those clauses were existing in the agreement, no inference can be drawn that Clause 47 is still existing having not been specifically deleted. He submits that the learned Arbitrator has held that the claimant would be entitled to benefit of Clause 47, and this finding is ex-facie beyond the terms of the agreement and relief on account of price adjustment as claimed by the claimant could not have been granted by resorting to Clause 47, which was specifically absent in the agreement.
Counsel for the respondents further submits that the time was the essence of the contract and refers to Sections 55 & 56 of the Indian Contract Act, 1872 and has also referred to a judgment passed by Hon'ble Supreme Court reported in (2002) 4 SCC 45 (General Manager, Northern Railway & Another vs. Sarvesh Chopra), and submits that in a case where time is the essence of contract and the contractor accepts the belated performance of reciprocal obligation on the part of the employer, the contractor cannot claim compensation for any loss occasioned by non-performance of the reciprocal promise by the employer at time agreed, unless at the time of such acceptance, he gives notice to the promisor of his intention to do so. He by referring to paragraph 15 of the said judgment submits that under the Indian Law in spite of there being a contract between the parties, whereunder the contractor has undertaken not to make any claim pursuant to delay in performance of the contract occasioned by an act of the employer, still the claim would be entertainable in one of the following situations:-
(i) If the contractor repudiates the contract exercising his right to do so under Section 55 of the Contract Act,
(ii) The employer gives an extension of time either by entering into supplemental agreement or by making it clear that escalation of rates or compensation for delay would be permissible,
(iii) If the contractor makes it clear that escalation of rates or compensation for delay shall have to be made by the employer and the employer accepts performance by the contractor in spite of delay and such notice by the contractor putting the employer on terms."
Counsel for the respondents further submits that as the time was the essence of the contract between the parties and at the time of extension no steps were taken by the claimant to have stipulation for price adjustment, therefore, the claimant is not entitled to claim any price adjustment on account of principles of justice, equity and good conscience. He submits that as Clause 47 was totally absent in the contract, the learned Arbitrator could not have resorted to Clause 47 of the contract to give any price adjustment to the claimant. However, during the course of arguments, he could not show any provision from the contract giving any negative covenant stating that the claimant would not be entitled to any price adjustment.
Counsel for the respondents has also referred to a judgment passed by Hon'ble Supreme Court reported in (2010) 8 SCC 563 (Rashtriya Chemicals & Fertilizers Ltd. vs. Chowgule Brothers & Ors.) and has referred to Para Nos. 20 to 25 to submit that it has been held by Hon'ble Supreme Court that an Arbitrator cannot make Award contrary to the terms of the contract executed between the parties. The counsel has also relied upon judgement reported in (2007) 4 SCC (FOOD CORPORATION OF INDIA vs. CHANDU CONSTRUCTION AND ANOTHER) and reported in (2010) 8 SCC 563 (Rashtriya Chemicals and Fertilizers Limited vs. Chowgule Brothers and Others) as well as on AIR 1992 SC 232 (Nagindra Bahadur Singh vs. State of U. P.) to submit that the learned Arbitrator has acted beyond jurisdiction, has committed legal misconduct, travelled beyond the four corners of the agreement and has acted independent of contract.
FINDINGS OF THE COURT
After hearing the counsels for the parties and after considering the materials on record, this Court finds as under: -
I. The facts narrated by the counsel for the appellant as recorded above is not in dispute and accordingly they are not being repeated here.
II. The contract which was entered into between the parties was initially to be completed within 3 months' time, but was subject to repeated extensions of time with a clear recommendation for the payment of price adjustment. After issuance of last letter for extension of time dated 24/03/2000, the work was completed within the extended time i.e. before 31.03.2000.
III. Further, there is no dispute that so far as Clause 47 is concerned, the space remained blank and there existed clauses in the agreement which referred to Clause 47 and certain clauses in the agreement were specifically struck off. There is further no dispute that there is no negative covenant in the agreement denying price adjustment to the claimant. Further, at the stage of extension of the period for completion, there was recommendations in connection with payment of price adjustment and thus it is apparent that the claimant had raised his voice regarding claim for price adjustment even at the stage of extension of time for doing the work and ultimately the claimant completed the work within the extended time and claimed for price adjustment initially before the learned Adjudicator who recommended for grant of price adjustment to the claimant and when the respondents refused to adhere to the directions of the learned Adjudicator, the matter was referred to the learned Arbitrator who has also allowed the claim of price adjustment to the claimant.
IV. From perusal of the arbitration award dated 28.02.2001, it is apparent that the claimant had put forward a claim for payment of price adjustment as per Clause 47 of the Conditions of Contract read with the Contract Data for increasing the rate of labour, material, cement, steel, petroleum oil and lubricants and then it was specifically claimed that the delay in execution of the work was totally attributable to the respondents. The respondents had declined to make payment on the ground that price adjustment clause as per Clause 47 of the Conditions of Contract read with the Contract Data was not available to the claimant. It is admitted fact that the project was a 'World Bank' sponsored project. The bid was initially invited on 13.08.1996, in which the claimant had participated, but due to certain reason, there was an order for re-biding. The re-biding was done, the date of opening of bid was fixed on 13.03.1997 and claimant had participated and was declared successful. Thereafter, letter of allotment of work was issued and the agreement was drawn between the parties and the period of completion was only three months at the time of execution of the agreement, which was made twelve months as revised by the 'World Bank' and was subsequently extended till 31.03.2000 vide Chief Engineer's Letter No. 400 dated 24.03.2000 and ultimately, the work was completed within the extended time.
V. The claim of price adjustment was duly recommended by the Executive Engineer vide Letter No. 190 dated 14.03.2000 as well as Letter of Chief Engineer, Ranchi vide Letter No. 400 dated 24.03.2000. Accordingly, the claim of price adjustment on account of extension of time for completing the work was within the contemplation of the parties.
VI. Upon perusal of the Award, it further appears that the specific case of the State before the learned Arbitrator was that the claim of price adjustment was said to be not payable on the ground that the contract was for a period of less than one year and that being so, Clause 47 was not applicable as per 'World Bank' norms. It was contended that as the period of completion was within one year, so no provision for price adjustment was made in the relevant agreement.
VII. The learned Arbitrator after considering the materials and evidences placed before him recorded a clear finding that the period of completion of work will be twenty four months, both de facto and de jure and accordingly, Clause 47 will be applicable for work completed by the claimant and the claimant would be entitled for price adjustment. Further, the learned Arbitrator also held that the claimant was entitled to price adjustment on the ground of justice, equity and good conscience.
VIII. The learned Arbitrator also held that Clause 47 in the second bid document was not deleted, it was all blank and it was confusing and controversial, as to whether the blank space is due to over sight or intentional and the same could not have been printed on account of over sight or any technical error, this was so particularly in view of the fact that the other clauses which were not applicable were specifically deleted in the agreement itself.
IX. The learned Arbitrator further held that the payment of price adjustment can be said to be an admitted fact and for this he referred to Letter No. 125 dated 28.02.2000 written by the Superintending Engineer to the Chief Engineer that the Superintending Engineer had recommended for payment towards price adjustment to the claimant and also Letter No. 190 dated 14.03.2000 that the Executive Engineer had written to the Chief Engineer for payment towards price adjustment to the claimant.
X. This Court finds that the learned Arbitrator came to a conclusion that it was not clear that Clause 47 of the agreement was consciously not printed or it was just an error and there was no explanation on the part of the State in that regard. Further, by referring to the norms of 'World Bank' itself, it was held that the price adjustment as provided in Clause 47 was fully available to the claimant. It was the specific case of the State that Clause 47 was not available to the claimant in view of the norms of 'World Bank' which provided that benefit of Clause 47 will not be available for execution of work whose period of completion was less than one year and this argument of the respondents was rejected by the learned Arbitrator.
XI. The counsel for the respondents has relied upon the judgment passed by the Hon'ble supreme court reported in (2010) 8 SCC 563 (Rashtriya Chemicals and Fertilizers Limited vs. Chowgule Brothers and Others) to submit that it has been held in para 20 of the said judgement that an arbitrator cannot make award contrary to the specific terms of the contract executed between the parties.
XII. The counsel for the respondents has also relied upon a judgment passed by the Hon'ble supreme court reported in (2007) 4 SCC 697 (FOOD CORPORATION OF INDIA vs. CHANDU CONSTRUCTION AND ANOTHER) Para Nos. 11 to 15 to submit that the Arbitrator being a creature of the agreement has to operate within the four corners of the agreement and if he ignores the specific terms of the contract, it would be question of jurisdictional error on the face of the Award falling within the ambit of legal misconduct.
XIII. The respondents have also relied upon judgement reported in AIR 1992 SC 232 (Nagindra Bahadur Singh vs. State of U. P.) which is also on the point of jurisdiction of the arbitrator and it has been argued that an arbitrator cannot act arbitrarily, irrationally, capriciously or independent of the contract and his sole function is to arbitrate in terms of the contract.
XIV. This Court finds that aforesaid well settled principles of law as laid down in the aforesaid judgements are not in dispute, but in the instant case, the learned Arbitrator has not passed Award contrary to the specific terms of the contract entered into between the parties. Admittedly, there was no clause in the agreement denying price adjustment and the same was sought to be read into the agreement by the respondents by referring to the World Bank's norms which provided that there would be no price adjustment for work having period of completion less than one year and in the instant case, the learned Arbitrator has found that the period of completion of the work was 24 months and on this ground, has rejected the contention of the respondents that clause regarding price adjustment as per World Bank's norms was not available to the claimant. Admittedly, in the contract there is no negative covenant regarding grant of price adjustment and the learned Arbitrator has also justified grant of price adjustment to the claimant on account of justice, equity and good conscience also. This exercise on the part of the learned Arbitrator was purely within the domain of the interpretation of the contract between the parties considering the facts and circumstances of the case, which was certainly within the jurisdiction of the learned Arbitrator. In the said judgement reported in (2010) 8 SCC 563 (Rashtriya Chemicals and Fertilizers Limited vs. Chowgule Brothers and Others) the Hon'ble Supreme Court in
Para 21 of the judgment has referred to the various judgments of the Hon'ble Supreme Court on the point of jurisdiction of the Arbitrator. Para 21 of the said judgement reads as under: -
"15. ... [that] it is settled law that the arbitrator derives authority from the contract and if he acts in manifest disregard of the contract, the award given by him would be an arbitrary one[; that] [t]his deliberate departure from the contract amounts not only to manifest disregard of the authority or misconduct on his part, but it may tantamount to mala fide action. ...
... It is true that interpretation of a particular condition in the agreement would be within the jurisdiction of the arbitrator. However, in cases where there is no question of interpretation of any term of the contract, but of solely reading the same as it is and still the arbitrator ignores it and awards the amount despite the prohibition in the agreement, the award would be arbitrary, capricious and without jurisdiction. Whether the arbitrator has acted beyond the terms of the contract or has travelled beyond his jurisdiction would depend upon facts, which however would be jurisdictional facts, and are required to be gone into by the court. The arbitrator may have jurisdiction to entertain claim and yet he may not have jurisdiction to pass award for particular items in view of the prohibition contained in the contract and, in such cases, it would be a jurisdictional error."
It was further observed: (SCC p. 131, para 16)
"16. Further, the Arbitration Act does not give any power to the arbitrator to act arbitrarily or capriciously. His existence depends upon the agreement and his function is to act within the limits of the said agreement."
In the said judgement reported in (2007) 4 SCC 697 (FOOD CORPORATION OF INDIA vs. CHANDU CONSTRUCTION AND ANOTHER) the Hon'ble supreme court has held in para 11 as follows: -
"It is trite to say that the arbitrator being a creature of the agreement between the parties, he has to operate within the four corners of the agreement and if he ignores the specific terms of the contract, it would be a question of jurisdictional error on the face of the award, falling within the ambit of legal misconduct which could be corrected by the court. We may, however, hasten to add that if the arbitrator commits an error in the construction of contract, that is an error within his jurisdiction. But, if he wanders outside the contract and deals with matters not allotted to him, he commits a jurisdictional error (see Associated Engg. Co. v. Govt. of A.P. and Rajasthan State Mines & Minerals Ltd. v. Eastern Engg. Enterprises)."
This Court finds that the learned Arbitrator has interpreted the contract and has not committed any jurisdictional error or has ignored any specific terms of the contract or has operated beyond the four corners of the contract.
XV. Even if it is assumed for a moment, considering the arguments advanced by the counsel for the respondents, that the claimant was not entitled to price adjustment under Clause 47 of the contract, as the contract was executed with a stipulation that the work was to be completed within a period of three months and time was the essence of the contract , then also, at the time of repeated extension of time, the claim regarding price adjustment was certainly within the contemplation of the parties, in as much as, letters issued by the respondents regarding extension of time clearly mentioned about the claim of price adjustment which is apparent from the Award itself.
XVI. In such circumstances, the judgement which has been relied upon by the respondents reported in (2002) 4 SCC 45 (General Manager, Northern Railway & Another vs. Sarvesh Chopra), does not help the respondents in any manner whatsoever, rather, the judgment is in favour of the appellant considering the facts and circumstances of this case. In paragraph 15 of the said judgment, it has been held that under the Indian Law in spite of there being a contract between the parties, whereunder the contractor has undertaken not to make any claim pursuant to delay in performance of the contract occasioned by an act of the employer, still the claim would be entertainable in one of the following situations:-
(i) If the contractor repudiates the contract exercising his right to do so under Section 55 of the Contract Act,
(ii) The employer gives an extension of time either by entering into supplemental agreement or by making it clear that escalation of rates or compensation for delay would be permissible,
(iii) If the contractor makes it clear that escalation of rates or compensation for delay shall have to be made by the employer and the employer accepts performance by the contractor in spite of delay and such notice by the contractor putting the employer on terms."
XVII. This Court finds that the facts of this case would certainly fall under the situation number (iii) as enumerated in the said judgment and mentioned above, even if it is assumed that Clause 47 regarding price adjustment was not available to the claimant and time of three months for completion of the work was the essence of the contract. The learned Arbitrator has awarded price adjustment also on account of justice, equity and good conscience, which is an independent reason, dehors Clause 47.
XVIII. This Court further finds that in the judgment relied upon by the appellant reported in AIR (2017) SC 3336 (Assam State Electricity Board v. Buildworth Pvt. Ltd.) which has also considered the other judgment relied upon by the appellant reported in (2007) Arb.W.L.J. 1 (SC) (K.N. Sathyapalan (Dead) by legal representatives vs. State of Kerala and Another), there was a specific clause in the agreement which fixed a ceiling on price escalation, but at the stage of extension of time, the claimant by a letter had specifically intimated the employer that the said clause providing the ceiling would not be applicable for the extended period and the employer allowed the claimant to carry out the work beyond the prescribed period of agreement, the Hon'ble Supreme Court held that Arbitrator rightly allowed escalation in the contract amount.
XIX. This Court, upon applying the ratio of the aforesaid judgements, is of the considered view that under the facts and circumstances of this case, the learned Arbitrator has rightly allowed price adjustment to the claimant, even if the arguments of the respondents, that Clause 47 was not applicable as the period of completion of work as per agreement was three months i.e. less than 1 year and time was the essence of contract, is assumed to be correct. This is over and above the fact that upon appreciating the facts and circumstances of the case the learned Arbitrator by a well-reasoned award has held that the period of completion of the work was 24 months and accordingly, as per World Bank's norms Clause 47 was applicable and otherwise also the claimant was entitled to the price adjustment by applying the principle of justice, equity and good conscience.
XX. This Court finds that the learned court below while considering the point regarding applicability of Clause 47, only considered the fact that Clause 47 was not there in the agreement, in as much as, its space was blank and the other facts and circumstances of this case including the specific case of the State citing reasons for non-applicability of Clause 47 as per the norms of 'World Bank' and also the letters issued by the State prior to stage of extension of time reflecting the claim of price adjustment, was not considered by the learned court below. The learned court below failed to consider that availability of price adjustment under Clause 47 in the agreement or otherwise, was itself a mixed question of fact and law and was not open for interference under Section 34 of Arbitration and Conciliation Act, 1996 by re-appreciation of evidences led before the learned Arbitrator. In such circumstances, this Court finds that the learned court below, has erred in law, in setting aside the Award.
As a cumulative effect of the aforesaid findings, this Appeal is allowed and the impugned judgment passed by the learned court below is hereby set-aside.