Madnani Construction Corpn. (P) Ltd. Vs. Union of India & Ors.  INSC
1788 (7 December 2009)
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.8385 OF
2004 M/s. Madnani Construction Corporation (P) Ltd. ...Appellant(s) Union of
India & Others ...Respondent(s)
The subject matter of challenge in this appeal is the judgment and
order dated 29.04.2003 passed by the High Court of judicature at Allahabad in
F.A.F.O. No. 40 of 1993, in a matter arising from the order dated 1.12.1992 of
the learned Senior Civil Judge, making the Award a Rule of the Court, and whereby
the High Court had partly allowed the Appeal filed by the respondent.
The appellant, a private limited company, is carrying on, inter
alia, various construction works for both the State and Central Government and
their undertakings. The appellant's case is that an agreement dated 03.11.1981
was entered between the appellant and the North Eastern Railway for the
construction of bridge island nos. 13 and 14 over the Kosi river. There were
certain special conditions of the contract (hereinafter, SCC) and they
stipulate that the General Conditions of Contract (hereinafter, GCC) and
standard specifications of the North Eastern Railways shall form part of the
aforesaid contract. In terms of the contract, the construction was to be
completed by 15.02.1982.
payments were made to the appellant after completion of the contract but they
were received by them "under protest". Thus, disputes cropped-up
between the parties. The appellant is said to have served a notice dated
16.11.1983 for the appointment of an arbitrator to settle the 2 disputes. The
General Manager of the respondent- Railways by an order dated 24.03.1986
rejected the appellant's prayer for appointment of an arbitrator on the ground
that the disputes were not arbitrable, as they fell under `expected matter' in
On or about 18.08.1987, the appellant filed an application under
Section 20 of the Arbitration Act, 1940 (hereinafter, the Act) before the Court
of Addl. Civil Judge, Gorakhpur for appointment of an arbitrator which was
transferred on 21st February, 1990, to the Court of Judge of Small Causes
/Additional Civil Judge (hereinafter, the Court below). The Court below passed
an order on 2.3.1990 that `file received, put up on the date fixed'. Then by an
order dated 31.05.1991 the learned Civil Judge appointed one Mr. B. N. Shukla,
the Sole Arbitrator, to adjudicate the disputes arising out of the agreement
dated 03.11.1981. Against the order of appointment of arbitrator the responder
approached the High Court 3 by filing F.A.F.O. No. 534 of 1991 (the earlier
F.A.F.O.), but the same was dismissed vide order dated 27.08.1991.
The learned Arbitrator gave his award on 13.4.1992 holding that
the Railways should pay an amount of Rs.4,48,873.22 along with compoundable
bank interest prevalent at that time from 16.11.1983 to 21.3.1992. In passing
the award the Arbitrator relied on the Level book No. I, the Graph Sheets, the
Log Book No. IA and the Log Book No. 4. The Arbitrator found that there were
subsequent alterations and over writing in the entries made in the Log Book
No.IA and the same were without any initials by the concerned authority on
behalf of the respondent Railways. From such materials the Arbitrator held that
all the manipulations/alterations/overwritings had resulted in reducing the
quantities of the work done by the appellant. It was further observed that
clause 21 (iv) of the special conditions was not followed by the respondent
Railways at all. Moreover in utter violation of the Railway rules and orders on
the subject, the measurements were hardly entered in the measurement book
directly and mostly entries in the measurement books were copied down from
subsidiary records or note books.
recording such findings, the Arbitrator gave the aforesaid award.
Thereafter on 08.05.1992 the appellant filed an application under
Section 17 of the Act for pronouncing judgment and making decree according to
On 20.5.1992 the respondent Railways filed application under
Section 30 read with Section 33 (Section 30/33) of the Act before the Civil
Judge for setting aside the award. Then on 24.08.1992 they also filed their
objections against the application filed by the contractor under Section 17 of
the Act. The following facts were recorded in the judgment of the High Court.
"The Railways filed an application before the District Judge for transfer
of the application filed by the contractor under Section 20 of the Act and
under Section 24 of the Civil Procedure Code. It was dismissed on 13th
November, 1992. The Railways filed an application on 23rd November, 1992,
before the court below for summoning their application and under Section 30/33
of the Act from the Court where it was filed. This was objected to by the
Contractor on the same date.
the Court below summoned it and not only rejected it but also rejected their
objections against the application under Section 17 of the Act. The Court below
by its order dated 1.12.1992 also pronounced judgment according to the award
and decreed interest at the rate given by the Bank from the date of the award
till actual payment".
On 1st December 1992, the Senior Civil Judge, Gorakhpur of the
Court of Judge, Small Causes Gorakhpur made the award a Rule of Court and
directed that a decree be prepared accordingly and directed that from the date
of the award to the date of payment the rate of interest on the Bank loan is to
Challenging the aforesaid order of the Civil Judge, the Railways
filed an appeal before the High Court.
Before the High Court, 7 issues were framed. The appeal was partly
allowed by the High Court and in doing so the High Court came to the conclusion
that the court below had the jurisdiction to entertain the application under
Section 17 of the Act.
On the application of the Railways under Section 30/33 of the Act,
the High Court held that the case is not required to be remanded as the court
below decided the case correctly on merits.
Referring to the decision of the General Manager dated 24.03.1986
rejecting request for appointment of Arbitrator on the ground that dispute fell
under excepted matters, the High Court concluded that there is difference of
opinion between the parties whether the dispute falls under excepted matters or
not and the decision of the General Manager regarding excepted matters is not
final between the parties. The General Manager by 7 wrongly deciding this
question could not exclude the jurisdiction of the Court.
On the issue as to whether the respondent Railways are entitled to
raise objections regarding the excepted matters at the stage of Section 20, the
High Court concluded that the trial Court did not say a word about it and the
High Court merely affirmed the order passed by the trial court. As such the
issue was left to be decided by the Arbitrator who has held that none of the
claims of the contractor were excepted matters. It was held that as the
question was not decided in the earlier litigation, it cannot be said that the
Railways are precluded from raising this question in these proceedings.
On the issue of excepted matters the High Court held that Item
Nos. 1 to 3 and 5 to 8 were excepted matters and were non-arbitrable and the
Arbitrator committed an illegality in allowing them. For the remaining items
viz. item No. 9 (a) & 8 (d) relating to supply of boats, 11 (b) relating to
cost of wastage of labour, it was held that these were not covered by Clause 22
(5) or 45 (a) of the GCC, as such they do not fall in the category of
non-arbitrable matters and are arbitrable.
On the award of interest it was contended that clause 16 (1) read
with 16 (2) of GCC prohibits payment of interest on amounts payable to the
appellant under the contract except the Government securities mentioned
therein. In this regard, the High Court considered Clause 30 of SCC and Clause
52 of GCC and found them to be similar and these clauses, according to High
Court, bar interest and damages in respect of withholding or retention under
the lien. Further by placing reliance on the case of Executive Engineer, D.M.I.
Division v. N. C. Budhraj, AIR 2001 SC 628 High Court held that interest could
not be awarded since there was specific prohibition in the contract regarding
awarding of interest.
On the award of interest High Court's specific conclusions are:
The contract prohibited payment of interest. Item 10 is award for interest;
not be awarded. Similarly no interest could be awarded under clause 3 of the
is no illegality in awarding interest payable at the bank rate, but it could only
be awarded from the date of decree and not from the date of award."
Appellant also filed a review petition before the High Court but
the same was dismissed vide order dated 15.05.2003.
This Court finds that the High Court's conclusion that Item Nos. 1
to 3 and 5 to 8 of the award are `excepted matters' and non-arbitrable is not
correct for the reasons discussed below.
In coming to the aforesaid finding, the High Court relied on
Clause 45 (a) of GCC. Clause 45(a) of the GCC is set out below:
"45(a): It shall be open to the Contractor to take specific objection to
any recorded measurement or classification on any ground within seven days of
the date of such measurements. Any re-measurements taken by the Engineer or the
Engineer's Representative in the presence of the Contractor or in his absence
after due notice has been given to him in consequence of objection made by the
Contractor shall be final and binding on the Contractor and no claim whatsoever
shall thereafter be entertained regarding the accuracy and classification of
A plain reading of Clause 45(a) of the GCC makes it clear that
re-measurement are to be made by the Engineer or the Engineer's representative
in the presence of the Contractor. It may be done in the absence of the
contractor but that has to be done only after due notice. On a proper
construction of Clause 45(a) it appears that it gives the contractor, (a) an
opportunity to take a specific objection to any recorded measurement within
seven days of such measurements; (b) Then any re- measurements is to be taken
by the Engineer or the Engineer's representative in the presence of the
contractor or in his absence after due notice; if 11 the steps under (a) and
(b) are strictly followed, (c) no claim whatsoever by the contractor shall be
entertained about the classification or the accuracy of the measurement.
Under Clause 62 of the GCC it is provided that matters for which
provisions have been made in Clause 45(a) shall be excepted matters.
The arbitrator in his award after perusal of the level Book No.1,
Graph-Sheets, Logbook No. 1A and Logbook No.4 came to a clear finding that
there were manipulations/alterations/over writings by the railways and as a
result of which the volume of work done by the contactor has been reduced.
It is well settled that the arbitrator is the master of facts.
When the arbitrator on the basis of record and materials which are placed
before him by the railways came to such specific findings and which have not been
stigmatized as perverse by the High Court, the High Court in reaching its
conclusions cannot ignore those findings.
But it appears that in the instant case, the High Court has come
to the aforesaid finding that the items mentioned above are excepted matters
and non-arbitrable by completely ignoring the factual finding by the arbitrator
and without holding that those findings are perverse.
It goes without saying that in order to deny the claims of the
contractor as covered under excepted matters, the procedure prescribed for
bringing those claims under excepted matters must be scrupulously followed. The
clear finding of the arbitrator is that it has not been followed and the High
Court has not expressed any dis-agreement on that. Therefore, the finding of
the High Court that those items are non-arbitrable cannot be sustained.
On the question of grant of interest by the arbitrator, the High
Court held that Clause 16(2) 13 of the GCC contains a provision against grant
of interest. Clause 16(2)of the GCC is set out below:
No interest will be payable upon the earnest money or the security deposit or
amounts payable to the contractor under the contract but government securities
deposited in terms of such clause (1) of this clause will be repayable with
interest accrued thereto."
The High Court has also relied on Clause 30 of the SCC and Clause
52 of the GCC to hold that payment of interest has been barred. The relevant
portion of Clause 30 of the SCC relating to interest is set out below:
the contractor will have no claim for interest and damage whatsoever on any
account in respect of such with-holding or retention under the lien referred to
supra and duly notified as such to the Contractor."
The High Court has held that Clause 30 of the SCC is similar to
Clause 52 of the GCC.
Before discussing the implication of these clauses, it may be
noted that the Arbitration Act, 14 1940 does not contain any provision enabling
the arbitrator to give interest.
Section 29 of the Arbitration Act enables the Court to award
interest from the date of the decree and at such rate as the Court deems
The present Act of 1996 (the Arbitration and Conciliation Act,
1996), however, empowers the Arbitrator under Section 31(7)(a) and (b) to grant
interest. Admittedly, in this case the 1996 Act is not attracted. Therefore,
the provisions of 1940 Act will govern. The arbitrator's power to grant
interest is governed by the various judicial pronouncements and the provisions
of Interest Act of 1978.
without saying that in the instant case, the provision of the Interest Act,
1978 is attracted. Under the Interest Act, 1978, Section 15 2(a) defines
"Court" to include both a tribunal and an arbitrator.
the Interest Act, Section 3 empowers the Court to allow interest. But
sub-Section (3) of Section 3 contains a proviso, namely, Section 3, sub-Section
(3), Clause (a) (ii), to the following effect:- "3. (3) Nothing in this
section, - (a) shall apply in relation to - (i) xxx xxx (ii) any debt or
damages upon which payment of interest is barred, by virtue of an express
the context of the aforesaid provision in the Interest Act, the Clauses in the agreement quoted hereinabove assume
Normally there are three periods for which interests are awarded -
(a) pre-reference period i.e. from the date of the cause of action for going to
arbitration and to the date of reference;
the pendente lite period i.e. from the date of reference to the date of award;
and (c) the post- reference period i.e. from the date of the award to the date
Initially there was a judgment of this Court in the case of
Executive Engineer (Irrigation), [1988 (1) SCC 418] which held, the arbitrator
has no power to award interests in the absence of contract or any substantive
Construing the provision of the 1940 Act, the Court held:-
"..in cases arising after the commencement of Interest Act of 1978 an arbitrator has the same power as the court to
award interest up to the date of institution of the proceedings, in cases which
arose prior to the commencement of the 1978 Act the arbitrator has no such
power under the Interest Act of 1839."
The decision in Abhaduta Jena (supra), however, was overruled by
the Constitution Bench of this Court in Secretary, Irrigation Department, 17
[1992 (1) SCC 508].
The Constitution Bench in G.C. Roy (supra) discussed several
aspects of the Act of 1940 and also the provisions of Section 34 of the Civil
Procedure Code and also those of the Interest Act.
discussing those provisions, the Constitution Bench formulated the question
which arose in that case as follows:- "......In the context of these
provisions the question arises whether an arbitrator to whom reference is made
by the parties has jurisdiction or authority to award interest pendente lite.
If the arbitration agreement or the contract itself provides for award of
interest on the amount found due from one party to the other, no question
regarding the absence of arbitrator's jurisdiction to award the interest could
arise as in that case the arbitrator has power to award interest pendente lite
as well. Similarly, where the agreement expressly provides that no interest
pendente lite shall be payable on the amount due, the arbitrator has no power
to award pendente lite interest. But where the agreement does not provide
either for grant or denial of interest on the amount found due, the question
arises whether in such an event the arbitrator has power and authority to grant
pendente lite interest.
After formulating the above question and discussing various
decisions and legal issues, the Constitution Bench in paragraph 43 at page 532
question still remains whether arbitrator has the power to award interest
pendente lite, and if so on what principle. We must reiterate that we are
dealing with the situation where the agreement does not provide for grant of
such interest nor does it prohibit such grant. In other words, we are dealing
with a case where the agreement is silent as to award of interest...."
After posing the question as above, the Constitution Bench laid
down the following principles in paragraph 43 at page 532 to 533:
A person deprived of the use of money to which he is legitimately entitled has
a right to be compensated for the deprivation, call it by any name. It may be
called interest, compensation or damages. This basic consideration is as valid
for the period the dispute is pending before the arbitrator as it is for the
period prior to the arbitrator entering upon the reference. This is the
principle of Section 34, Civil Procedure Code and there is no reason or
principle to hold otherwise in the case of arbitrator.
arbitrator is an alternative form (sic forum) for resolution of disputes
arising between the parties. If so, he 19 must have the power to decide all the
disputes or differences arising between the parties. If the arbitrator has no
power to award interest pendente lite, the party claiming it would have to
approach the court for that purpose, even though he may have obtained
satisfaction in respect of other claims from the arbitrator. This would lead to
multiplicity of proceedings.
arbitrator is the creature of an agreement. It is open to the parties to confer
upon him such powers and prescribe such procedure for him to follow, as they
think fit, so long as they are not opposed to law. (The proviso to Section 41
and Section 3 of Arbitration Act illustrate this point). All the same, the
agreement must be in conformity with law. The arbitrator must also act and make
his award in accordance with the general law of the land and the agreement.
the years, the English and Indian courts have acted on the assumption that
where the agreement does not prohibit and a party to the reference makes a
claim for interest, the arbitrator must have the power to award interest
has not been followed in the later decisions of this Court. It has been
explained and distinguished on the basis that in that case there was no claim
for interest but only a claim for unliquidated damages. It has been said
repeatedly that observations in the said judgment were not intended to lay down
any such absolute or universal rule as they appear to, on first impression.
Until Jena case almost all the courts in the country had upheld the power of
the arbitrator to award interest pendente lite. Continuity and certainty is a
highly desirable feature of law.
Interest pendente lite is not a matter of substantive law, like interest for
the period anterior to reference (pre- reference period). For doing complete 20
justice between the parties, such power has always been inferred."
Ultimately in paragraphs 44 and 45 at page 533 to 534 of the
report the Constitution Bench held as follows:
the agreement between the parties does not prohibit grant of interest and where
a party claims interest and that dispute (along with the claim for principal
amount or independently) is referred to the arbitrator, he shall have the power
to award interest pendente lite.
for the reason that in such a case it must be presumed that interest was an
implied term of the agreement between the parties and therefore when the parties
refer all their disputes -- or refer the dispute as to interest as such -- to
the arbitrator, he shall have the power to award interest. This does not mean
that in every case the arbitrator should necessarily award interest pendente
It is a matter
within his discretion to be exercised in the light of all the facts and
circumstances of the case, keeping the ends of justice in view.
the reasons aforesaid we must hold that the decision in Jena, insofar as it
runs counter to the above proposition, did not lay down correct law."
Following the Constitution Bench ratio in G.C. Roy (supra),
another three-Judge Bench in the case of Hindustan Construction Company Limited
vs. State 21 of Jammu and Kashmir - (1992) 4 SCC 217, while referring to the
ratio in G.C. Roy (supra), held in paragraph 5 at page 220:
the said decision deals with the power of the arbitrator to award interest
pendente lite, the principle of the decision makes it clear that the arbitrator
is competent to award interest for the period commencing with the date of award
to the date of decree or date of realisation, whichever is earlier. This is
also quite logical for, while award of interest for the period prior to an
arbitrator entering upon the reference is a matter of substantive law, the
grant of interest for the post-award period is a matter of procedure. Section
34 of Code of Civil Procedure provides both for awarding of interest pendente
lite as well as for the post-decree period and the principle of Section 34 has
been held applicable to proceedings before the arbitrator, though the section
as such may not apply......."
Subsequently, in the case of State of Orissa v. B.N. Agarwalla -
(1997) 2 SCC 469, before another three-Judge Bench a similar question came up
for consideration and this Bench following the ratio in G.C. Roy (supra) and
Hindustan Construction (supra) considered the question of payment of interest.
After discussing the ratio in Abhaduta Jena (supra) and G.C. Roy (supra) and
various other cases, the learned Judges in paragraph 18 at 22 page 477 of the
report came to the conclusion that; (a) it is well settled that the arbitrator
has a jurisdiction to award pre-reference interest in cases which arose after
Act, 1978 had become applicable. It is no doubt that
in this case arbitration proceedings were initiated after the 1978 Act became
applicable; (b) for the period in which the arbitration proceedings are pending
the arbitrator has the power to award interest;
Court also held that the power of the arbitrator to award interest for the
post-award period also exists.
In G.C. Roy (supra) this Court made it clear that the arbitration
clause was silent on the payment of interest but in B.N. Agarwalla (supra) the
Court considered Clause (4) which had the following stipulation on interest:
interest is payable on amounts withheld under the item of the agreement.......
Considering the said Clause (4), the learned Judges held that the
claim which was made before the arbitrator was for non-payment of the full
amount as per the final bill submitted by the claimant and the arbitrator
awarded interest on that. The interest so awarded, according to the learned
Judges, is not prohibited under Clause (4) of the Contract. Therefore, the
three Judge Bench clearly held that just a stipulation in the contract purporting
to indicate non-payment of interest cannot denude the arbitrator of his right
to pay interest.
In a subsequent decision of three-Judge Bench in the case of State
of U.P. v. Harish Chandra and Company - (1999) 1 SCC 63, there was stipulation
in the arbitration agreement against grant of interest. The relevant clause
namely Clause 1.9 to the aforesaid effect is set out below:
No claim for delayed payment due to dispute etc.--No claim for interest or
damages will be entertained by the Government with respect to any moneys or
balances which may be lying with the Government owing to any dispute, 24
difference; or misunderstanding between the Engineer-in-Charge in marking
periodical or final payments or in any other respect whatsoever."
Considering the said clause, the Court held that the prohibition
in the said clause does not prevent the contractor from raising the claim of
interest by way of damages before the arbitrator on the relevant items placed
paragraph 10 page 67). In saying so, the learned Judges relied on the ratio in
the case of B.N. Agarwalla (supra) and G.C. Roy (supra).
In Board of Trustees for the Port of Calcutta v. Engineers-De-Space-Age,
(1996) 1 SCC 516, a two- judge Bench of this Court considered the same
question. That was a case under the 1940 Act. In Engineers (supra), the
so-called prohibition in the contract relating to payment of interest was in
Clause 13(g), which is set out below:- "13(g) No claim for interest will
be entertained by the Commissioners with respect to any money or balance which
may be in their hands owing to any dispute between themselves and the
Contractor or with respect to any delay 25 on the part of the Commissioners in
making interim or final payment or otherwise."
Relying on the said clause, the appellant in Engineers (supra)
argued that there was absolute prohibition against payment of interest. The
learned Judges however, relying on the ratio in G.C. Roy (supra) held that
Clause 13(g) merely prohibits the Commissioner from entertaining any claim for
interest but it does not prohibit the arbitrator from awarding interest. The
learned Judges held that such clauses must be strictly construed in view of the
ratio of the Constitution Bench in G.C. Roy (supra). The reasoning given by the
learned Judges in favour of strict construction runs as follows:-
"...Clause has to be strictly construed for the simple reason that as
pointed out by the Constitution Bench, ordinarily, a person who has a
legitimate claim is entitled to payment within a reasonable time and if the
payment has been delayed beyond reasonable time he can legitimately claim to be
compensated for that delay whatever nomenclature one may give to his claim in
that behalf. If that be so, we would be justified in placing a strict
construction on the term of the contract on which reliance has been placed.
Strictly construed the term of the contract merely prohibits the Commissioner
from paying interest to the contractor for delayed payment but once the matter
goes to 26 arbitration the discretion of the arbitrator is not, in any manner,
stifled by this term of the contract and the arbitrator would be entitled to
consider the question of grant of interest pendente lite and award interest if
he finds the claim to be justified." (Para 4, page 520)
It was argued before us by the learned counsel for the respondent
that a subsequent Division Bench of this Court in the case of Union of India v.
Saraswat Trading Agency & others, JT 2009 (9) SC 648, has taken a view
different from the ratio in Engineers (supra). We do not think so.
In Saraswat Trading (supra) the Clause which was construed by the
Court as clamping a prohibition on the grant of interest was Clause 31 and
which is quoted in paragraph 15 of the judgment at page 656 of the report and
runs as follows:- "31. No interest or damage for delay in payment - No
interest or damage shall be paid to the Contractor for delay in payment of the
bill or any other amount due to the contractor for any reason whatsoever. The Railway
Administration will, however, make every endeavour for payment of the bills or
other amount due to the contractor within a reasonable time."
The learned Judges in Saraswat Trading (supra) in paragraph 16
held that Clause 31 is different from Clause 13(g) which was considered in
Engineers (supra). The ratio in Engineers (supra) was not questioned.
In the instant case also the relevant clauses, which have been
quoted above, namely, Clause 16(2) of GCC and Clause 30 of the SCC do not contain
any prohibition on the arbitrator to grant interest.
the High Court was not right in interfering with the arbitrator's award on the
matter of interest on the basis of the aforesaid clauses. We therefore, on a
strict construction of those clauses and relying on the ratio in Engineers
(supra), find that the said clauses do not impose any bar on the arbitrator in
Reference in this connection may be made to another Constitution
Bench judgment of this Court in the case of Executive Engineer, Dhenkanal Minor
28 Irrigation Division, Orissa and others v. N.C. Budharaj (deceased) by Lrs.
and others, (2001) 2 SCC 721.
In N.C. Budharaj (supra), Justice Raju, speaking for the majority,
considered the question of the arbitrator's jurisdiction and authority to grant
interest in great detail and also considered both Indian and English cases and
the ratio of the Constitution Bench of this Court in G.C. Roy (supra).
In paragraph 25 of the judgment the learned Judge summed up the
position as follows:- "...By agreeing to settle all the disputes and
claims arising out of or relating to the contract between the parties through
arbitration instead of having recourse to civil court to vindicate their rights
the party concerned cannot be considered to have frittered away and given up
any claim which otherwise it could have successfully asserted before courts and
obtained relief. By agreeing to have settlement of disputes through
arbitration, the party concerned must be understood to have only opted for a
different forum of adjudication with less cumbersome procedure, delay and
expense and not to abandon all or any of its substantive rights under the
various laws in force, according to which only even the arbitrator is obliged
to adjudicate the claims referred to him. As long as there is 29 nothing in the
arbitration agreement to exclude the jurisdiction of the arbitrator to
entertain a claim for interest on the amounts due under the contract, or any
prohibition to claim interest on the amounts due and become payable under the
contract, the jurisdiction of the arbitrator to consider and award interest in
respect of all periods subject only to Section 29 of the Arbitration Act, 1940 and that too the powers of the court there under, has to
We are constrained to note that Hon'ble High Court unfortunately
erred in appreciating the ratio of N.C. Budharaj (supra) in passing the
impugned judgment and order.
In view of such consistent views taken by both the Constitution
Bench judgments, in G.C. Roy (supra) and N.C. Budharaj (supra), we are of the
view that in the facts of this case, no interference is called for with the
award passed by the arbitrator. The judgment of the High Court is, therefore,
set aside and the award is upheld. The appeal is allowed.
There will be no order as to costs.
.......................J. (MARKANDEY KATJU)