Judgment :- Mishra, J. Two suits, one under Sec.14(2) of the Arbitration Act and another by way of objection to the award on behalf of the appellant were heard together and disposed of by a common judgment. These appeals arise out of the said judgment. 2. The Tamil Nadu Electricity Board, the appellant herein, called for tenders on 10. 1973 for the work of the construction of interconnecting tunnel for Suriliyar Hydro Electric Project as per the specification. The 1st respondent submitted the tender, enclosing a tender specification, and the appellant accepted the offer. The first respondent accordingly took over the site on 11. 1975. It seems, however, that certain further developments took place in their way delaying the execution of the work, certain modifications in the specifications, certain disputes inter se between the partners of the first respondent-firm and certain changes allegedly made in the specification of the work. But finally it seems on 19. 1978, the appellant sent a letter on the first respondent-firm to complete the balance of work mentioned therein and an agreement was signed by the Engineer of the appellant on 210. 1978 to the said effect. This was again followed by a good deal of correspondence with respect to the claims of the first respondent-firm and a demand for an appointment of an Arbitrator. Those details need not be set out as they have almost lost their relevancy for the purpose of the present dispute. What remains relevant, however, is the appointment of the Arbitrators, followed by the appointment of the umpire and the award by him and an earlier round of battle between the parties before this Court which had ended with the order dated 28. 1980 in O.P.No.304 of 1979 and Application No.2813 of 1980. The appellant herein had filed an application under Sec.33 of the Arbitration Act stating "there is no existing agreement to refer the claims made by the first respondent in the letter dated 2. 1979 to be decided by a single Arbitrator, and therefore it is prayed that respondents 1 and 2 (1st respondent-firm and Arbitrator) may be directed not to proceed with the arbitration and that the appointment of the second respondent as an Arbitrator, may be set aside." 3. 1979 to be decided by a single Arbitrator, and therefore it is prayed that respondents 1 and 2 (1st respondent-firm and Arbitrator) may be directed not to proceed with the arbitration and that the appointment of the second respondent as an Arbitrator, may be set aside." 3. When the matter came up before the Court, learned counsel appearing for the Board contended that the first respondent had hurriedly appointed the second respondent as a single Arbitrator in spite of the Board intimating the first respondent by two letters from the Chief Engineer on 25. 1979 and 25. 1979 that the question of arbitration could be considered by the first respondent only after the first respondent received a reply from the Board on or before 30.6.1979 because there was no need to refer the matter for arbitration at the stage and that, therefore, the appointment of the second respondent as an Arbitration was not valid. It is, however, not necessary to deal any further with the developments in the said proceedings because as recorded in the order of this Court "On the next adjourned date, Mr.Ramalingam has placed before Court a letter received by him dated 18. 1980, wherein the Board has agreed for referring the disputes to two Arbitrators subject to three conditions mentioned therein, namely, (1) our participation in the Arbitration proceedings is without prejudice to our rights to question the applicability of Clause 50 of the specification to the alleged dispute. (2) We should be enabled to contend before the Arbitrators that either all the alleged disputes or at least some of them are outside the scope of arbitration. (3) Our participation in the arbitration proceedings should be without prejudice to challenge the award, if any, passed by the Arbitrators". It is further staled in the said order: "Now that the petitioner-Board has come forward with this request, it is considered-that the first respondent could agree to what has been proposed for an amicable settlement of the disputes. 4. Counsel appearing for the first respondent would still plead that the conditions imposed, would take away effective disposal of the disputes by the Arbitrators. 4. Counsel appearing for the first respondent would still plead that the conditions imposed, would take away effective disposal of the disputes by the Arbitrators. But on the face of the three conditions, it will be noticed that so far as the first condition is concerned, undoubtedly in respect of disputes raised if found to be outside arbitration clause, a participant in the arbitration proceedings would be entitled to raise such an objection and therefore participate in the proceedings reserving the right to challenge the same, if any need arises at a later stage in a Court of Law. 5. If the petitioner had come forward to raise a dispute and if it is outside the scope of Clause 50, the first respondent itself would come forward with such a reservation. It is not as if all disputes would come within the scope of clause 50 and only those that would come within the ambit of clause 50 alone can be decided by the Arbitrators when such is the clear position on this aspect; raising an objection regarding disputes which may not come within the scope of clause 50 is not a concession, but a recognition of a right, which is available not only to the petitioner Board but also the first respondent in the event of the Board raising any dispute as against it. Therefore, the first stipulation is dependent upon the Arbitrators deciding as to whether a particular dispute would come within the scope of clause 50 or not, and only if they consider that it falls within the scope of Arbitration clause, they would have the jurisdiction to decide the same. In the event of the Arbitrators holding that any particular dispute is outside the Arbitration clause, it is not as if the first respondent is deprived of remedies by agitating the same in Courts. 6. As for the second condition, it is part of what has been already dealt with under condition No.1 and, therefore, there can be no objection to the Board being allowed to raise such an objection, and after recording the same, to participate in the proceedings in the event of the Arbitrators holding that the objection is unsustainable. 6. As for the second condition, it is part of what has been already dealt with under condition No.1 and, therefore, there can be no objection to the Board being allowed to raise such an objection, and after recording the same, to participate in the proceedings in the event of the Arbitrators holding that the objection is unsustainable. After the award is made, as the petitioner-Board has already reserved its’ right, it would enable the Board to raise this point in the event of any need arising for setting aside the award in Court. 7. As for the third condition, the counsel for the first respondent would contend that there is no need for such a condition when the Arbitration Act itself provides for such a relief. He would state that it has been stipulated in ignorance of the provisions of the Act. There is considerable force in this submission because, participation in an arbitration proceeding has never been held as to take away the right of a party to challenge the award in Court to which it is contemplated under the Act. The right to challenge the award if confined only to limited aspects, and when the Act itself had provided for a certain remedy, as rightly contended by the counsel for the first respondent, this condition is asked for, without comprehension of the provisions of the Act. 8. Now that the Electricity Board has come forward to have the disputes formulated by the first respondent herein, referred to arbitration, by appointing an Arbitrator on its behalf as provided under Clause 50 of the agreement, it is granted time till 30.9.1990 by which time, the named Arbitrators of both the parties are to enter upon the reference. 9. It, however, has to be stated that the two Arbitrators could not agree to a common award and accordingly they recorded that they could not make a unanimous award in the above dispute and requested the 4th respondent to step in as umpire in the above dispute. Accordingly the matter went to arbitration to the 4th respondent herein as the umpire and the 4th respondent thereafter has made the award which is under challenge. 10. The first respondent-firm claimed before the Arbitrators a sum of Rs.2,10,00,000 on various counts. The 4th respondent has, however awarded a sum of Rs.70,83,793. Accordingly the matter went to arbitration to the 4th respondent herein as the umpire and the 4th respondent thereafter has made the award which is under challenge. 10. The first respondent-firm claimed before the Arbitrators a sum of Rs.2,10,00,000 on various counts. The 4th respondent has, however awarded a sum of Rs.70,83,793. The award states: "As whereas, the two Arbitrators appointed me as umpire by their Joint letter dated 211.1980 which was accepted by me by letter dated 11. 1980. And whereas the Arbitrators Thiru S.Ardhanareeswaran and Thiru P.V.John have disagreed and had in their joint letter dated 20.7.1982 required me to step in as umpire in the reference. I, S.P.Namasivayam, of 1, Park Street, Kilpauk Garden, Madras 600 010 having entered on this reference as Umpire on 30.7.1982, heard the parties represented by their counsel who made the oral arguments in support of their claims and counter claims. And whereas the statutory period of two months from 30.7.1982 expired on 29. 1982, the parties submitted joint statements consenting to enlarge the time for making and publishing the award upto 212. 1982 which was allowed by me. Now, therefore, I, S.P.Namasivayam, having taken upon myself the burden of the reference and having heard and duly weighed and considered the allegations and evidence produced by both parties, and having inspected the sites of works on 111. 1982, do hereby make and publish this final award in writing of and concerning the matter referred to me: I hereby award and direct as follows: .(1) The respondent shall pay the claimant a sum of Rupees seventy lakhs eighty three thousand seven hundred and ninety three only and release the earnest money deposit and bank guarantees furnished by the claimant in lieu of security deposit, in full settlement of all claims and counter claims. .(2) The tip trucks already returned by the claimant to the respondent shall be the property of the respondent. .(3) The respondent shall pay interest to the claimant at 6% per annum of the amount awarded viz., Rs.70,83,793 from the 1st day of February, 1983 till the date of decree. .(4) The cost of these proceedings and all expenses incurred by both parties shall be on their own account. Signed and delivered on this 27th day of December 1982.“ 11. .(4) The cost of these proceedings and all expenses incurred by both parties shall be on their own account. Signed and delivered on this 27th day of December 1982.“ 11. In a detailed Judgment, the learned trial Judge has found that no ground for setting aside the award was made out, that no infirmity of any kind was found in the reference of the dispute to the empire by the arbitrators. Before us, however, learned counsel for the appellant has contended that as noticed in the order of this Court in O.P.No.304 of 1979 and Application No.2813 of 1980, the Board on its participation in the arbitration proceedings raised objections as to the maintainability of the arbitration and contended that the least some of them were outside the scope of arbitration, particularly the first respondent’s claim with respect to the rate of interest higher than the agreed rate of interest. The Arbitrator and the umpire were required to first determine the arbi-trability of such disputes which they failed to decide. This resulted in a serious error, apparent on the face of the record. In any case, it amounts to a legal misconduct. Learned counsel for the appellant further contended that irrespective, however of the above, on principle the question of rate fixed under the contract being outside the arbitration the award for the said reason is invalid. 12. In the written submissions on behalf of the appellant some details of the dispute, clauses of the contract and contentions with respect to each one of the items of dispute have been stated. In the written arguments filed on behalf of the first respondent, however, it has been contended that a single line award is legal and binding; that even increase in rates can be referred to arbitration; and that unless the Court refers particular and specific disputes to the arbitrator with a direction to give a finding on each issue the Arbitrator is not bound to give a finding on each issue. 13. 13. We shall thus be not justified in going into the details of the controversy before the Arbitrators without deciding whether the award being a single line award is legal and binding, whether there was any direction to the Arbitrators by the Court to decide any particular dispute and record a finding thereon, whether there was a dispute with respect to increase in rates and parties had raised their contentions before the Arbitrators, whether the increase in rates was one of the issues before the Arbitrators or not and whether the Arbitrators had jurisdiction to decide the said issues or not. 14. In Seth Thwards Pherumal v. The Union of India, (1955)2 M.L.J. (S.C.) 23: 1955 S.C.J. 445: (1955)2 S.C.R. 48: A.I.R. 1955 S.C. 468, the Supreme Court considered a case in which a clause in the contract required all disputes arising out of or relating to the contract to be referred to arbitration. Such disputes arose and were referred to arbitration. The Arbitrator gave an award in the contractor’s favour. The Union Government contested the award on a number of grounds, including whether the legality of the award can be challenged on facts and whether an Arbitrator gets jurisdiction to decide the questions of law as well as questions of fact or not. The Supreme Court said: ”In India this question is governed by Sec.16(1)(c) of the Arbitration Act of 1940 which empowers a Court to remit an award for consideration ‘where an objection to the legality of the award is apparent upon the face of it’. This covers cases in which an error of law appears on the face of the award. But in determining what such an error is, a distinction must be drawn between cases in which a question of law is specifically referred and those in which a decision on a question of law is incidentally material (however necessary) in order to decide the question actually referred. But in determining what such an error is, a distinction must be drawn between cases in which a question of law is specifically referred and those in which a decision on a question of law is incidentally material (however necessary) in order to decide the question actually referred. If a question of law is specifically referred and it is evident that the parties desire to have a decision from the arbitrator about that rather than one from the Courts, then the Courts will not interfere, though even there, there is authority for the view that the Courts will interfere if it is apparent that the Arbitrator has acted illegally in reaching his decision, that is to say, if he has decided on inadmissible evidence or on principles of construction that the law does not countenance or something of that nature.....“ The law about this is, in our opinion the same in England as here and the principles that govern this class of case have been reviewed at length and set out with clarity by the House of Lords in F.R.Absalom Ltd. v. Great Western (London) Garden Village Society, (1933) A.C. 592 and in Kelantan Government v. Duff Development Company, (1923) A.C. 395. .....The wider language used by Lord Macnaghten in Ghulam Jilani v. Muhammad Hussan, 29 LA. 51, 60, had reference to the revisional powers of the High Court under the Civil Procedure Code and must be confined to the facts of that case where the question of law involved there, namely, limitation, was specifically referred. An Arbitrator is not a conciliator and cannot ignore the law or misapply it in order to do what he thinks is just and reasonable. He is a tribunal selected by the parties to decide their disputes according to law and so is bound to follow and apply the law, and if he does not, he can be set right by the Courts provided his error appears on the face of the award. The single exception to this when the parties choose specifically to refer a question of law as a separate and distinct matter. The single exception to this when the parties choose specifically to refer a question of law as a separate and distinct matter. Reference was made to a decision of this Court in AM.Mair and Company v. Gordhwandas Sagar-mull, 1950 S.C.R. 792 at 798, where Fazl Ali, J., quoted a passage from Viscount Simon’s speech in Heyman v. Darwins Ltd., 1942 A.C. 356 at 368, where the learned Lord Chancellor (Viscount Simon) in turn quoted from Lord Dunedin in another case. It was argued on the basis of this that if you have to have recourse to the contract to establish your case, then the dispute must fall within the arbitration clause. That is undeniable but it is not enough that the dispute should fall within the clause. It is also necessary that the parties should define what the dispute is and agree to refer the dispute so set out and defined to arbitration, or, if they do not, then the court should compel them to do so; (see Lord Macmil-lan in Heyman’s case, 1942 A.C. 356 at 368, just cited at pages 369 and 370). If, therefore, no specific question of law is referred, either by agreement or by compulsion, the decision of the arbitrator on that is not final however much it may be within his jurisdiction, and indeed essential, for him to decide the question incidentally. Lord Russell of Killowen and Lord Wright were both in the earlier case, F.R.Absalam Ltd., v. Great Western (London) Garden Village Society, 1933 A.C. 592, as well as in Heyman’s case, 1942 A.C. 356 at 368, and they would have pointed to any distinction had there been a likelihood of conflict; but in fact there is none and we do not read ”Fazl Ali, J.‘s judgment as a decision to the contrary.“ 15. Thus, this case is an authority for the principle that the Arbitrator only gets jurisdiction when both parties agree specifically to refer specific matters or failing that the Court compels them to do so under the arbitration clause if the dispute is covered by it; the legality of the award cannot be challenged on facts, but it can be challenged on questions of law provided the illegality is apparent on the face of the award but not when both parties specifically refer questions of law for the decision of the arbitrator; in that event they are bound by his decision on such questions of law. A distinction must be drawn between cases in which a question of law is specifically referred and those in which a decision is incidentally material (however necessary) in order to decide the question actually referred. A wrong construction of the contract is an error of law and can be challenged provided the error appears on the fact of the award, Awarding of the interest is an error of law apparent on the face of the record. 16. In Tarapore and Company v. Cochin Shipyard Ltd, Cochin, A.I.R. 1984 S.C. 1072: (1984)2 S.C.C. 680 , a similar question was once again examined by the Supreme Court. The Supreme Court observed: ”Complexity of rights and obligations in national and international trade and commerce would certainly generate disputes between the parties and treated as a normal incident of commercial life and till commercial arbitration came to be recognised as a civilised way of resolving such disputes, prolix and time-consuming litigation was the only method of resolving such disputes. As an alternative to Court proceedings, arbitration as a method of resolving disputes by domestic tribunal constituted by the choice of parties became acceptable. The basic difference between the court proceedings and the arbitration is the choice of the tribunal. Ordinarily, all matters in which relief can be claimed from the Court may become subject matter of arbitration. Now if in a law court incidental questions of law arise in the course of proceedings, the Court has an obligation to decide those questions of law. Ordinarily, all matters in which relief can be claimed from the Court may become subject matter of arbitration. Now if in a law court incidental questions of law arise in the course of proceedings, the Court has an obligation to decide those questions of law. But when it came to a tribunal not endowed with the judicial power of the State but by conferment by the parties to the dispute or which acquires jurisdiction by a submission of the parties to the dispute to invite the-deci-sion by the forum of their choice and to be bound by it a question arose whether a pure question of law if at all can be referred to an arbitrator for his decision and even if he decides, can the decision be questioned on the ground that there is an error apparent on the face of the award in deciding the question. Now as stated a short while ago, a question of law may figure before an arbitrator in two ways. It may arise as an incidental point while deciding the main dispute referred to the arbitrator or in a given case parties may refer a specific question of law to the arbitrator for his decision. There is no more gainsaying the fact that a pure question of law may and can be referred to an arbitrator for his decision......With the ever widening expansion of international trade and commerce, complex questions of private International Law, effect of local laws on contracts between parties belonging to different nations are certainly bound to crop up. Arbitration has been considered a civilised way of resolving such disputes avoiding Court proceedings. There is no reason why the parties should be precluded from referring a specific question of law to an arbitrator for his decision and agree to be bound by the same. This approach manifests faith of parties in the capacity of the tribunal of their choice to decide even a pure question of law. If they do so, with eyes wide open, and there is nothing to preclude the parties from doing so, then there is no reason why the Court should try to impose its view of law superseding the view of the Tribunal whose decision the parties agreed to abide by. If they do so, with eyes wide open, and there is nothing to preclude the parties from doing so, then there is no reason why the Court should try to impose its view of law superseding the view of the Tribunal whose decision the parties agreed to abide by. Therefore, on principle it appears distinctly clear that when a specific question of law is referred to an arbitrator for his decision including the one touching upon the jurisdiction of the arbitrator, the decision of the arbitrator would be binding on both the parties and it would not be open to any of the two parties to wriggle out of it by contending that the arbitrator cannot clutch at or confer jurisdiction upon himself by misconstruing the arbitration agreement. “ 17. After a discussion with reference to the case-law on the subject, the Supreme Court rejected the contention that the jurisdiction of the Arbitrator could not be determined by him nor can he arrogate jurisdiction to himself by misconstruction of the contract and thereby clutch at jurisdiction but observed that in such a situation, the Court always retains to itself the power to set at naught the award on the ground of an error of law apparent on the face of the award. The Supreme Court stated: ”It cannot be disputed that even the question of jurisdiction of an Arbitrator can be the subject matter of a specific reference. If the parties agree to refer the specific question whether the dispute raised is covered by the arbitration agreement, it becomes a specific question of law even if it involves the jurisdiction of the arbitration and if it is so, a decision of the arbitrator on specific question referred to him for decisions even if it appears to be erroneous to the Court is binding on the parties. The decisions relied upon by Mr.Pai do not derogate from this legal position. The decisions relied upon by Mr.Pai do not derogate from this legal position. On a conspectus of these decisions, it clearly transpires that if a question of law is specifically referred and it becomes evident that the parties desired to have a decision on the specific question from the arbitrator about that rather than one from the Court, then the Court will not interfere with the award of the arbitrator on the ground that there is an error of law apparent on the fact of the award even if the view of law taken by the arbitrator does not accord with the view of the Court. This view of law taken in England was stated by this Court to be the same in this country and since the decision in Seth Thwards Pherumal’s case, (1955)2 M.L.J. (S.C.) 23: 1955 S.C.J. 445: (1955)2 S.C.R. 48: A.I.R. 1955 S.C. 468, which follows earlier decisions in England and India, it has not been departed from. The view canvassed by Mr.Pai that common law courts were very reluctant to part with its jurisdiction has hardly any relevance where a specific question of law including the one touching the jurisdiction of the arbitrator is referred to the arbitrator for his decision. Even if the decision of the arbitrator does not accord with the view of the Court, the award cannot be set aside on the sole ground that there is an error of law apparent on the face of it." The Court thereafter dealt with the relevant facts of the case and concluded: "The discussion leads to the inescapable conclusion that a specific question of law touching the jurisdiction of the arbitrator was specifically referred to the arbitrator and therefore the arbitrator’s decision is binding on the parties and the award that there was an error of law apparent on the face of the award. It is also established that the claim for compensation made by the arbitrator which led to the dispute was covered by the arbitration clause. The quantum of compensation awarded by the arbitrator was never disputed nor questioned. Therefore, the High Court was clearly in error in reversing the decision of the trial court." There has been no deviation from the above stated law and the Courts in India have exercised jurisdiction within the above stated bounds. 18. The quantum of compensation awarded by the arbitrator was never disputed nor questioned. Therefore, the High Court was clearly in error in reversing the decision of the trial court." There has been no deviation from the above stated law and the Courts in India have exercised jurisdiction within the above stated bounds. 18. In Gujarat W.S. & S.B. v. Unique Erectors (Gujarat) (P)Ltd.,A.I.R. 1989S.C. 973, a question arose whether the Arbitrator committed an error of law in not deciding or disclosing his mind about the arbitrability of the claims or counter-claims more so when the Board’s application for deciding the same, was pending before the Arbitrator. The Supreme Court said: "It was submitted that the arbitrator had committed an error of law in not deciding or disclosing his mind about the arbitrability of claims or counter-claims, more so, when the Board’s application for deciding the same was pending before the Arbitrator. Before the learned trial Judge, the Board has submitted an application to the Arbitrator seeking to raise a preliminary issue regarding arbitrability of the claims. As noted by the learned trial Judge, it appears that the third meeting specifically mentioned that the claims were placed before the Arbitrator and their contentions about the arbitrability were considered. So, these issues were gone into and it appears that the parties had agreed and proceeded on the basis that the claims may be examined and it was not necessary to decide pre-issue of arbitrability and it was agreed that all the claims be decided claimwise. So, it cannot be said that the Arbitrator had acted arbitrarily in discussing all the questions raised before him without first deciding the question of arbitrability or nonarbitrability of an issue as such." In this case, the Supreme Court also stated, "It was further submitted before us that the award was unreasonable and that the arbitrator had awarded a large amount of money but the original claim was not so large and as such the award was disproportionate. This contention, as it is, it appears from the Judgment of the High Court, was not urged and canvassed before the High Court. The claim and the counter-claim together in its totality, in our opinion, does not make the award amount disproportionate. Reasonableness as such of an award unless the award is per se preposterous or absurd is not a matter for the Court to consider. The claim and the counter-claim together in its totality, in our opinion, does not make the award amount disproportionate. Reasonableness as such of an award unless the award is per se preposterous or absurd is not a matter for the Court to consider. Appraisement of evidence by the Arbitrator is ordinarily not a matter for the Court. It is difficult to give an exact definition of the word ‘reasonable’. Reason varies in its conclusions according to the idiosyncrasy of the individual and the times and the circumstances in which he thinks. The word ‘reasonable’ has in law prima facie meaning of reasonable in regard to those circumstances of which the actor, called upon to act reasonably, knows or ought to know. 19. The Supreme Court in Gujarat W.S. & S.B. v. Unique Erectors (Gujarat) (P) Ltd., A.I.R. 1989 S.C. 973, also stated: "The scope and extent of examination by the Court of the award made by an Arbitrator has been laid down in various decisions. It has to be noted that there is a trend in modern times that reasons should be stated in the award though the question whether the reasons are necessary in ordinary arbitration awards between the parties is pending adjudication by the Constitution Bench of this Court. Even, however, if it be held that it is obligatory for the arbitrator to state reasons, it is not obligatory to give any detailed judgment. An award of arbitrator should be read reasonably as a whole to find out the implication and the meaning thereof. Short intelligible indications of the grounds should be discernible to find out the mind of the arbitrator for his action even if it be enjoined that in all cases of award by an arbitrator reasons have to be stated. The reasons should not only be intelligible, but should also deal either expressly or impliedly with the substantial points that have been raised. Even in a case where the arbitrator has to state reasons, the sufficiency of the reasons depends upon the facts and the circumstances of the case. The Court, however, does not sit in appeal over the award and review the reasons. The court can set aside the award only if it is apparent from the award that there is no evidence to support the conclusion or if the award is based upon any legal proposition which is erroneous. The Court, however, does not sit in appeal over the award and review the reasons. The court can set aside the award only if it is apparent from the award that there is no evidence to support the conclusion or if the award is based upon any legal proposition which is erroneous. See the observations of this Court in Indian Oil Corporation Ltd. v. Indian Carbon Ltd., A.I.R. 1988 S.C. 1340: (1988)3 S.C.C. 36 ." 20. In Dindasi Sahu v. State of Orissa, A.I.R. 1990 S.C. 1128, the Supreme Court pointed out: "Though the arbitrator is not bound to disclose as to what interpretation he has made and what inference he has derived from the documentary evidence, he is bound to refer in the award that he had considered all the documents placed before him no matter whether he relies on them or discards them from consideration. The arbitrator in his award ex facie does not mention that he has referred to or considered the documents placed before him in respect of the original claim." The Supreme Court, in the a forequoted decision, stated further: "This Court in State of Orissa v. Dindasi Sanu, A.I.R. 1988 S.C. 1791: (1988)4 S.C.C. 12 , to which one of us (Sabayasachi Mukharji, J.), was a party while noting that the amount awarded is quote high or that a large amount has been awarded does not by itself vitiate the award as such, observed that one has to judge whether the amount of the award was so disproportionately high to make it perse bad on the facts and circumstances of a particular case. In this connection, we have to keep in mind that we are concerned with a situation where the arbitrator need not give any reason and that even if he commits a mistake either in law in fact in determining the matter referred to him, where such mistake does not appear on the face of the award, the same could not be assailed. The arbitrator, in the case of a reference to him in pursuance of an arbitration agreement between the parties, being a person chosen by parties is constituted as the sale and final Judge of all the questions and the parties bind themselves as a rule to accept the award as final and conclusive. The arbitrator, in the case of a reference to him in pursuance of an arbitration agreement between the parties, being a person chosen by parties is constituted as the sale and final Judge of all the questions and the parties bind themselves as a rule to accept the award as final and conclusive. The award could be interfered with only in limited circumstances as provided under Sec.16 and 30 of the Arbitration Act. In this situation, we have to test the award with circumspection. Even with all this limitations, on the powers of the Court and probably because of these limitations, we have to hold that if the amount awarded was disproportionately high having regard to the original claim made and the totality of the circumstances it would certainly be a case where the arbitrator could be said to have not applied his mind amounting to legal misconduct." 21. In M/s.Alopi Parshad and Sons Ltd. v. The Union of India, A.I.R 1960 S.C. 588: (1960)2 S.C.R 793 , it has been pointed out by the Supreme Court: "An arbitration award maybe set aside on the ground of an error on the face of it when the reasons given for the decision, either in the award or in any document incorporated with it, are based upon a legal proposition which is erroneous. But where a specific question is referred, the award is not liable to be set aside on the ground of an error on the face of the award even if the answer to the question involves an erroneous decision on a point of law." 22. But where a specific question is referred, the award is not liable to be set aside on the ground of an error on the face of the award even if the answer to the question involves an erroneous decision on a point of law." 22. The Supreme Court in a Constitution Bench Judgment in Raipur Development Authority v. Chokhamal Contractors, A.I.R. 1990 S.C. 1426, however, has said: "An award passed under the Arbitration Act is not liable to be remitted or set aside merely on the ground that no reasons have been given in its support except where the arbitration agreement or the deed of submission or an order made by the Court such as the one under Sec.20 or Sec.21 or Sec.34 of the Act or the statute governing the arbitration requires that the arbitrator or the umpire should give reasons for the award." The Supreme Court in the above case took notice of the contention that in the decisions pertaining to Administrative Law, the Supreme Court in some cases has observed that the giving of reasons in an administrative decision is a rule of natural justice by an extension of the prevailing rule. It would be in the interest of the world of commerce that the said rule is confined to the area of Administrative Law. The Supreme Court has added: "We do appreciate the contention urged on behalf of the parties who contend that it should be made obligatory on the part of the arbitrator to give reasons for the award, that there is no justification to leave the small area covered by the law of arbitration out of the general rule that the decision of every judicial and quasi-judicial body should be supported by reasons. But at the same time, it has to be borne in mind that what applies generally to settlement of disputes by authorities governed by public law need not be extended to all cases arising under private law such as those arising under the law of arbitration which is intended for settlement of private disputes. As stated elsewhere in the course of this judgment if the parties to the dispute feel that reasons should be given by the arbitrators for the awards it is within their power to insist upon such reasons being given at the time when they enter into arbitration agreement or sign the deed of submission. As stated elsewhere in the course of this judgment if the parties to the dispute feel that reasons should be given by the arbitrators for the awards it is within their power to insist upon such reasons being given at the time when they enter into arbitration agreement or sign the deed of submission. It is significant that though nearly a decade ago the Indian Law Commission submitted its report on the law of arbitration specifically mentioning therein that there was no necessity to amend the law of arbitration requiring the arbitrators to give reasons. Parliament has not chosen to take any step in the direction of the amendment of the law of arbitration. Even after the passing of the English Arbitration Act, 1979, unless a Court requires the arbitrator to give reasons for the award (vide: Sub-secs.(5) and (6) of Sec.1 of the English Arbitration Act, (1979), an award is not liable to be set aside merely on the ground that no reasons have been given in support of it." 23. Some High Courts have also gone into the issue of this kind. Three decisions in Union of India v. M/s.Ajit Mehta and Associates, A.I.R. 1990 Bom. 45, State of Kerala v. Joseph Anchilose, A.I.R. 1990 Ker. 101 and State v. M/s.Associated Engineering Enterprises, Hyderabad, A.I.R. 1990 A.P. 294, have been brought to our notice. The Bombay High Court in Union of India v. M/s.Ajit Mehta and Associates, A.I.R. 1990 Bom. 45, has observed: "The appellant’s next contention in this behalf is also well-merited. In all these cases the arbitrators have purported to grant claim under Clauses 7, 11, 63 and 67 and in two cases also under Clause 10. Clause 7 relates to deviations in the contract work. Clause 11 relates to damages on account of delays in construction and extensions in time for completing the work. Clause 63 relates to reimbursement on account of variations in prices and wages (to which we have already referred earlier), and Clause 67 relates to withholding of payments on account of the dues from the Contractor under other contracts. All these clauses (under which the arbitrators have purported to award the claims of the firm) lay down the mode and manner of making the claims under them and the conditions on which and the extent to which such claims can be granted. All these clauses (under which the arbitrators have purported to award the claims of the firm) lay down the mode and manner of making the claims under them and the conditions on which and the extent to which such claims can be granted. The arbitrators admittedly did not have even a copy of the contract before them. Hence, it is difficult to know how the arbitrators have come to the conclusion that the firm had satisfied the terms of the said clauses. It may further be pointed out that the claim under Clause 11 which appears to be a major claim in each case is in the nature of damages including damages for delays in work. Admittedly, none of these claims were made in the final bill. In fact, the final bills were submitted unconditionally. Clause 11(c) of the Contract, among other things, states in categorical terms, as follows: "No claim in respect of compensation or otherwise, arising, as a result of extensions granted under Conditions (A) and (B) above shall be admitted." When therefore there was a specific prohibition against entertainment of such claim in the contract, it was certainly not open for the arbitrators to grant the same and yet the arbitrators have proceeded to grant the claims." In State of Kerala v. Joseph Anchilose, A.I.R. 1990 Ker. 101, it has been observed: "A large number of recent decisions however have had occasion to consider the gross abuse of the arbitral process because of the advantage not to give reasons and the limitation on the powers of Courts to interfere with the awards. Fanciful claims for enhancement of the above agreed rates had come up for particular notice in Alopi Prasad A.I.R. 1960 S.C. 588, and Continental Construction Company, A.I.R. 1988S.C. 1166. Award of amounts far in excess of the agreed rates and in contravention of the specific terms of the contract was noticed by this Court in a series of recent decisions. We need refer only to F.C.I., v. Pratap Transport Company, (1987)1 K.L. T. 366, State of Kerala v. Raveendranathan, (1987)1 K.L.T. 604 , State of Kerala v. Paulose, (1987)1 K.L.T. 781 , State of Kerala v. Paulose, (1988)1 K.L.T. 541 . On a reference to decided cases we find that widespread abuse of arbitral processes have come up for notice before the various High Courts. On a reference to decided cases we find that widespread abuse of arbitral processes have come up for notice before the various High Courts. One of us (Sivaraman Nair) had occasion to advert to these tendencies in the concurring opinion in M.F. A.No.650 of 1980. The provocation for reference of the question whether arbitrators should be obliged to state reasons in their awards to a larger bench of the Supreme Court seems to be the need felt in some quarters to hold the arbitrators in rein. The same trend of reasoning was adopted by the Supreme Court of India in the Continental Constniction Company Ltd. v. State of M.P., (1988)3 S.C.C 82 : A.I.R. 1988 S.C. 1166 and Food Corporation v. Great Eastern Shipping Co., Ltd., A.I.R. 1988 S.C. 1198. “ Thus approaching the case, the Kerala High Court in State v. Joseph, A.I.R. 1990 Ker. 101, found on merits that the Arbitrator considered the claim for additional conveyance charges etc., which were not available for arbitration and concluded: ”We do not propose to go into the other details of the case of the appellants since it is not necessary for us to do so. We are of the opinion that the Arbitrator and the Court below were wrong in assuming that the Arbitrator had jurisdiction notwithstanding the preliminary objections which the appellants validly raised. We are also of the opinion that these preliminary points involved propositions of law. The Arbitrator arrogated jurisdiction to proceed further with the disputes only on the basis of a wrong determination. We hold further that those propositions of law were incidental to the assumption of jurisdiction and the determination by the Arbitrator. We should necessarily hold that the wrong determination on incidental propositions of law which was the basis of assumption of jurisdiction and the decision of the Arbitrator were illegalities apparent on the face of the award. “ The Andhra Pradesh High Court in State v. M/s. Associated Engineering Enterprises, Hyderabad, A.I.R. 1990 A.P. 294, was dealing with a case in which a specific item of claim was separately claimed and it was noticed that the Arbitrator decided such of the claims which were beyond the terms of arbitration. The Court accordingly found that the Arbitrator exceeded his jurisdiction. The Court accordingly found that the Arbitrator exceeded his jurisdiction. However, the Court said: ”We are, therefore, of the opinion that the decisions relied upon by Mr.Ramachandra Reddy do not lay down the proposition that where an award is questioned on the ground that the arbitrator had no jurisdiction to entertain a claim by virtue of the terms of the contract, the Court is precluded from looking to the terms of the contract. On the contrary, such power is expressly recognized in one of the decisions cited., viz., Sudarsan Trading Company v. The Government of Kerala, A.I.R. 1989 S.C. 890: 1989 Scale. 395. Further,as held by the Supreme Court in Continental Con-sanction Company Ltd v. State of M.P., (1988)3 S.C.C. 82 : A.I.R. 1988 S.C. 1166, where the agreement bars a particular claim, the arbitrator has no jurisdiction to award any amount towards such a claim, and that any such award would be incompetent and void. “ Having thus noticed the law on the subject, we proceed to see whether any specific question of law was referred to the Arbitrators by the parties to the proceedings or under the orders of the Court or not. The learned counsel for the appellant has contended that the Court by its order in O.P.No.304 of 1979, acknowledged that the question as to the arbitrability of some of the items in dispute had to be decided by the Arbitrator without specific reference to challenge the award on those questions. Learned counsel for the first respondent has maintained that the Court only recognised the right to challenge any award on the ground of any error of law apparent on the face of the award. In the order, the learned Judge stated: ”Now that the petitioner-Board has come forward with this request, it is considered that the first respondent could agree to what has been proposed for an amicable settlement of the disputes.“ ”Counsel appearing for the first respondent would still plead that the conditions imposed, would take away effective disposal of the disputes by the Arbitrators. But on the face of three conditions, it will be noticed that so far as the first condition is concerned, undoubtedly in respect of disputes raised if found to be outside Arbitration clause, a participant in the Arbitration proceedings would be entitled to raise such an objection and thereafter participate in the proceedings reserving the right to challenge the same, if any need arises at a later stage in a Court of law. “ and ”If the petitioner had come forward to raise a dispute and if it is outside the scope of Clause 50, the first respondent itself would come forward with such a reservation. It is not as if all disputes would come within the scope of Clause 50 and only those that would come within the ambit of Clause 50 alone can be decided by the Arbitrators when such is the clear position on this aspect; enabling the petitioner-Board to raise an objection regarding disputes which may not come within the scope of clause 50 is not a concession, but a recognition of a right, which is available not only to the petitioner-Board but also the first respondent in the event of the Board raising any dispute as against it. Therefore, the first stipulation is dependent upon the Arbitrators deciding as to whether a particular dispute would come within the scope of Sec.50 or not and only if they consider that it falls within the scope of arbitration clause, they would have the jurisdiction to decide the same. In the event of the Arbitrators holding that any particular dispute is outside the arbitration clause, it is not as if the first respondent is deprived of remedies by agitating the same in Courts.“ ”As for the second condition, it is part of what has been already dealt with under condition No.1 and, therefore, there can be no objection to the Board being allowed to raise such an objection, and after recording the same, to participate in the proceedings in the event of the Arbitrators holding that the objection is unsustainable. After the award is made, as the petitioner-Board has already reserved its right, it would enable the Board to raise this point, in the event of any need arising for setting aside the award in Court.“ As for the third condition, the counsel for the first respondent would contend that there is no need for such a condition when the Arbitration Act itself provides for such a relief. He would state that it has been stipulated in ignorance of the provisions of the Act. There is considerable force in this submission because participation in an arbitration proceeding has never been held as to take away the right of a party to challenge the award in Court to which it is contemplated under the Act.” 24. We have referred to this to know the position that obtained when parties reached the Arbitrators and the Arbitrators proceeded to decide the dispute. Had there been a challenge that the matter was entirely outside the jurisdiction of the Arbitrators, the position would have been slightly different. The challenge, however, was that some of the matters decided by the Arbitrators were beyond the scope of the arbitration clause. If we proceed from a moment by accepting the contention that some of the items of the claim of the 1st respondent-contractor were beyond the scope of arbitration, we must take notice of the fact that the Board reserved its right to raise such objections before the Arbitrator, and as contended, it had raised such objections particularly with respect to the rate. Thus, although not satisfied with the order a forequoted, it is clear, the Board wanted a specific question of law in this regard to be decided by the Arbitrators and the parties were in dispute before the Arbitrators on such questions. It cannot be contended in view of the clear authority of the Supreme Court that while deciding even such a question, the Arbitrator was required to give reasons. Had reasons been stated, it would have been easier for the court to know whether the objection raised on behalf of the Board was sustained or rejected by the Arbitrators. Since no reason has been assigned, it is difficult to know whether all or some of the objections by the Board were sustained or rejected. Had reasons been stated, it would have been easier for the court to know whether the objection raised on behalf of the Board was sustained or rejected by the Arbitrators. Since no reason has been assigned, it is difficult to know whether all or some of the objections by the Board were sustained or rejected. But this much is clear, namely, that all the claims of the contractor were not accepted by the Arbitrators and that is why as against the claim of Rs.2,10,00,000 an award has been made to the tune of Rs.70,83,793 only. In our effort to find out why there has been such a gross imbalance in the claim of the contractor and the award in the sense that the contractor’s claims were mostly outside the scope of the arbitration clause, we have found that such items, which according to the Board also were within the arbitration clause only, have been disallowed. The learned trial Judge has a word on this aspect of the case. He has stated: “At this stage it will be proper to ‘refer to the arbitration clause in the agreement in our case. The said clause viz., clause 50 has not excluded any of the dispute between the parties and it has been widely worded that if at any time any question, dispute or difference whatsoever shall arise between the purchaser or the Engineer and the other party upon or in relation to or in connection with the contract, either party may forthwith give to the other notice in writing. It has also to be pointed out that in the same clause 50 it has been mentioned that the work under the contract, shall if reasonably possible, continue during the arbitration proceedings and no payments due or payable by the purchaser shall be withheld on account of such proceedings. Having regard to the wide amplitude of the said arbitration clause the contention put forth on behalf of the Board that the claims put forward by the contractor were not arbitrable or outside the scope of arbitration clause cannot at all be upheld. It cannot also be stated that the umpire had decided the dispute out of the contract and without jurisdiction.” 25.From the facts of this case what clearly emerges is that .(1) The award is unassailable on the ground that no reason has been assigned. It cannot also be stated that the umpire had decided the dispute out of the contract and without jurisdiction.” 25.From the facts of this case what clearly emerges is that .(1) The award is unassailable on the ground that no reason has been assigned. (2) The appellant-Board chose to raise questions of arbitrability with respect to certain items of claim of the 1st respondent-contractor before the Arbitrators and thus submitted to the jurisdiction of the Arbitrators. The Arbitrators thus got jurisdiction to go into all such disputes. .(3) The very fact that all the claims of the first respondent-contractor were not allowed by the Arbitrators goes to show that objections as to the arbitrability as well as admissibility of the claim with respect to several items raised on behalf of the appellant-Board were sustained by the Arbitrators. .(4) It is not possible to accept that but for the assumption of an erroneous jurisdiction, the Arbitrators would not have awarded the amount of Rs.70,83,793 as against the claim of Rs.2,10,00,000. 26. Learned counsel for the appellant made some attempts to persuade us to accept his contention that the Arbitrators did not look into any of the evidence or the documents which the Board produced before them. He contended that since the Arbitrator did not look into the documents and mention about them in the award, the presumption would be, as held by the Supreme Court, that the award is bad and it must be set aside. We find however that the Arbitrator has taken into consid-eration the evidence adduced on behalf of theparties and he has stated so in the award. Why he accepted a particular evidence and why he rejected the other has, however, not been stated by him.That would have been preferable particularly in view of the trend of the day noticed by several High Courts and the Supreme Court even in respect of such private disputes. We are, however, bound by the Constitution Bench Judgment of the Supreme Court in which it has been clearly stated that all that the Court can see is whether any condition enumerated in Secs.30 and 33 of the Arbitration Act existed for interference with the award or not or in other words whether there has b( en any misconduct, legal or otherwise or any er.or apparent on the face of the award. Since we are of the opinion that there is no error apparent on the face of the award, we do not propose to interfere with the award. 27. The learned trial Judge has taken notice of the relevant principles of law and the facts. He has reached a reasonable conclusion. Nothing has been shown to us to come to a contrary conclusion. Had there been any error of law or any unreasonableness in the order of the learned trial Judge, that would have warranted interference. We do not find any such error in the order of the learned trial Judge. There is no merit in the appeals. The appeals are accordingly dismissed. No costs.