Dalveer Bhandari ( 1 ) THE petitioner was awarded the balancework of construction of parking and widening of existing roads phase II atasian Games Village Complex vide agreement NO. 10/pe/agd and DDA/81-82. ( 2 ) THE disputes between the contractor/petitioner and the D. D. A. /respondent were referred to Mr. Hnarasi Das, for adjudication. Thearbitrator gave the award on 20th June, 1991. The award and the proceedings were filed by the arbitrator. The abjections to the award were filed onbehalf of the respondent and immediately thereafter issues were framed andparties in pursuance of the Court s directions filed the evidence by way ofaffidavit. ( 3 ) ON 18/02/1993, when the matter was listed for finaldisposal, the petitioner appeared in person and submitted that he does notwant to press his objections to the award and wants to withdraw his objections. Accordingly, the permission was granted to the petitioner to withdrawhis objections. ( 4 ) NOW, the Court is required to deal with the objections to theaward filed by the respondent/d. D. A. ( 5 ) THE learned Counsel for the respondent submitted that the claimno. 7 is contrary to the provisions of the agreement entered into between theparties and deserves to be set aside. The claim was for increase in labourwages under Clause 10-C of the agreement It was submitted by the learnedcounsel appearing for the respondent that the claimant was not entitled forincrease in labour wages as delay in the execution of contract was attributedto the contractor by the Chief Project Engineer. Under Clause 10-C of theagreement, the decision of the Engineer is final. Clause 10-C of the agreement reads as under : "if during the progress of the works, the price of any materialincorporated in the works (not being a material supplied from theengineer-in charge s stores in accordance with Clause 10 hereof)and/or wages of labour increase as a direct result of the coming intoforce of any fresh law. Clause 10-C of the agreement reads as under : "if during the progress of the works, the price of any materialincorporated in the works (not being a material supplied from theengineer-in charge s stores in accordance with Clause 10 hereof)and/or wages of labour increase as a direct result of the coming intoforce of any fresh law. or statutory rule or order (but not due toany changes in sales taxes.) and such increase exceed ten per cent ofthe price and/or wages prevailing at the time of receipt of the tenderfor the work, and contractor thereupon necessarily and properlypays in respect of the material (incorporated in the work) such increased price and/or in respect of labour engaged on the executionof the work such increased wages, then the amount of the contractshall accordingly be varied provided always that any increase so payable is not. in the opinion of the Engineer (whose decision shall befinal and binding) attributable to delay tn the execution of the contract within the control of the contractor. . . (Emphasis added ). BARE reading of the said clause clearly reveals that the opinion of theengineer regarding determination of delay in execution of the contract shallbe final and binding and the arbitrator was not justified in sitting in appealon the decision of the arbitrator, ( 6 ) THE petitioner who appeared in person has filed reply to theobjections filed by the respondent against the award. In the reply, it hasbeen submitted that the arbitrator had committed no error in making theaward and the same be made rule of the Court. The petitioner submittedthat the arbitrator was justified in decreeing his claim in respect of claimno. 7. The respondent on the other hand has mentioned that because ofclause 10-C of the agreement, the petitioner was not entitled to the decree ofhis claim No. 7. The Project Engineer in his letter dated 6/04/1984 hasattributed delay in execution of the contract to the petitioner. According toclause 10-C of the agreement, the decision of the Engineer is final and binding. Furthermore, when delay has been attributed to the contractor; thenaccording to the said Clause 10-C, the petitioner is not entitled to any increase in wages of labour. The learned Counsel for the respondent insupport of her arguments, placed reliance on M/s. Bharat Furnishing Co. v. Delhi Development Authority and Another, 1991 (4) D. L. 335. Furthermore, when delay has been attributed to the contractor; thenaccording to the said Clause 10-C, the petitioner is not entitled to any increase in wages of labour. The learned Counsel for the respondent insupport of her arguments, placed reliance on M/s. Bharat Furnishing Co. v. Delhi Development Authority and Another, 1991 (4) D. L. 335. In this judgment the Court observed: "the principal question is whether the arbitrator could sit overthe finding of the Engineer concerned, ignore and override it and,despite it, make the award. I feel that this be could not do. Bydoing so, he not only sat over the finding of the Senior Projectengineer which was "final" and thus exceeded the jurisdiction of thearbitrator, but also reduced to meaninglessness the expression:"except where otherwise provided in the contract" as contained inclause 25 of the Contract. " ( 7 ) I have heard the petitioner and the learned Counsel appearing forthe respondent. The arbitrator has clearly misconducted himself in decreeing claim No. 7 of the petitioner. The award to that axtent is liable to beset aside. THE learned Counsel for the respondent submitted that finding of thelearned arbitrator with regard to claim Nos. 9 and 11 are also contrary to theprovisions of the contract entered into between the parties and the arbitratorhas clearly misconducted himself in decreeing the claim Nos. 9 and 11 of thepetitioner. THE learned arbitrator has held that since the respondent has committed continuous breaches in handing over the site and supply of drawings,the delay was attributable to the respondents. Learned Counsel for the respondent submitted that the arbitrator hascompletely ignored the notice inviting tenders, which forms a part of theagreement. In Clause 2 (a) it was clearly stated that the site was to be madeavailable in stages. Clause 2 (a) of the agreement reads as under : "the site for the work will be made available in stages or thesite for the work will be made available in parts. "the learned Counsel for the respondent pointed out another condition of thecontract which reads as under: "if a part of the site is not available for any reason or there issome unavoidable delay in supply of materials stipulated by thedepartment, the programme of construction shall be modified accordingly and the contractor shall have no claim for any extras orcompensation on that account. " ( 8 ) THE learned Counsel for the respondent submitted that because ofincorporation of Clause 2-A, the site was to be made available to the petitioner in stages. Therefore, the petitioner was not justified in claiming anycompensation on that account. Moreover, during negotiations the petitionerhad withdrawn his condition that the site should be made available in falland, therefore, had accepted that the site may be made available to him instages. The learned Counsel for the re respondent has drawn attention of thiscourt to the decided English case namely, British Guiana Credit Corporationdasilva, (1965) 1 W. L. R. 248 in Building Contracts by D. Keating 4th Edn. The relevant portion of the judgment is reproduced hereunder : "where negotiations are in progress between the parties intending to enter into the contract, the whole of those negotiationsmust be looked at to determine when if at all, the contract comesinto being. . . once the contract comes into being, however, subsequent negotiations by either party seeking for e. g. to obtain betterterms will not affect the existence with previously concludedcontract. "the judgment was cited to strengthen her arguments that the petitioner hadwithdrawn the condition of availability of full site at the time of negotiationsand at that time contract came into being as his negotiations formed a partof the contract. Subsequent negotiations/grievance of the petitioner demanding 25% and 30% over the tendered rates due to non-availability of the fullsite is not justified. ( 9 ) THE learned Counsel for the respondent has placed reliance onsupreme Court judgment delivered in Associated Engineering Co. v. Government of Andhra Pradesh, 1991 (2) AIR 180. In this judgment, the Supremecourt has mentioned that the function of the arbitrator is to arbitrate interms of the contract. He has no power apart from what the parties havegiven him under the contract. If he has travelled outside the bounds of thecontract, he has acted without jurisdiction. ( 10 ) IN the instant case, in accordance with the terms of the contract,the site was to be given to the petitioner in stages and further more, duringnegotiations, the petitioner agreed to receive the site in stages therefore itwas not open to the petitioner to have agitated this issue again with thearbitrator and the arbitrator was not justified in awarding any damages onthis Court to the petitioner. ( 11 ) THE learned Counsel for the respondent has also placed relianceon another judgment of the Supreme Court delivered in Continental Construction Co. Ltd. v. State of Madhya Pradesh, AIR 1988 SC 1166 , for strenthening her submission. The objection of the respondent seems to be justifiedbecause the arbitrator has ignored the terms of the contract. The site wasto be made available in stages. However, the respondent has failed to explain undue and long delay in supplying the requisite drawings and givingdirections/decisions in time to the petitioner. The delay in supplying thedrawings and giving directions/decisions in time is clearly attributable to therespondent and the arbitrator was justified in awarding damages to thepetitioner. The arbitrator has decided claims No. 9 and 11 together and givenrs. 81. 736. 00 as damages against claims 9 and II. The amount has not beenbifurcated between the delay in giving the entire site and delay in supplyingrequisite drawings and other directions/decisions in time to the petitioner. The arbitrator has also not given any reason how he has arrived at the figureof Rs. 81,736. 00 ( 12 ) LEARNED Counsel for the respondent has submitted that thearbitrator ought to have given reasons for awarding damages against claims 9and 11. The learned Counsel for the respondent has placed reliance on thesupreme Court judgment delivered in Raipur Development Authority v. Chokhamal Contractors, AIR 1989 SC 430 . ( 13 ) IN view of the law laid down in these cases, the arbitrator oughtto have given reasons for decreeing the award pertaining to claims No. 9 and11. The error is apparent on the face of the record. The award to theextent of claims No. 9 and 11 is set aside. The award is remitted to thearbitrator for giving reasons as to how he has arrived at this amount. He isfurther directed to give bifurcation of the damages with regard to delay inproviding entire site and delay in giving requisite drawings and directions/decisions in time. ( 14 ) CLAIM No. 10 pertains to interest. The law is now well settled. The arbitrator is empowered to grant pendents lite and future interest, however,in view of my decision with regard to other claims, it would be appropriate for the arbitrator to reconsider his finding with respect to the claimno. ( 14 ) CLAIM No. 10 pertains to interest. The law is now well settled. The arbitrator is empowered to grant pendents lite and future interest, however,in view of my decision with regard to other claims, it would be appropriate for the arbitrator to reconsider his finding with respect to the claimno. 10 and accordingly the arbitrator s finding in respect of claim No. 10 arealso set aside and he is directed to consider the claim of interest in view ofcourt s finding regarding other issues. Counter Claim No. 1 ( 15 ) THE arbitrator has disallowed reductions under serial Nos. 1 to 7made by the respondent in the rates due to sub-standard work done by theclaimant and filed its counter claim No. 1 to this effect. According to therespondent, the arbitrator erroneously disallowed counter claim of the respondent. Clause 25 (B) of the agreement reads as under : "the decision of the Chief Project Engineer regarding thequantum of reduction as well as justification thereon in respect ofrates for sub-standard work which may be decided to be acceptedwill be final and would be open for arbitration. "the arbitrator could not have adjudicated upon this aspect of the matterbecause the decision of the Chief Project Engineer was final and could nothave been adjudicated by the arbitrator, and has to be set aside. ( 16 ) RELIANCE was placed by the respondent on para 11 of the judgment in M/s. Bindra Buildings v. Delhi Development Authority, AIR 1985delhi 370. Levy of Compensation under Clause 2 : ( 17 ) ACCORDING to the learned Counsel for the respondent the findingof the arbitrator regarding Clause 2 is also clearly in excess of the jurisdictionbecause the lew of compensation made by Senior Project Engineer underclause 2 would be final and is not open to adjudication by the arbitrator. Clause 2 of the agreement clearly stipulates that in case of any delay on thepart of the contractor to comply with the time schedule, he would be liableto pay compensation to the respondent and the decision of the Senior Projectengineer would be final. ( 18 ) READING Clauses 2 and 25 together, the position that emerges isthat the question of determination of compensation/penalty for delay incompletion of the work rests only with the Superintending Engineer and anyadjudication is outside the scope of the Arbitration Clause. ( 18 ) READING Clauses 2 and 25 together, the position that emerges isthat the question of determination of compensation/penalty for delay incompletion of the work rests only with the Superintending Engineer and anyadjudication is outside the scope of the Arbitration Clause. Reliance wasplaced by the learned Counsel on the leading judgment of the Supreme Courtin Vishwanath Sood v. Union of India, AIR 1989 (1) SC 357. ( 19 ) I have heard the petitioner and learned Counsel for the respondent. The assumption of jurisdiction to adjudicate and review the findingsof the Superintending Engineer is an error apparent on the face of therecord. The award to that extent is set aside and remitted for reconsideration. ( 20 ) THE learned Counsel for the respondent has also referred to theauthoritative treatise on arbitration by Russell and particularly invited attention to page 441 of the 19th Edn. The relevant portion of page 441 readsas under :- "it is necessary here to distinguish between cases in which a question of law is specifically referred and cases in which a question oflaw merely arises (though necessarily) in the course of a reference. The question is whether what is referred to the arbitrator is, "thegeneral question, whether involving fact of law" or "only somespecific question of law in express terms as the separate questionsubmitted," or in other works whether there is "a reference inwhich the questions of construction arises as being material in thedecision of the matter which has been referred to arbitration" of"a reference in which a specific question of law was referred to thedecision of the arbitrator as the sole Tribunal. Only in the lattercase will an apparent error in law be left unquestioned. " ( 21 ) LEARNED Counsel for the respondent submitted that in the instantcase, no specific question of law was referred and therefore, the decision ofthe arbitrator was not final. The arbitrator s assumption of jurisdiction overthe findings of the Senior Project Engineer was, therefore, in excess of thejurisdiction of the award is bad in law. ( 22 ) LEARNED Counsel for the respondent submits that the arbitratorhas disallowed Rs. 17,817. 00 towards the security deposit after 5 years of thedate of completion when the security was no longer required towards thesatisfactory execution/completion of the work. ( 22 ) LEARNED Counsel for the respondent submits that the arbitratorhas disallowed Rs. 17,817. 00 towards the security deposit after 5 years of thedate of completion when the security was no longer required towards thesatisfactory execution/completion of the work. ( 23 ) IN view of the Clauses 3 (a), (b) and (c) the finding of the arbitratorregarding para 10 of the award is an error apparent on the face of the award. The arbitrator could not have travelled beyond the terms of the agreementand in doing so he has gone beyond the terms of the contract. ( 24 ) MRS. Salwan, learned Counsel for the respondent has submittedthat the arbitrator has committed an error with regard to claim No. 10-A indisallowing Rs l327. 16 to the respondent as less amount credited by thebank on F. D. Rs. According to the petitioner, the plea of the D. D. A. thattheir bankers have given a less credit of Rs. 1327. 16 is not justified. Thisquestion relates to the decision of the arbitration in the facts of the casewhich cannot be looked into unless the error is apparent on the face of theaward. In this view of the matter, the award to the extent of Rs. 1327. 16 ismade the rule of the Court. ( 25 ) THE award to the extent of counter claim No. 1 is set asidebecause the arbitrator has given no reasons while awarding Rs. 100. 00to therespondent to be paid by the claimant. Against this counterclaim, no reasonswhatsoever have been given for awarding this amount. Therefore, the awardto this extent is bad, because the error is apparent on the face of the award. ( 26 ) I have heard the petitioner and the Counsel for the respondent. In the facts and circumstances of this case, the award with respect to claimsnos. 7, 9 to 1 ). and additional claims No. 1 to 3 and counter-claim No. 1 areset aside and the award with respect to the remaining clauses is made rule ofthe Court. ( 27 ) THE award regarding claim Nos. 7, 9 to 11, additional claims 1to 3 and counter claim No. 1, are remitted back to the arbitrator for his decisionin accordance with law. ( 28 ) BEFORE parting with this case, this Court would like to place onrecord extremely able assistance provided by Mrs. Anusuiya Salwan, learnedcounsel for the respondent/dda. ( 27 ) THE award regarding claim Nos. 7, 9 to 11, additional claims 1to 3 and counter claim No. 1, are remitted back to the arbitrator for his decisionin accordance with law. ( 28 ) BEFORE parting with this case, this Court would like to place onrecord extremely able assistance provided by Mrs. Anusuiya Salwan, learnedcounsel for the respondent/dda. The petition is accordingly disposed ofand the partics are directed to bear their own costs.