Judgment 1. This Misc. Appeal has been preferred by the Food Corporation of India and others against the judgment and decree dated 30.06.1999 passed in Title Suit No. 53 of 1984/65 of 1999 by Sri Rajendra Prasad Yadav. Sub-Judge IV, Samstipur, whereby he has been pleased to make the Award dated 20.02.1995 passed by Sri R. L. Mukherjee, the sole Arbitrator as the rule of the Court. 2. The brief facts of the case are as follows : Late Girdhari Lal Agarwal, the husband of the plaintiff respondent No. 1, Smt. Savitri Devi was appointed as Handling and Transport Contractor by Food Corporation of India for a period from 25.01.1982 to 24.01.1984 i.e. for two years in terms of the tender issued on 25.08.1981. The said tender was accepted on 18.01.1982 whereby the tender was allotted to late Girdhari Lal Agarwal. The case of the plaintiffs-respondent is that due to non-payment of running bills by the defendant appellant the late Girdhari Lal, Agarwal could not continue with the work after 30.09.1983, for which due notice was given to the defendants-appellants. On account of non issue of work done certificates by the defendants-appellants the said contractor could not continue the work after September, 1983 and the outstanding due of the contractor for the works done during the said period was Rs. 40,102.93. The said contractor also incurred extra expenses for the above period for loading food grains in bags on trucks which was to the tune of Rs. 49,911.25 p.a. According to the terms of the contract, the contractor was liable to make good of any loss due to demurrage, wharfage as per the railway rules. The contractor was also liable for the extra charges incurred by the defendants-appellants on account of delay in loading and unloading of trucks/unloading of wagons unless the delay is for reasons beyond the control of contractor. In this regard, the decision of Regional Manager was final and binding on the contractor. The contractor was also liable for all damages, charges and expenses suffered and incurred by the respondents due to contractors negligence and unworkman like performance of any services or breach of any terms of contract or failure to carry out the work with a view to avoid demurrage, wharfage etc. The contractor was also liable for all damages, charges and expenses suffered and incurred by the respondents due to contractors negligence and unworkman like performance of any services or breach of any terms of contract or failure to carry out the work with a view to avoid demurrage, wharfage etc. and for all damages or losses occasioned to the defendants appellants and in this regard the decision of the Regional Manager regarding such failure of the contractor and other liability for losses was final and binding to the contractor. The contractor was also liable for any loss which the corporation (Food Corporation of India) might have suffered on account of bags not being properly handled and the decision of the Regional Manager regarding such loss was final and binding on the contractor. Further case is that the defendants appellants deducted a total sum of Rs. 24.157.35 p.a. for the period from April. 1982 to March, 1983 from the bills of the contractor on account of demurrage ad wharfage charges. The defendants appellants also deducted a sum of Rs. 6569.51 p.a. on account of shortage and Rs. 25,844.00 on account of demurrage and wharfage charges along with a sum of Rs. 3430.50 p.a. for the subsequent period and in none of the cases approval of Regional Manager was taken as per the terms of relevant clause of the contract. Further case is that the contractor had to incur detention charges to the tune of Rs. 1,19,800.00 for the period from 14.05.1982 and from 1.01.1983 to 24.08.83. On the basis of the above facts the contractor filed a petition u/s. 20 of the Arbitration Act in the Court of the Sub-Judge, Samastipur, which was numbered as Title Suit No. 53 of 1984/19 of 1985. In the said suit, relief was sought for issuing direction to the defendants-appellants for filing Arbitration agreement in respect of the above mentioned contract dated 21.01.1982. Further relief was sought for making an order of Reference to the Arbitrator appointed by the parties or otherwise by the Court. 3. It appears that on 20.11.1986 the learned 1st Additional Subordinate Judge passed an order in the said suit whereby he appointed Sri Rai Ravindra Bahadur to act as Arbitrator with consent of both the parties. However, against the said order dated 20.11.1986, the defendants appellants preferred an appeal before this High Court. 3. It appears that on 20.11.1986 the learned 1st Additional Subordinate Judge passed an order in the said suit whereby he appointed Sri Rai Ravindra Bahadur to act as Arbitrator with consent of both the parties. However, against the said order dated 20.11.1986, the defendants appellants preferred an appeal before this High Court. The said appeal was numbered as Appeal No. 20 of 1987. On 11.11.1992, the appeal was allowed and the Managing Director was asked to appoint any person to act as Arbitrator under the Arbitration Clause within two months from the date of receipt of the order. It was further observed that in default of making appointment within the stipulated period the appeal shall stand dismissed. In pursuance of the said direction, the Managing Director, Food Corporation of India appointed Sri R. L. Mukherjee, Retd. Central Govt. Advocate, Calcutta, to arbitrate in the dispute in handling and transport contract between the Food Corporation of India, Muzaffarpur and Savitri Devi vide memorandum No. F-2-3-7-1992 dated 20.01.1993/25.01.1993. Thereafter, the sole Arbitrator issued notice to the parties and on receipt of notice the defendants appellants (Food Corporation of India, Muzaffarpur) filed written statement. The Food Corporation of India, Muzaffarpur, put counter claim and by way of counter claim a prayer has been made to award Rs. 4,26,423.78 p.a. in favour of the defendants-appellants. The plaintiffs-respondents also filed written statement and in the statement of claim the plaintiffs-respondents claimed relief for an award of Rs. 6,32,469.00 as detailed in annexure-"A". The particulars of which is being shown below : 1. Amount of wharfage and demurrage deducted from H & T bills Rs. 50,000.00 2. Amount of claim of detention charges of loaded trucks over night Rs. 1,19,800.00 3. Amount of recovery of shortage of sugar Rs. 10,000.00 4. Amount of security money deposited Rs. 5,000.00 5. Amount of double recovery of L/C from H & T Bills Rs. 579.00 6. Amount of wrong recovery of two bags of Wheat from H & T Bills Rs. 530.00 7. Amount of pending bills of work done Rs. 40.000.00 8. Amount of extra expenses incurred for loading food grains in bags on trucks on railway side Rs. 50,000.00 9. Loss due to relinquishing the work Rs. 6,000.00 10. Interest @ 18% p.a. Rs. 3,50,560.00 Total Rs. 530.00 7. Amount of pending bills of work done Rs. 40.000.00 8. Amount of extra expenses incurred for loading food grains in bags on trucks on railway side Rs. 50,000.00 9. Loss due to relinquishing the work Rs. 6,000.00 10. Interest @ 18% p.a. Rs. 3,50,560.00 Total Rs. 6,32.469.00 (Rupees six lakhs thirty two thousand four hundred sixty nine only) The plaintiffs-respondents also claimed that the counter claim put forward by the Managing Director amounting to Rs. 4,26,423.78 p.a. is illegal and without jurisdiction as the same was never raised before and the same was also barred by law of limitation. On the above grounds, the plaintiff respondents prayed before the Arbitrator that the counter claim be dismissed. 4 It appears that by way of counter claim the appellant has claimed the following amount under different heads : Rs. 1,08,924.54 as demurrage charge Rs. 2,22,611.60 as wharfage charges Rs. 67,500.00 shortage of sugar of 60 quintals Rs. 27,387.64 as extra expenditure incurred by FCI during unexpired period of contract 5. It further transpires that after considering the claim and counter claim of both the parties and after perusing the necessary papers the sole Arbitrator accepted the claim of the plaintiffs respondents to the tune of Rs. 1,95,500.00 with interest @ 10% per annum. The Award was passed on 20.02.1995. 6. After passing of the said Award, the plaintiffs respondents filed petition for making the Award rule of Court but the defendants appellants raised objection. However, after considering the case of both the parties the Court below decreed the suit on contest with cost in terms of the Award and ordered that the Award dated 2.02.1995 be made rule of the Court and will be part of the decree. The learned Court below also awarded interest @ 10% per annum from the date of award till the payment of the amount. The learned Court below also directed to make payment of the amount with interest within ninety days from the date of the order. 7. Against the said judgment and decree the defendants appellants have preferred this appeal. 8. The learned Court below also awarded interest @ 10% per annum from the date of award till the payment of the amount. The learned Court below also directed to make payment of the amount with interest within ninety days from the date of the order. 7. Against the said judgment and decree the defendants appellants have preferred this appeal. 8. During the course of hearing of this appeal, learned advocate appearing on behalf of the appellants challenged the Award on the following grounds : (i) The sole Arbitrator has failed to decide the dispute in terms of Reference and did not consider the counter claim put forward by the defendants appellants and, as such, the Award is illegal. (ii) The Award is non-speaking and does not contain reasons in support of conclusion and, as such, the same is illegal and must be set aside. (iii) The sole Arbitrator has awarded interest which is not permissible under law. 9. Point Nos. (i) & (ii) : Since both the objections raised by the appellants lawyer are inter related, as such, they are being taken up together for discussion. From perusal of Award, it appears that at page 9 of the judgment at the bottom the sole Arbitrator on the question of scope of reference has observed in the following manner : "Now the question posed is what is the scope of the present reference before me. In view of the order passed in the Sec. 20 petition as modified by the High Court as aforesaid it appears to me that the order envisaged the appointment of Arbitrator over the dispute, as referred to in Annexure- A to the petition only. It would not, therefore, be correct to contend that the respective claims as mentioned in the Memorandum of FCI are the subject matter of the disputes as referred to by the said order. Moreover, no attempt has been made to establish or deal with any other claim besides those mentioned in the said Annexure A to the petition as referred to above. I would therefore confine to the claims as referred to in the said Annexure A to the petition." Thus, the above observation of the Arbitrator fully establishes that the counter claim put forward by the appellant was beyond the scope of reference and it was not the subject matter of dispute which was referred to the sole Arbitrator for adjudication. I would therefore confine to the claims as referred to in the said Annexure A to the petition." Thus, the above observation of the Arbitrator fully establishes that the counter claim put forward by the appellant was beyond the scope of reference and it was not the subject matter of dispute which was referred to the sole Arbitrator for adjudication. I fully agree with the view taken by the sole Arbitrator as counter claim put forward by the appellant was never the subject matter of the dispute referred to the sole Arbitrator for adjudication and therefore, the sole Arbitrator was justified in not considering the counter claim of the appellant. 10. The learned advocate of the appellant has argued that if the Arbitrator fails to consider the counter claim put forward by the defendants-appellants the Award is erroneous and, as the same cannot be made rule of Court. In support of his argument he has placed reliance upon the decision of the Apex Court given in the case of M/s. Alopi Parshad and Sons Ltd. V/s. Union of India, AIR 1960 SC 588 . On the other hand, learned Advocate of the plaintiffs-respondents in support of his argument that on the ground of non consideration of counter claim the Award cannot be set aside has placed reliance upon the decision of our own High Court, Ranchi Bench given in the case of M/s. Bharat Coking Coal Ltd. & Anr V/s. Durga Prasad and Anr., 1995 1 PLJR 39 as well as the decision of the Apex Court in the case of Gujarat Water Supply & Sewerage Board V/s. Unique Erectors (Gujarat) (P) Ltd. and Anr., AIR 1989 SC 973 . After going through the above mentioned decisions, I have no hesitation in holding that the settled law is that the Award cannot be set aside on the ground of non-consideration of counter claim. 11. It has been argued by the learned Advocate of the appellant that the Award is non-speaking and the same does not contain reason in support of the conclusion arrived at, as such, the Award is arbitrary, improper and illegal and must be set aside. In reply to this argument, the learned Advocate of the respondent has argued that merely on the ground that award does not contain reasons in support of conclusion the same cannot be set aside. In reply to this argument, the learned Advocate of the respondent has argued that merely on the ground that award does not contain reasons in support of conclusion the same cannot be set aside. He further argued that pages 10 and 11 of the Award will show that the sole Arbitrator while discussing the claim of the plaintiffs respondents has given reasons for allowing the claim and, so, it cannot be said that the Award does not contain reason in support of conclusion. On going through the Award I find that at pages 10 and 11, the Arbitrator has given reason for allowing the claim of the plaintiffs respondents and, so, it cannot be said that the Award is arbitrary, non speaking and illegal. Moreover, I am of the view that on the ground that the award does not contain reason the same can not be set aside. In support of my view, I place reliance upon the recent decision of the Apex Court given in the case of M/s. Engineers Syndicate V/s. State of Bihar & Ors., 2007 0 AIR(SCW) 985. In the said judgment reliance has been placed on the judgment of the Apex Court in the case of Raipur Development Authority and others V/s. M/s. Chokhamal Contractors and Ors., 1989 0 SCC 721. The Apex Court quoted the following observation from the said decision : "This Court, in the above judgment has categorically held that it was not open to the High Court to speculate where no reasons are given by the arbitrator, as to what impelled the arbitrator to arrive at his conclusion. The Court declined to recognize the power of the Court to attempt to probe the mental process by which the arbitrator had reached his conclusion where it was not disclosed by the terms of his award. It is also further observed in the said judgment that the Court in dealing with an application to set aside an award has not to consider whether the view of the arbitrator on the evidence is justified and that the arbitrators adjudication is generally considered binding between the parties, for he is a tribunal selected by the parties and the power of the Court to set aside the award is restricted to cases set out in Sec. 30. It is also further observed that it is not open to the Court to speculate, where no reasons are given by the arbitrator, as to what impelled the arbitrator to arrive at his conclusion." The Apex Court has further referred para 19 of the said judgment which is being quoted below : "It is now well settled that an award can neither be remitted nor set aside merely on the ground that it does not contain reasons in support of the conclusion or decisions reached in it except where the arbitration agreement or the deed of submission requires him to give reasons. The arbitrator or umpire is under no obligation to give reasons in support of the decision reached by him unless under the arbitration agreement or in the deed of submission he is required to give such reasons and if the arbitrator or umpire chooses to give reasons in support of his decision it is open to the Court to set aside the award if it finds that an error of law has been committed by the arbitrator or umpire on the face of the record on going through such reasons. The arbitrator or umpire shall have to give reasons also where the Court has directed in any order such as the one made u/s. 2 or Sec. 21 or Sec. 34 of the Act that reasons should be given or where the statute which governs an arbitration requires him to do so." 12. Thus, on the basis of the above mentioned decision, I have no hesitation to hold that even if the award does not contain reasons in support of conclusion the same cannot be set aside. 13. Point No. iii: Learned Advocate appearing on behalf of the defendants-appellants argued that the award of interest was not in terms of reference and, as such, the award is illegal and it should be set aside. In this regard, he has placed reliance upon the decision of the Apex Court in the case of State of Orissa V/s. C. P. Ghosh, AIR 1991 SC 426 . In reply to the argument of the counsel for the appellants, learned counsel for the respondents has placed reliance upon the following decisions i. State of Orissa V/s. B. N. Agrawalla, 1997 1 PLJR 140. ii. Ram Sarup Khetan & Ors. V/s. The State of Bihar & Ors., 1998 2 BLJ 355. iii. In reply to the argument of the counsel for the appellants, learned counsel for the respondents has placed reliance upon the following decisions i. State of Orissa V/s. B. N. Agrawalla, 1997 1 PLJR 140. ii. Ram Sarup Khetan & Ors. V/s. The State of Bihar & Ors., 1998 2 BLJ 355. iii. M/s. S. K. Samanta & Co. V/s. Central Coal Field Ltd., AIR 2000 Pat 36 . 14. Besides the above decisions relied by the advocate of the respondents there are several decisions of the Apex Court in which it has been held that the Arbitrator is entitled to grant interest. In the case of Gujarat Water Supply & Sewerage Board V/s. Unique Erectors (Gujarat) (P) Ltd., AIR 1989 SC 973 (supra) the Apex Court has held that the arbitrator is empowered to grant interest from the date of the Award up to the date of decree. The Apex Courts decision referred above i.e. 2007 0 AIR(SCW) 985 also shows that in that case also Arbitrator had awarded interest @ 12% per annum and the Apex Court has confirmed the award. Thus, I hold that the award of interest by the Arbitrator is permissible in law and the learned trial Court has rightly upheld the decision of the Arbitrator to award interest on the amount awarded. However, the award of interest @ 1% per annum appears to be excessive in view of the fact that in the recent times all the banks have lowered down the rate of interest as per the policy of Reserve Bank of India. Under such situation, I am of the opinion that in this case the award of interest @ 5% per annum will be just and proper and to that extent the judgment and decree passed by the trial Court requires modification. 15. On consideration of entire facts and materials available on record, I find and hold that the learned Sub-Judge IVth, Samastipur, has rightly decreed the suit of the plaintiffs-respondents making the award dated 20.02.1995 for a sum of Rs. 1,95,500.00 passed by the sole Arbitrator as rule of the Court and, so, the said finding of the Court below is upheld. On consideration of entire facts and materials available on record, I find and hold that the learned Sub-Judge IVth, Samastipur, has rightly decreed the suit of the plaintiffs-respondents making the award dated 20.02.1995 for a sum of Rs. 1,95,500.00 passed by the sole Arbitrator as rule of the Court and, so, the said finding of the Court below is upheld. But, as regards the award of interest is concerned, I hold that the award of interest @ 10% per annum is excessive in view of prevalent rate of interest and, as such, the same is reduced to 5% per annum instead of 10% per annum and it is held that the plaintiff respondents will be entitled to get interest @ 5% per annum on the said sum of Rs. 1,95,500.00 from the date of award till the payment is made. Accordingly, it is ordered that the judgment and decree of the Court below is modified to this extent. 16. In the result, I find no merit in this appeal and, as such, the same is hereby dismissed on contest with the above modification in the rate of interest. It is further ordered that the defendants appellants shall pay the entire amount with interest as stated above within a period of two months from the date of this order, failing which the plaintiffs respondents will be entitled to recover the same through the process of the Court. It is further ordered that the parties will bear their respective costs.