ORDER : Sujoy Paul, J. This appeal filed under section 37 of the Arbitration and Conciliation Act, 1996 (Act of 1996) is directed against the order passed by the Additional District Judge, Bhopal in A.C.No.5/09 decided on 28.7.09 whereby the court below rejected the appeal preferred by the appellant under section 34 of the Act and affirmed the order passed by the Arbitrator dated 16.12.2008. 2. The brief facts necessary for adjudication of this matter are that pursuant to a notice inviting tender, the appellant submitted his bid and ultimately an agreement was entered into between the parties. The petitioner was required to supply medicines for human consumption. However, admittedly certain material/drugs were erroneously supplied by appellant which were only for animal consumption. The respondents upon noticing the same, took action against the appellant and in the order dated 30.5.2006, it was stated that the supply made by the appellant on 17.1.2006 and 24.2.2006 were with the label which indicates "Not For Human Use". The letter further indicates that on receipt of communication from the Nigam, the relevant material/drugs which were wrongly supplied were replaced by the appellant and complaint was found to be genuine. However, by order dated 30.5.2006, the marketing assistance of appellant unit was suspended with immediate effect in all medicines until further orders. The petitioner was directed to show-cause as to how such grave mistake has occurred in supplying the medicines which had created serious problems for the department and tarnished its image in public. In turn, the appellant submitted his reply on 05.06.2006 and stated that the appellant was not aware of this mishap until he received the information from MPLUN (given on telephone) on dated 23.5.2006 at 4.30 P.M. On the very next day, the appellant sent 200 vials of injections personally to the office of the respondent. Thus, the required deficit supply was made good free of cost by way of replacement. Under these circumstances, it was prayed to revoke the order of suspension dated 30.5.2006. The same was followed by letter of respondent dated 16.6.2006 whereby it was again reiterated that certain drugs were supplied by the appellant which were not made for human use. The appellant was directed to return back all pending orders lying with him which were not executed till 16.6.2006. This order is followed by another order dated 21.06.2006 (page 62). The same was followed by letter of respondent dated 16.6.2006 whereby it was again reiterated that certain drugs were supplied by the appellant which were not made for human use. The appellant was directed to return back all pending orders lying with him which were not executed till 16.6.2006. This order is followed by another order dated 21.06.2006 (page 62). The respondent opined that the appellant has violated certain terms and conditions which are mentioned in the said order. Accordingly, it was alleged that appellant's action was fraudulent and amounts to violation of the conditions of the agreement and negligence on his part. For these reasons, the marketing facility of appellant was discontinued for two years. 3. Shri Ashok Lalwani, learned counsel for the appellant placed reliance on certificate dated 1.2.2008 issued by the Licensing Authority, Food and Drugs Administration, M.P. It is urged that as per this certificate, it is clear that the drugs used for animals and human being is same, the only difference is regarding its dose which varies in cases of human and animals. 4. Criticizing the order dated 12.3.2008, Shri Lalwani contends that the appellant was permanently black listed by this order by invoking clause 15 of the agreement. By taking this court to various clauses of the agreement including clause 15, it is contended that incorrect supply of certain medicines/drugs, by no stretch of imagination, falls within the ambit of clause 15 or clause 23. Thus, same could not have been the reason for black listing the appellant permanently. 5. The appellant raised a dispute as per the arbitration clause before the Arbitrator. In turn, the Managing Director/Arbitrator started the arbitration proceedings. In arbitration proceedings, the respondent filed its written statement pregnant with counter claim. In turn, the appellant filed its objection/reply to counter claim (page 83). The Arbitrator heard the parties and passed the award on 16.12.2008. The claim of the appellant was rejected and it was directed that in lieu of loss caused to the respondent/corporation, the appellant shall pay Rs. 7.50 lacs as penalty and if the said amount is deposited, the bar of marketing facility will continue only upto six years and for remaining medicines the marketing facility will be started. It is made clear that if aforesaid amount of Rs. 7.50 lacs as penalty is not deposited with the respondent, the impugned final order will remain intact. 6. 7.50 lacs as penalty and if the said amount is deposited, the bar of marketing facility will continue only upto six years and for remaining medicines the marketing facility will be started. It is made clear that if aforesaid amount of Rs. 7.50 lacs as penalty is not deposited with the respondent, the impugned final order will remain intact. 6. Appellant feeling aggrieved by this order preferred an appeal under section 34 of the Act of 1996. The court below after hearing the parties passed the order dated 28.7.2009 and rejected the appeal, this order is called in question in the present appeal. 7. Shri Lalwani, during the course of arguments raised following points :- (i) The wrong supply of medicines by the appellant does not fall within the ambit of clause 15 or any other clauses of the agreement/terms and conditions, hence the action of respondent in permanently black listing the appellant is without authority of law and liable to be set aside. (ii) The marketing facility was initially stopped for two years but later-on, it was permanently stopped which amounts to permanently black listing the appellant which is impermissible in law. (iii) As per scheme of the Act of 1996 read with provisions of the agreement, the counter claim of the respondent was not tenable. Since the counter claim was not tenable, the relief of grant of compensation in terms of the claim was also not maintainable. (iv) The Arbitrator had no power to inflict punishment or evaluate compensation as per the Act of 1996 and clauses of the agreement. (v) The claim of the appellant should have been allowed by the Arbitrator. (vi) As per clause 11.3.1 read with clause 30 of the tender condition, it is clear that if incorrect drugs were supplied, at best, the respondent could have forfeited the security deposit. It is added that clause 30 (Guarantee and Warranty) makes it clear that defective drug was required to be replaced by the appellant. If appellant did not undertake the exercise of replacement then only the security deposit could have been forfeited. (vii) The appellant's specific objections were not considered by both the authorities. The conclusion drawn by both the authorities are not supported by justifiable and adequate reasons. If appellant did not undertake the exercise of replacement then only the security deposit could have been forfeited. (vii) The appellant's specific objections were not considered by both the authorities. The conclusion drawn by both the authorities are not supported by justifiable and adequate reasons. In support of said contentions, he relied on the judgments of Supreme Court in the case of P. Dasartharama reddy complex v. Government of Karnataka and another, (2014) 2 SCC 201 , K.P. Poulose v. State of Kerala, AIR 1975 SC 1259 , Dandasi Sahu v. State of Orissa, AIR 1990 SC 1128 , Rajasthan State Mines & Minerals Ltd. v. Eastern Enginering Enterprises and other, AIR 1999 SC 3627 , Associated Engineering Co. v. Government of Andhra Pradesh and another AIR 1992 SC 232 , Secretary, Irrigation Department, Government of Orissa and others v. G.C.Roy, 1992 SC 732, State of J&K and another v. Dev Dutt Pandit With Dev Dutt Pandit v. State of J&K and another, AIR 1999 SC 3196 , State of Goa v. Praveen Enterprises, (2012) 12 SCC 581 , Voltas Limited v. Rolta India Limited, (2014) 4 SCC 516 . Judgment of this court in the case of Jawaharlal Nehru Krishi Vishwavidyalaya Jabalpur v. J.H. Kotecha, 2015 (3) JLJ 280 , Industrial Security Association v. State of M.P. and another, 2011 (1) MPWN 26 . 8. Per contra, Shri S.P. Rai, learned counsel for the respondent, supported the award and the impugned judgment passed by the court below. He strenuously contended that action taken against the appellant is as per clause 15 and 23 of the terms and conditions. It is submitted that the drugs supplied by the appellant were "incorrect","spurious" and "misbranded". Thus, the aforesaid clauses were rightly invoked by the respondent. 9. If there existed a dispute between the parties, both the parties as per clause 16 of the arbitration clause, were free to file their respective claims. Thus, it cannot be said that the counter claim filed by the respondent was not tenable. Shri Rai has taken pains to contend that in absence of any bar to file the counter claim, no illegality can be attached to the award. It is submitted that the award is in consonance with law. Thus, it cannot be said that the counter claim filed by the respondent was not tenable. Shri Rai has taken pains to contend that in absence of any bar to file the counter claim, no illegality can be attached to the award. It is submitted that the award is in consonance with law. By placing reliance on the judgment of Supreme Court in the case of Associate Builders v. Delhi Development Authority, 2014 STPL (Web) 769 SC, it is contended that there is no scope for interference against the arbitral award by the court below. The award can be interfered with if it shocks the conscience of the court. Another view is possible, is not a ground for interference by the court. 10. No other point is pressed by learned counsel for the parties. 11. I have heard the parties at length and perused the record. 12. As to Point (i) and (v) : The department alleged certain violations of terms and conditions by the appellant. Shri Lalwani contended that on the basis of such allegations, the marketing facility could not has been stopped permanently. I deem it apposite to reproduce the reasons for impugned action and relevant clauses of terms and conditions/agreement which are attracted. The same are reproduce in juxtaposition as under :- S.No. REASONS TERMS & CONDITIONS( FOR SUPPLY OF DRUGS/MEDICINES) VIOLATED 01 v& bdkbZ dks ftl LisflfQds'ku ,oa mi;ksx dh vkS"kf/k ds fy;s vkns'k tkjh fd;k x;k Fkk] mlds }kjk mDr vkS"kf/k iznk; u djrs gq, osVjujh mi;ksx dh vkS"kf/k iznk; dh xbZA CONDITION 12. The samples of the few drugs with packing and packing material may be seen at the Technical Deptt. of MPLUN, Bhopal. The supplies shall be made strictly according to that specification. 02 c& iznkf;r dsVkfeu batsD'ku ok;y dh iSfdax dkVZu esa gksuh pkfg, Fkh] tks ugha ikbZ xbZA CONDITION 19. Good quality glass bottles/virgin bottles/plastic bottles shall be used for packing of the liquids. Plastic bottles should only be used where drug ingredient have no reaction/stability problem. If LDPE containers used for liquids then heat sealing of stoppers shall be preferred, uniformity in containers shall be strictly maintained. Drugs shall be packed in new corrugated boxes 5 ply x 7 ply according to weight. Plastic bottles should only be used where drug ingredient have no reaction/stability problem. If LDPE containers used for liquids then heat sealing of stoppers shall be preferred, uniformity in containers shall be strictly maintained. Drugs shall be packed in new corrugated boxes 5 ply x 7 ply according to weight. In case of kit supplies, a list of contents of drugs shall be affixed on the outside of the box and one list shall be essentially placed inside the box. 03 l& ,d ckWDl esa vf/kdre 24 ok;y iznk; dh tkuh Fkh] tcfd ,d dkVZu esa 30 ok;y iznk; fd;k x;kA CONDITION 27. The vials shall be packed in single cartoons of maximum twenty/twenty four vials for ensuring protection against damage due to handling/transportation. 04 n& iznkf;r vkS"kf/k esa fufonk 'krZ vuq:i e/;izns'k 'kklu ds iznk; gsrq&foØ; gsrq ugha vafdr fd;k tkuk Fkk] tks mDrkuqlkj ugha ik;k x;kA CONDITION 13. Each inner and other label should be of chrome art paper and shall be marked in bold letters with indelible ink as "for M.P. Government supply "not for sale". 05 n& bdkbZ }kjk iznk; dh xbZ vkS"kf/k ds lkFk y|q m|ksx fuxe vFkok vkS"kf/k iz'kklu foHkkx }kjk vuqeksfnr def'kZ;y ySc dh VsLV fjiksVZ vkS"kf/k ds lkFk Hksth tkuh Fkh] tks ugha fd;k x;kA CONDITION 16. The tender will have to keep proper reports, manufacturing records as per schedule "U" of each batch of the drugs supplied along with the counter samples. The information shall be furnished for each and every batch of the drug supplied in Performa "B" to the technical Deptt. Along with test reports of the drugs (Performa B enclosed) in test reports batch size of the drugs should be strictly mentioned. It is admitted in the present case that appellant has supplied incorrect medicines to the department where as, he was required to supply medicines for human use. Clause-15 of the agreement reads as under :- "Clause 15. That in case of non-supply or delayed supply or any other violation of this agreement (including the terms & conditions contained in the tender rate list or specifications or supply order) or in case the information submitted by Party No. 2 to Party No. 1 in the tender from application or otherwise is found to be misleading false incorrect or malafide, Party No. 2 shall be liable for. (a) Suspension/termination of this agreement and/or. (a) Suspension/termination of this agreement and/or. (b) Discontinuation of marketing assistance for such period as may be decided by Party No. 1 at its absolute discretion and/or. (c) Forfeiture either wholly or in part of the earnest money deposit/service charges/security deposit and/or. (e) Such other action, including legal action for breach of contract as may be decided by Party No. 1 at its sole discretion. (f) Liability for risk purchase by Party No. 1 the decision of Party No. 1 in such cases shall be final and binding. The underlined portion shows that respondent was within its power to invoke various clauses in case of non-supply, delayed supply or for "any other violation of the agreement including the terms and conditions contained in the tender list or specification or supply order". The aforesaid clause is wide enough and gives power to discontinue marketing facility for violation of terms and conditions/agreement and includes that if information submitted by the appellant is found to be misleading, false, incorrect or malafide, he shall be liable for action enumerated in Clause (a) to (f). Thus, I am unable to accept the contention of the learned counsel for the appellant that the incorrect supply of medicine does not fall within the ambit of terms and conditions and relevant clauses of the agreement. Thus, point No.(i) and (v) are decided against the appellant. Considering the nature of breach of conditions as described above, no fault can be found in the award to the extent relief is declined to appellant. 13. As to Point No.(ii) :- The terms and conditions make it clear that respondent is equipped with the power to stop the marketing facility for two years or for a longer period. The terms and conditions for supply of drugs/medicines make it clear that if drug supplied is found to be spurious, misbranded or not of standard quality by the Food and Drug Administration/MPLUN, the whole batch of drugs will be rejected and payment will be withheld. Clause 15 reproduced herein above shows that the respondent had ample power for suspension/termination of the agreement and for forfeiture of whole or part of the earnest money/security deposit. The respondent is empowered to "discontinue the market assistance" for a period which may be decided by respondent as per its absolute discretion. Clause 15 reproduced herein above shows that the respondent had ample power for suspension/termination of the agreement and for forfeiture of whole or part of the earnest money/security deposit. The respondent is empowered to "discontinue the market assistance" for a period which may be decided by respondent as per its absolute discretion. Thus, it is not possible to hold that respondent acted beyond the authority of law in permanently stopping the marketing facility. The respondent has followed the procedure and principles of natural justice while stopping the marketing facility. Thus, no fault can be found in the said action of the respondent. Apart from this, the order dated 12.3.2008 shows that earlier by order dated 21.6.06, the marketing facility was stopped for two years. Thereafter, the respondents examined all the relevant facts and terms and conditions and found that the appellant has violated certain terms and conditions. After due consideration, this order dated 12.3.2008 is passed. As noticed above, the respondents had ample power to pass such order. This order is neither without authority of law nor capricious in nature. Hence, merely because by earlier order marketing facility was stopped only for two years, it cannot be said that said facility cannot be stopped for indefinite time as per relevant clauses of the terms and conditions/agreement. It is noteworthy that appellant relied on judgment of this Court in the case of Industrial Security Association (supra), wherein this court dealt with the aspect of black listing. The said case was a writ petition filed under Article 226 of the Constitution wherein principle of natural justice were not followed before passing the order of black listing whereas in the present case before stopping the market facility, the respondent has followed the procedure laid down in the agreement/terms and condition. The appellant also got full-fledged hearing before the Arbitrator. Thus, the said judgment cannot be pressed into service in the present case. Appellant has also relied on certain judgments wherein question of fairness of Arbitrator is dealt with. However, during the course of arguments no such point was raised by Shri Lalwani nor their exists any such foundation in the appeal memo. Thus, the judgments cited on this point are of no assistance. It is also relevant to see that the appellant has mostly relied on the judgments based on various provisions of Arbitration Act of 1940. However, during the course of arguments no such point was raised by Shri Lalwani nor their exists any such foundation in the appeal memo. Thus, the judgments cited on this point are of no assistance. It is also relevant to see that the appellant has mostly relied on the judgments based on various provisions of Arbitration Act of 1940. There is a paradigm shift in the provisions in the Act of 1996. 14. As to Point (iii), (iv) and (vi) :- The appellant contended that the counter claim filed by the department was not maintainable. The appellant himself relied on the judgment of the Supreme Court in Praveen Enterprises (supra) wherein after taking into account Section 2(9) and Section 23 of the Act, it is held that "unless the arbitration agreement requires the arbitrator to decide only the specifically rendered dispute, the respondents can file counter claim and amend or add to the same, except where the arbitration agreement restricts the arbitration to only those disputes which are specifically rendered to arbitration, both the claimant and the respondents are entitled to make any claim or counter claim and further entitled to add or to amend such claims and counter claims provided they are arbitrable and within limitation. In Voltas Limited (supra), the Apex Court held that counter claim is tenable subject to certain conditions. In the light of aforesaid, suffice it to say that counter claim was very much tenable. However, the question whether compensation could have been claimed and granted pursuant to counter claim, needs serious consideration. Clause 16 i.e Arbitration clause reads as under :- "16. That in case of any dispute regarding execution/non-execution of the supply order or interpretation of any other matter relating to this agreement (including tender, rate list, specifications or supply orders), the same shall be referred for arbitration to the Managing Director of Party No.1 whose decision shall be and conclusive in all respects and shall be binding on all concerned." This is trite law that Arbitrator cannot travel beyond the arbitration clause. In the aforesaid judgments, it is made clear that Arbitrator can consider and grant the relief provided the claim is arbitrable. Condition Clause 23 deals with penalty, liquidity, damage, risk and purchase. It reads as under :- "23. In the aforesaid judgments, it is made clear that Arbitrator can consider and grant the relief provided the claim is arbitrable. Condition Clause 23 deals with penalty, liquidity, damage, risk and purchase. It reads as under :- "23. In case of breach of any of the conditions of the agreement or delay in supply or failure to supply at its own quoted rates/contracted rates, MPLUN may at its option, take any or all of the actions detailed below :- 23.1 Recovery from the tenderer/supplier liquidated damages for delay/non-supply @ 2% per month or part there of calculated on the price of stores not delivered in the stipulated time up to maximum of 5% of such price. 23.2 Purchase from elsewhere on tenderers/suppliers Risk or Account the entire or the remaining items. 23.3 Forfeiture either wholly or in part of the earnest money deposit/service charges/security deposit. 23.4 Cancellation of the contract. 23.5 Debarring of the tender/supplier from getting marketing assistance for such period as may be decided at the sole discretion of MPLUN. 23.6 Taking of such other action against the tender/supplier including legal action for breach of contract. 23.7 Levy of such penalties or with held payment of such extent as may be decided by MPLUN." Clause 29 reads as under :- Clause 29 : Wharf age and/or Demurrage : Wharf age and/or demurrage on account of incorrect OR delayed despatch of the material or documents shall be on the tenderer's account and shall be recovered from his bills. The respondent prayed for following relief in the counter claim :- "Hence, the respondent submit its counter claim as under :- (a) Claim of amount of Rs. 1,00,00,000/- (Rs. One Crores) as a compensation for wilful defamation of the respondent by the petitioner. (b) Claim of Rs. 50,00,000/- (Rs. Fifty laces) as the Respondent could not supply the medicines in time, and (c) Rs. 25,000/- (Rs. Twenty five thousands) towards legal expenses including other miscellaneous expenses, being total claim of Rs. 1,50,25,000/- (Rs. One Crore fifty lakh twenty five thousand only) with further interest @ 18% per annum." A conjoint reading of Clauses 15, 23 and 29 reproduced herein above makes it clear that although respondent was well within its power to deprive the appellant from marketing assistance for indefinite period, he was not justified in claiming compensation through the counter claim. One Crore fifty lakh twenty five thousand only) with further interest @ 18% per annum." A conjoint reading of Clauses 15, 23 and 29 reproduced herein above makes it clear that although respondent was well within its power to deprive the appellant from marketing assistance for indefinite period, he was not justified in claiming compensation through the counter claim. He could have invoked demurrage clause but it was not open to him to claim compensation. Clause 15(e) provides that "for breach of contract such other action, including legal action" was permissible. This talks about the action other than an action under the arbitration agreement. The respondent could have proceeded to claim damages etc. by filing civil suit or could have availed any other remedy available to him under the contract Act or under any other enactment. In the case of Oil and Natural Gas Corporation Limited v. Off-shore Enterprises Inc., (2011) 14 SCC 147, the Apex Court opined that the alleged deficiency and defects has to be decided within the fore-corners of jurisdiction of Arbitrator. Thus, I find force in the argument of the appellant that relief prayed in the counter claim and grant of compensation by the Arbitrator was impermissible. It is important to mention here that during the course of arguments, learned counsel for the respondent did not bring any provision to the notice of this court which enables the respondent to seek benefit of compensation through counter claim and in turn gives power to the Arbitrator to grant it. Thus, to the extent indicated herein above, this issue is decided in favour of the appellant. 15. The main attack on the order of the court below is on the ground that the court below has not assigned any reasons and failed to examine whether Arbitrator has passed the order in accordance with law. In para-11 of the order of the court below dated 28.07.2009, the court below opined that this is not the duty of the court to examine as to for which reason the award has been passed and whether the reasons are correct or not. This view taken by the court below runs contrary to the legislative mandate enumerated in section 31(3) of the Act. Section 31 of the Act reads as under :- 31. Form and contents of arbitral award. (1) ......... (2) ......... This view taken by the court below runs contrary to the legislative mandate enumerated in section 31(3) of the Act. Section 31 of the Act reads as under :- 31. Form and contents of arbitral award. (1) ......... (2) ......... (3) The arbitral award shall state the reasons upon which it is based, unless- (a) the parties have agreed that no reasons are to be given; or (b) the award is an arbitral award on agreed terms under Section 30. A plain language of the Section 34 makes it clear that the court below was under an obligation to examine the correctness of the award as per test flowing from clause (i) to (v) of sub section 2. The Apex Court in the matter of Som Dat Builders Limited v. State of Kerala, (2009) 10 SCC 259 and Anand Brothers Private Limited v. Union of India and others, (2014) 9 SCC 212 while dealing with section 31(3) of the Act emphasised the need of assigning reason by the Arbitrator. The court below should have seen whether Arbitrator has fulfilled the aforesaid requirement of assigning reasons. In M/s Kranti Associates Pvt. Ltd. and another v. Masood Ahmed Khan and others, (2010) 9 SCC 496, the Apex Court held that reasons must be assigned by administrative, quasi judicial and judicial authority. Thus, I am of the considered view that findings of the court below that Arbitrator is not required to assign reasons and court below was not required to undertake judicial review of that aspect cannot be upheld. 16. As to point (vii) :- The aforesaid analysis, to great extent, deals with this point. I find substance in the argument of the appellant that the court below should have dealt with the objections raised by the appellant. However, since this court has dealt with the matter in entirety, the award to the extent compensation was directed to be paid by the appellant cannot sustain judicial scrutiny and is hereby set aside. The Arbitrator had no power to pass the conditional order for payment of compensation or in absence thereto, upholding the action. However, since no fault could be found in the action of respondent in withholding marketing facility and passing the order dated 15.03.2008 no further interference is required. 17. Resultantly, the award to the extent indicated herein above is set aside. However, since no fault could be found in the action of respondent in withholding marketing facility and passing the order dated 15.03.2008 no further interference is required. 17. Resultantly, the award to the extent indicated herein above is set aside. Consequently, the order of the court below whereby even that offending portion was upheld, is set aside. Rest of the action of the respondent is affirmed. 18. Appeal is allowed in part. No cost.