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Meghalaya High Court · body

2019 DIGILAW 51 (MEG)

North Eastern Electric Power Corporation Ltd. (Neepco) v. Patel Engineering Ltd. Unity Infra Projects (JV)

2019-02-26

H.S.THANGKHIEW, MOHAMMAD YAQOOB MIR

body2019
JUDGMENT : 1. These three Arbitration Appeals have been filed by the appellant North Eastern Electric Power Corporation (for short "NEEPCO") under Sec. 37 of the Arbitration and Conciliation Act, 1996, challenging the common order dated 27.04.2018 passed by the Court of the learned Additional Deputy Commissioner (Judicial), Shillong on applications under Sec. 34 of the Arbitration and Conciliation Act, 1996 filed by NEEPCO which were registered as Arbitration Case No. 5 (T) 2016, Arbitration Case No. 6 (T) 2016 and Arbitration Case No. 7 (T) 2016. The learned Additional Deputy Commissioner (Judicial), Shillong vide the aforesaid common order dated 27.04.2018 has dismissed the aforesaid Sec. 34 applications filed by NEEPCO and upheld the 3 (three) Arbitral Awards dated 29.03.2016. 2. The facts leading to filing of the batch of these three Arbitration Appeals are that in the year 2000, NEEPCO had acquired 710 hectares of land in Kameng, Arunachal Pradesh had also obtained clearances from the Ministry of Environment and Forests for setting up Kameng Hydro Electric Project (for short "KaHEP"). 3. On 23.04.2003, NEEPCO issued Invitation for Bids for civil work of the said project under three separate Packages as follows: Package-I: Contract for civil works for Bichom Dam, River Diversion, Bichom Intake and Head Race Tunnel from RD 0 m to 4400m (+/- 500m) on either side (i.e. 1st half of the Bichom-Tenga Portion). Package-II: Contract for civil works for Bichom Dam, River Diversion, Bichom Intake and Head Race Tunnel from RD 4400 m to 11600m (+/- 500m) on either side (i.e. 2nd half of the Bichom-Tenga Portion and 1st half of Tenga-Kimi portion). Package-III: Contract for civil works for Head Race Tunnel from RD 11600m (+/- 500m) up to surge shaft (i.e. 2nd half of Tenga-Kimi portion), surge shaft, Pressure Tunnels, Power House and Tail Race Tunnel. 4. On 8.12.2003 a corrigendum was issued by NEEPCO to the Bid Documents and a location map was issued showing the distance of the designated quarries for sand and boulders for Package-I at a distance of 500 Mtrs from the dam axis of Bichom Dam, for Package-II at a distance of 1200/1300 Mtrs from the dam axis of Tenga Dam, and for Package-III at a very short distance from Kimi Power House. 5. On 03.12.2004 the bids of the respondents were accepted by NEEPCO and Letters of Intent were issued to them as follows: Package-I: Contract Amount Rs. 5. On 03.12.2004 the bids of the respondents were accepted by NEEPCO and Letters of Intent were issued to them as follows: Package-I: Contract Amount Rs. 1,43,81,03,498/- Contract awarded to Patel Engineering Ltd.-Unity Infra Projects JV Package-II: Contract Amount Rs. 1,16,39,65,649/- Contract awarded to Patel Engineering Ltd. Package-III: Contract Amount Rs. 1,31,65,12,797/- Contract awarded to Patel Engineering Ltd. This was followed by issuance of detailed Work Order by NEEPCO on 08.12.2004 in favour of Patel Engineering Ltd.-Unity Infra Projects JV, Patel Engineering Ltd. and Patel Engineering Ltd. in respect of Packages-I, II and III respectively and signing of formal Contract Agreements on 17.12.2004. The documents which would form part of the Contract are mentioned in the said Contract Agreement dated 17.12.2004. 6. On 29.03.2007, the Deputy Commissioner, West Kameng District issued letter to NEEPCO informing that the designated stone/boulder quarries as indicated in the project location map had been leased by the local people in favour of a third party for a period of 15 years and hence there was objection to acquisition of the said quarry land. Thereafter, in the year 2010, NEEPCO acquired additional 42 hectares of land at a cost of Rs. 3.20 Crores for the purpose of quarrying of sand and boulders. However, the Chief Conservator of Forests, by his letter dated 01.09.2011 declined permission for operation of stone quarry in the said 42 Hectares of land. The said letter stated as follows: "The construction activities of Kameng HEP has already caused serious interference to the pristine and serene environment of the area. Under the circumstances it is not possible to allow open cast mining which will require heavy blasting by using explosives or use of heavy machineries for collection and transportation of the mined boulders, sand and shingles to the tune of 6 (six) Lakh Cubic Mtrs. Further open cast mining is also prohibited by the Hon"ble Supreme Court of India. Therefore, the User Agency may be advised to collect the required sand, shingles and boulders from the Government approves quarries in the adjoining areas. Further, the proposal submitted by you vide your letter under reference is also returned herewith as it is not possible to allow open cast mining in the area." 7. The result of the above was that the construction material viz. Further, the proposal submitted by you vide your letter under reference is also returned herewith as it is not possible to allow open cast mining in the area." 7. The result of the above was that the construction material viz. sand, shingles and boulders for the project was required to be procured from State Government approved quarries located at places far away from the project sites. The State Government approved quarries were situated at following distances from the project sites: Package-I: 78 Km Package-II: 53 Km Package-III: 36.50 Km 8. This new dimension of transportation of construction material like sand, shingles and boulders from Government approved quarries located at a distance of 36.5 to 78 Kms from the project site necessitated a meeting between NEEPCO and the Contractors to resolve the issue relating to extra lead for transportation of quarried sand, shingles and boulders. The meeting was held on 19.04.2012 and the record of the meeting are as follows: "M/S PEL expressed that in wake of restrictions imposed by Forest department, Project Authorities of Package-II and III have instructed M/S PEL to fetch sand and boulders from quarries as far as 50 to 100 KM from project site to suffice the requirement of aggregates required for concreting works. M/S PEL insisted that payment for the lead in handling of common excavated materials from the far away quarries shall be made in terms of respective BOQ items under Package-II and Package- III. NEEPCO opined that payment of extra lead is payable and the rate for the same will be decided on mutual discussions. CMD, NEEPCO agreed to resolve the issue within 7 (seven) days i.e. by 26th April 2012 in the best interest of the progress of the project citing necessity of an internal meeting with finance wing. 9. On 01.05.2012, NEEPCO conveyed its decision that Clause 33(iii) of the Conditions of Contract would be applicable in calculating extra lead and this would be based on a detailed rate analysis in terms of the Conditions of Contract. 9. On 01.05.2012, NEEPCO conveyed its decision that Clause 33(iii) of the Conditions of Contract would be applicable in calculating extra lead and this would be based on a detailed rate analysis in terms of the Conditions of Contract. Thereafter in the meeting held between the parties on 06.08.2012 NEEPCO conveyed its decision to the Contractors that (i) existing BOQ rates cannot be considered as analogous item due to certain major dissimilarities, (ii) the rates shall be firmed up on actual basis, (iii) till such time payment on provisional basis may be affected, (iv) in order to facilitate continuance of the project work unhindered, 80% of the approved analyzed rate for similar contract may be considered provisionally against extra lead from the govt. approved quarries, and (v) the provisional payment would be subject to adjustment on finalization of the rates. 10. Thereafter meetings were held between the parties on 07.12.2012 and 08.12.2012 wherein the Contractors reiterated their stand that the rates of similar items available in the BOQ for open excavation and underground excavation as per Clause 33(ii)(a) of the Conditions of Contract be made applicable. On the other hand, NEEPCO reiterated that the rates should be decided in terms of Clause 33(iii) of the Conditions of Contract. Finally, Patel Engineering Ltd. requested that since a dispute has arisen, the matter may be referred to arbitration panel appointed by NEEPCO to resolve the dispute. It was finally decided that HoP, KaHEP will forward the matter to NEEPCO Headquarters for further necessary action to start the process of arbitration. It was also agreed that till the arbitral award, the payment would be made as per the prevailing provisional rate without any escalation and that final rate payable for transportation of sand and boulder shall be done on implementation of the arbitral award. 11. In the meantime, on 11.10.2013 NEEPCO issued Invitation for Bids for transportation of boulders, sand from the government approved quarries to the project site. The respondents challenged the said Notice Inviting Bids before this Court by way of W.P. (C) Nos 306,307and 308 of 2013. This Court vide separate orders dated 29.10.2013 dismissed the said three writ petitions. The respondent herein, then filed three writ appeals being W.A. Nos.39,40 and 41 of 2013. The respondents challenged the said Notice Inviting Bids before this Court by way of W.P. (C) Nos 306,307and 308 of 2013. This Court vide separate orders dated 29.10.2013 dismissed the said three writ petitions. The respondent herein, then filed three writ appeals being W.A. Nos.39,40 and 41 of 2013. This Court then vide order dated 01.11.2013 granted an interim stay on the Notice Inviting Bids and the order dated 29.10.2013 passed by the learned Single Judge. NEEPCO preferred SLPs before the Hon’ble Supreme Court against the order dated 01.11.2013. The said SLPs later numbered as Civil Appeal No. 11224 of 2013 arising from SLP 36587 of 2013, Civil Appeal No. 11225 of 2013 arising from SLP 36684 of 2013, and Civil Appeal No. 11226 of 2013 arising from SLP 36756 of 2013, were disposed of vide consent order dated 13.12.2013 with a direction that NEEPCO would be free to invite fresh bids, but the finalization of the bid would be subject to outcome of the writ appeal pending before this Court. It was also provided that in the meantime, the respondents herein would be free to collect sand and boulders for use at the three sites from the approved quarries. NEEPCO then issued fresh Notice Inviting Bids which was again challenged by the respondents before this Court in W.P. (C) No76 of 2014. The said writ petition was dismissed vide order dated 19.03.2014 on the ground that an appeal was already pending before the Division bench of this Court. The three Writ Appeals, W.A.s No. 39, 40 and 41 of 2013, then came up for consideration on 05.05.2014 and NEEPCO made a statement that "as the lowest bids quoted by the contractor is 100 times higher than the estimated cost, it will not be continued to finalize the tender in the interest of public at large. Therefore, the respondent has already cancelled the new NIB". The said writ appeals were as such disposed of vide order dated 05.05.2014 as being infructuous. 12. On 16.06.2014 the dispute between NEEPCO and the respondents was referred to arbitration. Three identical but separate arbitration references were made to the learned Sole Arbitrator in connection with three separate work contracts i.e. Package-I (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/560 dated 17.12.2004), Package- II (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/561 dated 17.12.2004), and Package-III (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/562 dated 17.12.2004) of the Kameng HE Project. 12. On 16.06.2014 the dispute between NEEPCO and the respondents was referred to arbitration. Three identical but separate arbitration references were made to the learned Sole Arbitrator in connection with three separate work contracts i.e. Package-I (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/560 dated 17.12.2004), Package- II (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/561 dated 17.12.2004), and Package-III (Contract No. NEEPCO/ED/QP/C&P/R/C/KaHEP/562 dated 17.12.2004) of the Kameng HE Project. The term of arbitration reference under Package-I was as follows: "Whether the rate for extra lead for transportation of sand and boulder from Government approved quarries to work site for Package-I under KaHEP shall be decided in terms of Clause 33(ii)(a) or Clause 33(iii) of Part-III, Vol. I, Conditions of Contract of Book-II of Contract Agreement No. NEEPCO/ED/QP/C&P/R/C/KaHEP/560 of 2004-05 dated 17.12.2004." There were similar terms of arbitration reference in respect of Package- II and Package-III. 13. The learned Sole Arbitrator held the arbitration proceedings in several sittings and finally passed the declaratory Arbitral Award dated 29.03.2016 in respect of Package-I holding as follows: "Based on my findings above, I have no hesitation in coming to the considered finding that the contract itself provides rate(s) for payment of extra lead in items Nos. 2.7 and 3.4 of the BOQ for surface and underground structures respectively. Admittedly material had been transported from a lead much longer than that envisaged at the time of award of work in favour of the claimant. It is also an admitted case of the parties that the claimant is entitled to extra payment for the extra lead. The only point at issue is whether Clause 33(ii)(a) or Clause 33(iii) would be applicable for working out the rate payable for transportation. In view of my findings, I have no hesitation in holding that the payment of extra lead is to be determined in accordance with Clause 33(ii)(a) for the item which has deviated being already available in the contract. In view of my findings, I have no hesitation in holding that the payment of extra lead is to be determined in accordance with Clause 33(ii)(a) for the item which has deviated being already available in the contract. I, therefore, answer the reference as follows: The rate for extra lead for transportation of sand and boulders from Government approved quarries to the work site for package-I works under KaHEP shall be decided in terms of Clause 33(ii)(a) of Part-III, Volume-I, Conditions of Contract of Book-II of Contract Agreement No. NEEPCO/ED/QP/C&P/R/C/KaHEP/560 of 2004-05 dated 17.12.2004." Similar Declaratory Arbitral Awards dated 29.03.2016 were passed by the learned Sole Arbitrator in respect of the other two Arbitral References in respect of contracts pertaining to Package-II and Package-III of the project. 14. The appellant NEEPCO then filed three separate applications under Sec. 34 of the Arbitration and Conciliation Act, 1996 before the learned Additional Deputy Commissioner (Judicial), Shillong challenging the three Arbitral Awards dated 29.03.2016 in respect of Packages-I, II and III and the same were registered as Arbitration Case No. 5 (T) 2016, Arbitration Case No. 6 (T) 2016 and Arbitration Case No. 7 (T) 2016 respectively. The Court of the learned Additional Deputy Commissioner (Judicial), Shillong vide common order dated 27.04.2018 declined to interfere and dismissed the aforesaid Sec. 34 applications filed by NEEPCO and upheld the 3 (three) Arbitral Awards dated 29.03.2016. 15. The appellant NEEPCO has filed these 3 (three) Arbitration Appeals under Sec. 37 of the Arbitration and Conciliation Act, 1996 challenging the common order dated 27.04.2018 passed by the Court of the learned Additional Deputy Commissioner (Judicial), Shillong in Arbitration Case No. 5 (T) 2016, Arbitration Case No. 6 (T) 2016 and Arbitration Case No. 7 (T) 2016. 16. Heard learned Senior Counsels Shri. H.A. Ahmadi and Shri. V.K. Jindal appearing for the appellant and Senior Counsel Shri. A. Bhan appearing for the respondents. 17. Shri. H.A. Ahmadi, the learned Senior Counsel appearing for the appellant submits that the instant case primarily involves interpretation of Clause 33 of the Conditions of Contract and the issue before the learned Arbitrator was as to whether the rate for extra lead for transportation of sand and boulder from government approved quarries to work site was to be decided in terms of Clause 33(ii)(a) or in terms of Clause 33(iii) of the Conditions of Contract. Clause 33 of the Conditions of Contract reads as follows: "33. DEVIATIONS (I) The Engineer-in-Charge shall have power to make any deviations in the original specifications or drawings or designs of the works or any part thereof that are in his opinion, necessary at the time of or during the course of execution of work. In the aforesaid purpose or for any other reason, if it shall in the opinion of the Engineer-in-Charge be desirable he will also have the powers to make deviations, such as: (a) variations, (b) extra item, (c) additions/omissions, (d) alterations or substitutions of any kind. No such deviations in the specifications or drawings or designs or Bill of Quantities, as aforesaid shall in any way vitiate or invalidate the contract and any such deviations which the contractor may be directed to do shall form integral part of the contract as if originally provided therein and the contractor shall carry out the same on the same conditions in all respect on which he agreed to do the works under the contract. (II) The rates for such items of works as are required to be executed due to deviations as stated in sub-clause shall be payable in the manner as stated hereunder : (a) The rates already provided in the Bill of Quantities and as per the procedure mentioned above under sub-clause 33 of this part shall apply in respect of the same items of work to be executed due to variations. (b) In case some items are not available in the Bill of Quantities, the rates of such items, as far as practicable, shall be derived from the contracted rates of analogous items in the Bill of Quantities after actual observation at Site. The decision to select analogous items shall be taken by the Engineer-in-Charge which shall be conclusive and binding on the Contractor. The decision to select analogous items shall be taken by the Engineer-in-Charge which shall be conclusive and binding on the Contractor. (III) If the rates for such items of work cannot be determined in the manner as specified in Clause 33(ii), the rates for such items to be executed shall be determined by the Engineer-in- Charge on the basis of actual analysed cost taking the following into consideration the rates for such items of works as are required to be executed due to deviations as stated in sub-clause shall be payable in the manner as stated hereunder: (a) Cost of material including taxes (b) Cost of transportation to site (c) Cost of direct wages (excluding fringe benefit) for workers, gangers and working foreman (exclusing supervisors) and direct equipment charges as set out in the Central Water Commission guidelines. (d) Cost of facilities like electricity (e) Supervision and overhead profit @ 20% of the sum of (a) to (d). Note: In case material in (a) above is supplied by the Corporation, there will be no overhead and profit on the cost of material. The decision of the Engineer-in-Charge, if any, in deriving rates as aforesaid shall be conclusive and binding on the Contractor. (IV) Under no circumstances, the Contractor shall at any stage suspend the work on account of non-settlement of rates of such deviated items. 18. The learned Senior Counsel Shri. H.A. Ahmadi further submits that Clause 33(ii)(a) would apply only when the rates for similar item is already provided in the Bill of Quantities and not otherwise. The learned Senior Counsel submits that Clauses 2.7 and 3.4 of the Bill of Quantities (of Packages-I and II) require to be examined as to whether these clauses provide rates for similar item as "transportation of sand and boulders from government approved quarries to work site". Clauses 2 and 3 of the Bill of Quantities, which include clauses 2.7 and 3.4, read as follows : BILL OF QUANTITIES/SCHEDULE OF ITEMS PACKAGE-I Item Description Unit Qty Rate (Rs.) Amount (Rs.) 2 SURFACE EXCAVATION AND BACKFILL Surface excavation including loading, transport, all lift and lead up to 3.0 km from the excavation area/working site, unloading at disposal site or stockpiles and maintenance of the disposal sites or stockpiles, construction of haul roads (if any) and its maintenance, complete in all respects as per technical specifications, drawings and as directed by Engineer-in-Charge. 2.1 Clearing of excavation areas, disposal areas and stockpiles M2 38300 25 957500 2.2 Excavation in soil including stripping of top soil M3 20500 130 2665000 2.3 Excavation in soft and disintegrated rock M3 120000 200 24000000 2.4 Excavation in hard rock 2.4.1 Drilling and blasting M3 60000 320 19200000 2.4.2 Line drilling M 500 100 50000 2.5 Additional excavation (in open cuts, for foundation of structures, in faults and seams etc.) M3 55 320 17600 2.6 Loading, transportation including all lift and lead upto 3.0 km and unloading of accepted geological overbreak at disposal areas or stockpiles M3 110 495 54450 2.7 Handling excavated material for extra lead beyond initial lead of 3.0 km M3 /KM 200 198 39600 2.8 Backfilling 2.8.1 Random backfill M3 300 100 30000 2.8.2 Selected backfill M3 100 150 15000 2.8.3 Free-draining backfill M3 100 500 50000 2.8.4 Sand-gravel backfill M3 100 500 50000 2.8.5 Backfilling with M10 concrete M3 30 3960 118800 2.8.6 Backfilling with M15 concrete M3 20 4455 89100 2.8.7 Backfilling with M20 concrete M3 10 4950 49500 3 UNDERGROUND EXCAVATION Underground excavation of Head Race Tunnel and Construction Adit including excavation by drill and blast, mechanical, manual or conventional methods; including all survey and setting out, all lifts and transportation and unloading at disposal sites upto 3.0 km from the nearest portal and including maintenance of the disposal sites. Stockpiles, construction of haul roads (if any) and its maintenance, complete in all respects as per technical specifications, drawings and as directed by Engineer-in- Charge. Stockpiles, construction of haul roads (if any) and its maintenance, complete in all respects as per technical specifications, drawings and as directed by Engineer-in- Charge. 3.1 Head Race Tunnel excluding handling of excavated materials upto 3.0 km from the nearest portal 3.1.1 Excavation in Class I M3 62000 1000 62000000 3.1.2 Excavation in Class 2 M3 82000 1030 84460000 3.1.3 Excavation in Class 3 M3 46500 1330 61845000 3.1.4 Excavation in Class 4A & 4B M3 24000 2050 49200000 3.2 Construction Adit including handling of excavated materials upto 3.0 km from the nearest portal 3.2.1 Excavation in Class 3 M3 4100 1330 5453000 3.2.2 Excavation in Class 4 M3 4100 2050 8405000 3.3 Loading, transport including all lift and lead up to 3.0 km and unloading of accepted geological overbreak at disposal areas or stockpiles M3 200 7920 1584000 3.4 Handling of excavated material for extra lead beyond initial lead of 3.0 km M3 /KM 200 198 396000 3.5 Backfilling of accepted geological overbreak with M10 concrete M3 75 6930 519750 3.6 Backfilling of accepted geological overbreak with M15 concrete M3 75 7425 556975 3.7 Backfilling of accepted geological overbreak with M20 concrete M3 50 8415 420750 The Bill of Quantities in respect of Surface Excavation and Backfill Underground Excavation under Package-III is also similarly worded except that clauses are numbered differently and are numbered as 2.7 and 3.5 instead of Clause 2.7 and 3.4. 19. 19. The further submission of the learned Senior Counsel for the appellant is that the appellants case before the learned Arbitrator was that that the work "extra lead for transportation of sand and boulder from Government approved quarries to work sites" is not the same as or identical to any of the items in the BoQ and since, the work is not identical to any of the items in the BoQ, Clause 33(iii) of the Conditions of Contract was applicable which provides that "If the rates for such items of work cannot be determined in the manner as specified in Clause 33(ii), the rates for such items to be executed shall be determined by the Engineer-in-Charge on the basis of actual analysed cost taking the following into consideration the rates for such items of works as are required to be executed due to deviations as stated in sub-clause shall be payable in the manner as stated hereunder : (a) Cost of material including taxes, (b) Cost of transportation to site, (c) Cost of direct wages (excluding fringe benefit) for workers, gangers and working foreman (excluding supervisors) and direct equipment charges as set out in the Central Water Commission guidelines, (d) Cost of facilities like electricity, (e) Supervision and overhead profit @ 20% of the sum of (a)to (d)." As such the rates in respect of the work of "extra lead for transportation of sand and boulder from Government approved quarries to work sites" was required to be determined by the Engineer-in-Charge in terms of the provisions of Clause 33(iii) of the Conditions of Contract. 20. The learned Senior Counsel further submits that Clause 33(ii)(a) can be resorted to for fixing the rates for the work of "extra lead for transportation of sand and boulder from Government approved quarries to work sites" in terms of Clause 2.7 (Handling Excavated Materials for extra lead beyond initial lead of 3.0 km at the rate of Rs. 198 per Cubic Mtr/Km) and in terms of Clause 3.4 (Handling Excavated Materials for extra lead beyond initial lead of 3.0 km at the rate of Rs. 198 per Cubic Mtr/Km) only if the said work of "extra lead for transportation of sand and boulder from Government approved quarries to work sites" was same as or identical to the work "Handling Excavated Materials for extra lead beyond initial lead of 3.0 km". 198 per Cubic Mtr/Km) only if the said work of "extra lead for transportation of sand and boulder from Government approved quarries to work sites" was same as or identical to the work "Handling Excavated Materials for extra lead beyond initial lead of 3.0 km". This is apparent from the very wording of Clause 33(ii)(a) which states that, "The rates already provided in the Bill of Quantities and as per the procedure mentioned above under sub-clause 33 of this part shall apply in respect of the same items of work to be executed due to variations". 21. The learned Senior Counsel for the appellant further referred to various other clauses viz. Clause 2.1 of one of the contract documents namely "Particular Technical Specifications", Vol. 2, Part II. Clause 2.15 of the aforesaid document provides for mode and manner of disposal of excavated materials from surface excavation as follows: "2.15. Disposal of Excavated Materials (i) All materials from surface excavation suitable for use as backfill, concrete aggregates or for other purposes shall be stockpiled on the site within a radius of 3.0 km, as directed or approved by the Engineer-in-Charge, if the immediate placement in the final location in permanent works is not possible. (ii) Excavated materials which is not suitable for or is in excess of the permanent construction requirements, shall be disposed of within a radius of 3.0 km from the excavation place in the waste disposal areas shown on the drawings or in areas designated as such by the Engineer-in-Charge in the course of the work. 22. The learned Senior Counsel further referred to Clause 2.17.2(vii) of the aforesaid document which provides for extra payment for handling of excavated material from surface excavation beyond initial lead of 3.0 km and provides that extra payment will be made for handling of excavated material beyond initial lead of 3.0 km and the measurement of the same would be based on the hauled volume which will be measured during hauling operation by counting the number of return truck loads. The learned Senior Counsel further referred to Clause 3.10.1(iv) which provides for extra payment for handling of excavated material from underground excavation beyond initial lead of 3.0 km and provides for similar method of measurement as in the case of handling of excavated material for surface excavation. 23. The learned Senior Counsel further referred to Clause 3.10.1(iv) which provides for extra payment for handling of excavated material from underground excavation beyond initial lead of 3.0 km and provides for similar method of measurement as in the case of handling of excavated material for surface excavation. 23. It is the submission of the learned counsel for the appellant that the contract documents have to be read as a whole and Clauses 2.7 and 3.4 of the BoQ cannot be read in isolation. To support this contention reliance has been placed on CHITTTY ON CONTRACTS, Vol. I (26th Edition), pg 520-521, ODGERs CONSTRUCTION OF DEEDS AND STATUTES (5thEdn) Pg 55-56, The House of Lords decision in North Eastern Railway Company v. Lord Hastings, [1900] AC 260, the Hon’ble Apex Court decisions in Bank of India v. K. Mohandas, (2009) 5 SCC 313 and Mahanadi Coalfields Ltd. v. Dhansar Engg Co. (P) Ltd., (2016) 10 SCC 571 . 24. The learned Senior Counsel for the appellant submits that (a) if the contract is read as a whole, it is evident that the provisions thereof have, in the ordinary course, only provided for dumping of the excavated material from the project site at designated locations which are otherwise within a lead of 3.0 km, (b) however, clauses 2.7 and 3.4 have been added by way of abundant caution to factor in a contingency when such excavated material is dumped beyond the distance of 3.0 km instead of the designated dumping areas, (c) Clauses 2.7 and 3.4 are part of a composite sequence of activities undertaken in the course of "Surface Excavation and Backfill" and "Underground Excavation". The work in question "extra lead for transportation of sand and boulders from Government Approved quarries" does not form part of the sequence of activities contemplated under Chapter 2 and 3 of the Particular Technical Specifications, (d) When the respondent loaded and transported sand and boulders from the Government Approved quarries, there was no excavation involved, (e) Therefore, the work in question ""extra lead for transportation of sand and boulders from Government Approved quarries" cannot be considered as the item of work "same as the item of work under Clause 2.7 and 3.4 of the BoQ, and (e) as evident from Clause 33(ii)(a), the clause only applies in respect of the "same item(s) of works to be executed due to variations", that is when there is a variation in the quantity with respect to the same item already in BoQ. As this is not the case in the instant case, Clause 33(ii)(a) has no relevance and the appropriate clause for arriving at the rate would be Clause 33(iii) of the Conditions of Contract. 25. The second submission of the learned senior Counsel for the appellant is that Clauses 2.7 and 3.4 of the BoQ contemplate "Handling" of excavated material which encompasses a plethora of activities far wider than mere "transportation" of boulder and sand. In this regard, references have been made of clauses 2.15(iii), 2.17.2(vi)(b), 3.6.8(iii), 3.10.1(iii)(b) of the Particular technical Specifications to substantiate that "handling" as envisaged in the contract involves a plethora of activities like shaping and trimming of disposal areas to the lines and grades, stripping of vegetation, compacting by movement of dumping vehicles, grading in layers, loading, hauling, dumping, formation and maintenance of stockpiles, recultivation of disposal areas and stockpile areas etc. This plethora of activities is not involved in the work of "transportation of sand and boulders from Government Approved quarries". 26. The learned Senior Counsel for the appellant further submits that the type and nature of road surface has an impact on determining the rate as it impacts fuel consumption and also the types of vehicles being used. Moving the material within the project site under Clauses 2.7 and 3.4 would involve vehicles traversing haulage roads which are freshly cut and which are not paved. Moving the material within the project site under Clauses 2.7 and 3.4 would involve vehicles traversing haulage roads which are freshly cut and which are not paved. On the other hand, transport of sand and boulder from the Government Approved quarries from the distance of 78 km, 53 km and 36.5 km involved transportation over paved roads. Further, moving the material within the project site under Clauses 2.7 and 3.4 involved hauling equipment which are different from tipper trucks used for transportation of sand and boulders. 27. The further submission of the appellant is that the cost of material, including aggregate, was already factored in the existing items of BoQ which also includes "lead" in respect of all materials used in concrete. Clause 33 provides that, "The Corporation will not issue any material like reinforcement and/or structural steel, cement, POL etc. except explosives for this package. The Contractor has to make his own arrangements for all materials, consumables etc for incorporation and for completion of the works, within his quoted rates". Additionally, the learned Senior Counsel for the appellant submits that the award is an inchoate award, lacking in certainty and ought to set aside on this ground alone. 28. The further submission of the appellant is that the learned Arbitrator has exceeded his jurisdiction and has ruled on an "excepted matter". As per Clause 33 of the Conditions of Contract, "the decision of the Engineer-in-Charge, if any, in deriving rates as aforesaid shall be conclusive and binding on the Contractor" and therefore, arriving at a rate under Clause 33(iii) was the exclusive domain of the engineer-in-Charge and the learned Arbitrator has essentially impinged on the exclusive domain of the Engineer-in-Charge. Reliance has been placed on the Hon’ble Apex Court decision in Vishwanath Sood v. Union of India, (1989) 1 SCC 657 wherein the Hon’ble Apex Court observed: "8. We have gone through the judgment of the Division Bench of the High Court and we have also considered the arguments advanced on both sides. With great respect, we find our- selves unable to agree with the interpretation placed by the Division Bench on the terms of the contract. Clause 2 of the contract makes the time specified for the performance of the contract a matter of essence and emphasises the need on the part of the contractor to scrupulously adhere to the time schedule approved by the Engineer-in charge. Clause 2 of the contract makes the time specified for the performance of the contract a matter of essence and emphasises the need on the part of the contractor to scrupulously adhere to the time schedule approved by the Engineer-in charge. With a view to compel the contractor to adhere to this time schedule, this clause provides a kind of penalty in the form of a compensation to the Department for default in adhering to the time schedule. The clause envisages an amount of compensation calculated as a percentage of the estimated cost of the whole work on the basis of the number of days for which the work remains uncommenced or unfinished to the prescribed extent on the relevant dates. We do not agree with the counsel for the respondent that this is in the nature of an automatic levy to be made by the Engineer-in charge based on the number of days of delay and the estimated amount of work. Firstly, the reference in the clause to the requirement that the work shall throughout the stipulated period of the contract be proceeded with due diligence and the reference in the latter part of the clause that the compensation has to be paid "in the event of the contractor failing to comply with" the prescribed time schedule make it clear that the levy of compensation is conditioned on some default or negligence on the part of the contractor. Secondly, while the clause fixes the rate of compensation at 1 per cent for every day of default it takes care to prescribe the maximum compensation of 10 per cent on this ground and it also provides for a discretion to the Superintending Engineer to reduce the rate of penalty from 1 per cent. Though the clause does not specifically say so, it is clear that any moderation that may be done by the Super- intending Engineer would depend upon the circumstances, the nature and period of default and the degree of negligence or default that could be attributed to the contractor. This means that the Superintending Engineer, in determining the rate of compensation chargeable, will have to go into all the aspects and determine whether there is any negligence on the part of the contractor or not. This means that the Superintending Engineer, in determining the rate of compensation chargeable, will have to go into all the aspects and determine whether there is any negligence on the part of the contractor or not. Where there has been no negligence on the part of the contractor or where on account of various extraneous circumstances referred to by the Division Bench such as vis major or default on the part of the Government or some other unexpected circumstance which does not justify penalising the contractor, the Superintending Engineer will be entitled and bound to reduce or even waive the compensation. It is true that the clause does not in terms provide for any notice to the contractor by the Superintending Engineer. But it will be appreciated that in practice the amount of compensation will be initially levied by the Engineer-in-charge and the Superintending Engineer comes into the picture only as some sort of revisional or appellate authority to whom the contractor appeals for redress. As we see it, clause 2 contains a complete machinery for determination of the compensation which can be claimed by the Government on the ground of delay on the part of the contractor in completing the contract as per the time schedule agreed to between the parties. The decision of the Superintending Engineer, it seems to us, is in the nature of a considered decision which he has to arrive at after considering the various mitigating circumstances that may be pleaded by the contractor or his plea that he is not liable to pay compensation at all under this clause. In our opinion the question regarding the amount of compensation leviable under clause 2 has to be decided only by the Superintending Engineer and no one else. 9. The Division Bench has construed the expression in clause 2 in parenthesis that "the Superintending Engineer's decision shall be final" as referring only to a finality qua the department; in other words, that it only constitutes a declaration that no officer in the department can determine the quantification and that the quantum of compensation levied by the Superintending Engineer shall not be changed without the approval of the Government. After refer-ring to certain judicial decisions regarding the meaning of the word "final" in various statutes, the Division Bench concluded that the finality cannot be construed as excluding the jurisdiction of the arbitrator under clause 25. After refer-ring to certain judicial decisions regarding the meaning of the word "final" in various statutes, the Division Bench concluded that the finality cannot be construed as excluding the jurisdiction of the arbitrator under clause 25. We are unable to accept this view. Clause 25 which is the arbitration clause starts with an opening phrase excluding certain matters and disputes from arbitration and these are matters or disputes in respect of which provision has been made elsewhere or otherwise in the contract. These words in our opinion can have reference only to provisions such as the one in parenthesis in clause 2 by which certain types of determinations are left to the administrative authorities concerned. If that be not so, the words "except where other- wise provided in the contract" would become meaningless. We are therefore inclined to hold that the opening part of clause 25 clearly excludes matters like those mentioned in clause 2 in respect of which any dispute is left to be decided by a higher official of the Department. Our conclusion, therefore, is that the question of awarding compensation under clause 2 is outside the purview of the arbitrator and that the compensation, determined under clause 2 either by the Engineer-in-charge or on further reference by the Superintending Engineer will not be capable of being called in question before the arbitrator. 10. We may confess that we had some hesitation in coming to this conclusion. As pointed out by the Division Bench, the question of any negligence or default on the part of the contractor has many facets and to say that such an important aspect of the contract cannot be settled by arbitration but should be left to one of the contracting parties might appear to have far reaching effects. In fact, although the contractor in this case might object to the process of arbitration because it has gone against him, contractors generally might very well prefer to have the question of such compensation decided by the arbitrator rather than by the Superintending Engineer. But we should like to make it clear that our decision regarding non arbitrability is only on the question of any compensation which the Government might claim in terms of clause 2 of the contract. We have already pointed out that this is a penalty clause introduced under the contract to ensure that the time schedule is strictly adhered to. But we should like to make it clear that our decision regarding non arbitrability is only on the question of any compensation which the Government might claim in terms of clause 2 of the contract. We have already pointed out that this is a penalty clause introduced under the contract to ensure that the time schedule is strictly adhered to. It is something which the Engineer- in-Charge enforces from time to time when he finds that the contractor is being recalcitrant, in order to ensure speedy and proper observance of the terms of the contract. This is not an undefined power. The amount of compensation is strictly limited to a maximum of 10% and with a wide margin of discretion to the Superintending Engineer, who might not only reduce the percentage but who, we think, can even reduce it to nil, if the circumstances so warrant. It is this power that is kept outside the scope of arbitration. We would like to clarify that this decision of ours will not have any application to the claims, if any, for loss or damage which it may be open to the Government to lay against the contractor, not in terms of clause 2 but under the general law or under the Contract Act. As we have pointed out at the very outset so far as this case is concerned the claim of the Government has obviously proceeded in terms of clause 2 and that is the way in which both the learned single Judge as well as the Division Bench have also approached the question. Reading clauses 2 and 25 together we think that the conclusion is irresistible that the amount of compensation chargeable under clause 2 is a matter which has to be adjudicated in accordance with that clause and which cannot be referred to arbitration under clause 25." 29. The further submission of the learned counsel for the appellant is that the errors in the Award are not trivial and the potential effect on the public exchequer is massive. Although, no crystallized sum is mentioned in the Award and the Award is only a declaratory award, the appellants have, on processing of the bills have tentatively calculated that they might have to pay an amount of Rs. 3.56 lakh for every truck of which has travelled 100 km carrying 10 cubic Metre of sand or boulder. Although, no crystallized sum is mentioned in the Award and the Award is only a declaratory award, the appellants have, on processing of the bills have tentatively calculated that they might have to pay an amount of Rs. 3.56 lakh for every truck of which has travelled 100 km carrying 10 cubic Metre of sand or boulder. The Arbitral Award would allow the respondents to unjustly enrich itself ultimately driving up the cost of project by over Rs. 1,000 Crores. The learned Counsel refers to the decisions of the Bombay High Court in Angerlehner Structural and Civil Engineering co. v. Municipal Corporation of Greater Mumbai, MANU/MH/0554/2017. 30. Per contra, the learned senior counsel for the respondents submits that the scope of appeal under Sec. 37 of the Arbitration and Conciliation Act, 1996 is limited and that it is now settled law that the court while deciding an appeal under Sec. 37 of the Arbitration and Conciliation Act, 1996 must not interfere with the decision of the lower court unless it is shown to be palpably erroneous in facts or in law, or it is manifestly perverse. Reliance has been placed on the decision of the Delhi High Court in NHAI v. BSC-RBM-Pati JV, 2018 SCC Online Del 6780 wherein it has been held at para 66, as follows: "The position that emerges from the law, as it stands crystallized today, is, clearly, that findings, of fact as well as of law, of the arbitrator/Arbitral Tribunal are ordinarily not amenable to interference either under Sections 34 or Section 37 of the Act. It is only where the finding is either contrary to the terms of the contract between the parties, or, ex facie, perverse, that interference, by this Court, is necessary. The arbitrator/Arbitral Tribunal is the final arbiter on facts as well as in law, and even errors, factual or legal, which stop short of perversity, do not merit interference under Sections 34or 37 of the Act. Insofar as the ultimate view of the learned arbitrator/Arbitral Tribunal, on any issue is concerned, so long as the view is plausible, and not merely possible, this Court would be loath to interfere therewith." 31. Insofar as the ultimate view of the learned arbitrator/Arbitral Tribunal, on any issue is concerned, so long as the view is plausible, and not merely possible, this Court would be loath to interfere therewith." 31. In this regard the learned senior counsel for the respondents places further reliance on the decision of the Hon’ble Apex Court in Associated Builders v. Delhi Development Authority, (2015) 3 SCC 49 , wherein the Hon’ble Apex Court held as follows: "It must clearly be understood that when a court is applying the "public policy" test to an arbitration award, it does not act as a court of appeal and consequently errors of fact cannot be corrected. A possible view by the arbitrator on facts has necessarily to pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his arbitral award. "Construction of the terms of a contract is primarily for an arbitrator to decide unless the arbitrator construes the contract in such a way that it could be said to be something that no fair minded or reasonable person could do." 32. The learned senior counsel for the respondents places further reliance on the Delhi High Court decision in NTPC v. Marathon Electric motors, (2012) 194 DLT 404 (DB) wherein it has been held as follows: "17. We have gone through the pleading as well as all the orders passed by trial Court in the above matter and considered the rival submissions of both sides. The present matter has been filed by the appellant under Section 31(1)(b) of the Act. It is settled law that the Appellate Court should not interfere with the exercise of the discretion under appeal solely on the ground that if it had considered the matter at the trial stage, it may have come to a contrary conclusion. In case, the discretion has been exercised by the trial Court reasonably and in judicial matter, the Appellate Court would not take different view by interfering with the Trial Court's exercise of discretion, unless, it is found that in exercising its discretion, the trial Court has acted unreasonably and capriciously or has ignored relevant facts, then it could be open to the Appellate Court to interfere with the trial Court's exercise of discretion. Reliance can be placed upon the case reported in AIR 1967 SC 209 , Uttar Pradesh Co-operative Society v. Sundar Bros. 18. The scope of judicial interference against the arbitral award which has time and again came up before the courts for consideration, wherein the view of the Courts including this Court are consistent that the Court while deciding Section 34 objection cannot culminate into the appellate Court to decide every legal and factual issue. It is only those errors of patent illegality, without jurisdiction or biasness or against the public policy where in the awards seems to be unsustainable, the Courts are empowered to interfere and not in all other cases to correct errors committed by the Arbitrator." 33. The learned senior counsel for the respondents next submits that the work of "extra lead for transportation of sand and boulder from Government Approves quarries to work sites" is identical to and is the same item of work as specified under Clauses 2.7 and 3.4 of the BoQ and that quarry excavation is the same as surface excavation. The term "surface excavation" includes within its ambit excavated material obtained from excavation in quarry areas. Clause 2.8 of the Particular technical Specifications, Vol. 2, Part II mentions about Quarry Excavation under Chapter 2 (SURFACE EXCAVATION AND BACKFILL) and therefore surface excavation includes within its ambit excavated material obtained from excavation in quarry. Therefore, it is abundantly clear that excavation activities mentioned in Items No. 2.1 to 2.5 of the BoQ read with Chapter 2 of the PTS for surface excavation are the same excavation activities that were undertaken by the respondent for quarry excavation in the Government Approved quarries. The works mentioned in items No. 2.2. to 2.5 of the BoQ have been undertaken by the respondents with respect to sand and boulder during quarry excavation which is to be done in the same manner as surface excavation. The term "excavated material" as used in Clause 2.7 of the BoQ is nothing but the material that are excavated during quarry excavation which in this case is sand and boulder. The term "excavated material" as used in Clause 2.7 of the BoQ is nothing but the material that are excavated during quarry excavation which in this case is sand and boulder. The payment of these activities within the distance of 3.0 km has been included in the rate of concrete under the BoQ and, therefore, the cost with respect to excavation of sand and boulders from the Government Approved quarries including transportation upto a distance of 3.0 km has already been paid for to the respondent in the price of concrete. The only cost that remains unpaid is the cost of transportation of sand and boulders beyond the intial lead of 3.0 km which is to be paid by the appellant under Clauses 2.7 and 3.4 of the BoQ. 34. It is further submitted on behalf of the respondents that a commercial contract of the present nature ought to be interpreted so as to give effect to the commercial intent of the parties and an ambiguity, if any, ought to be read against the draftsman. The learned Senior Counsel places reliance on Bombay High Court decision in Mumbai Metropolitan Region Development Authority v. Unity Infraprojects Ltd, (2008) 5 Bom CR 196 wherein it has been held as follows: "5. A business like interpretation of contractual provisions must be adopted in construing contracts entered into by persons of business to govern business dealings. The Court must ensure that interpretation of law in commercial cases must not be disjointed from the intent and object which those having business dealings seek to sub-serve. Unless interpretation of contracts effectuates a business meaning for persons of business, the law will not fulfill its purpose and object of being a facilitator for business and providing a structure of ordered certainty to those who carry on business here. The legal system must innovate constantly to keep abreast with rapid changes in technology and business. Further reliance has been placed on the Supreme Court decision in Godhra Electricity Co, Ltd. v. State of Gujarat, (1975) 1 SCC 199 wherein it has been held as follows: "16. We are not certain that if evidence of subsequent acting under a document is admissible, it might have the result that a contract would mean one thing on the day it is signed but by reason of subsequent event it would mean something a month or year later. We are not certain that if evidence of subsequent acting under a document is admissible, it might have the result that a contract would mean one thing on the day it is signed but by reason of subsequent event it would mean something a month or year later. Subsequent 'interpreting' statements might not always change the meaning of a word or a phrase. A word or a phrase, is not always crystal clear. When both parties subsequently say that by the word or phrase which, in the context, is ambiguous, they meant this, it only supplies a glossary as to the meaning of the word or phrase. After all, the inquiry is as to, what the intention of the parties was from the language used. And, why is it that parties cannot clear the latent ambiguity in the language by a subsequent interpreting statement? If the meaning of the word or phrase or sentence is clear, extrinsic evidence is not admissible. It is only when there is latent ambiguity that extrinsic evidence in the shape of interpreting statement in which both parties have concurred should be admissible. The parties themselves might not have been clear as to the meaning of the word or phrase when they entered into the contract. Unanticipated situations might arise or come into the contemplation of the parties subsequently which would sharpen their focus and any statement by them which would illuminate the darkness arising out of the ambiguity of the language should not be shut out. In the case of an ambiguous instrument, there is no reason why subsequent interpreting statement should be inadmissible." 35. It is additionally submitted on behalf of the respondents that even if there was some ambiguity in the meaning of the terms used in the BoQ items, in such case the principle of verba chartarum forties accipiuntur contra proferentem should be applied. This is a principle of construction where under if words of a contract are ambiguous, of two equally possible meanings, they should be interpreted against the author, drafter or writer of the contract and not against the other party. This is a principle of construction where under if words of a contract are ambiguous, of two equally possible meanings, they should be interpreted against the author, drafter or writer of the contract and not against the other party. The counsel places reliance on Bank of India v. K. Mohandas, (2009) 5 SCC 313 , para 32, wherein it has been held as follows: "The fundamental position is that it is the banks who were responsible for formulation of the terms in the contractual Scheme that the optees of voluntary retirement under that Scheme will be eligible to pension under Pension Regulations, 1995, and, therefore, they bear the risk of lack of clarity, if any. It is a well-known principle of construction of contract that if the terms applied by one party are unclear, an interpretation against that party is preferred." (verba chartarum forties accipiuntur contra proferentem) 36. The next submission on behalf of the respondents is that the terms of reference as referred to the learned Arbitrator is within the scope of his jurisdiction and does not amount to an "excepted matter". The learned Senior Counsel raises the point that the above ground has been raised for the first time before this Court in the instant appeal. This ground was not raised either before the learned Arbitrator or before the learned Additional Deputy Commissioner (Judicial), Shillong at the stage of hearing on Sec. 34 application and as such this ground cannot be raised at the appellate stage. The learned Senior Counsel further submits that it is incorrect to aver that the learned Arbitrator exceeded his jurisdiction and usurped the power of the Engineer-in-Charge because the present dispute is with regard to whether the payment for the works in question is to be made in terms of Clause 33(ii)(a) or Clause 33(iii) of the Conditions of Contract which would constitute a condition precedent before the Engineer-in-Charge can determine the appropriate rate under Clause 33(iii). In this regard reliance has been placed on the Hon’ble Supreme Court decision in BSNL v. Motorola India (P) Ltd., (2009) 2 SCC 337 . 37. In this regard reliance has been placed on the Hon’ble Supreme Court decision in BSNL v. Motorola India (P) Ltd., (2009) 2 SCC 337 . 37. The additional submissions of the respondents are that the award is well reasoned, considered and unambiguous award and there is no legal infirmity in the award on this count and that though appellant NEEPCO is a public sector undertaking, but mere loss to the public exchequer will not be a ground to set aside an award on ground of public policy. Reliance in this regard is placed on Bombay High Court decision in Union of India v. India Proofing and General Industries, AIR 2000 Bom 292 . 38. We have heard the submissions of the learned senior counsel for the parties. 39. The present appeals are appeals under Sec. 37 of the Arbitration and Conciliation Act, 1996. We are conscious of the scope of judicial interference with an Arbitral Award under Sec. 34 or under Sec. 37 of the Arbitration and Conciliation Act, 1996. The above provisions of the Arbitration and Conciliation Act, 1996 read as follows: 34. Application for Setting Aside Arbitral Award.- (1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3). The above provisions of the Arbitration and Conciliation Act, 1996 read as follows: 34. Application for Setting Aside Arbitral Award.- (1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3). (2) An arbitral award may be set aside by the Court only if- (a) the party making the application furnishes proof that - (i) a party was under some incapacity; or (ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or (iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or (iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration: Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or (v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or (b) the Court finds that - (i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or (ii) the arbitral award is in conflict with the public policy of India. Explanation.-Without prejudice to the generality of sub-clause (ii), it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81. Explanation.-Without prejudice to the generality of sub-clause (ii), it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81. (3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under Section 33, from the date on which that request had been disposed of by the arbitral tribunal: Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter. (4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside the arbitral award." Sec. 5 of the Act categorically provides that, "Extent of judicial intervention.-Notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part." Thus Section 34 of the Arbitration and Conciliation Act, 1996 when read with Section 5 of the said Act, makes it abundantly clear that an arbitral award which is governed by Part I of the Act can be set aside only on the grounds mentioned in Sec. 34(2) of the Act and not on any other grounds. Section 37 of the Arbitration and Conciliation Act, 1996 reads as follows: 37. Appealable orders.-- (1) An appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order, namely:-- (a) granting or refusing to grant any measure under section 9; (b) setting aside or refusing to set aside an arbitral award under section 34. Appealable orders.-- (1) An appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order, namely:-- (a) granting or refusing to grant any measure under section 9; (b) setting aside or refusing to set aside an arbitral award under section 34. (2) An appeal shall also lie to a Court from an order granting of the arbitral tribunal.-- (a) accepting the plea referred in sub-section (2) or sub-section (3) of section 16; or (b) granting or refusing to grant an interim measure under section 17. (3) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court. This is also a settled proposition that none of the grounds contained in sub- clause 2(a) of Sec. 34 deal with the merits of the decision rendered by an arbitral tribunal. It is only when we come to sub-clause 2(b)(ii) that is "the award being in conflict with the public policy of India" that the merits of an arbitral award can be looked into by a Court under certain specified circumstances. Associated Builders v. Delhi Development Authority, (2015) 3 SCC 49 . 40. While construing the expression "the public policy of India" as contained in Section 34(2)(b)(ii) of the Arbitration and Conciliation Act, 1996, the Hon’ble Apex Court in ONGC v. Saw Pipes, 2003 (5) SCC 705 , held as follows: "31. Therefore, in our view, the phrase "public policy of India" used in Section 34 in context is required to be given a wider meaning. It can be stated that the concept of public policy connotes some matter which concerns public good and the public interest. What is for public good or in public interest or what would be injurious or harmful to the public good or public interest has varied from time to time. However, the award which is, on the face of it, patently in violation of statutory provisions cannot be said to be in public interest. Such award/judgment/decision is likely to adversely affect the administration of justice. However, the award which is, on the face of it, patently in violation of statutory provisions cannot be said to be in public interest. Such award/judgment/decision is likely to adversely affect the administration of justice. Hence, in our view in addition to narrower meaning given to the term "public policy" in Renusagar case [1994 Supp (1) SCC 644] it is required to be held that the award could be set aside if it is patently illegal. The result would be - award could be set aside if it is contrary to: (a) Fundamental policy of Indian law; or (b) The interest of India; or (c) Justice or morality, or (d) in addition, if it is patently illegal. Illegality must go to the root of the matter and if the illegality is of trivial nature it cannot be held that award is against the public policy. Award could also be set aside if it is so unfair and unreasonable that it shocks the conscience of the court. Such award is opposed to public policy and is required to be adjudged void." 41. The Hon’ble Apex Court in ONGC v. Western Geco International Ltd., (2014) 9 SCC 263 held as follows: 35. What then would constitute the "Fundamental policy of Indian Law" is the question. The decision in Saw Pipes Ltd. does not elaborate that aspect. Even so, the expression must, in our opinion, include all such fundamental principles as providing a basis for administration of justice and enforcement of law in this country. Without meaning to exhaustively enumerate the purport of the expression "Fundamental Policy of Indian Law", we may refer to three distinct and fundamental juristic principles that must necessarily be understood as a part and parcel of the Fundamental Policy of Indian law. The first and foremost is the principle that in every determination whether by a Court or other authority that affects the rights of a citizen or leads to any civil consequences, the Court or authority concerned is bound to adopt what is in legal parlance called a "judicial approach" in the matter. The duty to adopt a judicial approach arises from the very nature of the power exercised by the Court or the authority does not have to be separately or additionally enjoined upon the fora concerned. The duty to adopt a judicial approach arises from the very nature of the power exercised by the Court or the authority does not have to be separately or additionally enjoined upon the fora concerned. What must be remembered is that the importance of Judicial approach in judicial and quasi judicial determination lies in the fact so long as the Court, Tribunal or the authority exercising powers that affect the rights or obligations of the parties before them shows fidelity to judicial approach, they cannot act in an arbitrary, capricious or whimsical manner. Judicial approach ensures that the authority acts bonafide and deals with the subject in a fair, reasonable and objective manner and that its decision is not actuated by any extraneous consideration. Judicial approach in that sense acts as a check against flaws and faults that can render the decision of a Court, Tribunal or Authority vulnerable to challenge. 38. Equally important and indeed fundamental to the policy of Indian law is the principle that a Court and so also a quasi-judicial authority must, while determining the rights and obligations of parties before it, do so in accordance with the principles of natural justice. Besides the celebrated "audi alteram partem" rule one of the facets of the principles of natural justice is that the Court/authority deciding the matter must apply its mind to the attendant facts and circumstances while taking a view one way or the other. Non-application of mind is a defect that is fatal to any adjudication. Application of mind is best demonstrated by disclosure of the mind and disclosure of mind is best done by recording reasons in support of the decision which the Court or authority is taking. The requirement that an adjudicatory authority must apply its mind is, in that view, so deeply embedded in our jurisprudence that it can be described as a fundamental policy of Indian Law. 39. No less important is the principle now recognised as a salutary juristic fundamental in administrative law that a decision which is perverse or so irrational that no reasonable person would have arrived at the same will not be sustained in a Court of law. Perversity or irrationality of decisions is tested on the touchstone of Wednesburys principle of reasonableness. 39. No less important is the principle now recognised as a salutary juristic fundamental in administrative law that a decision which is perverse or so irrational that no reasonable person would have arrived at the same will not be sustained in a Court of law. Perversity or irrationality of decisions is tested on the touchstone of Wednesburys principle of reasonableness. Decisions that fall short of the standards of reasonableness are open to challenge in a Court of law often in writ jurisdiction of the Superior courts but no less in statutory processes where ever the same are available. 40. It is neither necessary nor proper for us to attempt an exhaustive enumeration of what would constitute the fundamental policy of Indian law nor is it possible to place the expression in the straitjacket of a definition. What is important in the context of the case at hand is that if on facts proved before them the arbitrators fail to draw an inference which ought to have been drawn or if they have drawn an inference which is on the face of it, untenable resulting in miscarriage of justice, the adjudication even when made by an arbitral tribunal that enjoys considerable latitude and play at the joints in making awards will be open to challenge and may be cast away or modified depending upon whether the offending part is or is not severable from the rest. 42. The Hon’ble Apex Court in Associated Builders v. DDA, (2015) 3 SCC 49 further held as follows: 31. The third juristic principle is that a decision which is perverse or so irrational that no reasonable person would have arrived at the same is important and requires some degree of explanation. It is settled law that where - (i) a finding is based on no evidence, (ii) an arbitral tribunal takes into account something irrelevant to the decision which it arrives at; (iii) ignores vital evidence in arriving at its decision, such decision would necessarily be perverse. 32. A good working test of perversity is contained in two judgments. In H.B. Gandhi, Excise and Taxation Officer-cum-Assessing Authority v. Gopi Nath & Sons, 1992 Supp (2) SCC 312 at p. 317, it was held: "7. 32. A good working test of perversity is contained in two judgments. In H.B. Gandhi, Excise and Taxation Officer-cum-Assessing Authority v. Gopi Nath & Sons, 1992 Supp (2) SCC 312 at p. 317, it was held: "7. ...................It is, no doubt, true that if a finding of fact is arrived at by ignoring or excluding relevant material or by taking into consideration irrelevant material or if the finding so outrageously defies logic as to suffer from the vice of irrationality incurring the blame of being perverse, then, the finding is rendered infirm in law." In Kuldeep Singh v. Commr. of Police, (1999) 2 SCC 10 , at para 10, it was held: "10. A broad distinction has, therefore, to be maintained between the decisions which are perverse and those which are not. If a decision is arrived at on no evidence or evidence which is thoroughly unreliable and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, howsoever compendious it may be, the conclusions would not be treated as perverse and the findings would not be interfered with." 33. It must clearly be understood that when a court is applying the "public policy" test to an arbitration award, it does not act as a court of appeal and consequently errors of fact cannot be corrected. A possible view by the arbitrator on facts has necessarily to pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his arbitral award. Thus an award based on little evidence or on evidence which does not measure up in quality to a trained legal mind would not be held to be invalid on this score[1]. Once it is found that the arbitrators approach is not arbitrary or capricious, then he is the last word on facts. In P.R. Shah, Shares & Stock Brokers (P) Ltd. v. B.H.H. Securities (P) Ltd., (2012) 1 SCC 594 , this Court held: "21. A court does not sit in appeal over the award of an Arbitral Tribunal by reassessing or reappreciating the evidence. An award can be challenged only under the grounds mentioned in Section 34(2) of the Act. In P.R. Shah, Shares & Stock Brokers (P) Ltd. v. B.H.H. Securities (P) Ltd., (2012) 1 SCC 594 , this Court held: "21. A court does not sit in appeal over the award of an Arbitral Tribunal by reassessing or reappreciating the evidence. An award can be challenged only under the grounds mentioned in Section 34(2) of the Act. The Arbitral Tribunal has examined the facts and held that both the second respondent and the appellant are liable. The case as put forward by the first respondent has been accepted. Even the minority view was that the second respondent was liable as claimed by the first respondent, but the appellant was not liable only on the ground that the arbitrators appointed by the Stock Exchange under Bye-law 248, in a claim against a nonmember, had no jurisdiction to decide a claim against another member. The finding of the majority is that the appellant did the transaction in the name of the second respondent and is therefore, liable along with the second respondent. Therefore, in the absence of any ground under Section 34(2) of the Act, it is not possible to re-examine the facts to find out whether a different decision can be arrived at." 34. It is with this very important caveat that the two fundamental principles which form part of the fundamental policy of Indian law (that the arbitrator must have a judicial approach and that he must not act perversely) are to be understood. 43. The legal proposition that emerges from the above is that an arbitral award can be set aside under Sec. 34 of the Arbitration and Conciliation Act, 1996 if it is contrary to: (a) The fundamental policy of Indian law The three aspects of "the fundamental policy of Indian law" that have been elucidated are that: (i) The Court or the authority must adopt a judicial approach in deciding the matter (ii) The Court or the authority must determine the rights and obligations of the parties in accordance with the principles of natural justice. (iii) The decision must not be so irrational or perverse that no reasonable person would have arrived at such decision. (b) The interest of India (c) Justice or morality (d) If it is patently illegal, that is if it is patently in violation of statutory provisions 44. (iii) The decision must not be so irrational or perverse that no reasonable person would have arrived at such decision. (b) The interest of India (c) Justice or morality (d) If it is patently illegal, that is if it is patently in violation of statutory provisions 44. Coming to the test that "the decision must be so irrational or perverse that no reasonable person would have arrived at such decision", the Hon’ble Apex Court further elucidated that if a finding is based on no evidence, or an arbitral tribunal takes into account something irrelevant to the decision which it arrives at, or an arbitral tribunal ignores vital evidence in arriving at its decision, such decision would necessarily be perverse (Associated Builders case). If a finding of fact is arrived at by ignoring or excluding relevant material or by taking into consideration irrelevant material or if the finding so outrageously defies logic as to suffer from the vice of irrationality incurring the blame of being perverse, then, the finding is rendered infirm in law (H.B. Gandhi case). A decision which is perverse or so irrational that no reasonable person would have arrived at the same will not be sustained in a Court of law. Perversity or irrationality of decisions is tested on the touchstone of Wednesburys principle of reasonableness. Decisions that fall short of the standards of reasonableness are open to challenge in a Court of law often in writ jurisdiction of the Superior courts but no less in statutory processes where ever the same are available (Western Geco Case). 45. Turning to the case in hand, it is a settled law that a contract has to be read as a whole and individual clauses cannot be read in isolation. In CHITTY ON CONTRACTS, VOL.I (26th Edition), Pg 520-52, it is stated, "The whole contract is to be considered. 45. Turning to the case in hand, it is a settled law that a contract has to be read as a whole and individual clauses cannot be read in isolation. In CHITTY ON CONTRACTS, VOL.I (26th Edition), Pg 520-52, it is stated, "The whole contract is to be considered. Every contract is to be construed with reference to its object and the whole of its terms, and accordingly, the whole contract must be considered in endeavoring to collect the intention of the parties, even though the immediate object of inquiry is the meaning of an isolated clause." In Bank of India v. K. Mohandas, (2009) 5 SCC 313 , the Hon’ble Apex Court cited with approval the passage from the decision of the House of Lords in North Eastern Railway Company v. Lord Hastings, [1900] AC 260 and held as follows: 28. The true construction of a contract must depend upon the import of the words used and not upon what the parties choose to say afterwards. Nor does subsequent conduct of the parties in the performance of the contract affect the true effect of the clear and unambiguous words used in the contract. The intention of the parties must be ascertained from the language they have used, considered in the light of the surrounding circumstances and the object of the contract. The nature and purpose of the contract is an important guide in ascertaining the intention of the parties. 31. It is also a well-recognized principle of construction of a contract that it must be read as a whole in order to ascertain the true meaning of its several clauses and the words of each clause should be interpreted so as to bring them into harmony with the other provisions if that interpretation does no violence to the meaning of which they are naturally susceptible. [The North Eastern Railway Company v. Lord Hastings, (1900) AC 260]. 46. In the instant case also, Clauses 2.7 and 3.4 of the BoQ cannot be read in isolation and have to be read along with other provisions of the Contract. [The North Eastern Railway Company v. Lord Hastings, (1900) AC 260]. 46. In the instant case also, Clauses 2.7 and 3.4 of the BoQ cannot be read in isolation and have to be read along with other provisions of the Contract. In the instant case, Clause 2.7 forms part of main Clause 2 which has the following heading-"SURFACE EXCAVATION AND BACKFILL-Surface excavation including loading, transport, all lift and lead up to 3.0 km from the excavation area/working site, unloading at disposal site or stockpiles and maintenance of the disposal sites or stockpiles, construction of haul roads (if any) and its maintenance, complete in all respects". The various works under the heading of SURFACE EXCAVATION AND BACKFILL are mentioned as separate items under clauses 2.1 to 2.8.7. This essentially means that these items and rates are pertaining to clearing to surface excavation areas, excavation of soil, excavation of soft rock, excavation of hard rock, drilling and blasting, loading and transport of excavated material to upto initial lead of 3 km, handling excavated materials for extra lead beyond 3 km, backfilling and backfilling with concrete. A close reading of Clause 2 and its various sub-clauses from 2.1 to of the BoQ clearly indicates that all the items mentioned therein are with regard to material excavated at the project site in the course of surface excavation. Clause 2.6 therefore pertains to loading, transport including all lift and lead upto 3.0 km and unloading of materials excavated at the project site from the surface. Similarly Clause 2.7 pertains to handling of materials for extra lead beyond initial lead of 3.0 km of the materials excavated at the project site from the surface. 47. Clause 2.1 of the contract document namely "Particular Technical Specifications", Vol. Similarly Clause 2.7 pertains to handling of materials for extra lead beyond initial lead of 3.0 km of the materials excavated at the project site from the surface. 47. Clause 2.1 of the contract document namely "Particular Technical Specifications", Vol. 2, Part II broadly defines the scope of the work of "SURFACE EXCAVATION AND BACKFILL" as "The Specifications described herein cover the surface excavation and backfilling in and around structures, buildings, pipes, foundations, trenches, pits, channel, cable ducts, underground facilities & similar works and shall include all labour materials, plant and equipment necessary to carry out the excavation in all materials, the transportation and stockpiling or disposal of all excavated material into stockpiles or disposal areas including all leads and lifts as shown on the drawings or as approved by the Engineer-in-Charge." Clause 2.15 of the aforesaid contract document provides for mode and manner of disposal of excavated materials from surface excavation as follows: "2.15. Disposal of Excavated Materials (i) All materials from surface excavation suitable for use as backfill, concrete aggregates or for other purposes shall be stockpiled on the site within a radius of 3.0 km, as directed or approved by the Engineer-in-Charge, if the immediate placement in the final location in permanent works is not possible. (ii) Excavated materials which is not suitable for or is in excess of the permanent construction requirements, shall be disposed of within a radius of 3.0 km from the excavation place in the waste disposal areas shown on the drawings or in areas designated as such by the Engineer-in-Charge in the course of the work. (iii).. (iv).. (v) . (vi) (vi).. 48. Clause 2.17.2(vii) provides for extra payment for handling of excavated material from surface excavation beyond initial lead of 3.0 km and provides as follows: "Extra payment will be made for handling the excavated material beyond 3.0 km. Payment for handling of excavated material will be made at the Unit Price per cubic meter per km and the same will be applicable for all leads beyond initial 3.0 km. Measurement will be based on the hauled volume. The volume of the material will be measured during hauling operations by counting the number of return truck loads and will be calculated by applying the following bulk factor.." 49. Measurement will be based on the hauled volume. The volume of the material will be measured during hauling operations by counting the number of return truck loads and will be calculated by applying the following bulk factor.." 49. Clause 3.4 of the BoQ which provides for "Handling Excavated Materials for extra lead beyond initial lead of 3.0 km" at the rate of Rs. 198 per Cubic Mtr/Km, forms part of the main Clause 3 which has the following heading-"UNDERGROUND EXCAVATION-Underground excavation of Head Race Tunnel and Construction Adit including excavation by drill and blast, mechanical, manual or conventional methods; including all survey and setting out, all lifts and transportation and unloading at disposal sites upto 3.0 km from the nearest portal and including maintenance of the disposal sites. Stockpiles, construction of haul roads (if any) and its maintenance, complete in all respects .". Similarly, a closer scrutiny of Clause 3 and its various sub-clauses from 3.1 to 3.7 of the BoQ clearly shows that all the items mentioned therein are with regard to material excavated at the project site in the course of underground excavation. Clause 3.4 therefore pertains to loading, transport including all lift and lead upto 3.0 km and unloading of materials excavated at the project site by way of underground excavation. Similarly Clause 3.4 pertains to handling of materials for extra lead beyond initial lead of 3.0 km of the materials excavated at the project site by way of underground excavation. 50. Clause 3.1 of "Particular Technical Specifications", Vol. 2, Part II outlines the scope of the work of "UNDERGOUND EXCAVATION" as, "This chapter covers all excavation work for underground structures to be carried out by the Contractor under this contract and shall include all labour, materials, plant and equipment, all survey and setting out, all excavation, loading, transportation and disposal of materials to disposal or stockpile areas as well as the cleaning of excavated surfaces." Clause 3.10.1(iv) provides for extra payment for handling of excavated material from underground excavation beyond initial lead of 3.0 km and provides as follows: "Extra payment will be made for handling the excavated material beyond 3.0 km from the portal/working site as applicable. Payment for handling of excavated material will be made at the Unit Price per cubic meter per km and the same will be applicable for all leads beyond initial 3.0 km. Payment for handling of excavated material will be made at the Unit Price per cubic meter per km and the same will be applicable for all leads beyond initial 3.0 km. Measurement will be based on the hauled volume. The volume of the material will be measured during hauling operations by counting the number of return truck loads and will be calculated by applying the following bulk factors." 51. A reading of the contract document as a whole including Clauses 2.7 and 3.4 of the BoQ leaves no room for doubt that the item "Handling Excavated Materials for extra lead beyond initial lead of 3.0 km" at the rate of Rs. 198 per Cubic Mtr/Km as mentioned in Clauses 2.7 and 3.4 of the BoQ pertains to handling of excavated materials excavated from the work site by way of surface excavation or underground excavation for the purpose of its disposal in the waste disposal areas, if such waste disposal areas are beyond the initial lead of 3.0 km. As Clause 2.6 and 3.3 of the BoQ make it amply clear, the originally envisaged position in the contract is that such excavated material will be disposed of within the initial lead of radius of 3.0 km from the working site/portal at the rate of Rs. 495 per Cubic Metre (Surface excavation) and Rs. 7920 (underground excavation). However, any unforeseen eventuality has been taken care of by Clauses 2.7 and 3.4 that in case such waste disposal is not possible within the initial lead of radius of 3.0 km from the working site/portal, extra payment would be made at the rate of Rs. 198 per Cubic Mtr for every extra km. Thus, a reading of Clause 2.7 and 3.4 along with the contract document as a whole makes it abundantly clear that Clauses 2.7 and 3.4 pertain to handling of outbound excavated material which have been excavated from the project site by way of either surface excavation or underground excavation for its disposal in the designated waste disposal areas. Thus, it is abundantly clear, and leaves absolutely no room for doubt that the work "handling Excavated Materials for extra lead beyond initial lead of 3.0 km" at the rate of Rs. Thus, it is abundantly clear, and leaves absolutely no room for doubt that the work "handling Excavated Materials for extra lead beyond initial lead of 3.0 km" at the rate of Rs. 198 per Cubic Mtr/Km as mentioned in Clauses 2.7 and 3.4 of the BoQ is not the same, similar or identical work as "extra lead for transportation of sand and boulder from Government approved quarries to work sites" which apparently is handling of inbound construction material like sand, shingles and boulders from the government approved quarries located at a distance of 78 km from the project site of Package-I, 53 km from the project site of Package-II and 36.50 km from the project site of Package-III. As this is our categorical conclusion that the work "Handling Excavated Materials for extra lead beyond initial lead of 3.0 km" at the rate of Rs. 198 per Cubic Mtr/Km as mentioned in Clauses 2.7 and 3.4 of the BoQ is not the work "same" as the work "extra lead for transportation of sand and boulder from Government approved quarries to work sites", there is absolutely no scope for invoking Clause 33(ii)(a) of the Conditions of Contract. Clause 33(ii)(a) can be invoked only when the work executed is the "same" as the one provided in the BoQ. This is apparent from the very wording of Clause 33(ii)(a) which states that, "The rates already provided in the Bill of Quantities and as per the procedure mentioned above under sub-clause 33 of this part shall apply in respect of the same item(s) of work to be executed due to variations". The necessary corollary of the above is that since the item is not the same as mentioned in BoQ, the rate cannot be determined in terms of Clause 33(ii)(a) and hence the rates have to be determined in terms of Clause 33(iii) of the Conditions of Contract. Clause 33(iii) specifically provides that "If the rates for such items of work cannot be determined in the manner as specified in Clause 33(ii), the rates for such items to be executed shall be determined by the Engineer-in-Charge on the basis of actual analysed cost taking the following into consideration the rates for such items of works as are required to be executed due to deviations as stated in sub-clause shall be payable in the manner as stated hereunder..". We are of the firm view that this is the only possible interpretation of Clauses 2.7 and 3.4 of the BoQ and Clauses 32(ii)(a) and 33(iii) of the Conditions of Contract. No reasonable person would arrive at a different conclusion while interpreting Clauses 2.7 and 3.4 of the BoQ and Clauses 32(ii)(a) and 33(iii) of the Conditions of Contract. Any other interpretation of the above clauses would definitely be irrational and in defiance of all logic. 52. The Arbitral Awards and the findings of the learned Arbitrator suffer from the vice of perversity. The learned Arbitrator has taken into account various factors irrelevant in coming to the decision and has ignored vital clauses of the tender documents like Clause 2 and various Sub-clauses i.e. Sub-clauses 2.1 to 2.8.7 under Clause 2 and Clause 3 and various Sub-Clauses i.e. Sub-clauses 3.1 to 3.7 under Clause 3 of the BoQ, Clause 2 and various Sub-clauses i.e. Sub-clause 2.1 to 2.17.7 under Clause 2 and Clause 3 and various Sub-clauses i.e. Sub-clause 3.1 to 3.10.5 under Clause 3 of "Particular Technical Specifications", Vol. 2, Part II. The learned Arbitrator has taken into consideration an irrelevant fact that while making provisional payment, the initial lead of 3.0 km has been deducted and that this shows that Clause 2.7 and 3.4 of the BoQ are applicable. The provisional payment was an interim arrangement and was preceded by meetings dated 07.12.2012 and 08.12.2012 wherein it was specifically agreed between the parties that HoP, NEEPCO would take steps for referring the dispute to arbitration and that till the arbitral award, the payment would be made as per the prevailing provisional rate without any escalation and that final rate payable for transportation of sand and boulder shall be done on implementation of the arbitral award. As such the fact that provisional payment was made by deducting initial lead of 3.0 km was an irrelevant fact for deciding the issue. The findings of the learned Arbitrator having been arrived at by taking into account irrelevant factors and by ignoring vital clauses, the same suffers from vice of irrationality and perversity. As such the fact that provisional payment was made by deducting initial lead of 3.0 km was an irrelevant fact for deciding the issue. The findings of the learned Arbitrator having been arrived at by taking into account irrelevant factors and by ignoring vital clauses, the same suffers from vice of irrationality and perversity. It must be borne in mind that the Arbitral Awards in question are Declaratory Arbitral Awards and involved interpretation of Clauses 2.7 and 3.4 of the BoQ and Clauses 32(ii)(a) and 33(iii) of the Conditions of Contract and the learned arbitrator was required to interpret the same in accordance with the established rules of interpretation. The findings of the learned Additional Deputy Commissioner (Judicial), Shillong while upholding the arbitral awards of the learned Arbitrator also suffer from the similar vice. We are, therefore, of the considered view that that the common order dated 27.04.2018 passed by the learned Additional Deputy Commissioner (Judicial), Shillong in Arbitration Case No. 5 (T) 2016, Arbitration Case No. 6 (T) 2016 and Arbitration Case No. 7 (T) 2016 as well as the 3 (three) Arbitral Awards dated 29.03.2016 passed by the learned Arbitrator warrant interference in these appeals under Sec. 37 of the Arbitration and Conciliation Act, 1996. 53. There are additional reasons for interfering with order dated 27.04.2018 passed by the learned Additional Deputy Commissioner (Judicial), Shillong and the Arbitral Awards dated 29.03.2016 passed by the learned Arbitrator. As the learned counsel for the appellant has submitted, the potential effect of the Arbitral Award on public exchequer is that the appellant, which is a public sector undertaking, will have to pay a sum of about Rs. 3.56 Lakh for every truckload of 10 cubic metre of sand or boulder (travelling for 100 km) and the total potential effect would be about Rs. 1,000 Crore. We are of the considered view that payment of Rs. 3.56 Lakh per truck (10 Cubic Metre) of sand or boulder (100 km distance) is definitely a case of unjust enrichment which is contrary to the Fundamental Policy of Indian Law. Unjust enrichment being contrary to the Fundamental Policy of Indian Law is a ground for interference with an Arbitral Award under Sec. 34(2) of the Act. The Bombay High Court in Angerlehner Structural and Civil Engineering co. Unjust enrichment being contrary to the Fundamental Policy of Indian Law is a ground for interference with an Arbitral Award under Sec. 34(2) of the Act. The Bombay High Court in Angerlehner Structural and Civil Engineering co. v. Municipal Corporation of Greater Mumbai, MANU/MH/0554/2017 has recognized unjust enrichment of a party at the cost of public exchequer as being against the fundamental policy of Indian law. The Bombay High Court has held: "If the argument of the Contractors is accepted, it lead to them blatantly enriching themselves over and above what they are entitled. Such completely unjust enrichment, that too at the cost of public funds, is abhorrent under the fundamental policy of Indian Law. The award in AJECT, which permits such blatant enrichment is therefore is also vitiated on the ground that it is against the fundamental policy of Indian Law." We are also of the considered view that the Arbitral Award which would potentially result in unjust enrichment of the respondent to the extent of about Rs. 1,000 Crores is against the fundamental policy of Indian law and, therefore, warrant interference on this count as well. Though this court is not sitting in appeal over the award of the arbitral tribunal, the presence of grounds under Section 34[2] of the Act and the satisfaction arrived at by this Court in this regard, warrants interference more so, as the Arbitral Awards in question are Declaratory Arbitral Awards and involved interpretation of Clauses 2.7 and 3.4 of the BoQ and Clauses 32(ii)(a) and 33(iii) of the Conditions of Contract and the learned arbitrator was required to interpret the same in accordance with the established rules of interpretation and in line with the fundamental policy of Indian law. 54. The result of the above is that the common order dated 27.04.2018 passed by the learned Additional Deputy Commissioner (Judicial), Shillong in Arbitration Case No. 5 (T) 2016, Arbitration Case No. 6 (T) 2016 and Arbitration Case No. 7 (T) 2016 as well as the 3 (three) Arbitral Awards dated 29.03.2016 passed by the learned Arbitrator are hereby set aside. Further, it is hereby declared that the rates for "extra lead for transportation of sand and boulders from Government approved quarries to the work site" shall be determined by the Engineer-in- Charge in accordance with Clause 33(iii) of the Conditions of contract in the manner as provided therein. 55. Further, it is hereby declared that the rates for "extra lead for transportation of sand and boulders from Government approved quarries to the work site" shall be determined by the Engineer-in- Charge in accordance with Clause 33(iii) of the Conditions of contract in the manner as provided therein. 55. No order as to costs.