JUDGMENT R.M.S. Khandeparkar, J.
1. Heard. This appeal arises from the order dated 10th June, 1998 passed by the learned Single Judge in Arbitration Petition No. 30 of 1995. The said petition was filed under Section 30 of the Arbitration Act, 1940, hereinafter called as "the said Act", for setting aside the award dated 1st January, 1993 declared by the learned Arbitrator. The challenge to the award was confined and restricted to the Claim No. 2 therein. The said challenge being rejected by the impugned order, the present appeal has been preferred.
2. The facts in brief are that the appellants invited tenders in respect of the construction of multi storeyed warehouse at Sewree, Mumbai. The respondents' tender in respect of the said construction for a sum of Rs. 7,10,21,050.65 ps. was accepted by the appellants under their letter dated 1st September, 1987. The respondents commenced the work of the construction site on 9th September, 1987. In terms of the tender contract, the respondents were required to complete the work in 104 weeks. As the dispute arose between the parties, the respondents referred the matter for arbitration and the learned Arbitrator by his award dated 1st January, 1990 awarded increased rates for work done between 8th September, 1989 to 31st March, 1991. As regards the further dispute, the matter was referred to arbitration wherein under the award dated 1st November, 1990, the learned Arbitrator granted the respondents extension of time to complete the work upto 31st July, 1991. The respondents however were not able to complete all the work within the stipulated period and the appellants sought to terminate the contract under letter dated 23rd August, 1991. The respondents filed suit in this Court being Suit No. 357 of 1992, consequent to the termination of contract by the appellants. As there were several disputes which were raised subsequent to the declaration of both the earlier awards, third reference was made to the Arbitrator. The same was adjudicated and the award came to be declared on 1st January, 1993. Being dissatisfied with the award in relation to the Claim No. 2, the appellants filed the said petition which came to be dismissed by the impugned order.
3. The Claim No. 2 related to monetary relief over and above the one contained in Arbitration Awards dated 1st January, 1990 and 1st November, 1990 and over and above the claim set out in Claim No. 1 on the ground of prolongation of contract.
4. We have heard the learned advocates for the parties as well as we have perused the written submissions filed on behalf of both the parties. We have also perused the records.
5. It has been submitted on behalf of the appellants that undisputedly the increased rates were granted by the award dated 1st January, 1990 for all the work done from 8th September, 1989 till 31st March, 1991 which included the extended period. Referring to the definition of rates and prices and the methodology for calculating the same which is revealed from the said definition, it is submitted on behalf of the appellants that the rates and prices were to include the provision for plant, labour, supervision, materials, erection, insurance, maintenance, overheads and profits and every incidental and contingent cost and charges whatsoever including Sales Tax, General Tax and for compliance with the conditions of contract and the specifications, and therefore, it was clear that while fixing the rates for the entire period including the extended one all the relevant factors were taken into account for arriving at the unit rates, and therefore, there was no occasion or justification for entertaining and granting the Claim No. 2 which was nothing but repetition of Claim No. 1. In other words, it is the contention on behalf of the appellants that the amount which is sought to be claimed under the Claim No. 2 has already been included under the Claim No. 1, and therefore, the learned Arbitrator misconducted himself in awarding Claim No. 2 in addition to Claim No. 1. In that regard, attention is drawn to the consent terms and in particular the Clause Nos. 2, 4, 5 and 12 thereof filed in the Suit No. 357 of 1992 while contending that the same nowhere entitles the respondents to canvass the Claim No. 2. In short, it is the contention on behalf of the appellants that all necessary components were taken into account by fixing unit rates by the first award upto the period of 31st March, 1991 and by the impugned award in relation to the Claim No. 1 for the period after 31st March, 1991, and thus, items like overheads and profit and other incidental and contingent cost and charge whatsoever were taken into account while fixing unit rates, and therefore, there was no scope for awarding any sum in respect of the Claim No. 2 over and above the one contained in Arbitration Award dated 1st January, 1990 and over and above the claim made in Claim No. 1 of the impugned award.
6. On the other hand, it has been submitted on behalf of the respondents that the ground which is sought to be canvassed was not at all raised in the petition filed under Section 30 of the said Act and considering the provisions of the said Section 30, it is not permissible to raise any such new ground in the course of hearing of the appeal. Reliance is sought to be placed in the matter in Bijendra Nath Srivastava Bijendra Nath Srivastava Bijendra Nath Srivastava (Dead) Through LRs. v. Mayank Srivastava and Ors. . It is sought to be contended that though the award in relation to the claim No. 2 was sought to be challenged, it was not challenged on the ground on which it is sought to be challenged in the proceedings under Section 30 of the said Act. If the impugned award is allowed to be challenged on the ground which is now sought to be canvassed, it would virtually amount to allow the appellants to raise such ground beyond the period of 30 days from the date of declaration of the award in contravention of the said provision of the said Act and the law laid down by the Apex Court in Bijendra Bijendra Bijendra Nath Srivastava's case (supra). The attention is also drawn to the petition under Section 30 of the said Act while contending that the four grounds specifically raised therein, nowhere discloses the ground sought to be canvassed by the learned advocate for the appellants in the course of argument as well as in the written submissions. Without prejudice to the said contention, it is the submission on behalf of the respondents that the Claim No. 2 was on account of loss of overheads and profits and for loss due to underutilisation of machinery caused due to prolongation of the contract and the same is different from the claim for increase in unit rates and the same was clearly permissible in terms of Clause 12 of the consent terms filed in the said suit. While Clause 5 of the consent terms entitles the respondents to claim for unit rate for the items executed after 1st April, 1991 till 28th February, 1993, the Clause 12 sets out an independent head of claim arising out of prolongation of contract, and therefore, no fault can be found with the impugned award in that regard. The learned Arbitrator has correctly understood the import of Clause 12 of the consent terms. Even assuming that the learned Arbitrator committed an error in construction of the said terms of the contract between the parties, it is not permissible for the Court to interfere in exercise of power under Section 30 of the said Act and for the same reason, the Appellate Court cannot unsaddle the award on that count. Reliance is sought to be placed in Sudarsan Trading Co. v. The Govt. of Kerala and Anr. reported in AIR 1989 SC Food Corporation of India v. Joginderpal Mohinderpal and Anr. . It is further contention on behalf of the respondents that the arbitrator was not under obligation to give reasons in the absence of specific requirement in that regard. Reliance is placed in State of Orissa and Ors. v. Lall Brothers and Raipur Development Authority etc. v. Chokhamal Contractors etc. reported in AIR 1990 SC 1426.
7. In the facts and circumstances of the case and on consideration of the rival contentions, the first point which arises for consideration is whether the ground canvassed for challenging the impugned order and the impugned award in relation to the Claim No. 2 is a totally new ground which was never raised in the Petition under Section 30 of the said Act, and that therefore the appellants are not entitled to canvass the said ground in the appeal?
8. As far as the petition under Section 30 of the said Act is concerned, undisputedly, the award in relation to the Claim No. 2 was challenged only on four grounds which read thus:
A. In respect of Claim No. 2, the Petitioners say and submit that the Learned Arbitrator had totally misconstrued the concept (extension of time) to the Respondents to complete the contract. The misconstruction of the Learned Arbitrator showed that the award is erroneous and is indicative of error apparent on facts and in law and that the Award in totally prejudiced and the Learned Arbitrator has not approached the question in dispute with the requisite application of mind. The Petitioners state that the Learned Arbitrator has failed to appreciate that the Respondent had failed to make any application for extension of time. No application for the alleged extension of time was made by the Respondents nor any such engineer has given his decision as permitted in Clause 10.3 of the conditions. The Petitioners state that only if the claim for extension of time is rejected by the Engineer, there can be a dispute which can be referred to arbitration. The very fact that no application for extension of time was made by the Respondents after November, 1990 establishes that the Respondents have no valid ground for seeking extension of time and that the same was only an attempt to delay the work and for reasons stated hereinabove, the said award is bad, illegal untenable at law and liable to be set aside.
B. The Petitioners state that the learned Arbitrator has clearly stated "In my first Arbitration Award dated 1st January, 1990, I had awarded increased rate to M.S.C. for the work done from 8th September, 1989 upto 31st March 1991." "For the period beyond 8th September, 1989, the total evidence before me suggests that M.S.C. had not deployed the requisite resources fully to achieve the interim progress as per the Bar Chart furnished by the M.S.C. from time to time". "From the total evidence before me, it is clear that no details about the claim were furnished by M.S.C. to B.P.T. at the any time earlier to the present Arbitration case". "No opportunity was given by M.S.C. to B.P.T. at the relevant time to check up if really any items of machinery of M.S.C. were remaining unutilised at site and to take appropriate steps to mitigate the possible losses. After the aforesaid observation it is really strange that the Learned Arbitrator has come to the conclusion that be, therefore, considered that it is not possible for M.S.C. to perform the Contract within the original period of two years, i.e. upto 8th September, 1989 for reasons beyond their control, resulting in loss in the overhead underutilization of heavy machinery. It is inconceivable that the learned Arbitrator has held "On this background I award that M.S.C.'s claim No. 2(i) is tenable". The Petitioners say and submit that the reasons given by the Learned Arbitrator in coming to the conclusion are totally contrary to and inconsistent with the conclusion arrived at by him and the conclusions arrived at by him are of such a nature that no reasonable prudent person would arrive at after the requisite application of mind and that the same is clearly indicative of an error apparent on the face of the record and or clearly above that the Award is perverse and has been given by a person clearly biased in favour of the Respondents and is consequently liable to be set aside.
C. The Petitioners further submit that a further error apparent on the face of the record is obvious from the finding of the Learned Arbitrator that the extension of time upto 28th February, 1993 is deemed to have been granted to MSC by BPT with the province that MSC shall achieve fortnightly targets as per Bar Chart at annexure "A" to the Consent Terms. On the basis of the said reasoning, Counterclaim No. 2(II) of the Petitioners was held to be untenable. The Petitioners state that the said conclusion is also indicative of an error apparent on the face of the record and shows bias on the part of the Learned Arbitrator in favour of the Respondents as it will be further observed that not a single Counter-claim of the Petitioners has been granted by the Learned Arbitrator. The Petitioners submit that consequently the same is liable to be set aside by this Hon'ble Court.
D. paragraph 14.8 of the said Award of the Learned Arbitrator, claim No. 2(III) has been granted by the Learned Arbitrator without any reasoning whatsoever and it appears to have been absolutely illegally granted at random and the same is clearly perverse, reveals bias on the part of the Learned Arbitrator and clear non-application of mind on his part. The said para merely says "considering the claim of M.S.C. in totality including the demand of interest, I award that BPT shall pay to MSC an amount of Rs. 30 lacs". This clearly shows non-application of mind to the proper facts of the case and the evidence on record, especially that the Petitioners themselves procured steel for and on behalf of the Respondents for the purposes of carrying on the construction work for which the Petitioners themselves had paid, in respect of which the Respondents have failed and neglected to compensate the Petitioners.
9. The first ground of challenge in the petition refers to misconstruction of the concept of extension of time to complete the contract and failure on the part of arbitrator to appreciate that there was neither any application for extension of time after November, 1990 nor any decision in terms of Clause 10.3 of the conditions of the contract. There was delay without any valid ground for extension of period for completion of contract. The second ground of challenge is that the reasons given for arriving at the conclusion are contrary to the conclusions themselves, besides that the conclusions are such that no reasonable prudent person would arrive at. The third ground of challenge is that the finding that the extension of time to complete the work under the contract upto 28th February, 1993 was deemed to have been granted by the appellants to the respondents is indicative of error apparent on the face of record. The fourth ground of challenge is that the award has been made without reasons and discloses non application of mind to the materials on record which reveals that the steel required for the work was procured by the appellants on behalf of the respondents and price thereof was also paid by the appellants but the same was not reimbursed by the respondents. In short, the challenge to the award in the petition under Section 30 of the said Act is on the ground that the arbitrator has misconducted himself in misconstruing the contract and in arriving at the findings contrary to the reasonings as well as that the award being declared without reasons.
10. The petition under Section 30 of the said Act is, therefore, essentially on the ground of misconduct on the part of arbitrator. The ground of misconduct on the part of arbitrator is sought to be substantiated in the petition on four counts:
(i) Misconstruction of the concept of extension of time;
The misconstruction of concept of extension of time is alleged on the basis of:
(a) Absence of application for extension; and
(b) Absence of decision under Clause 10.3 of the Contract.
(ii) Conclusions being contrary to the reasons:
(iii) Extension of period being deemed to have been granted.
(iv) Absence of reasonings in support of findings in the award.
The allegation of misconduct and the basis for the same are thus specifically stated as above in the petition under Section 30 of the said Act.
11. The ground of challenge canvassed in the course of the arguments in the appeal though relates to the misconduct on the part of the Arbitrator in awarding Claim No. 2 but it pertains to the contention about ignoring the fact that the amount in relation to Claim No. 2 is already covered by the Claim No. 1 and the award dated 1st January, 1990. This ground is nowhere reflected in any of the four grounds pleaded in the petition and the basis enumerated in support thereof, which are quoted hereinabove. Ex facie, it is clear that the plea which is sought to be canvassed in the course of arguments for challenging the impugned order and the impugned award is nowhere reflected from the pleadings in any of the four grounds along with the basis thereof quoted above from the petition filed by the appellants under Section 30 of the said Act.
12. The Apex Court in Bijendra Nath Srivastava's Bijendra Nath Srivastava's Bijendra Nath Srivastava's case (supra), while dealing with the contention that the amendment application to the petition under Section 30 of the said Act was wrongly entertained inasmuch as that an objection to the award could not be raised after expiry of 30 days from the date of service of notice under Section 14 of the said Act, held that the Court should not lose sight of the well recognised distinction between statement of material facts which are required under Order 6 Rule 2 of the Code of Civil Procedure and the particulars which are required to be stated under Order 6 Rule 4 of the Code of Civil Procedure. Referring to its earlier decision in the matter of Samant N. Balkrishna v. George Fernandez in the context of Section 83(1)(a) and (b) of the Representation of the People Act, 1951, which contained provisions similar to Order 6 Rules 2 and 4 of the Code of Civil Procedure, the Apex Court reiterated the said decision in George Fernandez's case George Fernandez's case George Fernandez's case on the subject of difference between the material facts and the particulars. It was held in George Fernandez's case George Fernandez's case George Fernandez's case in that regard that:
The word `material' shows that the facts necessary to formulate a complete cause of action must be stated. Omission of a single material fact leads to an incomplete cause of action and the statement of claim becomes bad. The function of particulars is to present as full a picture of the cause of action with such further information in detail as to make the opposite party understand the case he will have to meet. There may be some overlapping between material facts and particulars but the two are quite distinct. The material facts thus will show the ground of corrupt practice and the complete cause of action and the particulars will give the necessary information to present a full picture of the cause of action. In stating the material facts it will not do merely to quote the words of the section because then the efficiency of the words `material facts' will be lost. The fact which constitutes the corrupt practice must be stated and the fact must be correlated to one of the heads of corrupt practice. Just as a plaint without disclosing a proper cause of action cannot be said to be a good plaint, so also an election petition without the material facts relating to a corrupt practice is no election petition at all.
If a petitioner has omitted to allege a corrupt practice, he cannot be permitted to give particulars of the corrupt practice.
One cannot under the cover of particulars of a corrupt practice give particulars of a new corrupt practice. They constitute different causes of action.
Having reiterated the said decision in George George George Fernandez's case, the Apex Court ruled that:
This is in consonance with the rule that a charge of fraud must be substantially proved as laid and that when one kind of fraud is charged, another kind of fraud cannot, upon the failure of proof, be substituted for it. See Abdool Hoosein Zenail Abadin v. Charles Agnew Turner (1887) 14 1A 111 : ILR (1887) 11 Bom. 620 (PC). The same is true for the charge of misconduct. This means under Order 6 Rule 4 CPC particulars have to be furnished of the plea of fraud or misconduct raised in accordance with Order 6 Rule 2 CPC and it is not permissible to introduce by way of particulars a plea of fraud or misconduct other than that raised in the pleadings.
(Emphasis supplied.)
13. The Apex Court referring to the facts of Birendra Nath Srivastava's case (supra), wherein the grievance was relating to paragraphs 52 and 53 which were added by way of amendment, observed that in paragraph 52 it was alleged that the arbitrator had misconducted the proceedings by returning the papers and documents specified in sub-paragraphs (i) to (iii) to the parties who had submitted the said papers and documents during the course of the proceedings. In paragraph 53 it was alleged that the arbitrator had misconducted the proceedings falsely showing the presence of Birendra Nath Srivastava in the proceedings dated 18-10-1966, 20-10-1966, 25-10-1966, 4-11-1966 and 10-11-1966 in spite of the fact that he fully knew that the said Birendra Nath Srivastava was absent from the proceedings from 10-10-1966 till the close of the proceedings on 10-11-1966. On perusal of the averments contained in the original petition which was filed by Birendra Nath Srivastava on 3rd July, 1967, the Apex Court observed that although in the said objections various acts of misconduct had been imputed to the arbitrator in several paragraphs, there was no averment in any of the paragraphs imputing misconduct of the nature mentioned in paragraphs 52 and 53 which was sought to be inserted by way of amendment. Further referring to paragraphs 41 and 45 of the original petition, it was observed by the Apex Court that the objection raised in paragraph 41 in the original petition was to the effect that during the course of the arbitration proceedings the arbitrator had met and heard individual members in the absence of others and the enquiries which were made by the arbitrator behind the back of others had been kept secret and were not disclosed. The said objection did not refer to any misconduct arising on account of recording the presence of a party in the proceedings even though the said party was not present on the date to which the proceedings relate. Referring to the paragraph 45 in the original petition, it was observed that it contained a general objection regarding failure to follow the principles of natural justice by the arbitrator and denial of equal opportunity to the objector while the misconduct referred to in paragraphs 52 and 53 was of different nature and was not covered by the objection in paragraph 45.
14. The law on the point in issue is very clear to the effect that while challenging the award under Section 30 of the said Act on the ground of arbitrator having misconducted himself, the petitioner has to disclose the basis on which the allegation of misconduct is attributed to the arbitrator. The petition should disclose the basis on which the arbitrator is stated to have misconducted himself or the proceedings and the pleadings in that regard should be specific. Once the basis as regards the allegation of misconduct are disclosed, the petition will have to be considered in relation to the alleged misconduct of the arbitrator with reference to such basis without permitting the petitioner to substitute or supplement or to add the basis in relation to the allegation of misconduct, unless such substitution or addition of the basis is preferred within the period of limitation within which the petition under Section 30 of the said Act can be filed. Once the basis in support of the allegation of misconduct are disclosed, the same cannot be substituted or added after expiry of the period of limitation referring the objection under the said Section, because in that case it would virtually amount to introducing a new cause of action in relation to the alleged misconduct on the part of the arbitrator or the proceedings and the same is not permissible bearing in mind the mandate of Section 30 of the said Act read with the provisions of law as incorporated under Order 6 Rules 2 and 4 of the Code of Civil Procedure and explained by the Apex George Fernandez's case (supra) and reiterated in Birendra Nath Srivastava's case (supra). Birendra Nath Srivastava's case (supra). Birendra Nath Srivastava's case (supra).
15. As already seen above, when the petition came to be filed by the appellants, the allegation of misconduct was specifically on the grounds enumerated and quoted in paragraph 9 hereinabove. The basis for those grounds were disclosed as stated in the same paragraph. However, the ground which is canvassed in the course of hearing of the appeal, orally as well as in the written submissions, for challenging the impugned award in relation to the Claim No. 2 is neither revealed from the grounds enumerated in paragraph 9 nor from the basis disclosed thereunder. In other words, the ground on which the impugned award is sought to be challenged at this stage was never raised in the objection filed under Section 30 of the said Act, and therefore, the appellants are not entitled to seek interference in the impugned order and award on any such new ground. There is no dispute on the point of law in that regard.
16. Besides, it is settled position in law that the arbitrator is the sole Judge of quality as well as quantity of evidence and it is not for the Court to take upon itself the task of being a Judge on the evidence before arbitrator. The interpretation of a contract is a matter for the arbitrator and the Court cannot substitute its own decision in that regard. Sudarsan Trading Co. (Supra).
17. It Is also a settled law that the arbitrator can construe the effect of the contract and the finding arrived at in that regard by the arbitrator upon such exercise cannot be said to be impermissible nor the Court is empowered to substitute such finding. If the construction arrived at by the arbitrator is conceivable and possible, the Court cannot modify the same. If the arbitrator has construed a particular term of contract between the parties, and if it cannot be said that the arbitrator's construction is not plausible then the Court cannot substitute its construction for the construction of the documents arrived at by the arbitrator. The Court cannot sit in appeal over the views expressed by the arbitrator in relation to the assessment of the evidence. Vide : Food Corporation of India (supra).
18. It is also settled position in law that under the said Act the award can neither be remitted nor set aside merely on the ground that it does not contain reasons in support of the conclusion or the decision reached in it except where the arbitration agreement or the deed of submission requires him to give reasons when the award is declared under the said Act. The arbitrator or the umpire under the said Act is under no obligation to give reasons in support of the decision reached by him unless under the arbitration agreement or in the deed of submission he is required to give such reasons. Vide : Raipur Development Raipur Development Raipur Development Authority (supra).
19. Considering the provisions of law and the facts of the case, once it is apparent that the ground which is sought to be canvassed in the appeal is totally foreign to the grounds which were raised for assailing the award in the petition under Section 30 of the said Act as also the basis on which the alleged misconduct is sought to be attributed to the learned arbitrator was totally different from the one canvassed in the appeal, and hence the same is not permissible. The law in that regard is well settled. Hence, the question of interference in the impugned order on a totally new ground does not arise at all.
20. Since, apart from the said new ground, no other ground is canvassed, the appeal fails and is hereby dismissed. There shall be no order as to costs.