Arbitrator's Jurisdiction Upheld by Supreme Court in Award Validity Case

The Supreme Court upheld the arbitrator's jurisdiction, finding the award valid despite being non-reasoned. The Court determined that the claims were arbitrable under the contract, rejecting challenges to the awarded amount as disproportionately high. However, the Court ruled that interest pendente lite was not within the arbitrator's jurisdiction and deleted that portion from the award. The appeal was dismissed, except for the modification regarding interest pendente lite, with parties directed to bear their own costs.

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Issues Involved:
1. Jurisdiction of the arbitrator.
2. Validity of non-reasoned award.
3. Arbitrability of claims under Clause 11 of the contract.
4. Proportionality of the awarded amount.
5. Award of interest pendente lite.

Issue-wise Detailed Analysis:

1. Jurisdiction of the Arbitrator:
The appellant contended that the arbitrator had no jurisdiction to deal with the claims raised by the respondent, arguing that these claims were fictitious and baseless. The arbitrator, however, proceeded with the arbitration, considering all evidence and making an award. The Supreme Court found that the arbitrator acted within his jurisdiction and the award was not made ex parte.

2. Validity of Non-reasoned Award:
The appellant argued that the non-reasoned award was invalid. However, the Supreme Court held that this contention was not raised before the lower courts and thus could not be entertained at this stage. The Court emphasized that arbitration is a method for speedy adjudication and that the law, as it stands, does not consider non-reasoned awards to be bad per se. The contention was rejected.

3. Arbitrability of Claims under Clause 11 of the Contract:
The appellant argued that Clause 11 of the contract made the decision of the Engineer-in-Charge final and binding on certain matters, thus excluding them from arbitration. The Supreme Court examined Clause 11 and its proviso, which stated that the decision of the Superintending Engineer of the Circle would be final in case of disputes about rates and time for completion. The Court found that the disputes adjudicated by the arbitrator were not covered by Clause 11 and thus were arbitrable. The Court rejected the appellant's reliance on similar cases from other jurisdictions, noting differences in contract clauses and dispute nature.

4. Proportionality of the Awarded Amount:
The appellant contended that the awarded amount of Rs. 15,23,657 for additional work was disproportionately high and per se bad. The Supreme Court reiterated that when parties choose their arbitrator, they cannot object to the decision on law or facts if the award is good on its face. The Court noted that the arbitrator was a qualified individual who considered all evidence and found no basis to declare the award disproportionately high or bad per se. The High Court's decision to uphold the award was affirmed.

5. Award of Interest Pendente Lite:
The Supreme Court held that the arbitrator did not have jurisdiction to grant interest pendente lite, referencing the decision in Executive Engineer (Irrigation), Balimela & Ors. v. Abhaduta Jena & Ors. The direction for payment of interest pendente lite was deleted from the award. The High Court's grant of interest from the date of the decree was sustained.

Conclusion:
The appeal was dismissed except for the modification regarding the deletion of interest pendente lite. The parties were directed to bear their own costs.

Appeal dismissed.

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