Limited Section 37 review of arbitral awards: plausible contract interpretation cannot be replaced by a court's preferred reading.

Section 37 interference with an arbitral award remains narrowly confined, and a court should not substitute its own reading of contractual clauses merely because another interpretation is possible. The dispute concerned valuation of excess geogrid quantity under contract terms governing variations and the Bill of Quantities. The article notes that the fact-finding forums and Single Judge treated the excess quantity as a BOQ item rather than an instructed variation, and the Supreme Court reiterated that a plausible arbitral interpretation of contractual terms must stand. A Division Bench that re-read the clauses through dictionary meaning and reappreciated the factual matrix was said to have exceeded Section 37 limits.

---

---

Issues: Whether the Division Bench was justified in setting aside the arbitral award, despite the award having been upheld under Section 34 of the Arbitration and Conciliation Act, 1996, on the ground that the interpretation of the contractual clauses was implausible or contrary to public policy.

Analysis: The dispute turned on the interpretation of the contractual clauses governing variations and valuation. The fact-finding bodies and the learned Single Judge held that the increase in geogrid quantity was not an instructed variation, but only an increase in quantity beyond the Bill of Quantities, and therefore the BOQ rate applied. The Court reiterated that interference under Section 34 is narrow and that appellate interference under Section 37 is even more circumscribed. An arbitral award interpreting contractual terms should not be disturbed if the view taken is plausible, merely because another view is possible. The Division Bench, by reinterpreting the clauses through dictionary meaning and by reappreciating the contractual and factual matrix, exceeded the permissible limits of Section 37 jurisdiction.

Conclusion: The Division Bench was not justified in setting aside the arbitral award. The arbitral award restored the contractor's entitlement to payment at the BOQ rate for the excess quantity of geogrid.

Ratio Decidendi: Interference under Section 37 of the Arbitration and Conciliation Act, 1996 cannot travel beyond the narrow limits applicable to Section 34, and an arbitral interpretation of contractual terms that is plausible cannot be substituted merely because the court prefers a different interpretation.

---