Judgment

KAILASAM, J. - This appeal is preferred by the Orissa Mining Corporation Ltd., (a Government of Orissa Undertaking) by special leave against the judgment and decree dated February 20, 1976 of the High Court of Orissa where by the High Court upheld the judgment of the Subordinate Judge, Rourkela refusing to set aside the award of the arbitrator directing payment of certain moneys to the respondent herein

2. The respondent is a partnership firm carrying on business of transport, mining, loading and unloading etc. with its office at Rourkela. The appellant called for a tender for the work of raising of iron ore in Khandadhar Mines and transporting it to Barsuan Railway siding, including wagon loading. An agreement was entered into between the appellant and the respondent for a period of one year with effect from May 25, 1971. The estimated value of the contract was Rs. 6,77,040. The respondent under the terms of the contract was required to work in quarry Nos. 1 and 2 in Khandadhar Mines but during the progress of the work, on the directions of the appellant, the respondent worked in quarry No. 5 also which was at a distance of about 2 K. M. from quarry Nos. 1 & 2. As the respondent had to cover an extra distance between quarry Nos. 1 & 2 and quarry No. 5 he demanded extra cost for the transport. The respondent also demanded cost for construction of a road at the Schedule rate provided by the State P.W.D., Orissa, and submitted two bills, Bill No. 1 dated March 31, 1972 and Bill No. 2 dated May 1, 1972 for Rs. 62,477.50 and Rs. 6,104.50 respectively amounting to Rs. 68,582.00 in all for the extra load in transporting. A claim was also made towards the cost of constructing a road from quarry No. 5 for Rs. 25,000. As in spite of repeated reminders the appellant did not pay for the bills the respondent called upon the appellant to refer the disputes for arbitration according to the contract. The respondent filed an application under S. 20 of the Arbitration Act for a direction to the appellant to file the agreement in court and for the appointment of a Superintending Engineer of the state P.W.D. as the sole arbitrator and a reference to him to give his award on the dispute. The respondent, for the purpose of court-fee and jurisdiction, valued the suit at Rs. 93,582. The Subordinate Judge, Rourkela, after notice to the appellant and after hearing the parties ordered "that the said agreement be filed, and it is further ordered that the following matters in difference specified in the said agreement No. 4/F2 of 1971 arising in this suit namely for demand of payment of Rs. 93,582.00 on account of raising iron ore from quarry Nos. 1 and 2 at Khandadhar Mines and transporting the same to the Barsuan Railway siding including loading of wagons and also for the same work as per the subsequent order in respect of quarry No. 5 which was at a distance of 2 kilometres away from quarry Nos. 1 and 2 and for extra changes for this extra load of transporting and for construction of a road from quarry Nos. 1 and 2 to the quarry No. 5 be referred for determination..........of the arbitrator."

3. The arbitrator on receipt of the order of reference issued notice to the parties calling upon them to file their respective statements and the documents on which they intended to rely on and to produce witnesses. The parties filed their respective statements and the arbitrator took up the hearing of the dispute. The respondent in these proceedings made a claim of Rs. 68,582 under the head "4. Extra as the distance came to 1.4 Kms. after verification from the same quantity mentioned in the Bill Nos. I and II." The arbitrator inspected the site and measured the distances. Regarding the claim of Rs. 25,000 for construction of the road the arbitrator found that the respondent is not entitled to it and rejected the claim.

4. Regarding the claim for transport of the iron ore for the extra distance from quarry No. 5 the respondent made an additional claim for