The Arbitrator's decision is final, and the court's interference is limited to specified grounds. The court should not substitute its view for that of the Arbitrator, and the Arbitrator's interpretation of the contract and factual findings should be respected.

JUDGMENT :

A.S. BOPANNA, J.

1. The appellant-claimant has preferred this appeal against the judgment and order dated 20th July, 2010 passed by the Division Bench of the High Court of Madras partly allowing the appeal preferred by the respondent-Union of India under Section 39 of the Arbitration Act, 1940¹ [In short ‘1940 Act’] and interfering with the order dated 19th January, 2009 passed by the learned Single Judge in O.P. No. 663 of 1999, a petition filed by the respondent-Union of India under Sections 30 and 33 of the 1940 Act against the arbitral Award dated 24th June, 1999. Vide judgment dated 19th January, 2009, the learned Single Judge had dismissed the said petition filed by the respondent-Union of India and had upheld the Award. The Division Bench of the High Court has, however, set aside the amount awarded by the learned Sole Arbitrator in favour of the appellant herein towards idle hire charges and value of the tools and machineries. Further, the findings returned in the Award relating to extension of time and illegal termination of the contract by the respondent-Union of India in favour of the appellant-claimant were also set aside. On the remaining issues, the order of the learned Single Judge was duly confirmed and the decree upheld.

2. A conspectus of the facts of the case, relevant for disposing of the present appeal, are as follows:

On 16th November, 1988, the appellant-claimant, a construction company, entered into a contract with the respondent-Union of India for construction of a runway and allied works at the Naval Air Station, Arakonam for a total contract price of Rs. 19,58,94,190/- [Rupees Nineteen Crores fifty eight lakhs ninety four thousand one hundred and ninety]. As per the contract, the work was to be completed within a period of 21 months from the date of the commencement, ending on 23rd August, 1990. It is the stand of the respondent-Union of India that the site was handed over to the appellant-claimant on 24th November, 1988 and reckoned from the said date, the date of completion of the contract would have expired on 23rd August, 1990. On the contrary, the appellant’s stand is that it could commence the work only on 1st January, 1989, since the site was heavily waterlogged due to the rainy season. During the course of execution of the work, the appellant-claimant sought extension of time for completion of the project for 45 fortnights w.e.f. 15th July, 1992 as the probable target date. The respondent-Union of India granted extension of time thrice, firstly upto 31st December, 1990, then upto 30th June, 1991 and lastly upto 31st March, 1992. By Mid-March, 1992, the appellant-claimant claims to have completed the substantial work of construction of the runway and taxi track to the extent of 72%. Since the respondent-Union of India proposed to have the runway inaugurated by the then President of India on 11th March, 1992, the appellant-claimant had to hand back the site on 9th March, 1992 whereafter, for security reasons, the station became a restricted area. As a result, the appellant-claimant had to request the respondent-Union of India to issue passes for its staff, operators and labourers to complete the balance work. But no entry passes were issued. Instead, vide letter dated 2nd April, 1992 the contract was terminated with immediate effect by the Chief Engineer, who declined to extend the time any further for completion of the work which was otherwise to expire on 31st March, 1992.

3. Aggrieved by the aforesaid termination order, the appellant-claimant invoked the Arbitration Clause in the contract executed by the parties and a Sole Arbitrator was appointed to adjudicate the disputes between them. Several claims were raised by the appellant-claimant before the learned Sole Arbitrator. The respondent-Union of India also raised counter claims. The learned Sole Arbitrator framed as many as 33 issues and on evaluating the evidence and hearing the parties pronounced a detailed Award dated 24th June, 1