Arbitrators have full authority to construe the effect of a contract clause to settle disputes between parties, and even if such construction is erroneous, it cannot be corrected by a court unless it results in a manifest error of law or fact apparent on the Award.

( 1 ) THIS is an appeal against the judgment and order dated October 4, 1996 of a Single Judge of this court, by which an application under section 30 of the Arbitration Act, 1940, to set aside an award dated June 10, 1995 was dismissed.

( 2 ) A dispute relating to the claim for rentals of equipments and for supply of chemicals arising out of a contract between the parties was referred to the joint Arbitrators, Mr. Alok Chandra Gupta (nominated by ONGC) and Mr. R. P. Bhatt (nominated by Dowell) both retired judges of High Court. At the close of the reference proceeding, there was an Award in favour of the claimant (Dowell) directing the appellant (ONGC) to pay the following amounts with interest @ 7. 5 per cent per annum from 1st April, 1994 till the date of payment as also a sum of Rs. 25,000 as costs of arbitration :- (1) Claim for rentals of equipment (payable is US$) (2) Claim for difference in exchange rate an the invoice for supply of chemicals (payable in Rupees at the DD buying exchange rate on the date of payment. US$ 345,449. 39 us$ 16,345. 27

( 3 ) THE Award was challenged on the grounds with regard to the authority of the joint Arbitrators in construing the terms of the contract and also there being errors of facts and in law said to be apparent on the body of the Award. A question was, therefore, raised as to the extent of interference by a court of law with regard to the contentions raised as such. A long catena of authoritative decisions with regard to propositions of law was cited on the either side before the Single Bench where the appellant did not, however, find favour to accept its contention and, accordingly, the matter has been brought before this Bench. It may be added here that in the event of there being no default in conducting the proceeding of an arbitration as being an admitted case here there usually arises only the question as to how the terms of the contract have been interpreted by the arbitrators and if such interpretation has resulted into some apparent errors in the Award with regard to the facts. Any interference by a court of a law was however restrictive as provided under section 30 of the Arbitration Act, 1940. It was only the extent of restriction that has thus been always in anxiety for a court of law so as to determine the same in the given facts of a particular case and to sub-serve the cause of justice.

( 4 ) AT this juncture I may advert to the factual matrix of the case that can be fairly summarised as follows. By a contract in writing dated December 26, 1988 the respondent Dowell, agreed to let on certain equipments including Coil Tubing Unit (CTU) and Nitrogen Unit (N2) for production testing on-shore and off-shore rigs for one year with option to renew and extend the period. By an Addendum-I to the original contract, the term was extended for a further period of 10 months from 2. 8. 89 to 1. 6. 90 or till completion of testing of SMB-4 well of Calcutta off-shore project. The rental for the equipment was to be applicable from the date complete set of equipment, is off-loaded at Calcutta/haldia and made in a condition to full readiness to commence work and was to cease the day the equipments reached the port of entry. The contract provided that Dowell, the respondent, shall arrange for inland transportation of equipments/chemicals from one place to another as required by the company in connection with the requirement of jobs but the contractor will engage any transport agency with prior approval of the company in this regard. There was a term of contract as "force Majeure" as per which in the event of either party being rendered by a "force Majeure" to perform any obligations required to be performed by them under the contract, the relative obligation of the party effected by such "force Majeure" was upon notification to the other party to be suspended for the period during which such cause lasted.

( 5 ) PURSUANT to the above contract, on 24. 3. 90 instructions w