JUDGMENT :

1. Heard Sh. Anil Mahajan, learned counsel for the petitioner and Sh. Vishal Sharma, learned Assistant Solicitor General of India appearing for the respondents.

2. The petitioner is a proprietorship firm engaged in the contract business. It was awarded a contract on 22.03.2006 for a total amount of Rs. 26,50,442.82 which was to be completed by 30.09.2006. The said contract provided for the resolution of the disputes inter se the parties by means of arbitration and that the award has to be made within a maximum period of one year from the date of entry into arbitration.

3. Condition No. 70 of IAFW 2249 of the Contract providing for referring the dispute to the arbitrator is reproduced hereunder:-

"70. Arbitration.- All disputes, between the parties to the Contract (other than those for which the decision of the C.W.E. or any other person is by the Contract expressed to be final and binding) shall, after written notice by either party to the Contract to the other of them, be referred to the sole arbitration of an Engineer Officer to be appointed by the authority mentioned in the tender documents.

Unless both parties agree in writing such reference shall not take place until after the completion or alleged completion of the Works or termination or determination of the Contract under Condition Nos. 55, 56 and 57 hereof:

Provided that in the event of abandonment of the Works or cancellation of the Contract under Condition Nos. 52, 53 or 54 hereof, such reference shall not take place until alternative arrangements have been finalized by the Government to get the Works completed by or through any other Contractor or Contractors or Agency or Agencies:

Provided always that commencement or continuance of any arbitration proceeding hereunder or otherwise shall not in any manner militate against the Government's right of recovery from the contractor as provided in Condition 67 hereof. If the Arbitrator so appointed resigns his appointment or vacates his office or is unable or unwilling to act due to any reason whatsoever, the authority appointing him may appoint a new Arbitrator to act in his place.

The Arbitrator shall be deemed to have entered on the reference on the date he issues notice to both the parties, asking them to submit to him their statement of the case and pleadings in defence.

The Arbitrator may proceed with the arbitration, ex-parte, if either party, inspite of a notice from the Arbitrator fails to take part in the proceedings.

The Arbitrator may, from time to time with the consent of the parties, enlarge, the time upto but not exceeding one year from the date of his entering on the reference, for making and publishing the award.

The Arbitrator shall give his award within a period of six months from the date of his entering on the reference or within the extended time as the case may be on all matters referred to him and shall indicate his findings, along with sums awarded, separately on each individual item of dispute.

The venue of the Arbitration shall be such place or places as may be fixed by the Arbitrator in his sole discretion.

The Award of the Arbitrator shall be final and binding on both parties to the Contract."

4. On the petitioner's request in connection with the disputes arising from the said contract, the designated authority vide letter dated 31.07.2010 appointed Sh. Rajesh Kachwah, Superintending Engineer as the sole arbitrator. The said arbitrator entered upon the reference on 19.08.2010 and the award made by him was published on 11.06.2012.

5. The aforesaid award has been assailed by means of this petition under Section 34 of the Arbitration and Conciliation Act, 1996 (herein after referred to as 'the Act').

6. Apart from other submissions, the primary argument of learned counsel for the petitioner is that the award is in conflict with the public policy of India as the arbitrator acted arbitrarily in making the award even after he had ceased to exercise jurisdiction in the matter. The parties had agreed for t