JUDGMENT :

(Prayer: This Petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 praying to set aside the arbitral Award of Respondents 2 to 4 dated 13.06.2011 and the further Award dated 14.12.2011 made in relation to Agreement No.14/Dy.CE/GC/MDU/HQ/2009.)

1. The Petitioners were the respondents before the Arbitral Tribunal. An arbitral award dated 13.06.2011 (the Award) and the further Award dated 14.12.2011 are assailed under Section 34 of the Arbitration and Conciliation Act, 1996 (the Arbitration Act). The Award and further Award are referred to collectively as the Awards.

2. A contract was awarded on 28.03.2009 to the first Respondent by the Petitioners for the work of doubling of track between Dindigul and Madurai section by gauge conversion. The total contract value was a sum of Rs.5,17,73,362/-. The contract was on measure and pay basis with a bill of quantities(BoQ) annexed thereto, and work was to be completed within a period of six months.

3. In spite of granting extensions, it is stated that the first Respondent did not complete work. Therefore, the work was awarded to a third party contractor and completed in such manner. The first Respondent made about 6 claims before the Arbitral Tribunal for an aggregate sum of Rs.1,33,85,336/-. By a reply statement, the Petitioners denied the claims and made four counter claims. The Arbitral Tribunal did not frame issues, but dealt with each claim and counter claim. Both parties adduced documentary evidence. Eventually, by the Awards, the Arbitral Tribunal awarded a sum of Rs.57,67,377/- + Rs.4,62,382.74, thereby aggregating to a sum of Rs.62,29,759.74, to the first Respondent herein. The said Awards are assailed herein. The three members of the Arbitral Tribunal are the second to fourth Respondents herein, who are neither necessary nor proper parties.

4. The Petitioner assails the Awards on three grounds. The first ground of challenge relates to claim No.1. Under claim No.1, several sub-claims were made. Sub-claims (A), (B), (C) and (D) were awarded by the Arbitral Tribunal at 100% of the relevant BoQ rate. The Petitioners challenge the same on the ground that Clause 43.6 of the Contract was relied upon by the Petitioners but disregarded by the Arbitral Tribunal. On the other hand, the first Respondent submits that the said clause was not disregarded by the Arbitral Tribunal. Clause 43.6 is as under:

“43.6. In case, increase in quantity of an individual non-schedule item by more than 25% of the agreement quantity is considered as unavoidable, the same can be got executed by floating a fresh tender. If floating a fresh tender is considered not practicable by Railways, negotiation will be held with the contractor for arriving at reasonable rates for additional quantities in excess of 125% of agreement quantity.”

5. The contention of the Petitioners that Clause 43.6 was disregarded is incorrect. In fact, the Arbitral Tribunal noticed Clause 43.6 and thereafter recorded the following finding at internal page 9 of the Award:

“Tribunal’s discussion and Award: Respondent Railways had addressed one letter to CE/CN/N/MS on 27-5-09 (Exhibit R.26). Accordingly, item No.5 of Annexure A and item 4, 40, 41, 42 of Annexure B were executed in excess over to agreement quantities. Because of this 90% of rate were admitted for payment. In that letter, they were furnished floating of tender is not practicable at this stage for additional quantities. For having ordered the work, non-releasing of payment is injudicious. When CE/CN/N/MS has given approval vide letter No.W.148/DG MDU/47/CN of 1-6-09 to conduct negotiation as per Clause 43.6 for quantities exceeding more than 25%. By extending currency by 2 times i.e. one from 4.8.09 to 31.12.09 and another from 1-1-2011 to 30-4-2011 works were given but could not find time interval for conducting negotiations to settle the payment for additional work done....”

6. In light of the above findings, it cannot be said that the Arb