The court emphasized the importance of adhering to the terms of the contract and the need for Arbitrators to confine their decisions within the scope of the agreement, considering the specific obligations and responsibilities outlined in the contract.

1. Appellant has filed this appeal against order dated 23.7.2013, passed by learned Additional District Judge, Chandigarh, vide which application under Section 34 of the Arbitration and Conciliation Act, 1996 (in short, 'the Act') for setting aside the award dated 18.12.2003 was dismissed.

2. Facts of the case are that vide memo No. 201 dated 5.1.1996, the respondent No. 1- Sutlej Construction Limited, Chandigarh was granted the contract of earth work excavation and loading into trucks and unloading for the purpose of widening of approach road of Sukhna Choe on Chandigarh Kalka Road, Chandigarh. It was stipulated in the said memo that earth is to be lifted from the first source near the regulator and the same will be taken through trucks from Golf side and lead will be paid not more than 5 kilometre. After the earth from source No. 1 i.e. near the regulator is exhausted then on the written intimation given to the appellant for getting permission from the Superintending Engineer for lifting earth from the second source i.e. beyond the regulator, reduce rate of 4 kilometre will be paid. The contractor did not fulfill the contract and consequently, the same was terminated on 12.11.1996. Therefore, the contractor requested for appointment of Superintending Engineer as Arbitrator under Clause 25A of the agreement. Since no action was taken, the objector moved to the Civil Court for appointment of Arbitrator and accordingly, the Civil Judge (Senior Division), Chandigarh, vide order dated 31.7.2002 appointed Shri R.N. Singal, retired District & Sessions Judge as Arbitrator. The Arbitrator held that the contract was illegally terminated. Before the Arbitrator, following claims were made:--

"1. Balance payment accruing from the last running bill - Rs. 2,00,014/-

2. Payment due on account of transportation or earth not measured by department - Rs. 1,11,231/-

3. Payment due on account of less lead paid - Rs. 95,400/-

4. Idle hour charges of heavy earth moving machinery and labour deployed on the machinery - Rs. 31,22,280/-

5. Payment due on account of earth eroded by heavy rains due to non compaction of earth and leaking water pipelines - Rs. 1,69,206/-

6. Payment on account of loss of profit on balance work - Rs. 90,835/-

7. Loss due to prolongation of work - Rs. 12,80,000/-

8. Litigation expenses - Rs. 25,000/-"

3. The department also filed counter claim, claiming Rs. 8,01,808/- as liquidated damages and the expenses incurred by it for completion of work. It also claimed Rs. 20 lacs on account of the loss due to delay in completion of work. Arbitrator allowed claim No. 1 and allowed Rs. 1,20,299/- + Rs. 32000/- deposited by way of earnest money. Claim No. 2 was rejected. Claim No. 3 was allowed to the extent of Rs. 65,076/-. Claim No. 4 was allowed and Rs. 7,74,375/- were allowed. Claim No. 5 was rejected. In claim No. 6, a sum of Rs. 45,435/- was allowed. Claim Nos. 7 and 8 were also rejected. The counter claim was also rejected. Interest @ 12% per annum was also allowed. Total award for Rs. 10,37,185/- was passed.

4. The appellant filed objections against the award passed before the learned Additional District Judge, Chandigarh, which were rejected.

5. I have heard learned counsel for the parties and have also carefully gone through the file.

6. Learned counsel for the appellant has relied upon the authority Oil and Natural Gas Corporation Limited v. Western Geco International Limited, (2014) 9 Supreme Court Cases 262 and pressed that since the Arbitrator has misconducted and passed the award beyond the terms of agreement, therefore, this Court can interfere to set aside the same.

7. On the other hand, learned counsel for respondent No. 1 has placed reliance on authority Pr. Shah, Share and Stock Brokers Private Limited v. B.H.H. Securities (P) Ltd., (2012) 1 Supreme Court Cases 594 and has pressed that the Court cannot substitute its reasoning given by the Arbitrator nor reasoning by the Arbitrator can be re-assessed or re-appreci