JUDGMENT

Indira Banerjee, J. This Appeal is against a judgment and order dated 09.08.2016 of the Learned Single Judge,dismissing the petition of the appellant under Section 34 of the Arbitration and Conciliation Act, 1996, for setting aside an arbitralAward dated 02.05.2016, made by the majority of the arbitrators constituting the Arbitral Tribunal.

2. The Appellant, a multinational company registered under the laws of the Republic of Korea, is engaged in the field of infrastructure development, including construction of roads, highways, dockyards and various other projects across the world.

3. The Respondent, National Highways Authority of India, hereinafter referred to as NHAI, is a Government of India Undertaking responsible for the construction of National Highways throughout the country.

4. By a letter dated 30.12.2005, Respondent NHAI awarded to the appellant, the contract for the work of construction of the4-Lane Sagar By-pass from Km 297 to Km 351 on National Highway (NH) No.26 in the State of Madhya Pradesh (Contract Package-ADB-II/C-5) for a total contract value of Rs.219,01,16,805/- (Rupees Two Hundred Nineteen crores, one lac, sixteen thousand eight hundred five only). The Respondent NHAI issued notice to the appellants to commence work on 28.04.2006 and the Appellant commenced work on 28.05.2006.

5. At the time of submission of the bid in the year 2005 and commencement of the work in 2006, escalation was being paid by the respondent to the appellant under Sub-Clause 70.3 of the Conditions of Particular Application (COPA) on the basis of the Wholesale Price Index (WPI)of100 with the base year being 1993-1994(hereinafter referred to as the `Old Series') which the Ministry of Industrial Development, Govt. of India was publishing at the time. After August, 2010, the Ministry of Industrial Development, Govt. of India introduced the New Series with WPI of 100 and the base year was changed to 2004-2005 (hereinafter referred to as the `New Series').

6. After the publication of the New Series, the Appellant started raising the bills on the basis of indices published under the New Series (i.e., 2004-05=100) which had become applicable for calculation of Price Adjustment. However, the Respondent rejected the bills raised by the Appellant upon the application of the New Series and made provisional payment to the Appellant towards Price Adjustment.

7. The Respondent, due to the change in WPI Series, issued a Circular dated 15.02.2013 to provide a linking factor between the old and the new Series. A pertinent aspect of the said Circular, which forms the basis of the disputes between the parties, talks about the `weighted average linking factor and reads as follows:

"For payment of price adjustment after August 2010 for contracts based on 1993-94 series, average linking factor for individual items may be derived by taking average of the month-wise linking factor of the item obtained by dividing its index of old series of a month by index of its new series for that month for the year 2009-2010 (April 2009 to March 2010), when both the series are available." "The index for any item for any month in 1993-94 series beyond August, 2010 (when 1993-94 series is not available) may be worked out on the basis of available index of the item for the month in 2004-05 series by multiplying the same by the average linking factor for the item so obtained. Thus, payment on account of price adjustment is acceptable to them and they will not make any claim, whatsoever on this account in future after this payment".

8. Subsequently, the Appellant started raising the bills for payment from September 2010 onwards by applying the base index as well as indices under New Series directly without applying the linking factor.

9. Sub-clause 70.3 of the COPA specifies a formula for adjustment of the contract price for increase or decrease in rates and price of labour, materials, fuels and lubricants. In terms of item (ii) of Sub-Clause 70.3the