IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA CARBC No.50 of 2026 Reserved on 16.07.2026 Decided on 30th July 2026 State of Himachal Pradesh and another …Petitioners Versus M/s Mountain Movers Tara Devi Shimla …Respondents Coram Hon’ble Mr. Justice Ajay Mohan Goel, Judge 1Whether approved for reporting? For the petitioners: Mr. Sanjay Dutt Vasudeva, Deputy Advocate General. For the respondents: Mr. J.S. Bhogal, Senior Advocate, with M/s T.S. Bhogal, Srishti Verma and Swati Verma, Advocates. Ajay Mohan Goel, Judge (Oral) By way of this petition, the petitioners have prayed for the following relief:- “It is therefore, prayed that the objections as filed by the objectors may kindly be accepted and the award dated 24.12.2016 passed by the learned Sole Arbitrator in the above titled case may be set aside, so as to secure the ends of justice.” 2. The case of the petitioners is that the work of extension of carriage way on improved curves, kilometers 2 200/0 to 209/0 on NH-22 in the State of Himachal Pradesh was awarded to the respondent-claimant by the Executive Engineer NH Division HPPWD Rampur Office vide letter dated 24.03.1998 for a sum of ₹2,06,29,536/-. The stipulated period for the completion of said work was one year, which was required to be completed on or before 07.04.1999. After the execution of contract between the parties, certain disputes were raised after the execution of the work by the contractor and, accordingly, Engineer-in-Chief appointed retired Chief Engineer Shri Sunil Sharma as an Arbitrator in terms of the contract entered into between the parties. The claimant submitted various claims before the learned Arbitrator, and a response thereto was filed by the present petitioners, but, no counter-claim was preferred by the petitioners. 3. In terms of the impugned award, the respondent- claimant has been awarded the claims as under:- CLAIM OF CLAIMANT CONTRACTOR: Sr. No. Nature of Claim Amount claimed Amount awarded by learned Arbitrator Claim No.1 Price Escalation 17,55,416/- 17,55,416- 3 Claim No.2 Damages for the prolongation of contract 51,65,861/- 51,65,861/- Claim No.3 Loss on account of idle Machinery 1,23,63,540/- 19,26,802/- Claim No.4 Watch & ward charges 5,38,224/- Nil Claim No.5 Payment and preparation of final bill Amount not mentioned Department should prepare the final bill Claim No.6 Security deposit 25,000/- 25,000/- Claim No.7 Payment of loss of profit 20,62,953/- Nil Claim No.8 Cost of Arbitration Amount not mentioned Nil Claim No.9 Interest @18% Amount not mentioned @ 8% on of Rs. /- awarded amount i.e. /- 4. Feeling aggrieved, the petitioners have preferred this petition under Section 34 of the Arbitration and Conciliation Act, 1996. 5. Learned Deputy Advocate General argued that the award under challenge is not sustainable in the eyes of law for the reason that the same is against the facts which were before the learned Arbitrator and is not in conformity with the terms of reference and agreement executed between the parties. He submitted that the award was against the Public Policy of India 4 and as learned Arbitrator had completely ignored the pleadings and evidence which was produced on record by the parties, the same has resulted in erroneous conclusions which rendered the award bad in law. He further submitted that learned Arbitrator had illegally allowed Claim No.1 with regard to price escalation without considering the objections which were raised by the petitioners. Learned Arbitrator had also erred in not appreciating that the claim was barred by limitation. He argued that the contention of the petitioners that the claim of price escalation was not arbitral in light of the law declared by Hon’ble Supreme Court of India was ignored by the learned Arbitrator. While deciding claim No.2 relating to damages on account of prolongation of contract, again learned Arbitrator erred by not appreciating the stand of the petitioners. The findings returned were beyond pleadings, as material placed on record by the claimant was not sufficient to have had warranted the award of claim under this head. Learned Deputy Advocate General also argued that the learned Arbitrator had allowed the claim merely on the statement of the claimant and in fact the findings returned by the learned Arbitrator with regard to Claim 5 Nos.1 and 2 were contradictory to each other, which also rendered the award to be bad in law. He submitted that as far as Claim Nos. 3 to 6 are concerned, the claims on the face of it were frivolous claims and were in contradiction to Claim Nos. 1 and 2. However, all these aspects were completely ignored by the learned Arbitrator. He further submitted that nothing was produced on record by the claimant to demonstrate that any of its machinery or labour remained idle during the currency of the contract. No evidence was produced, by which a prudent person could have accepted the plea that the machinery and labour remained idle for the period alleged by the learned Arbitrator yet, he ignored all these aspects of the matter while awarding the claims in favour of the claimant. No other point was urged. 6. On the other hand, learned Senior Counsel for the respondent-claimant submitted that there was no infirmity in the Award passed by the learned Arbitrator. He submitted that a perusal of the Award demonstrates that learned Arbitrator took into consideration the claims as well as response filed thereto by the parties concerned and by interpreting the terms of the 6 contract, as they should have been construed, learned Arbitrator rightly passed the Award in favour of the claimant. Learned Senior Counsel submitted that there was no misreading or misappreciation either of the pleadings or evidence or of the terms of the contract. Learned Senior Counsel further submitted that Hon’ble Supreme Court of India had, in numerous judgments, held that in exercise of its power under Section 34 of the Arbitration and Conciliation Act, the Court was not to act as an Appellate Court and that the Award passed by the learned Arbitrator had to be respected until and unless it was perverse on the face of it. In the present case, as there was no such perversity and as the Award was not against the Public Policy of India, the present petition deserved to be dismissed. Learned Senior Counsel also submitted that the findings returned by the learned Arbitrator were based on record. He submitted that a mere perusal of the award demonstrated that each of the conclusions arrived at in the award by the learned Arbitrator was substantiated by detailed reasoning. Learned Senior Counsel submitted that the issue of the claim being time barred or not was duly discussed by the 7 learned Arbitrator and the findings returned by the learned Arbitrator that the agreement had not been closed and the work had not been finalized/completed fully, as the final bill for the work had not been prepared and paid, were correct findings which were borne out from the record of the case. Therefore, the argument of the petitioners that learned Arbitrator erred in not holding that the claim was time barred is not sustainable in law. Learned Senior Counsel further submitted that each and every aspect of the matter was gone into in detail by the learned Arbitrator, which is evident from the award. The respective contentions of the parties were considered by the learned Arbitrator and he has discussed all aspects of the matter, i.e., respective pleas of the parties and evidence led by them while arriving at the conclusion. Accordingly, he submitted that as the findings returned by the learned Arbitrator were clearly borne out from the record of the case and were a result of correct appreciation of pleadings and evidence before the learned Arbitrator, the same did not call for any interference. 8 7. I have heard learned counsel for the parties and have also carefully gone through the Award as well as the other documents on record. 8. Before the Court addresses respective contentions of the parties, it is necessary to refer to the scope of interference by this Court in a petition which is preferred under Section 34 of the Arbitration and Conciliation Act. Hon’ble Supreme Court of India in UHL Power Company Limited vs. State of Himachal Pradesh, (2022) 4 Supreme Court Cases 116, inter alia, has been pleased to hold that the jurisdiction conferred on Courts under Section 34 of the Arbitration and Conciliation Act is fairly narrow and when it comes to the scope of an appeal under Section 37 of the Arbitration and Conciliation Act, the jurisdiction of an appellate Court in examining an order, setting aside or refusing to set aside an award is all the more circumscribed. Hon’ble Supreme Court has held that if there are two plausible interpretations of the terms and conditions of the contract, then, no fault can be found, if the learned Arbitrator proceeds to accept one interpretation as against the other. Hon’ble Supreme Court has 9 referred to its earlier judgment passed in Dyna Technologies (P) Ltd. Vs. Crompton Greaves Ltd. (2019) 20 SCC 1, in which Hon’ble Supreme Court was pleased to hold that Section 34 of the Act limits a challenge to an award only on the grounds provided therein or as interpreted by various Courts and arbitral awards should not be interfered with in a casual and cavalier manner, unless the Court comes to a conclusion that the perversity of the award goes to the root of the matter without there being a possibility of alternative interpretation which may sustain the arbitral award. Hon’ble Supreme Court further held that Section 34 is different in its approach and cannot be equated with a normal appellate jurisdiction. The mandate under Section 34 is to respect the finality of the arbitral award and the parties autonomy to get their dispute adjudicated by an alternative forum as provided under the law. Hon’ble Supreme Court has further held that if the Courts were to interfere with the arbitral award in the usual course on factual aspects, then the commercial wisdom behind opting for alternative dispute resolution would stand frustrated. 10 9. Coming to the facts of this case, I have carefully gone through the award passed by the learned Arbitrator. A perusal thereof demonstrates that out of the nine claims which were raised before the learned Arbitrator by the claimant, learned Arbitrator has allowed Claim Nos. 1 to 6 and 9. 10. A further perusal of the award demonstrates that while deciding each of the claims, learned Arbitrator firstly referred to the contentions of the claimant, then of the respondents. Thereafter, learned Arbitrator referred to the discussions and arguments of the parties and subsequently, gave his conclusion thereupon. The conclusions which have been given by the learned Arbitrator reflect that the same are based on the appreciation of the respective contentions of parties as also the material before the learned Arbitrator. 11. That being the case, as during the course of the hearing of this petition, learned Deputy Advocate General could not point out that which particular finding returned qua the nine claims were erroneous or perverse in the sense that the same were a result of misreading or non-appreciation of relevant evidence on record, the findings call for no interference. This is 11 also for the reason that in exercise of its power under Section 34 of the Arbitration and Conciliation Act, this Court is not to sit as an Appellate Authority and substitute its view for the view taken by the learned Arbitrator, if another view on the facts of the case is possible. In light of the fact that the parties agreed to have their dispute settled by way of arbitration, this Court has to respect the award passed by the learned Arbitrator, until and unless it is per se perverse in terms of the law declared by the Hon’ble Supreme Court of India, which has been discussed hereinabove. 12. The award passed in the present case, besides being a reasoned and speaking award, contains findings which are based on the pleadings and evidence which was led by the parties before the learned Arbitrator. Even with regard to the issue as to whether the claim was time barred or not, learned Arbitrator has discussed this issue and has held that in the case in hand, the bill for the work had not yet been finalized till date, i.e., till the date of the decision of the award and the respondents before the learned Arbitrator had admitted this fact in their submission. Learned Arbitrator held that it was of the 12 considered view that the agreement had not been closed and the work had not been finalized/completed fully, and as the final bill for the work not having been prepared and paid, the claim was not barred. While arriving at the said conclusion, learned Arbitrator has relied upon the judgment of the Hon’ble Supreme Court in the case of Major (Retd.) Inder Singh Rekhi v. DDA, (1988) 2 SCC 338, reference whereof is given in the award. 13. Even as far as the other claims are concerned, as observed hereinabove, while deciding each claim, learned arbitrator has taken into consideration the respective contentions of the parties and, after detailed discussion, returned his conclusion thereupon. The conclusion, having been based on the facts before the learned Arbitrator, call for no interference, as the same would amount to this Court exercising its power of appeal over the award passed by the learned Arbitrator. 14. At the cost of repetition, this Court holds that in the absence of any perversity being pointed out in the award in terms of the law declared by the Hon’ble Supreme Court of India and further in light of the fact that it is settled law that the 13 Court in exercise of its jurisdiction under Section 34 of the Arbitration and Conciliation Act, should not ordinarily interfere with the award passed by the learned Arbitrator, as this Court does not find any perversity in the award under challenge, and further, as this Court does not find any merit in the present petition, the same is accordingly dismissed. 15. Pending miscellaneous applications, if any, also stand disposed of. (Ajay Mohan Goel) Judge July 30, 2026 (Vinod)