R.C. Jain, J.

1. Parties entered into a Rate contract bearing Nos. ES-3/RC-1432/Pvc/Alum Cables/II/85-86/33/Meryfur/1337/Coad dated 17.2.1986, ES-3/RC-1431/Pvc/Alum Cables/I/85-86/33/Meryfur/Coad/1358 dated 31.1.1986, and ES-3/RC-1430/Ugac/85-86/III/Meryfur/1419/Coad dated 19.3.1986, for the supply of PVC cables. Clause 6 of the Conditions of the Contract provided for the payment of Excise Duty by the purchaser. The said clause reads as under:

Excise Duty: The prices are exclusive of Excise Duty. The present rate of Excise Duty on cost of Stores applicable in this case is 10% plus 5% E.D. on the basic ED. Any change in Excise Duty arising out of (a) Method of assessment, (b) Tariff Value and (e) Ad valorem rates will be to purchasers account.

2. It is the admitted case of the parties that after entering into the said contract, a major change was brought about in the excise policy of the Government and Modvat scheme was introduced in terms of which the rate of excise duty on such type of commodity i.e. PVC cables was increased from 10% plus 5% ED to 30% w.e.f. 1.3.1986 and later to 25% w.e.f. 3.4.1986. The supplier admittedly paid excess duty at this enhanced rate for the supplies made during that period. The supplier claimed the excise duty at the enhanced rate which the department disputed on the ground that under the MODVAT scheme, the supplier had received certain benefits which he was liable to set off and the respondent was entitled deduction in the excise duty to that extent. However, without prejudice to their rights, the respondent paid 50% of the enhanced duty to the supplier/petitioner. Disputes arose between the parties in regard to the payment of the enhanced duty. The petitioner claimed the balance 50% of the enhanced duty which remained unpaid by the respondent. The dispute was referred to the named Arbitrator who entered upon the reference. There was a change in the Arbitrators from time-to-time and lastly the Sole Arbitrator Mrs. Shail Goel made and published her Award dated 15.3.2000 thereby allowing the claim of the petitioner along with interest @ 18% p.a.

3. Pursuant to a petition under Sections 14 and 17 of the Arbitration Act, 1940 (hereinafter referred to as the Act), the Award and proceedings were filed and notice inviting objections, if any, against the said Award of the Arbitrator was issued. A petition under Sections 30 and 33 challenging the Award of the Sole Arbitrator and seeking to set it aside has been made on behalf of the respondent/UOI inter alia challenging the Award on the grounds that the Arbitrator has misconducted the proceedings and that the claim has been allowed on no material or insufficient material and without adhering to the conditions of the Contract. In the reply, objections have been controverted and it is denied that there are any grounds much less sufficient grounds for setting aside the Award of the Sole Arbitrator. On the pleadings of the parties, following issue was framed:

1. Whether the Award is liable to be set aside in view of the objections filed by the respondent

4. Though the parties have not led any evidence but have agreed to refer to the documents and arbitral proceedings during he course of their submissions.

5. I have heard Mr. Rajesh Banati, learned Counsel representing the petitioner and Ms. Rekha Palli, learned Counsel representing the respondent/objector and have given my thoughtful considerations to their respective submissions.

6. Ms. Rekha Palli, learned Counsel representing the respondent/objector has fairly conceded at the Bar that in terms of Clause 6 of the Conditions of Contract, the respondent/purchaser was required to pay any increase in the excise duty which had been increased during the subsistence of the Contract, but here the main contention is that that this was conditioned by the method of assessment as envisaged by (a) in Clause 6 and since there was a change in the method of assessment of the excise duty pursuant to the introduction of MODVAT scheme in the general budget of 1986-87, the consequence of that scheme should follow. According to her on the introduction of this scheme and consequent increase in the excise duty from 10% plus 5% ED to 30% and then to 25% was dependent on the reimbursement of certain amount of excise duty paid by the manufacturer/supplier on the inputs used in the manufacture of the finished product i.e. PVC cables and, therefore, the supplier could at best claim the difference in the increase in the excise duty after adjusting the MODVAT benefit received by him. The Sole Arbitrator has considered this plea of the respondent but negatived the same firstly on the ground that there was no modification of the Contract after the MODVAT scheme was introduced and no provision was made in the Contract for making adjustment/set off any MODVAT benefit received by the supplier under the said scheme and secondly that as per the respondents own showing it was not possible to make an assessment of the MODVAT benefit which the petitioner was entitled or might have received against such a product. The Sole Arbitrator relying upon the affidavit filed on behalf of the petitioner which was not rebutted from the side of the respondent had accordingly allowed the claim of the petitioner.

7. Ms. Rekha Palli has strenuously urged that affidavit of Shri S.K. Gupta filed on behalf of the petitioner is quite vague and as it did not state that the petitioner has not received any benefit/reimbursement under the MODVAT scheme and, therefore, the Sole Arbitrator ought not to have relied and acted upon this piece of evidence in awarding his claim more particularly when her predecessor arbitrator had discarded the same. In this connection, she has invited the attention of this Court to several proceedings of the Arbitrator dated 16.12.1990 onward where despite filing of such affidavit, the Sole Arbitrator called upon the petitioner to file further documents.

8. It may be stated that this Court while examining the objections against the Award passed by an Arbitrator is not sitting in a Court of Appeal and cannot go into either adequacy of the evidence or proper appreciation thereof and is not entitled to reappraise the evidence led before the Arbitrator. The Award of the Arbitrator can only be set aside if it is shown that the Arbitrator has either misconducted himself or the proceedings or there is an error apparent on the face of the record. In the opinion of this Court, none of the grounds can be said to exist because the Arbitrator has rendered a reasoned Award. Besides it is also not possible to hold that the Arbitrator has ignored the terms of the Contract or has interpreted the same in a perverse manner.

9. In the opinion of this Court there are no sufficient grounds for setting aside the Award of the Sole Arbitrator. Accordingly objections filed by the respondent/UOI are hereby dismissed and the Awards of the Arbitrator are hereby made Rule of the Court. Let decree sheets be prepared accordingly.