A.K Sikri, J.— This appeal is directed against decision dated 7th July, 1994 by the learned Single Judge. By the said decision award dated 22nd March, 1991 passed by Shri S.C Gupta, sole Arbitrator was made rule of the Court after dismissing the objections filed by the Delhi Development Authority (hereinafter referred to as DDA, for short). Various claims were made by the respondent/Contractor before the Arbitrator. The Arbitrator gave its award dated 22nd March, 1991 allowing some of these claims to some extent and dismissed all the counter claims of DDA. The award was filed in this Court. IA 1279/91 was filed by the respondent/Contractor for making it rule of the Court whereas IA 1280/91 was filed by the applicant which contained objections to the aforesaid award. Objection were preferred in respect of additional claim No. 1 and claim No. 2, claim Nos. 4, 8 and additional claim No. 3 and in respect of counter claims. As noted above, all these objections were rejected by the learned Single Judge and award was made rule of the Court and it was directed that decree be prepared in terms thereof. Interest @ 12% p.a from date of award till payment was also granted.

2. In this appeal which is preferred against the aforesaid judgment and decree dated 7th July, 1994, the grievance was limited to claim Nos. 2, 4, additional claim No. 3 and counter claim Nos. 1 and 5. However, at the time of argument Ms. Anusuya Salwan, learned Counsel appearing on behalf of the DDA, pressed her objections only in respect of the award relating to claim No. 2, additional claim No. 3 and counter claim No. 1. Therefore, we proceed to examine the legality of the impugned judgment only in respect of these claims.

Claim No. 2:

3. Claim No. 2 was preferred by respondent/Contractor before the Arbitrator which related to work done beyond the deviation limit provided in the contract. There is no dispute that as per the agreement there could be deviation to the extent of—or + 20% of the work. However, if the work ultimately undertaken by the Contractor extended the deviation limit, as per Clause 12-A of the Agreement he became entitled to a higher rate. There is no dispute that the work done by the Contractor was beyond the deviation limit provided in the contract. In such an eventuality the respondent was entitled to claim revision of rates supported by proper analysis in respect of such items for quantities in excess of deviation limit. However, as per Clause 12-A of the Agreement respondent had to claim the deviation and submit proper analysis within seven days from the date of receipt of the order. On submission of these rates and analysis in support thereof Engineer-in-charge could revise the rates having regard to the prevailing market rates. For proper appreciation of Clause 12-A is reproduced below:

Clause 12A:

“In the case of contract of substituted items which individually exceed the quantity stipulated in the contract by more than the deviation limit, except the items relating to foundation work which the Contractor is required to do under Clause 12 above, the Contractor shall, within 7 days from the receipt of order, claim revision of the rates supported by proper analysis in respect of such items for quantities in excess of the deviation limit, notwithstanding the fact that the rates for such items exist in the tender for the main work or can be derived in accordance with the provisions of Sub-clause (ii) of Clause 12 and the Engineer-in-charge may revise their rates, having regard to the prevailing market rates and the Contractor shall be paid in accordance with the rates fixed. The Engineer-in-charge shall, however, be at liberty to cancel his order to carry out such increased quantities of work by giving notice in writing to the contract and arrange to carry it out, in such a manner as he may consider advisable, but under no circumstances the Contractors shall suspend the work on the plea of non-settlement of rates of items falling under this clause”.

4. The aforesaid clause enumerates the procedure to be followed for making revision in rates in the following manner:

(i) The Contractor is to claim revision of rates within seven days from the receipt of the order.

(ii) The said revision is to be supported by proper analysis in respect of such items for quantities in excess of deviation limit.

(iii) On receipt of such claim supported by analysis. Engineer-in-charge would consider the same and may revise the rates.

(iv) In revising the rates Engineer-in-charge shall have regard to prevailing market rates.

(v) The Contractor thereafter shall be paid in accordance with the rates fixed.

5. Alternatively, Engineer-in-charge may on receipt of such claim cancel the order to carry out increased quantity of work by giving notice in writing. Thus, in order to claim the revised rates it is incumbent upon the Contractor to make this claim for revision of rates duly supported by proper analysis in respect of such items for quantities in excess of deviation limit within seven days of the receipt of the order and on receipt thereof it would be for the Engineer-in-charge to either revise the rates having regard to the prevailing market rate and pay the Contractor accordingly or cancel the order and get the work done from some other Contractor in respect of such increased quantities of work.

6. in the instant case admittedly no such claim was made by the respondent by giving any analysis in respect of the concerned items. This analysis was given for the first time before the Arbitrator. The appellant-DDA refuted the analysis submitted by the respondent and submitted its own analysis of rates. Arbitrator did not accept the analysis submitted by either parties and fixed his own rates and awarded the same. In the objections filed by the appellant to the grant of the amount against this claim it was submitted that Arbitrator had no jurisdiction to award any amount in the face of provisions of clause 12-a of the Agreement as no such analysis was submitted to the Engineer-in-charge. This objection was brushed aside by the learned Single Judge in the impugned judgment observing that appellant had acquiesced into Arbitrator's jurisdiction and having placed its case before the Arbitrator cannot now be heard/allowed to object to the award only on account of delay in not furnishing the analysis before its Engineer. Learned Single Judge also referred to the judgment of Supreme Court in the case of Neelkantan & Brothers Construction v. Superintending Engineer, National Highways, Salem, (1988) 4 SCC 462.

7. Assailing the aforesaid reasons Ms. Anusuya Salwan, learned Counsel for the appellant submitted that the award of amount by the Arbitrator against claim No. 2 was self-contradictory inasmuch as the Arbitrator had himself refused to entertain additional claim No. 2-A precisely on the same ground namely that the respondent had not claimed revision in rates within Clause 12-A for quantities of work beyond deviation limit during currency of work and therefore he could not prefer the claim before the Arbitrator. A perusal of the award in respect of additional claim No. 2 shows that the analyses of rates were submitted by the respondent before the Arbitrator. However, the Arbitrator rejected the claim by observing as under:

“It is however seen that the claimants did not claim revision in rates against Clause 12(A) for quantities of work beyond deviation limit during currency of work, what to say of within seven days of occurrence as provided in the said clause. The work was executed in the years 1982 to 1984 and submission of analysis of rates now on market rate basis, in 1990, is meaningless. Revision in rates for the entire work done during extended period including work done beyond deviation limit, is also a subject matter of additional claim No. 3. This claim is, therefore, not justified and is rejected. I award Rs. Nil against this claim”.

8. From the aforesaid it is clear that for not submitting the analysis, additional claim No. 2 was rejected by the Arbitrator as, according to the Arbitrator, the respondent did not conform to Clause 12-A of the Agreement between the parties. However, ignoring this very aspect when admittedly no such analysis was submitted by the respondent before the Engineer-in-charge during the period of contract, what to talk of submission of analysis within seven days of the receipt of the order and Arbitrator entertained claim No. 2 and awarded the amount. Therefore, we are agreeing with the contention of learned Counsel for the appellant that the Arbitrator exceeded his jurisdiction in entertaining claim No. 2 and awarding the amount. Interestingly the Arbitrator was aware of the provisions of clause 12-a of the contract. He was also aware of the legal position that this claim had to be dealt with in accordance with Clause 12-A of the contract and therefore rejected additional claim No. 2. However, he ignored this very aspect while entertaining claim No. 2. In fact the procedure contained in Clause 12-A is mandatory. Rates of the items which exceeded deviation limit, are mentioned in the contract itself. When deviation limit is exceeded Contractor becomes entitled to revised rates for the quantities beyond the deviation limits. However, for this purpose it is necessary for him to prefer the claim. In case he does not prefer the claim and keeps getting the payment of the additional work done by him on agreement rates in the running bills, the department has a right to infer that Contractor has agreed to perform the quantities of work beyond the deviation limits also on the same rates. This would further become apparent from the facts of the case inasmuch as not only respondent did not submit any claim supported by analysis of rates, he kept on getting the payment as per rates of the agreement during the currency of the contract against running bills. Therefore, it is rather the respondent who acquiesced into accepting the agreement rates instead of making claims of revised rates in respect of quantity beyond deviation limits. There is yet another purpose for incorporating Clause 12-A in the Agreement. If the revised rates claimed by the Contractor are not suitable to the Department, Engineer-in-charge is at liberty to cancel the contract in respect of increased quantities beyond deviation limits. Therefore, Contractor cannot be allowed to claim such rates by raising dispute afterwards and submitting analysis for the first time before the Arbitrator if he failed to do so during the currency of the contract as per the procedure contained in Clause 12-A of the Agreement. Therefore, we do not agree with the reasoning of the learned Single Judge that the Department had acquiesced into Arbitrator's jurisdiction by placing its case before the Arbitrator. The litigating parties has right to take possible alternate objections before adjudicating authorities and merely because the appellant submitted its own rates before the Arbitrator does not mean that appellant gave up its objection to the admissibility of the claim and acquiesced into Arbitrator's jurisdiction. Arbitrator is supposed to act in accordance with the provisions of Agreement between the parties and therefore Arbitrator could not have granted the claim in violation of or ignoring provisions of clause 12-a of the Agreement. Judgment of Supreme Court in the case of Neelkantan (supra) does not come to the aid of the respondent. That case related to the appointment of the Arbitrator and the Court held that in spite of the knowledge of defect in the appointment of the Arbitrator, if a party participates in proceedings before the Arbitrator it acquiesces in the appointment made and is therefore precluded from objecting to such an appointment as invalid in the subsequent proceedings. In the instant case, we are not concerned with the appointment of the Arbitrator but the manner in which Arbitrator has dealt with a particular claim and granted the same in violation of Clause 12-A of the Agreement. The award of Rs. 37,791/- in favour of respondent in respect of claim No. 2 is accordingly set aside. It is held that respondent is not entitled to any amount under this claim.

Additional Claim No. 3:

9. Under this claim Arbitrator had allowed 25% extra rates for the work done after the stipulated date of completion. The submission of the learned Counsel for the appellant was that Arbitrator had ignored important documents placed on record by the appellant showing that there was delay on the part of the respondents in execution of the contract and learned Single Judge did not consider this aspect. However, the learned Counsel could not point out which documents were allegedly ignored by the Arbitrator. No such documents are even mentioned in the grounds of appeal. In fact during the course of the argument learned Counsel almost conceded that this objection could not be raised as Arbitrator was the best Judge of fact and law and his conclusion that delay on the part of the appellant could not be interfered with as this Court was not sitting in appeal over the award of the Arbitrator.

Counter Claim No. 1:

10. These claims were preferred by the appellant before the learned Arbitrator which the Arbitrator rejected. Under counter claim No. 1 compensation was claimed by the appellant which Superintending Engineer had levied in terms of Clause 2 in the Agreement. This claim was rejected by the Arbitrator on the ground that there was no delay on the part of the respondent. The argument of the learned Counsel for the appellant is that the decision of Superintending Engineer under Clause 2 of the Agreement, when he levies compensation is final and in respect of those matters where his decision is final, the Arbitrator has no jurisdiction to adjudicate upon such decisions as is clear from the arbitration clause in the Agreement itself. In support of her submission appellant has relied upon the judgment of this Court in the case of D.D.A v. Sudhir Brothers.., 1995 (2) Arbitration Law Reporter 306 and judgment dated 27th March, 2000 passed in Suit No. 289A of 1989 titled Bhagat Construction Company v. Delhi Development Authority.

11. On the other hand it was argued by learned Counsel for the respondent that the appellant itself preferred the claim for adjudication by the Arbitrator and at their instance the matter was adjudicated upon by the Arbitrator who rejected this claim. Not only this, the appellant had filed the objections but at the time of arguments before the learned Single Judge, appellant did not press objections in respect of counter claims 1 and 5. For these reasons appellant should not be permitted to raise this objection at the appeal stage.

12. It is not in dispute that the counter claim No. 1 falls in “excepted matter” i.e, as per the arbitration clause dispute regarding claim No. 1 was not referable. Such a matter, therefore, normally, could not have been referred to Arbitrator and the position in this respect stands settled by catena of judgments of this Court following the dicta laid down by the Apex Court (Refer: Vishwanath Sud v. Union of India, (1989) 1 SCC 657 : AIR 1989 SC 952 and D.D.A v. Sudhir Brothers.. (supra).

13. However, in the present case, the Delhi Development Authority had itself referred counter claim No. 1 for arbitration and when the award was filed in this Court, objections were filed by the appellant in respect of counter claim Nos. 1 and 5 but were dismissed as having not pressed. Therefore, the question which falls for determination is as to whether appellant-DDA can still raise this plea? Ms. Anusuya Salwan, learned Counsel for the appellant submits that it is still open for the appellant to raise the plea. This submission is based on the premise that since the Arbitrator did not have jurisdiction to deal with an “excepted matter” the same goes to the root of the matter and further that it is pure question of law and, therefore, it could be raised at any point of time. In support of this proposition she has relied upon the judgment dated 27th March, 2000 in the case of Bhagat Construction (supra).

14. A perusal of the judgment of Bhagat Construction (supra), which was also a case relating to DDA, would show that the same question arose for consideration on almost identical facts. Notwithstanding Clause 25 of the Agreement relating to arbitration, counter claim No. 2 of similar nature, which was an “excepted matter” was referred for adjudication. When the award was filed in the Court various objections were raised. However, there was no specific objection in respect of counter claim No. 2 that Arbitrator did not have jurisdiction to deal with the same as it was an “excepted matter”. This objection was raised at the time of arguments and it was not opposed on the ground that it could not be raised at the stage of arguments inasmuch as, under Section 30 of the Arbitration Act, 1940 objections to the award could be filed by the parties within 30 days of the receipt of the notice of filing of the award failing which the Court had no other option but to make the award rule of the Court and pass decree in terms thereof. On the other hand, it was contended on behalf of the DDA that since the Arbitrator did not have jurisdiction to deal with an “excepted matter” the same goes to the root of the matter and therefore such an objection could be raised at any time and in support of this contention reliance was placed on the decision of the Supreme Court in the case of Prabartak Commercial Corporation Ltd. v. The Chief Administrator, Dandakaranya Project, (1991) 1 SCC 498 : AIR 1991 SC 957. Learned Single Judge, keeping in view the importance of the question involved, made reference to the Division Bench and that is how this question came to be dealt with by the Division Bench. After hearing both the parties at length, detailed judgment is given holding that objections with regard to lack of inherent jurisdiction on the part of the Arbitrator to pass an award in respect of counter claim No. 2 could be taken at any time as it was not an objection under Section 30 of the Arbitration Act, 1940 but amounted to an objection raised under Section 33 of the Arbitration Act, 1940 for which law of limitation had no application. It was further held that the said counter claim did not fall within the jurisdiction of the Arbitrator and the question was one of lack of inherent jurisdiction of the Arbitrator to deal with the matter and the award in respect of such counter claim was a nullity and could be set up wherever it was sought to be enforced or relied upon, even at the stage of execution and even in collateral proceedings. This judgment in fact applies with all force as far as present case is concerned and, therefore, relying upon the aforesaid judgment, we are of the view that Arbitrator lacked inherent jurisdiction to deal with the counter claim No. 1. Award on counter claim No. 1 is accordingly set aside:

15. The appeal is therefore partly allowed to the extent indicated above i.e award of the Arbitrator on claim No. 2 and decree in respect thereof stands set aside. Award of the Arbitrator on counter claim No. 1 also stands set aside. The decree stand modified accordingly. The parties shall, however, bear their own costs.

Appeal partly allowed.