M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED versus M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA
[2023] 11 S.C.R. 623, Supreme Court of India, 2023
Outcome: Appeal(s) allowed (Granted)
Segment: Facts
[2023] 11 S.C.R. 623 : 2023 INSC 768
CASE DETAILS
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED
v.
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA
(Civil Appeal No(s). 4658 of 2023)
AUGUST 24, 2023
[S. RAVINDRA BHAT AND ARAVIND KUMAR, JJ.]
HEADNOTES
Issue for consideration: The issue is with respect to the 
interpretation of a contract condition, which required the measurement 
of quantities used for payment for embankment construction with soil or 
with pond; and the relevance of the dissenting opinion of the arbitrators.
Arbitration and Conciliation Act, 1996 – ss. 34, 37 – Arbitral 
award – Scope of intereference u/ss. 34 and 37 – On facts,  three 
technical member arbitration passed an award which was unanimous 
on most questions while, on others, there was a dissenting view – 
Single Judge of the High Court held that the tribunal’s majority 
opinion reﬂ ected a plausible and reasonable view, however, the 
Division Bench holding that the tribunal’s majority opinion, and 
award, were based on an implausible interpretation of the contract, 
set aside the award – Correctness:
Held: Awards which contain reasons, especially when they interpret 
contractual terms, ought not to be interfered with, lightly – Prevailing 
view about the standard of scrutiny- not judicial review, of an award, by 
persons of the disputants’ choice being that of their decisions to stand- 
and not interfered with, save a small area where it is established that such 
a view is premised on patent illegality or
their interpretation of the facts 
or terms, perverse, as to qualify for interference – Judges tend to adopt a 
corrective lens; usually, commended for appellate review, however, it is 
unavailable when exercising jurisdiction u/s. 34 – Courts cannot, through 
process of primary contract interpretation, thus, create pathways to the 
623
624
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
kind of review which is forbidden u/s. 34 – So viewed, the Division 
Bench’s approach, of appellate review, u/s. 37, and conclusions drawn 
by it, resulted in displacing the majority view of the tribunal, as also 
the unanimous view – As long as the view adopted by the majority was 
plausible and there is no reason to hold otherwise, such a substitution 
was impermissible – Judgments passed by the High Court are set aside 
– Awards, which were the subject matter of challenge, and to the extent 
they were set aside, are upheld and restored. [Paras 22, 23, 28]
Arbitration – Arbitral award – Dissenting opinion of the 
arbitrator – Relevance of:
Held: Dissenting opinion cannot be treated as an award if the 
majority award is set aside – It might provide useful clues in case there 
is a procedural issue which becomes critical during the challenge – When 
a majority award is challenged by the aggrieved party, the focus of the 
court and the aggrieved party is to point out the errors or illegalities in 
the majority award – Minority award or dissenting opinion only embodies 
the views of the arbitrator disagreeing with the majority – There is no 
occasion for the party aggrieved by the majority award, or, more crucially, 
the party who succeeds in the majority award, to challenge the soundness, 
plausibility, illegality or perversity in the approach or conclusions in the 
dissenting opinion – Dissenting opinion would not receive the level
and 
standard of scrutiny which the majority award is subjected to – Thus, the 
so-called conversion of the dissenting opinion, into a tribunal’s ﬁ ndings, 
in the event a majority award is set aside and elevation of that opinion 
as an award, would, be inappropriate and improper. [Para 27]
LIST OF CITATIONS AND OTHER REFERENCES
Associate Builders v. Delhi Development Corporation [2014] 13 
SCR 895; BOC India Ltd. v. Bhagwati Oxygen Ltd. [2007] 3 SCR 915; 
Indian Oil Corporation v. Shree Ganesh Petroleum Rajgurunagar [2022] 
16 SCR 450; PSA SICAL Terminals Pvt. Ltd. v. Board of Trustees of V.O. 
Chidambranar Port Trust [2021] 5 SCR 408; South East Asia Marine 
Engineering and Constructions Limited (SEAMEC Ltd) v. Oil India Ltd.
[2020] 4 SCR 254; M/s. Voestalpine Schienen GmbH v. DMRC [2017] 
1 SCR 798; Delhi Airport Metro Express (P) Ltd v. DMRC [2021] 5
625
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA 
SCR 984; State of UP v. Allied Constructions [2003] Supp 2 SCR 55; 
McDermott International Inc. v. Burn Standard Co. Ltd. [2006] Suppl. 2 
SCR 409; MSK Projects (I) (JV) Ltd v. State of Rajasthan [2011] 9 SCR 
402; Dakshin Haryana Bijli Vitran Nigam Ltd. v. Navigant Technologies 
(P) Ltd. [2021] 1 SCR 1135; Ssangyong Engg. & Construction Co. Ltd. 
v. NHAI [2019] 7 SCR 522 – referred to.
David St. John Sutton, Judith Gill and Matthew Gearing QC, 
Russel on Arbitration, 24th Edn. (Sweet & Maxwell), p. 313; Gary Born, 
International Commercial Arbitration, Wolters Kluwer, Edn. 2009, Vol. 
II, p. 2466 & 2469 – referred to.
OTHER CASE DETAILS INCLUDING IMPUGNED 
ORDER AND APPEARANCES
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4658 of 
2023.
From the Judgment and Order dated 08.11.2012 of the High Court 
of Delhi at New Delhi in FAO No. 48 of 2012.
With
Civil Appeal Nos. 4659, 4660, 4661 and 4662 of 2023.
Appearances:
Ms. Aishwarya Bhati, A.S.G., Anil Airi, Dr. A.M. Singhvi, V. Giri, 
Sr. Advs., Mohit D. Ram, Ravi Krishan Chandna, Ms. Monisha Handa, 
Ms. Bindiya Logawney, Anubhav Sharma, Mudit Ruhella, Sameer 
Parekh, Sumit Goel, Ms. Sreeparna Basak, Prateek Khandelwal, Jayant 
Bajaj, M/s. Parekh & Co., Mahesh Agarwal, Rishi Agrawala, Ms. Shruti 
Arora, Anirudh Bhatia, Devansh Srivastava, Nidhi Ram, Rahul Narang, 
Ms. Vidisha Swarup, E. C. Agrawala, George Thomas, Dr. Swaroop 
George,
R. Sathish, Rajesh Kumar, Mohan Das Kk, Mathen Joseph, Mrs. 
S. Geetha, M/s. M. V. Kini & Associates, Ms. Neetica Sharma, Tavinder 
Sidhu, Ms. Padma Priya, Ms. Manisha, Shreyansh Rathi, Advs. for the 
appearing parties.
626
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
JUDGMENT / ORDER OF THE SUPREME COURT
JUDGMENT
S. RAVINDRA BHAT, J.
1. All these appeals involve decision on a common question, with 
respect to the interpretation of a contract condition, which required the 
measurement of quantities used for payment for embankment construction 
with soil or with pond ash. The claimants (hereafter “the contractors”) 
contended that the measure is one and the same, which is by taking a 
composite cross section as a whole of the embankment and determining the 
volume by the average end area method. However, the supervising engineer 
(hereafter “EE”) adopted a method, whereby the area of the cross section 
was bifurcated to account for the area occupied by soil and pond ash for 
the determination of quantum of the embankment in two diﬀ erent items. 
The contractor urged that this was contrary to the technical speciﬁ cation 
(hereafter “TS”) clause 305.8; the National Highways Authority of India 
(hereafter “NHAI”) justiﬁ ed the EE’s interpretation. Since there have been 
diﬀ erent outcomes in all these appeals, and the impugned judgments in some 
of them have relied upon the judgment of the Division Bench of the Delhi 
High Court, in CA 4658/20231 (hereafter referred to as “the main judgment”) 
the facts and decisions, in that appeal would be alluded to. 
2. NHAI awarded, to the contractor the work of construction of the 
Allahabad by-pass project in U.P. by agreement dated 02.06.2004. The 
project
was completed. However, certain disputes arose inter se the parties 
with reference to diﬀ erent areas of the contract; these were referred to 
arbitration. NHAI has an inbuilt resolution mechanism, i.e., a Dispute 
Resolution Board (“DRB”) consisting of technical experts in the ﬁ eld, to 
which matters are ﬁ rst referred to. Since the contractor was not satisﬁ ed with 
the opinion of the DRB, in terms of the agreement, it could and, did invoke 
the arbitration. The disputes in the present case culminated in a reference 
to the arbitration of three technical persons, who after considering the rival 
viewpoints and the materials before them, made the award2. The award was 
unanimous on most questions while, on others, there was a dissenting view 
of one of the arbitrators. 
1 
Arising out of SLP No. 38162/2012, which was directed against the judgment of the 
Division Bench of the Delhi High Court dated 08.11.2012 in FAO (OS) No. 48/ 2012.
2 
Award dated 30.03.2010
627
3. The contractor, aggrieved by both the unanimous view and the 
majority view preferred objections under Section 34 of the Arbitration 
and Conciliation Act, 1996 (“the Act”). A learned single judge rejected 
the petition3. The single judge was of the considered opinion that as far 
as measurement aspects were concerned, the tribunal’s majority opinion 
reﬂ ected a plausible and reasonable view that did not call for interference:
“26. As regards non-payment for, executed work of embankment which 
forms the subject matter of Disputes 2 and 4, this is purely a question 
of fact based on the measurement. There is no dispute in relation to the 
construction of the embankment that is covered under item 2. 02 (a) of 
the BOQ. In fact, NHAI has already paid HCC for the said construction. 
Clause 305.8 of the MORTHTS provides for measurement of the cross 
section of the embankment as one whole composite section and paid 
under item No.2.02(b). The decision of the majority members of the 
Arbitral Tribunal based on an analysis of the material before them 
was a possible view to take. Merely because another view as evidenced 
by the dissenting opinion is possible interference by this Court under 
Section 34 of the Act is not warranted.”
4. NHAI appealed to the Division Bench, which set aside the decision 
of the learned single judge, and held that the tribunal’s majority view, and 
award, were based on an implausible interpretation of the contract. It was 
held, in the impugned
order that:
“[..] On a conjoint reading of BOQ item No.2.02 and clause 305.8 
of the technical speciﬁ cation, to us, it is clear that the cross sections 
have to be taken in respect of the diﬀ erent materials used, i.e. soil 
and pond ash. Pertinently, it is not the case of the respondents that 
the two are mixed into a mixture and then used. Soil and pond ash are 
used separately. Thus, the cross sections are to be taken at intervals. 
We cannot permit the respondent to contend that it is not possible to 
compute the volumes of the two materials in the cross section, when for 
30 months both the appellant and the respondent were actually making 
measurements accordingly. The respondent itself made the IPCs and 
submitted for payments which were duly paid by the appellant. Such 
3 
By the order dated 30.11.2011
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
628
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
measurements were made on the basis of actual utilization of the two 
materials. We fail to appreciate how the arbitral tribunal could have 
come to a conclusion that the mode of measurement of the two items 
separately was not in accordance with the contract. The majority 
view, after having noticed the principles of consensus ad idem, seems 
to have failed to appreciate this vital issue.[..]”
Contentions of parties
5. On behalf of the appellant/contractors, Dr. Abhishek Manu Singhvi, 
Mr. V. Giri, and Mr. Anil Airi, learned senior counsels, Mr. Sameer Parekh 
and Mr. George Thomas learned counsel made submissions. It was argued 
that the impugned judgment goes far beyond the scope of the jurisdiction 
under Section 34 /Section 37 of the Act. The Division Bench while interfering 
with the award on the grounds that it did, transgressed the extremely narrow 
scope of interference under Section 37 of the Act. It was argued that this 
court in a plethora of cases has held that the intent of the Act is to restrict 
the grounds of challenge to an arbitral award to the barest minimum. It is 
submitted that this court has time and again held that the general approach 
of the courts should be to uphold the award and the arbitral award and not to 
sit with a meticulous legal eye endeavouring to pick holes, inconsistencies 
and faults in the award.
6. It was argued that contractual conditions relating to a method of 
measurement are
dependent heavily on technical understanding and cannot 
be read and interpreted like the general provision of a contract. They have 
meanings developed over time based on the views and the courts should defer 
to the ﬁ nding by the technical experts. It was argued that the speciﬁ c point of 
dispute was whether any outstanding amount “on account of ‘construction 
of embankment’ with pond ash in accordance with BOQ Item No. 2.02 (b) 
read with clause 305.2.2.3 of the Technical Speciﬁ cations” was payable to 
the contractor. This was a pure question of fact, over which the ﬁ ndings in 
the award had to be left alone. Counsel also highlighted that in many appeals, 
the DRB constituted an internal mechanism by NHAI, comprised entirely of 
technical personnel, nominated by it (NHAI) had also endorsed the opinion, 
which favoured the contractors’ interpretation. Given this background and 
the further like interpretation given in arbitration, by the tribunal, which 
again comprised of experts, there was no scope for interference.
629
7. Learned counsel submitted that the impugned judgment failed to 
or overlooked that there are two kinds of embankments- one with soil and 
the other, with ﬂ y ash and soil. Therefore, the contractor had quoted rates 
for these two kinds of embankment. 
8. It was highlighted that Clause 305 of MoRTH4 technical 
speciﬁ cations read together with the project speciﬁ c amendments contained 
in additional technical speciﬁ cations provides the formation of embankment 
with two types, viz. embankment with soil and embankment with pond 
ash, the material requirements for each of the above two types have been 
speciﬁ ed in clauses 305.2.2.2 (for soil) and 305.2.2.3 (for pond ash) of 
additional technical speciﬁ cations.
9. Counsel submitted, that furthermore, the impugned judgment 
overlooked that the TS clause 305 of MoRTH dealt only with embankment 
with soil; therefore a project specific sub-clause 305.2.2.3.2 of the 
construction operations, was included in the contract which speciﬁ es 
the various operations (viz., setting out, stripping and storing of top 
soil, compacting ground supporting embankment, spreading material, 
compaction, ﬁ nishing, quality control, a measurement for payment etc) 
to be followed by the contractor for embankment with pond ash. It was 
submitted that clause 305.2.2.3.2 further provides, “the work shall conform 
to clause 4.7.l of IRC SP:58 - 2001”. It was highlighted that the contract 
contemplated payment for ‘construction of earth embankment
with soil’ in 
BOQ5 item 2.02(a) and ‘construction of Pond ash embankment with pond 
ash’ in BOQ item No. 2.02. It was also contended that BOQ pertains to the 
execution and completion of the entire item of work in compliance with the 
contract requirements and does not relate only to any individual material/ 
consumables used in the execution of the work.
10. It was argued that the contract conditions and stipulations are 
to be read as a whole; thus, technical speciﬁ cations, drawings and other 
documents form part of the contract which cannot be considered in 
isolation. The counsel also emphasized that the preamble to the BOQ and 
the technical speciﬁ cations read together also mandate that the rates given 
4 
Ministry of Road Transport and Highways
5 
Bill of Quantities
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
630
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
in BOQ item 2.02 (a) and (b) are for the construction of embankment 
i.e., soil embankment and pond ash embankment and not for the usage of 
materials in an embankment. It was highlighted that the applicable test for 
interference with awards was clearly enunciated in Associate Builders v 
Delhi Development Corporation (“hereafter, “Associate Builders”)6 and 
was ignored by the impugned judgment. Counsel also relied on BOC India 
Ltd. vs. Bhagwati Oxygen Ltd7 and urged that since the tribunal had relied 
on a plausible view on interpretation of the contract, it was not open to the 
court to set aside the award.
11. Ms. Aishwarya Bhati learned Additional Solicitor General (ASG) 
appeared for NHAI and urged the court not to interfere with the impugned 
judgment of the High Court and other decisions which followed it, which 
are the subject matter of all these appeals. She contended that the Division 
Bench’s interference with the award was justiﬁ ed and warranted. Learned 
counsel highlighted the diﬀ erence in the stipulations as they existed in the 
contract as opposed to what was cited in the majority award which is the 
subject matter of appeal in the impugned judgment. It was contended that 
the clause was wrongly reproduced and consequently, not only vitiated 
by incorrect interpretation but rather a case of rewriting the terms of the 
contract by the tribunal. This meant that the tribunal acted beyond the 
terms of the
contract. Learned counsel, emphasized that such rewriting 
was suﬃ  cient justiﬁ cation for the Division Bench to interfere with the 
award. This aspect had been lost sight of – even overlooked by the learned 
Single Judge.
12. It was argued next that the interpretation by the contractors and 
the tribunal, if accepted, will lead to absurd results so far as the ratio of 
soil and pond ash used in an embankment is concerned. These components 
or materials vary from case to case. Therefore, it would be illogical and 
rather unfair to cast a liability upon the NHAI to pay at one rate regardless 
of the soil and pond ash used for the work. Learned counsel highlighted 
that embankment construction can involve varied ratios of such materials 
– ranging from 9:1 to 3:2 at diﬀ erent locations. Therefore, the Division 
6 
2014 [13] SCR 895
7 
2007 [3] SCR 915
631
Bench correctly held that it would not be justiﬁ ed to cast this liability upon 
the NHAI. 
13. It was also highlighted that the tribunal and the learned Single 
Judge erred in improperly analyzing the stipulations and conditions 
in the contract. Clauses 2.02(a) and (b) reveal that there is only BOQ 
Item, i.e., embankment. The separate treatment in the stipulation only 
meant that the embankment could be constructed one way, where the 
soil was used and second, where both soil and pond ash was used. 
Learned counsel submitted that in terms of clause 305.8 of the technical 
speciﬁ cations, cross-sections had to be quantiﬁ ed proportionately. The 
ASG further highlighted that for two years, separate measurements 
were taken and consequently it was incorrect to contend that separate 
measurements for both the materials were not possible. It was further 
argued that embankment work with pond ash and soil is completed by 
layering wherever concerned materials are necessary and easily capable 
of measurement. Further, she argued that separate quantities were 
expressly notiﬁ ed and mentioned in the concerned conditions which the 
parties at the relevant time intended to give meaning to. This aspect was 
highlighted by the dissenting award of one member of the tribunal, who 
upheld the EE’s decision to reject the claim based on such interpretation. 
Therefore, wherever soil was used it had to be paid as per Clause 2.02(a) 
and wherever pond ash was used, payment had to be as
per Clause 2.02 
(b) read with TS 305.2.2.3. Lastly, it was contended that the intention 
of the draftsman was clear as any reference to technical speciﬁ cation 
was avoided but a mention was made of IRC:SP:58.201 and instead it 
was only TS 305 and TS 305.2.2.3 were used. These did not deal with 
or describe embankments to be constructed with ﬂ y ash or even they 
ought to be designed in a composite manner.
14. The ASG relied on Indian Oil Corporation v Shree Ganesh 
Petroleum Rajgurunagar8; PSA SICAL Terminals Pvt. Ltd. v. Board of 
Trustees of V.O. Chidambranar Port Trust9; South East Asia Marine 
8 
2022 (16) SCR 450
9 
2021 (5) SCR. 408
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
632
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
Engineering and Constructions Limited (SEAMEC Ltd) v Oil India Ltd10
and other decisions, in support of NHAI’s argument that if the interpretation 
adopted by a tribunal is unsupported by law, or wholly incorrect, in the given 
facts of a case, the award can be interfered with. It was submitted that so 
long as the interpretation of contractual terms is reasonable and possible, 
awards should not be interfered with. However, if awards do not adopt such 
an interpretation, and adopt one, which results in unreasonable expansion 
of any express contractual term, they can and should be interfered with. 
Learned counsel submitted that the occasion for exercise of such discretion 
was exercised rightly, by the impugned judgment.
Analysis and Conclusions
15. Before dealing with the merits, it is essential to extract the relevant 
contract stipulations. The main judgment which involved the contract for 
works Allahabad Bypass Project of a road from KM 158 to KM 198 (except 
Ganga Bridge) was concerned with the following clauses:
Item
Description
Unit
Est. Qty.
Units Rate
(INR)
Amount INR
In words
In 
ﬁ gu
res
In words
In ﬁ gures
2.02
Construction 
of embankment 
with approved 
material complete 
as per Technical 
Speciﬁ cations 
Clause 305 with all 
leads and lifts
a) With Soil
CuM
1198000
Rs. 
One 
hundred and 
two only.
102
R u p e e s 
twelve crore, 
twenty 
one 
lakhs ninety 
six thousand 
only
122,196,000
b) With Pond Ash
CuM
3252000
Rs. 
Two 
hundred and 
ﬁ fty two only
252
R u p e e s 
e i g h t y 
one 
crore 
ninety 
ﬁ ve 
lakhs 
four 
t h o u s a n d 
only
819,504,000
10 2020 (4) SCR 254
633
16. For pond ash embankment under BOQ item No. 2.02(b), the 
relevant stipulation for measurement and payment are Clause 305.8 and 
Clause 305.2.2.3.3 of additional technical speciﬁ cations, respectively. The 
said clauses are extracted below. The MoRTH speciﬁ cation reads as follows:
“305.8 Measurements of Payment
Earth embankment/subgrade construction shall be measured 
separately by taking cross sections at intervals in the original 
position before the work starts and after its completion and 
computing the volumes of earthworks in cubic metres by the 
method of average end areas…….”
Clause 305.2.2.3.3- relatable to Item No. 2.02(b) reads as under:
“Measurement for payment: Same as Clause 305.8 of MoRTH 
speciﬁ cations.”
The relevant stipulation for contract rate units for diﬀ erent items in 
rate contracts is clause 114.1; it reads as follows:
“114.1. - For item rate contracts, the contract unit rates for 
diﬀ erent items of work shall be payment in full for completing 
the work to the requirements of the speciﬁ cations including full 
compensation for all the operations detailed in the relevant 
sections of these speciﬁ cations under “Rates”. In the absence of 
any directions to the contrary, the rates are to be considered as 
full inclusive rate for ﬁ nished work covering all labour, materials, 
wastage.... Arising out of General Conditions of Contract.”.
17. The majority award, in the main judgment (from which CA 
4658/2023 arises) listed why the members in the
majority found for the 
contractor:
“i) It is contemplated in the contract to construct two types of 
embankments. One with the soil alone, and the second one with the 
combination of soil pond ash. 
ii) The embankment with pond ash alone cannot be constructed, as the 
pond ash is susceptible for erosion. Hence, the soil cover is provided 
for protection of the embankment. 
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
634
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
iii) The composite cross section of the embankment comprising of 
soil and pond ash together is as the collectively termed embankment 
construction with pond ash under BOQ item No. 2.02(b) 
iv) The method of measurement to be adopted for payment for the 
embankment construction with soil or with pond ash is one and 
the same, which is by taking composite cross section as a whole of 
the embankment and determining the volume by average end area 
method.
v) The method of measurement adopted by the Engineer, where in, 
the area of the cross section has been bifurcated to account for area 
occupied by the soil and pond ash for determination of quantum of 
the embankment in two diﬀ erent items if contrary to the technical 
speciﬁ cation Clause 305.8. 
vi) Clause 114.1 of MORTH speciﬁ cation speciﬁ cally states that 
the rates are for the ﬁ nished work in all respects. The pond ash 
embankment comprising of soil and pond ash is composite and 
complete ﬁ nished item of work. It cannot be separated into two 
diﬀ erent items as having been done by the Engineer. 
vii) The contention of the claimant that the whole cross section of 
the pond ash embankment shall be measured as one cross section for 
determination of the work under Item No. 2.02 (b) is fully supported 
by the contract conditions.”
The member of the tribunal, who dissented, inter alia, recorded that 
a reading of the speciﬁ cations: 
“clearly shows that wherever soil is used it
will be measured 2.02 
(a) with whenever pond ash is used it will be measured under 2.02(b) 
with TS 305.2.2.3.
13.3.7 I agree with the view taken by the Engineer while rejecting 
claim, as the view of the Engineer is strictly as per contract/BOQ 
provision as in this particular Contract embankment with soil 
and pond ash appear under one item and are · very conspicuously 
bifurcated for diﬀ erent materials.
635
13.3.8 I analyse that claimant has ﬂ awed under and after thought to 
claim even soil as ﬂ y ash under item No.2.02 (b). of BOQ.
13.3.9 Thus I draw ﬁ rm conclusion that the provision made in the 
BOQ item 2.02 (a) and 2.02 (b) are for diﬀ erent material i.e. 2.02 
(a) is for soil and 2.02 (b)is for pond ash and is for type of material 
to be used in the respective items.”
18. A reasoning similar to the majority award, which was in issue 
in the main judgment, was adopted in awards, rendered by tribunals of 
other contractors, such as CEC -HCC(JV)11; Sunway Construction12; Patel 
KNR JV13; and Oriental Structural Engineers (P) Ltd (hereafter, “Oriental 
Structures”)14. In some cases, the stipulation was for the construction of 
an “embankment with approved materials from borrow areas” in terms 
of TS clause 305, and also the construction of an embankment “with ﬂ y 
ash obtained from coal or lignite burning thermal power station” (CA 
4659/2023); likewise, ﬂ y ash or lignite burning thermal station as waste 
material (CA 4660/2020); “all types of soil” and “with ﬂ y ash obtained 
from coal or lignite burning thermal power station” (CA 4661/2023) and 
pond ash (CA 4662/2023). 
19. In some cases, the DRP (or DRB) set up departmentally, with 
three experts (in CA 4659/2023) expressed its view in the following terms:
“4.1.5...The above contract stipulation clearly means that the 
Embankment 6 or Subgrade, as the case may be, shall be measured 
separately by taking cross
sections at intervals before the Embankment 
work starts and after its completion. The use of phrase ‘taking 
cross sections ....... before the Embankment work starts and after 
its completion’ means nothing but measurement of embankment as 
o whole. In other words what is to be measured is an embankment 
and such measurement shall be by taking cross sections at suitable 
intervals before the start of Embankment work and after completion 
of Embankment of work. In other words the volume of the 
11 The appellant in CA 4659/2023;
12 Appellant in CA 4660/2023
13 Appellant in CA 4661/2023
14 Appellant in CA 4662/2023
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
636
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
entire embankment formed by ﬂ yash and Soil as per Additional 
Technical Speciﬁ cations Clause A-14 is to be measured. Had the 
intention of the contract been measuring soil separately then it would 
be necessary to take cross sections repeatedly of every intermediate 
layer at the junction of the core ﬂ y ash with soil side cover and also at 
top of ﬂ y ash layer before covering it with 1m soil layer, which is not 
stipulated so in the mode of measurement for payment in the Contract. 
[…]
4.1.8 The item is for construction of embankment with fly ash. 
The words “with Fly Ash” are the adjective qualifying the type of 
Embankment. Thus, if is necessary to measure embankment as a 
whole and not the individual materials comprising embankment. 
Had the item been described as “Providing ﬂ y ash for embankment” 
then it would have been appropriate to measure ﬂ y ash material only. 
The intention of contract is to measure the embankment. This is also 
corroborated from the description of BoQ item no.2.02(a), which is 
only in one type of material i.e. approved material; the phrase used in 
description is “construction of embankment with approved materials”. 
Here too embankment as an item and the words approved material is 
the adjective qualifying the type of embankment.”
In other appeals too, the DRP gave similar directions and instructions. 
In Oriental Structures’ (supra) appeal (CA 4662/2023), the DRB’s decision, 
inter alia, was
that:
“The decision of DRB is to measure the soil cover & Pond Ash together 
for Pond Ash embankment& be paid under BOQ item 2.02 (b). The 
ﬁ nal quantity under BOQ item 2.02(b) are with Engineer & shall be 
submitted to Employer & to be paid at the rates approved after the 
Arbitration in vogue as on the days after allowing the rebate provided 
by Contractor in his oﬀ er.”
20. It is quite evident that in most cases, the view of DRPs and tribunals, 
and in two cases, majority awards of tribunals, favoured the arguments of 
contractors, that composite embankment construction took place, as a result 
of which measurement was to be done in a composite, or uniﬁ ed manner. 
Dissenting or minority views, wherever expressed, were premised on
637
separate measurements. This opinion was of technical experts constituted as 
arbitrators, who were versed in contractual interpretation of the type of work 
involved; they also had ﬁ rst hand experience as engineers who supervised 
such contracts. When the predominant view of these experts pointed to one 
direction, i.e., a composite measurement, the question is what really is the 
role of the court under Section 34 the Act.
21. This court, in M/s. Voestalpine Schienen GmbH v DMRC15
commenting on the value of having expert personnel as arbitrators, 
emphasized that “technical aspects of the dispute are suitably resolved by 
utilising their expertise when they act as arbitrators.” Such an approach 
was commended also in Delhi Airport Metro Express (P) Ltd v DMRC16
wherein this court held that:
“The members of the Arbitral Tribunal, nominated in accordance 
with the agreed procedure between the parties, are engineers and 
their award is not meant to be scrutinized in the same manner as one 
prepared by legally trained minds. In any event, it cannot be said that 
the view of the Tribunal is perverse. Therefore, we do not concur with 
the High Court’s opinion that the award of the Tribunal on the legality 
of the termination notice is vitiated due to the vice of perversity.” 
22. The prevailing view about the standard of scrutiny- not judicial 
review, of an award, by persons of the disputants’ choice being that of 
their decisions to stand- and not interfered with, [save a
small area where 
it is established that such a view is premised on patent illegality or their 
interpretation of the facts or terms, perverse, as to qualify for interference, 
courts have to necessarily chose the path of least interference, except 
when absolutely necessary]. By training, inclination and experience, 
judges tend to adopt a corrective lens; usually, commended for appellate 
review. However, that lens is unavailable when exercising jurisdiction 
under Section 34 of the Act. Courts cannot, through process of primary 
contract interpretation, thus, create pathways to the kind of review which 
is forbidden under Section 34. So viewed, the Division Bench’s approach, 
of appellate review, twice removed, so to say [under Section 37], and 
15 2017 (1) SCR 798
16 2021 (5) SCR 984
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
638
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
conclusions drawn by it, resulted in displacing the majority view of the 
tribunal, and in many cases, the unanimous view, of other tribunals, and 
substitution of another view. As long as the view adopted by the majority 
was plausible- and this court ﬁ nds no reason to hold otherwise (because 
concededly the work was completed and the ﬁ nished embankment was 
made of composite, compacted matter, comprising both soil and ﬂ y ash), 
such a substitution was impermissible. 
23. For a long time, it is the settled jurisprudence of the courts in the 
country that awards which contain reasons, especially when they interpret 
contractual terms, ought not to be interfered with, lightly. The proposition 
was placed in State of UP v Allied Constructions17:
“[..] It was within his jurisdiction to interpret Clause 47 of the 
Agreement having regard to the fact-situation obtaining therein. It is 
submitted that an award made by an arbitrator may be wrong either 
on law or on fact and error of law on the face of it could not nullify 
an award. The award is a speaking one. The arbitrator has assigned 
suﬃ  cient and cogent reasons in support thereof. Interpretation of a 
contract, it is trite, is a matter for arbitrator to determine (see M/s. 
Sudarsan Trading Co. v. The Government of Kerala, AIR (1989) SC 
890). Section 30 of the Arbitration Act, 1940 providing for setting 
aside an award is restrictive in its operation. Unless one or the other
condition contained in Section 30 is satisﬁ ed, an award cannot be set 
aside. The arbitrator is a Judge chosen by the parties and his decision 
is ﬁ nal. The Court is precluded from reappraising the evidence. Even 
in a case where the award contains reasons, the. interference therewith 
would still be not available within the jurisdiction of the Court unless, 
of course, the reasons are totally perverse or the judgment is based 
on a wrong proposition of law”
24. This enunciation has been endorsed in several cases (Ref 
McDermott International Inc. v. Burn Standard Co. Ltd18). In MSK Projects 
(I) (JV) Ltd v State of Rajasthan19 it was held that an error in interpretation 
17 2003 Supp (2) SCR 55
18 2006 Suppl. (2) SCR 409
19 2011 (9) SCR 402
639
of a contract by an arbitrator is “an error within his jurisdiction”. The 
position was spelt out even more clearly in Associate Builders (supra), 
where the court said that:
“[..] if an arbitrator construes a term of the contract in a reasonable 
manner, it will not mean that the award can be set aside on this ground. 
Construction of the terms of a contract is primarily for an arbitrator 
to decide unless the arbitrator construes the contract in such a way 
that it could be said to be something that no fair minded or reasonable 
person could do.”
25. Before ending the discussion, it would be also necessary to 
highlight one aspect which is likely to arise in some arbitration proceedings, 
especially when it involves adjudication by multi-member tribunals. This 
aspect was highlighted in Russel on Arbitration, where the relevance of a 
dissenting opinion was explained as follows [as quoted in Dakshin Haryana 
Bijli Vitran Nigam Ltd. v. Navigant Technologies (P) Ltd (hereafter, “Dakshin 
Haryana Bijli Vitran Nigam Ltd”)20]:
“6-058. Dissenting opinions.—Any member of the Tribunal who 
does not assent to an award need not sign it but may set out his own 
views of the case, either within the award document or in a separate 
“dissenting opinion”. The arbitrator should consider carefully whether 
there is good reason for expressing his dissent, because a dissenting 
opinion may encourage a challenge to the award. This is for the 
parties’ information only and does not form
part of the award, but it 
may be admissible as evidence in relation to the procedural matters 
in the event of a challenge or may add weight to the arguments of a 
party wishing to appeal against the award.”.21
This court also quoted Gary B. Born’s commentary on International 
Commercial Arbitration22 opinion:
20 2021 (1) SCR 1135
21 David St. John Sutton, Judith Gill and Matthew Gearing QC, Russel on Arbitration, 
24th Edn. (Sweet & Maxwell), p. 313.
22 Gary Born, International Commercial Arbitration, Wolters Kluwer, Edn. 2009, Vol. II, 
p. 2466 & 2469.
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
640
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
“Even absent express authorization in national law or applicable 
institutional rules (or otherwise), the right to provide a dissenting or 
separate opinion is an appropriate concomitant of the arbitrator’s 
adjudicative function and the Tribunal’s related obligation to make a 
reasoned award. Although there are legal systems where dissenting 
or separate opinions are either not permitted, or not customary, these 
domestic rules have little application in the context of party-nominated 
co-arbitrators, and diverse Tribunals. Indeed, the right of an arbitrator 
to deliver a dissenting opinion is properly considered as an element of 
his/her adjudicative mandate, particularly in circumstances where a 
reasoned award is required. Only clear an explicit prohibition should 
preclude the making and publication to the parties of a dissenting 
opinion, which serves an important role in the deliberative process, 
and can provide a valuable check on arbitrary or indefensible decision 
making. [.]
[…] 
There is nothing objectionable at all about an arbitrator “systematically 
drawing up a dissenting opinion, and insisting that it be communicated 
to the parties”. If an arbitrator believes that the Tribunal is making 
a seriously wrong decision, which cannot fairly be reconciled with 
the law and the evidentiary record, then he/she may express that 
view. There is nothing wrong — and on the contrary, much that is 
right — with such a course as
part of the adjudicatory process in 
which the Tribunal’s conclusion is expressed in a reasoned manner. 
And, if the arbitrator considers that the award’s conclusions require 
a “systematic” discussion, that is also entirely appropriate; indeed, 
it is implied in the adjudicative process, and the requirement of a 
reasoned award.” 
[…]
… the very concept of a reasoned award by a multi-member Tribunal 
permits a statement of diﬀ erent reasons — if diﬀ erent members of the 
Tribunal in fact hold diﬀ erent views. This is an essential aspect of the 
process by which the parties have an opportunity to both, present their 
case, and hear the reasons for the Tribunal’s decision; not hearing the 
dissent deprives the parties of an important aspect of this process.”
641
26. In Dakshin Haryana Bijli Vitran Nigam Ltd, the court recollected 
the previous holding in Ssangyong Engg. & Construction Co. Ltd. v. NHAI 
(hereafter, “Ssangyong Engg. & Construction Co. Ltd.”)23, wherein the 
court had set aside the majority award, but issued consequential directions 
in the peculiar facts of the case:
“In Ssangyong [Ssangyong Engg. & Construction Co. Ltd. v. NHAI, 
(2019) 7 SCR 522], this Court upheld the view taken by the 
dissenting arbitrator in exercise of its powers under Article 142 of 
the Constitution, in order to do complete justice between the parties. 
The reason for doing so is mentioned in para 77 i.e. the considerable 
delay which would be caused if another arbitration was to be held. 
This Court exercised its extraordinary power in Ssangyong [Ssangyong 
Engg. & Construction Co. Ltd. v. NHAI,] keeping in mind the facts 
of the case, and the object of expeditious resolution of disputes under 
the Arbitration Act.”
However, the court did not, in Dakshin Haryana Bijli Vitran Nigam 
Ltd (supra) direct the dissenting opinion to be treated as an award. In the 
opinion of this court, that approach is correct, because there appears to 
be a slight divergence in thinking between Russel and Gary Born. The 
former, Russel is careful to point out that a dissenting opinion is not per 
se an award, but “is for the parties’ information only and does not form 
part of the award, but it may be admissible as evidence in relation to the 
procedural
matters in the event of a challenge.” However, Gary Born does 
not expressly say that the opinion is not a part of the award. That author yet 
clariﬁ es that “This is an essential aspect of the process by which the parties 
have an opportunity to both, present their case, and hear the reasons for 
the Tribunal’s decision; not hearing the dissent deprives the parties of an 
important aspect of this process.”
27. It is, therefore, evident that a dissenting opinion cannot be treated as 
an award if the majority award is set aside. It might provide useful clues in 
case there is a procedural issue which becomes critical during the challenge 
hearings. This court is of the opinion that there is another dimension to 
the matter. When a majority award is challenged by the aggrieved party, 
23 2019 [7] SCR 522
M/S HINDUSTAN CONSTRUCTION COMPANY LIMITED v. 
M/S NATIONAL HIGHWAYS AUTHORITY OF INDIA [S. RAVINDRA BHAT, J.]
642
SUPREME COURT REPORTS 
[2023] 11 S.C.R.
the focus of the court and the aggrieved party is to point out the errors or 
illegalities in the majority award. The minority award (or dissenting opinion, 
as the learned authors point out) only embodies the views of the arbitrator 
disagreeing with the majority. There is no occasion for anyone- such as the 
party aggrieved by the majority award, or, more crucially, the party who 
succeeds in the majority award, to challenge the soundness, plausibility, 
illegality or perversity in the approach or conclusions in the dissenting 
opinion. That dissenting opinion would not receive the level and standard of 
scrutiny which the majority award (which is under challenge) is subjected to. 
Therefore, the so-called conversion of the dissenting opinion, into a tribunal’s 
ﬁ ndings, [in the event a majority award is set aside] and elevation of that 
opinion as an award, would, with respect, be inappropriate and improper. 
28. In view of the ﬁ ndings recorded earlier, this court is of the opinion 
that all the appeals have to succeed. Therefore, C. A. No. 4658/2023, C. A. 
No. 4659/2023; C. A. No. 4660/2023; C. A. No. 4661/2023 and C. A. No. 
4662/2023 are allowed; all judgments of the Delhi High Court, which were 
the subject matter of challenge in those appeals are set aside. The awards, 
which were the subject matter of challenge, and to the extent they were set 
aside, are hereby upheld and restored. The direction in the awards, to the
extent they required compounded monthly interest payments, are modiﬁ ed. 
Instead, the NHAI shall pay uniform interest on the amounts due, on the 
head concerned, i.e., construction of embankment, to the extent of 12% 
from the date of award to the date of payment, within eight weeks from 
today. All the above appeals are allowed in these terms. There shall be no 
direction to pay costs. 
Headnotes prepared by: 
Appeals allowed.
Nidhi Jain