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Arbitrator to decide interpretation of terms of contract

The interpretation of the terms of a contract is primarily for the arbitrator to decide. He is entitled to take the view which he holds to be the correct one. The court while considering a challenge to an arbitral award would not sit in appeal over the arbitrator's decision unless it is totally unreasonable, the Supreme Court has stated while dismissing a large batch of appeals by National Highways Authority of India (NHAI) against mining companies. The dispute related to the liability of NHAI when the royalty payable to the firms was revised upwards. NHAI maintained that the additional amount was not payable to the firms in view of certain terms in the contract. The dispute was decided by arbitration which went against NHAI. Its appeal was dismissed.

 Article referred: http://www.business-standard.com/article/opinion/excise-duty-at-point-of-sale-sc-115050300727_1.html

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