M/S Subhash Aggarwal Agencies Vs. M/S
Bhilwara Synthethics Ltd. & Ors  INSC 666 (13 December 1994)
MOHAN, S. (J) MOHAN, S. (J) AHMADI A.M. (CJ)
MANOHAR SUJATA V. (J)
CITATION: 1995 AIR 947 1995 SCC (1) 371 JT
1995 (1) 392 1994 SCALE (5)228
facts in brief leading to this civil appeal are as follows:
The appellant is a member of the Delhi
Hindustani Mercantile Association. By a claim petition dated 11.8.1979, the
appellant had claimed a sum of Rs.4,51,246.50 under various heads of accounts
including commission from the first respondent upto the period of 30.6.1979.
The claim related to transactions which took place between appellant and first
respondent. In turn, the first respondent was also a member of Delhi Hindustan
Mercantile Association. It also made a counter claim against the appellant. As
per the rules of the association, the dispute was referred to an Arbitrator.
an order dated 20.11.1981, the learned Single Judge of Delhi High Court
directed in terms of the concession made on behalf of the Association and the
Sole Arbitrator, a reasoned award shall be passed by the Arbitrator.
Sole Arbitrator (Mohan Lal) entered upon the reference. On 19.7.1983, by a
reasoned award, he awarded a sum of Rs.1,97,891.81 in favour of the appellant
against the first respondent. The amount was also to carry interest @ 18% per
annum from the date of the award till the date of payment. Aggrieved by this
award the first respondent preferred an appeal as per Rule 37 Regulation 7 of Delhi
Hindustani Mercantile Association Rules'). The appeal was heard by the
Tribunal. By an order dated 24.2.1984, the Tribunal confirmed the award of the
Arbitrator without assigning any reasons.
this order, the appellant preferred Suit No.498- A/84 for making the award a
rule of the court. The first respondent filed objections against the Award.
Inter alia, it was urged by it that the award was not a reasoned award.
A learned single Judge of the High Court of
394 Delhi by an order dated 5.4.1990 allowed the objections and set-aside the
award of the appellate Tribunal and remitted the award to Tribunal for
reconsideration and for giving reasons for the Award within four months from
the date oil the judgment.
the correctness of this judgment, the appellant preferred Appeal FAO (OS)
113/90 before the High Court. The said appeal was dismissed in limine by the
impugned order date 17.7.1990.
learned counsel for the appellant would argue that in so far as the award dated
19.7.1983 is concerned it is a reasoned award. That is enough compliance with
Generally speaking, when the Appellate
Tribunal merely confirms that reasoned award, it is not necessary again to give
reasons. Therefore, the High Court erred in setting- aside the order of the
Appellate Tribunal on the ground that no reasons were given in that order. The
principle of merge did not apply to the present proceedings where the parties
had consented to a reasoned award by the Sole Arbitrator.
In any event, the High Court erred in
requiring reasons to be given even at the appellate stage overlooking the fact
that the Award dated 19.7.1983 is a reasoned award.
opposition to this, the learned counsel for the respondent would urge that in
law as laid down in Commercial Arbitration by Mustill and Body, Second Edition
at pages 364-65 when the appellate tribunal has made an award either confirming
or reversing the original award, it is the award of the Tribunal which defines
the rights of the parties.
appellate award once made completely replaces the original award. Therefore, a
party is entitled to know the reasons as to why the appellate authority has
come to such a conclusion. Once the award of the Sole Arbitrator was subject to
an appeal, the award of the appellate authority supersedes the original award
and it is only that award which exists in law. Such an award must contain
reasons for its decision. This Court in Indian Oil Corporation v.
Indian Carbon Ltd., 1983 (3) SCR 426 has
stressed the requirement of the Arbitrator to give reasons in the Award.
first respondent filed O.M.P.37 no. of 1980 before the High Court of Delhi.
That was a petition under Sections 5 and 12(2) of Arbitration Act,1940. The
prayer was that the authority granted in favour of Delhi Hindustani Mercantile
Association and the Arbitrator (Mohan Lal) be revoked: a sole arbitrator be
appointed in their places and that a direction may be issued that the
arbitrator agreement shall cease to have any effect. By order dated 20.11.1981,
the said petition was dismissed with the following directions:
"In the circumstances, I would,
therefore, dismiss the petition subject, however to the direction to the
arbitrator, in terms of the concession made on behalf of the Association and
the Arbitrator, that the Arbitrator would hear the matter after giving
reasonable opportunity to the petitioner of being heard, and to make a reasoned
award on the conclusion of the proceedings. The petitioner would be at liberty
to raise before the Arbitrator, as indeed in any proceedings, subsequent to the
award any question of law or fact, irrespective of whether they have been
raised and/or dealt with in the present proceedings, including the question as
to the effect of the petitioner's resignation on the arbitration agreement and
the 395 arbitration proceedings." (emphasis supplied).
to this direction, the matter was taken up by the Sole Arbitrator any by his
reasoned award dated 19.7.1983, he ultimately held as under:
"Thus, for the above reasons, I do
hereby award a sum of Rs. 1,97,891.81 (Rupees one lakh ninety seven thousand
eight hundred ninety one and paise eighty one only) against respondent No. 1
(M/s Bhilwara Synthetic Limited, who are the principal respondents in this
case, as agreed by themselves also) in favour of the claimant (M/s Subhash
Aggarwal Agencies). I further give my award that respondent is liable to pay
interest at 18% P.A. on this award amount from this day to the date of making
the whole payment by the re- spondent No. 1. " 11.This award fully
conforms to the order dated 20.11.1981 of the High court made on concession
between the parties.
Aggrieved by the same, as per Regulation 7 of
Rule 37 of the Rules, the matter was taken up in appeal to the Tribunal by the
first respondent. It may be relevant at this stage to quote Regulations 7 and
10 of Rule 37 of the Rules. The said regulations read as under:
"7: If any of the parties is not agreed
with the decision of the Arbitrator, the party may file the appeal against the
decision within 30 days from the date of decision. The cost of the appeal's
documents will be Rs.20/- Note:The holiday will not be counted for the period
of expire of aforesaid time limit.
: If any of the [parties files the appeal against the decision of the Arbitrator,
the appeal will be heard by the Tribunal con- sisting of three members and its
decision will be final."
24.2.1984, the Tribunal dismissed the appeal of the respondent and confirmed
the award of the Sole Arbitrator.
That order reads as under:
"We have heard the arguments for both
the parties and also taken into consideration their objections raised by them.
The appeal of the appellant is dismissed and the award of the Arbitrator Shri
Mohan Lal dated 19.7.1983 is hereby upheld. Parties to bear their own costs.
Order be pronounced. "
was set aside by the learned single Judge by his order dated 5.4.1990 on the
ground that as the award given by the Tribunal is bereft of reasons, it cannot
be made a rule of the Court. In his opinion the award given by the Tribunal is
the final award and this award is to be made a rule of the Court. No reasons
had been given at all.
Only the conclusion has been stated. The
award does not indicate as to how the Tribunal have arrived at the con-
clusion. The award of the Appellate Tribunal is directly in conflict with the
direction given by this Court by order dated 20.11.1981 which specifically
provided that the arbitrator should make a reasoned award. No reasons
whatsoever have been assigned. This is the final award. It should have
contained the reasons. Thus, it cannot be legally sustained and has to be set
aside. The order of the learned singly Judge was confirmed in FAO(OS) 113/90
when the Division Bench dismissed the same laconically saying:
a perusal of the award dated 396 19.7.1983of the Sole Arbitrator, it cannot be
disputed that it contained reasons as to why an award of Rs. 1,97,891.81 was
made in favour of the appellant. Therefore, that is fully in conformity with
the direction given by the High Court on 20.11.198 1. Now, the High Court holds
that the appellate order of the Tribunal dated 19.7.1983 must also give
reasons. This finding is arrived at on two grounds:
(1) The award of the Tribunal is the final
award which has to be made a rule of Court;
(ii) The failure to give reasons runs counter
to the directions of the High Court dated 20.11.1981.
can shortly dispose of the second ground before we take up the first. The
direction dated 20.11.1981 does not envelop the appellate authority. Before we
proceed further, we will consider the relevant law on this aspect. The
Arbitrator should give reasons, is beyond dispute.
on Arbitration (Twentieth Edition)at page 291 says:
"In order that an appeal (if it takes
place) may be affective, the court has power to order an arbitrator or umpire
to give reasons for his decision in sufficient detail to enable the Court to
consider any question of law arising out of the award. Where the arbitrator or
umpire gives no reason for making the award, the Court must not make an order
unless it is satisfied either that before the award was made, one of the
parties gave notice to the arbitrator or umpire that a reasoned award would be
required: or that there was some special reason why such notice was not given,
or unless all the parties to the arbitration consent to the order being
made....." All that is necessary under the Act of 1979 is that the
arbitrators should give a reasoned award", i.e. the arbitrators should set
out that, in their view of the evidence, did or did not happen and should
explain succinctly why in the light of what happened they had reached their
decision and what that decision was. They are not expected to analyse the law
and the authorities. "
at page 335 it is stated:
"An arbitrator does normally have to
state Ms reasons in his award, but, of course, may be ordered by the Court to
do so, or to amplify those already given.
illuminating passage is found in Arbitration Law by Robert Merkin, 1991 Edn. It
is stated in the following paragraphs as under:
English arbitration law does not impose any general duty upon arbitrator to
give reasons for their award, although the parties are of course free to agree
that the award should contain reasons. The provision of a reasoned award is
nevertheless of great significance under English law as, presented with a
reasoned award, it becomes possible for the High Court to determine whether the
arbitrators have made any error of law in reaching their conclusions. In order
to ensure that the possibility of an appeal on point of law is not defeated by
the failure of the arbitrators to provide a reasoned award, the 1979 Act
provides a mechanism whereby sufficient reasons may be obtained to facili- tate
judicial review: if reasons are not available, the High Court has no
jurisdiction to hear any appeal based on error of law.
19.23: It would seem that where arbitrators
do determine to give reasons for their 397 award, or are ordered to do so by
the High Court or the parties themselves, no great obligation is involved; this
is by way of contrast to the old special case procedure. The often repeated
guidelines were laid down by Donaldson LJ in (1981) 2 Lloyd's Rep 130, at p
It is of the greatest importance that trade
arbitrators working under the 1979 Act should realise that their whole approach
should now be different. At the end of the hearing they will be in a position
to give a decision and the reasons for that decision. They should do so at the
earliest possible moment ... No par- ticular form of award is required..... All
that is necessary is that the arbitrators should set out what on their view of
evidence, did or did not happen, and should explain succinctly why in the light
of what happened, they have reached their decision and what that decision
is...... where a 1979 Act award dif- fers from a judgment is in the fact that
the arbitrators will not be expected to analyse the law and the authorities. It
will be quite sufficient that they should explain how they reached their
conclusion ... The point -which I am seeking to make is that a reasoned award,
in accordance with the 1979 act, is wholly different from an award in the form
of a special case. It is not technical, it is something which can and should be
produced promptly and quickly at the conclusion of the nearing.
The courts have, consistently with this
passage, stressed that award are not legal judgments and thus must not be
viewed in a pedantic or over critical fashion. Equally, the fact that an award
is short does not mean that it is inadequately reasoned. In particular it is
not necessary for for arbitrators to set out lists of rival submissions or
factual propositions and to choose between them. It is enough that the award
demonstrates why the arbitrators have found for one party rather than the
Situations in which reasons may be ordered.
24 : The operation of S. 1(5) - (6) of the
Arbitration Act 1979 is most easily explained by separate consideration of each
of the situation in which it may be required. These are as follows:
(a) The parties have agreed that a reasoned
award is required, or have otherwise asked the arbitrators for a reasoned
(b) The parties have agreed that no reasons
are to be given, or have otherwise asked the arbitrators not to include reasons
in their award.
(c) There is no agreement as to reasons, but
neither party has asked for reasons.
(d) There is no agreement as to reasons, and
one party has requested reasoned award.
(e) There is no agreement as to reasons ,and
one party has requested an award not containing reasons.
19. The Indian Law is stated by N.D. Basu on
Arbitration (Eighth Edition) ar para 2228 at pages 853-836. It reads:
"2228. Whether arbitrators should give
reasons for decisions:- An award of arbitrators is not a reasoned judicial de-
cision and the arbitrators need not give reasons for their decisions, and even
ignore any proposition advanced by the parties. The court in filing an award
wherein 398 the arbitrators have failed to give a decision or any matter, the
subject of dispute cannot be deemed to have exercised a jurisdiction not vested
in it by law or to have failed to exercise a jurisdiction vested in it by law.
arbitrator is not bound by the technical rules of procedure which the court
must follow, nor need he record separate findings on the various points on
which the parties are at issue or write a reasoned judicial decision. All that
he is required to do is to give an intelligible decision which determines the
rights of the parties in relation to the subject-matter of the reference. While
it is not necessary for an arbitrator to give reasons for his own conclusions
or to give separate finding on each and every issue in- volved in the dispute,
every party that appoints an arbitrator has right to expect an intelligible
decision which determines the rights of the parties in the various important
points which are at issue. Mere omission to give reasons does not vitiate the
award. It is not open to the court to speculate where no reasons have been
given by the arbitrator as to what impelled him to arrive at a conclusion and
to determine whether the conclusion was right or not. " (Emphasis
supplied) 20.A few rulings of this Court may now be seen. In Bungo (para 9),
this court observed thus:
"It is now a well-settled principle that
if an arbitrator, in deciding dispute before him, does not record his reasons
and does not indicate the principles of law on which he has proceeded, the
award is not on that account vitiated. It is only when the arbitrator proceeds
to give his reasons or to lay down principles on which he has arrived at his
decisions that the Court is competent to examine whether he has proceeded
contrary to law and is entitled to interfere if such error in law is apparent
on the face of the award itself"(emphasis supplied)
in Firm Madanlal Roshanlal v.Hukumchand Mills, AIR 1967 SC 1030 at 1031-32, it
"In the present case, the arbitrator
gave no reason for the award. We do not find in the award any legal proposition
which is the basis of the award, far less a legal proposition which is
erroneous. It is not possible to say from the award that the arbitrator was
under a misconception of law. The contention that there are errors of law on
the face of th e award is rejected." (emphasis supplied)
reference may be made to the decision of Indian Oil Corporation (supra), it is
held as under:
"In India, there has been a trend that
reasons should be stated in the award. The reasons that are set out must be
reasons which will not only by intelligible but also deal with the substantial
points that have been raised.
When the arbitration clause required the
arbitrator to give a reasoned award, the sufficiency of the reasons depend upon
the facts of the particular case. He is not bound to give detailed reasons.
The Court does not sit in appeal over the
award and review the reasons. The Court can set aside the award only if it is
apparent from the award that there is no evidence to support the conclusions or
if the award is based upon any legal proposition which is erroneous.
The reasons that are set out must be reasons
which will not only be intelligible but also deal with the substantial points
that have been raised. When the arbitration clause required the Arbitrator to
give his reasons in the award, the sufficiency of the reasons depend upon the
facts of 399 the present case. He is not bound to give detailed reasons. The
Court does not sit in appeal over the award and review the reasons.
The Court can set aside the award only if it
is apparent from the award that there is no evidence to support the conclusions
or if the award is based upon any legal proposition which is erroneous."
Raipur Development Authority v. M/s. Chokhamal Contractors, AIR 1990 SC 1426, a
five Judge Bench of this Court discussed the entire law on this aspect
Therefore, it is enough that we refer to this
ruling. It is stated in following paragraphs as under:
"3 : A brief history of the English law
of Arbitration is given in the learned treatise The Law and Practice of
Commercial Arbitration in England by Sir Michael, J. Mustill and Steward
C.Boyd. For centuries, commercial men preferred to use arbitration rather than
the courts to resolve their business disputes on account of the inherent
advantages in the settlement of disputes by arbitration. They preferred this
alternates method of settlement of disputes to the ordinary method of
settlement through courts because arbitration proceedings were found to be
cheap and quick.
it was no doubt true that the courts
repeatedly expressed doubts as to the wisdom o f this preference as reflected
by the current opinion that arbitration was an ineffective procedure, not that
it was undesirable in itself. The commercial community, has been however,
insisting on the right to arbitration and has always exhibited an interest in
seeking that the system is made to work as well as possible. This led to
repeated situatory intervention. Accordingly laws were passed from time to time
to make the ar- bitration proceedings effective. The English Arbitration Act of
1950 and the English Arbitration Act, 1979 are the two major pieces of
legislation which now control the arbitration proceedings in England. The legal
requirements of an award under English law are succinctly given in the Hand
Book of Arbitration Practice by Ronald Bernstein (1987). English Law does not
impose any legal award must be certain. It could be either interim or final. An
award without reasons is valid. "The absence of reasons does not
invalidate and award. In many arbitrations the parties want a speedy decision
from a tribunal whose standing and integrity they respect, and they are content
to have an answer Yes or No: or a figure of X. Such an award is wholly
effective; indeed, in that it cannot be appealed as being wrong in law it may
be said to be more effective than a reasoned award." 4 : Section 1 of the
English Arbitration Act, 1979, however, provides that if it appears to the High
Court that an award does not or does not sufficiently set out the reasons for
the award in sufficient detail to enable the court to consider any question of
law arising out of it, the court has power to order the arbitrator umpire to
give reasons of further reasons.] 5 : In the United States of America as a
general rule an arbitration award must contain the actual decision which
results from an arbitrator's consideration of the matter submitted to them but
the arbitrator need not write opinion with any specificity as a court of law
does unless otherwise provided by a statute or by the submission itself.
Arbitrators are not required to state in the
award each matter considered or to set out the evidence or to record findings
of facts or conclusions of law. They need not give reasons for their award and
conclusions or the grounds which form the basis for the arbitration
determination, describe the process by which they arrived at their decision or
the rationale of the award.
Although such matters a not required, the
award is not 400 necessarily] invalidated because it sets out the reasons or
the specific findings, matters, or conclusions on which it is based and faulty
reasoning if disclosed does not by itself vitiate the award. (See Corpus Juris
Secundum Vol. VI P. 324 - 325) 6: In Australia too an arbitrator, unless
required under Section 19 of the Australian Arbitration Act, 1902 to state in a
special case a question of law is under no obligation in law to give his
reasons for his decision (Vide University of New South Wales V. Max Cooper
& Sons Pt. Ltd. 35 Australian Law Reports 219.) x x x x x 21 : Thus it is
seen that the Law Commission did not recommenced the inclusion of a provision
in the Act requiring the arbitrator or umpire to give reasons for the award.
22 : It is not disputed that in India it had
been firmly established till the year 1976 that it was not obligatory the part
of the arbitrator or the Umpire to give reasons in support of the award when
neither in the arbitration agreement nor in the deed of submission it was
required that reasons had to be given for the award (Vide Firm Madanlal
Roshanlal Mahajan v. Hukumchand Mills Ltd., Indore (1967) 1 SCR 105, Bungo
Steel Furniture Pvt. Ltd. vs. Union of India AIR 1967 SC 378 and N. Chellappan
V. Secretary, Kerala State Electricity Board, AIR 1975 SC 230. It is, however,
urged by Shri Fali S. Nariman who argued in support of the contention that in
the absence of the reasons for the award, the award is either liable to be
remitted or set aside, that subsequent to 1976 there has been a qualitative
change in the law of arbitration and that it has now become necessary to insist
upon the arbitrator or the umpire to give reasons in support of the award
passed by them unless the parties to the dispute have agreed that no reason
need be given by the arbitrator or the umpire for his decision. Two main
submissions are made in support of the above contention.
The first submission is that an arbitrator or
an umpire discharges a judicial function while functioning as an arbitrator or
an umpire under the Act, and, therefore, is under an obligation to observe
rules of natural Justice while discharging his duties, as observed by this
Court in Payyavula "Vengamma V. Payyavula Kesanna, AIR 1953 SC 21.
This Court relied in that decision upon the
observations made by Lord Langdale MR. in Harvey v. Shelton, (1844) 7 Beav 455
at paged 462 which read thus:
"it is so ordinary a principle in the
administration of justice, that no party to a cause can be allowed to use any
means whatsoever to influence the mind of the Judge, which means are not known
to and capable of being met and resisted by the other party, that it is
impossible for a moment, not to see, that this was an extremely indiscreet mode
of proceeding, to say the very least of it. It is contrary to every principal
to allow of such a thing and wholly deny the difference which is alleged to
exist between mercantile arbitrations and legal arbitrations .
The first principle of justice must be
equally applied in every case. Except in the few cases where exceptions are
unavoidable, both sides must be heard, and each in the presence of the other.
In every case in which matters are litigated, must attend to the rep-
resentations made on both sides, and you must not, in the administration of
justice, in whatever form, whether in the regularly constituted courts or in
arbitrations, whether before lawyers or merchants, permit one sides to use
means of influencing the con- 401 duct and the decisions of the Judge, which
means are not know to the other side." (emphasis supplied) 23 : This Court
also relied on the decision in Haigh v. Haigh, 1861) 31 LJ Ch 420 which
required an arbitrator to act fairly in the course of its duties. The two well
recognized principles of natural justice are (1) that a Judge or an arbitrator
who is entrusted with the duty to decide a dispute should be disinterested and
unbiased (namo judex in cause sua): and (ii) that the parties to dispute should
be given adequate notice and opportunity to be heard by the authority (audialteram,
partem) (See Administrative Law by H.W.R. Wade, Part V and Judicial Review of
Administrative Action by S.A. de Smith, Third Edition, Chapter 4) , Giving
reasons in support of a decision was not considered to be rule of natural
justice either under the law of arbitration or under administrative law.
x x x x 33 : The people in India as in other
parts of the world such as England. USA. and Australia have become accustomed
to the system of settlement of disputes by private arbitration and have accepted
awards made against them as binding even though no reasons have been given in
support of the awards for a long time. They have attached more importance to
the element of finality of the awards and those reasons disclose any error
apparent on the face of the record people have not refrained from questioning
such awards before the courts.
It is not as if that people are without any
remedy at all in cases where they find that it is in their interest to require
the arbitrator to give reasons for the award. In cases where reasons as
required, it is open to the parties to the dispute to introduce a term either
in the arbitration agreement or in the deed of submission requiring the
arbitrator to give reasons in support of the awards. When the parties to the dispute
insist upon reasons being given, the arbitrator is, as already observed
earlier, under an obligation to give reasons. But there may be many
arbitrations in which parties to the dispute may not relish the disclosure of
the reasons given by the Indian Law Commission for not recommending to the
Government to introduce an amendment in the Act requiring the arbitrations to
give reasons for their awards we feel that it may not be appropriate to take
the view that all awards which do not contain reasons should either be remitted
or set aside. A decision on the question argued before us involves a ques- tion
of legislative policy which should be left to the decision of Parliament. It is
a well-know rule of construction that if a ,certain interpretation has been
uniformly put upon the meeting of a statute and transactions such as dealings
in property and making of contracts have taken place on the basis of that
interpretation upon it which will materially affect those transactions. We may
rear here to the decision of the court of Appeal rendered by Lord Evershed M.R.
in Brownsea Haven Properties v. Poole corpn. (1958) Ch 574 in which it is
"There is well established authority for
the view that a decision of long standing, on the basis of which many persons
will in the course of time have arranged their affairs should not lightly be
disputed by a superior court not strictly bound itself by the decision."
(emphasis supplied) In the present case, the arbitrator was directed to give a
reasoned award by an order dt. 20.11.1981 of the High Court.
That he is bound to do.
24.But the question is, where the arbitrator
had given sufficient reasons is it incumbent upon the appellate tribunal also
402 to give reasons more so, while confirming the same ? When an award is
subject to an appeal, what is the position? 25.In Commercial Arbitration by
Mustill & Boyd, (2nd Edition) it is state at pages 364-365 as under:
"When the appeal tribunal has made an
award, whether confirming, reversing or varying the decision of the original
arbitrators, it is the award of the appeal tribunal which defines the right of
The appellate award once made completely
replaces the original award of the arbitrators.
26. In the case on hand, the appellate
tribunal has confirmed the award in the manner set out as above when the
Tribunal upheld the award dated 19.7.1983 of the Sole Arbitrator, it stand to
reason that it has come to be confirmed for the same reasons as prevailed with
the Sole Arbitrator. To insist upon such reasons to be repeated by the
appellate authority will only be superfluous. An arbitration procedure should
be quick. Such proceedings cannot be equated to court proceedings nor do they
partake the character of trial. To insist upon the appellate tribunal to furnish
reasons for its confirmatory order is not warranted.
27. From the above extract it is manifest
1. non-reasons award is not violative of
2. Equally, such an award would not put a
party under a disadvantage, in that he is unable to question the same by
discerning the error apparent on the face of the record.
The plea of the respondents for which
reliance is placed on the above quoted passage from Mustill & Boyd (2nd
Edition) is when an arbitrator's award is, subject to an appeal the finals
award is the appellate award and the original award is replaced. Therefore, it
is the appellate award that is made the rule of the court. Hence reasons must
be given by the appellate authority. the contention cannot be accepted in view
of what we have held above.
28. Of course, If the appellate tribunal
reverses the arbitrator's award, it may be required to give reasons but that is
not the position here.
29. The essence of arbitration is to avoid
cumbersomeness of the court procedure to have a fair settlement. It is true
that the award of the appellate tribunal is the final award and it is that
which is to be made the rule of Court.
The Court by looking at the original award as
confirmed by the order of the appellate tribunal, can always discern the
reasons which in this case are fully contained in the award dated 19.7.1983of
the Sole Arbitrator.
30. In this view, we find great difficulty in
upholding the impugned judgment. Accordingly, it is set-aside. The civil appeal
stands allowed. However, there shall be no order as to costs.