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Report No. 76

4.45. Relevant consideratio.- Burden on the arbitrator.-

There are, it seems to us, several considerations that are relevant in determining the question whether an arbitrator should be required by law to give reasons for the award. The scheme of the Arbitration Act is to provide a domestic forum for speedy and substantial justice, untrammelled by legal technicalities, by getting the dispute resolved by a person in whom the parties have full faith and confidence. The award given by such a person under the scheme of the Act can be assailed only on very limited ground like those mentioned in section 30 of the Act.

The result is that most of the awards at present are made rule of the court despite objections to their validity by the, party against whom those awards operate. To have a provision making it obligatory for the arbitrator to give reasons for the award would be asking for the introduction of an infirmity in the award which in most cases is likely to prove fatal. Many honest awards would thus be set aside. Once the arbitrators are compelled to give reasons in support of the award, the inevitable effect of that would be that the validity of most of the awards would be challenged on the ground that the reasons, or at least some of them, are bad and not germane to the controversy.

Sometimes, if four reasons are given in support of the award and one of the reasons is shown to be not correct or not germane, the award would be challenged on the ground that it is difficult to predicate as to how far the bad reason which is not germane has influenced the decision of the arbitrator. Many awards would not survive court scrutiny in such circumstances.

Arbitration Act, 1940 Back

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