M/S ANAND BROTHERS P. LTD. TR. M.D. versus UNION OF INDIA & ORS.

Citation: [2014] 10 S.C.R. 382 · Decided: 04-09-2014 · Supreme Court of India · Bench: T.S. THAKUR, C. NAGAPPAN, ADARSH KUMAR GOEL · Disposal: Dismissed
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Judgment (excerpt)

[2014] 10 S.C.R. 382 
A 
MIS ANAND BROTHERS P. LTD. TR. M.D. 
B 
V. 
UNION OF INDIA & ORS. 
(Civil Appeal No. 76 of 2009) 
SEPTEMBER 4, 2014 
[T.S. THAKUR, C. NAGAPPAN AND 
ADARSH KUMAR GOEL, JJ.] 
Arbitration Act, 1940: Arbitration Award passed in favour 
C of the appellant-company set aside by High Court on the 
ground that the expression "finding" appearing in Clause 70 
of the General Conditions of Contract implies something 
more than the mere recording of a conclusion by the Arbitrator 
and the Arbitrator failed to give the findings - High Court 
D remitted the matter back to the Arbitrator for a fresh 
determination of the disputes between the parties - Held: 
E 
Arbitrator's award was admittedly unsupported by any reason 
- High Court rightly set aside the award - Arbitration and 
Conciliation Act, 1996 - s.31(3). 
Words and phrases: 'findings' - Meaning of 
Dismissing the appeal, the Court 
HELD: 1. A plain reading of Clause 70 of the General 
F Conditions of Contract showed that the Arbitrator was 
required to (i) give his award within the stipulated period 
as extended from time to time. (ii) the Award must be on 
"all matter referred to him" (iii) the Award must indicate 
the findings of the Arbitrator along with sums, if any, 
G awarded (iv) the findings and award of sums if any must 
be separate on each item of dispute. [Para 5] [385, D-E] 
H 
2. Section 31 (3) of the Arbitration and Conciliation 
Act, 1996 obliges the arbitral tribunal to state the reasons 
382 
ANAND BROTHERS P. LTD. TR. M.D. v. UNION OF 
383 
INDIA 
upon which it is based unless the parties have agreed 
A 
that no reasons be given or the arbitral award is based 
on consent of the parties. The expression 'finding' has 
not been defined either in the agreement executed 
between the parties or in any statute for that matter. The 
expression shall, therefore, have to be given its ordinary 
B 
literal meaning having regard to the context in which the 
same is used. It is only when the conclusion is supported 
by reasons on which it is based that one can logically 
describe the process as tantamount to recording a 
finding. Clause 70 provides a mechanism for adjudication 
C 
of disputes between the parties and not only requires the 
Arbitrator to indicate the amount he is awarding in regard 
to each item of claim but also the "findings on each one 
of such items". The underlying purpose of making such 
a provision in the arbitration clause governing the parties, 
D 
obviously was to ensure that the Arbitrator while 
adjudicating upon the disputes as a Judge chosen by the 
parties gives reasons for the conclusions that he may 
arrive at. In the case at hand the Arbitrator's award was 
admittedly unsupported by any reason, no matter the 
Arbitrator had in the column captioned 'findings' made 
comments like 'sustained', 'partly sustained', 'not 
sustained'. The High Court was, therefore, justified in 
setting aside the award made by the Arbitrator and 
remitting the matter to him for making of a fresh award. 
[Paras 9, 11, 13, 14, 15, 16] [388-D-F; 389-F-G; 393-A-B; 
392-D, G, H; 349-A-B] 
E 
F 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 76 
of 2009. 
From the Judgment & Order dated 04.08.2008 in FAO 
(OS) No. 144 of 2002 of the High Court of Delhi at New Delhi. 
Saurabh Suman Sinha, Sunil Singh Parihar, S.K. 
Sabharwal for the Appellant. 
G 
H 
384 
SUPREME COURT REPORTS 
[2014] 10 S.C.R. 
A 
P.S. Patwalia, J.S. Attri, Vimla Sinha, Farrukh Rasheed, 
B.V. Balaram Das, Anil Katiyar for the Respondents. 
The Judgment of the Court was delivered by 
T.S. THAKUR, J. 1. ~ non-speaking arbitral award in 
B favour of the appellant-company was set aside by a learned 
Single Judge of the High Court of Delhi on the ground that the 
Arbitrator had not recorded his "findings" as required under 
Clause 70 of the General Conditions of Contract. Relying upon 
the decisions of this Court in Mis Daffadar Bhagat Singh and 
C Sons v. Income-tax officer, A Ward, Ferozepur (AIR 1969 SC 
340), Bhanji Bhadgwandas v. The Commissioner of Income-
tax, Madras (AIR 1968 SC 139 and Rajinder Nath etc. v. 
Commissioner of Income-tax, Delhi (AIR 1979 SC 1933) the 
High Court held that the expression "finding" appearing in 
D Clause 70 of the General Conditions of Contract implies 
something more than the mere recording of a conclusion by the 
Arbitrator. Inasmuch as the Arbitrator had failed to do so, the 
award rendered by him was unsustainable. The High Court 
accordin
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