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Judgment
Rajiv Sahai Endlaw, J.—Both arbitration suits u/s 14 of the Arbitration Act, 1940 have been filed by the respective parties to the arbitration with respect to the same arbitral award. IA No. 354/1983 u/s 30 and 33 of the Act in CS(OS) No. 1175A/1982 came to be filed by M/s. Pearl Woollen Mills Ludhiana.
The arbitral award dated 27th July, 1982 subject matter of these proceedings directs payment by the said M/s. Pearl Woollen Mills Ludhiana (Objector) to the Union of India (U.O.I) of a sum of Rs. 2,62,026.70 p. U.O.I though had preferred claims before arbitrator for much larger amount, has not filed any objections to the award.
The counsel for the Objector has fairly conceded that the arbitral award being non-speaking, in view of the law recently reiterated in Engineer Syndicate Vs. State of Bihar and Others, and Markfed Vanaspati and Allied Industries Vs. Union of India (UOI), , the scope of interference therewith is very limited.
The counsel for Objector at the outset sought adjournment to trace out a letter by which it was contended, both the parties had requested the arbitrator to give a reasoned award. However, in view of the suits being very old, adjournment was declined. The files of the suits including the arbitral record received in this Court were handed over to the counsel to find such letter if any on record. None has been found.
I have perused the objections filed. Only in ground No. 2, it is stated that on 9th March, 1982 the arbitrator had inquired from the parties'' counsel whether he should make a speaking award or a non- speaking award and that the counsel for both the parties had instructed the arbitrator to give a speaking award. It is further pleaded that subsequently on one of the dates of hearing, the arbitrator had started dictating facts to his stenographer in the presence of the counsel for the parties but had subsequently stated that he would complete the award later on; the award made does not contain any such statement of facts which are alleged to have been dictated.
It is significant that in the objections no mention whatsoever is made to any letter having been given by the parties to the arbitrator requesting him to give a reasoned award. The objections were drafted and filed under the signatures of an eminent counsel of this Court and I find it difficult to fathom that if there had been any such letter, reference thereto would not have been made in the objections. For this reason also it is not deemed necessary to grant any further time to enable the counsel to trace the letter. Even if the letter exists the same having not been filed for the last 26 years, no further time can be given for tracing out the same today.
U.O.I. in its reply to the objections aforesaid controverted what was stated in the ground No. 2 Supra. The Objector filed a rejoinder thereto wherein also save for controverting the corresponding paragraph of the reply, no further details / particulars if any of the instructions if any to the arbitrator to give a reasoned award are given.
I have also perused the order sheet on arbitral record of 9th March, 1982. The same in the margin bears two signatures as the order sheet of other hearings before the arbitrator. Presumably the said signatures are either of the representatives or counsel of the parties. There is no mention therein of anything as alleged in objection petition. Had the arbitrator in the hearing on 9th March, 1982 inquired from the parties as alleged or had an agreement of giving reasons been reached, the same ought to have been recorded in the order sheet of that date. Thus, a bare averment in the objections and of the counsel for the objector of an agreement between the parties and the arbitrator to give reasons cannot be believed and the objection on that ground is rejected.
The counsel for the objector has next contended that the proceedings before the arbitrator show that as many as 15 issues were framed by the arbitrator. It is contended that such detailed issues having been framed the arbitrator ought to have given reasons for his findings. It is also contended that while claim of the U.O.I. was for over Rs. 25 lacs award is only for approximately Rs. 3 lacs with deductions of amounts found payable to the objector. It is argued that the same shows the arbitrariness of the award.
I am afraid merely because issues are framed does not ipso facto result in the arbitrator being required to give a speaking award. Issues are framed for methodical conduct of the proceedings and framing of the issues before the arbitrator carries no obligation to deal with each issue individually or to return finding therein. The arbitrator has in the award recorded that he has heard and examined and considered the statements of the parties and their evidence and thereafter made a non-speaking award for the amount aforesaid.
The counsel for the objector on inquiry as to whether the agreement between the parties contained any stipulation for giving a speaking or reasoned award, contends that the arbitral record does not contain the DGS&D Contract-1968, then prevalent and as such he is unable to comment whether the same contained a stipulation for the arbitrator to give speaking/reasoned award. In fact the counsel sought adjournment on this ground as well.
A perusal of the objections drafted and filed at the contemporaneous time does not show any objection having been taken on the ground that the agreement between the parties provided for a reasoned/speaking award and the arbitrator having rendered a non-speaking award. In fact if that had been the position, it was unnecessary for the objector to plead the oral agreement of 9th March, 1982 Supra. I find it hard to believe that if the then DG&SD contract which would then have been readily available to the counsel, provided for reasoned or speaking award by the arbitrator, objection in that regard would not have been taken. In any case the objections have to be decided on the pleadings and there is no pleading to that effect.
The counsel for the objector lastly contended that the arbitral award on the record received from the arbitrator is not properly stamped. However, it is found that the award with reference where to objection is taken is of the arbitrator earlier appointed and the award with respect whereto petitions have been filed is contained in the part I file of CS(OS) No. 1175A/1982 and is duly stamped.
Though the objections are lengthy and contain plethora of grounds against the award, but in view of the nature of the award, the same are not maintainable. IA No. 354/1983 is accordingly dismissed.
I find that the arbitral award does not allow any interest on the amount awarded. The proceedings have remained pending before this Court alone for over 27 years and the arbitration is found to have commenced in 1970. The counsel for the objector contends that U.O.I. has neither filed any objection with respect to the award not allowing any interest nor have made any such prayer in these proceedings.
This Court in Amar Industries v. U.O.I. 2006 (2) Arb. LR 253 after examination of law on the subject held that the court in such proceedings is entitled to also award interest for the period the proceedings for making the award rule of the court remain pending in the Court, besides interest u/s 29 of the Act. In that case also there was no prayer for interest but it was held that since the proceedings remained pending before court, the court was empowered to grant interest both pendente lite and future. I also find that under the 1940 Act there was inherent power in the court to modify the award. In the present case, specially from the requests made today for adjournment for a month, the objector is found to have delayed the proceedings for exceptional long 27 years, perhaps knowing that no interest was running. The objector then also knew the award to be non-speaking and scope of interference therewith being minimal. Still lengthy objections were filed and advantage taken of paucity of time with the Courts. There is a sea change in buying power of money, since 1983. In the circumstances, I also allow interest on award amount @ 12% p.a. pendente lite and future.
The arbitral award dated 27th July, 1982 is made the rule of the court and judgment pronounced in terms of the same and as modified above, Decree Sheet be drawn up.