M/s D.D. Sharma vs Union of India and Another

A.K. Sikri, J.—A very interesting question of law has been raised in the objections filed by the objector/petitioner to the award dated 31st May, 1995 made and published by Brig.S.C.K.Puri, Chief Engineer, Project Udayak, C/0 99, APO, acting as sole arbitrator. Before referring to question of law and dealing with the same, it would be appropriate to scan through the main events surrounding the controversy. The petitioner had been award a contract No.CA No. ce(p) DTK 4/1989-90 for Design and Construction of PMT Bridges (Balance Works) at Ishni and Bonday on confluence-Dukey-Dzong Road in Bhutan. However, certain disputes and differences arose which were referred to the arbitration. The petitioner preferred its claims. The respondent department also raised counter-claims.Certain claims of the petitioner have been awarded partially.Counter-claims of the department have been rejected.In terms of the contract and the reference made by the appointing authority, the learned arbitrator was required to:

(a) publish the award

(b) indicate his findings, along with the sums awarded, separately on each individual item of dispute.

While rejecting certain claims of the petitioner, particularly claims No. 1,3,5,6 & 7 the award used the following language: NTL (not considered as admissible). The primary challenged in these objections to the award is that by using the expression ''not considered as admissible'' while rejecting these claims, the learned arbitrator has filed in his duty to `indicate his findings''.Thus the question to be determined is as to whether the aforesaid expression used by the learned arbitrator while rejecting the claim, would amount to indicating his findings. It is this question which is to be decided in this case.

Normally, the stipulation in the contract or the reference orders to the arbitrators indicate that arbitrator is supposed to give `reasons in support of his award''. Here the arbitrator was required to `indicate his findings''. The learned counsel for petitioner argued that findings should be such which indicate the mind of the person giving those findings so as to serve useful purpose.In support he relied upon 1 JR 1987 Calcutta (D8) 11.39-52-3-4 entitled Vivekanand Travels Vs. Secretary.STA. That case may not be applicable as it related to the judicial review of an administrative decision and principles governing administrative decisions would be totally alien to the cases of arbitral adjudication where under the Act of 1940 the arbitrator is not supposed to give any reasons unless specifically asked to do so.

Be as it may, in the present case, the arbitrator was supposed to records his findings. Therefore, we have to ascertain the meaning of `findings''. The Universal Dictionary of the english language expresses `findings'' in the context of legal meaning to be `conclusion arrived by court of justice, by a judge or jury''. The New Lexicon Websters Dictionary of the English language in Deluxe Encyclopedia defines `findings'' as : The act of someone who finds, something found by research like he published his findings in the trade journal, the result of an enquiry or of judicial examination.Black''s Law Dictionary, 6th Edn. gives more detailed version of the term `finding'' in the following manner:

"The result of the deliberations of a jury or a court.A decision upon a question of fact reached as the result of a judicial examination or investigation by a court, jury, referee, coroner, etc. A recital of the facts as found. The word commonly applies to the result reached by judge or jury.

Finding of fact. Determination from the evidence of a case, either by court or an administrative agency, concerning facts averred by one party and denied by another.Kozsdiy V.O`Falton Bd.of Fire and police Com''rs, 31 Ill.App.3d 173, 334, N.E.2D 325, 329.A determination of a fact by the court, averred by one party and denied by the other, and founded on evidence in case. C.I.T. Corp.V.Elliott, 66 Idaho 384, 159, P.2d 891, 897. A conclusion by way of reasonable inference from the evidence. Welfare of Carpenter, 21, Wash.App.814,587 P.2d 588, 592.Also the answer of the jury to a specific interrogatory propounded to them as to the existence or non-existence of a fact in issue. Conclusion drawn by trial court from facts without exercise of legal judgment. Compare Conclusion of law.

Findings of fact shall not be set aside unless clearly erroneous. Fed.R.Civil P.52(a).The court may amend, or make additional findings, on motion of a party.Fed.R.Civil P.52(b)

A general finding by a court is a general statement that the facts are in favor of a party or entitle him to entitle him to judgment. It is a complete determination of all matters, and is a finding of every special thing necessary to be found to sustain the general finding.

A special finding is a specific setting fort of the ultimate facts established by the evidence and which are determinative of the judgment which must be given. It is only on which the law must be determined. A special finding may also be said to be one limited to the fact issue submitted.

Finding of law. Term applies to rulings of law made by court in connection with finding of fact; such findings on rulings of law are subject to appellants review."

Professor Beranard Schwartz has thrown some light on the expression `findings'' in the following words:

QUOTE 1: The most common defect in agency findings in their tendency to be couched in vague and obscure terms abounding in bureaucratic legalism, they obfuscate rather than clarify.

QUOTE 2: At the same time, if the requirement of findings means anything it must compel administrative agencies adequate to articulate the bases of their action showing a rational connection between the facts found and the choice made."

Seen in the aforesaid context, it cannot be held that merely by writing `not considered as admissible'' the learned arbitrator has given the findings. It was, at the most, his conclusion to the effect that the particular claim was devoid of any merit. When the arbitrator was required to `indicate his findings'' it was expected of him to record something more than mere conclusion. It would be almost akin to giving reasons at least to the extent which indicate his mind or thought process.

It may be mentioned that even here the expression `admissible'' is not a happy expression as it could lead to inference that the claim was not even found `admissible'', and Therefore, was rejected without considering the merit of the claim. However, even if it is assumed that what the arbitrator meant was that the claim was not considered as `admissible'' on merits, the requirement of indicating the finding is not met. When the contract mandated the learned arbitrator to indicate his findings, along with the sums awarded, separately on each individual item of dispute what was required was to indicate something more than mere conclusion. After all, by awarding `NITL'' the conclusion is that according to arbitrator nothing is payable. Therefore, by obliging to indicate his findings what is meant that something more than the conclusion is to be stated to justify the conclusion.As per the Black''s Law Dictionary quoted above, it should be the result of the deliberations or a decision upon a question of fact reached as a result of examination or investigation.It needs determination from the evidence of a case, either by court or an administrative agency concerning the facts averred by one party and denied by another.There should be some indication as to how he arrived at the aforesaid conclusion. In fact the learned arbitrator himself undertook this very exercise while deciding claims 2,4,8 and 11 of the petitioner and counter claim (d) of the respondent.While awarding a sum of Rs. 84,744/- against claim of Rs.2.99 lacs in respect of claim No.4 of the petitioner, the arbitrator recorded as under:

`Claim partially sustained''. Steel of grade IS 2062 was used due to non-availability/non-manufacture of steel grade IS 226. Since, the use of IS 2062 was consented by Dept. also, the claim of the claimant in cost less escalation etc. is permissible.

Likewise against claim No.11, while awarding a sum of Rs.47,169/- the bracketed portion mentions as under:

"The escalation is governed as per Condition No.21 on page No.109 of CA. Though the Contractor requested for extension of time from 01 June 93 to 14 May 93 without escalation vide his letter No. NIL dated 14 April 1993 but no mention has been made in the Deviation order and No amendment to CA has been issued to this effect The extension of time has been granted up to 14 May 1993. Since the payments are to be released as per CA provisions, the escalation from 01 Jan 93 to 14 May 93 is payable to the Claimant."

It is this kind of finding which was to be indicated by the learned arbitrator. Having not done so in respect of certain other claims, the arbitrator has not discharged his duty-responsibility as mandated by the terms of the contract or the order of reference.

Learned counsel for petitioner/objector had also argued that there was an irregularity in filing of the award and contradiction in deciding the effect. The is not necessary to go into these aspects in view of the fact that I am sustaining the aforesaid objection. The matter is accordingly remitted back to the arbitrator with directions to indicate his findings against award on Claims No. 1,3,5 to 7,9 and 10. He would be required to indicate his findings within four weeks from the date of receipt of this order.

The petition is accordingly disposed of.However,if the petitioner is still aggrieved against the findings to be indicated by the arbitrator, it would be open to the petitioner to file objections of the same as per law.