PETITIONER: UNION OF INDIA Vs. RESPONDENT: <NAME> DATE OF JUDGMENT30/11/1979 BENCH: <NAME>, V.R. BENCH: <NAME>, V.R. PATHAK, R.S. CITATION: 1980 AIR 600 1980 SCR (2) 298 1980 SCC (2) 144 ACT: Code of Civil Procedure 1908 (V of 1908) Order 39 rule 2 (3)-Suit by railway employee-In injunction application court ordering reinstatement in service-Non-compliance by department-<ORG> ordering attachment of department property and officers be sent to civil jail-Property for attachment not specified, contemner for detention not named-Such order whether valid. HEADNOTE: The respondent a railway employee was proceeded against by the department for misconduct. He did not respond to the 'show-cause' notice issued to him and when the disciplinary proceedings proceeded ex-parte he filed a suit for a declaration of immunity and permanent injunction against further departmental action. He also moved an application for an ad interim injunction to restrain the department from affecting his position in service by continuing the disciplinary enquiry and to continue to pay his full salary. After hearing, the <NAME> directed that the respondent be placed in the same position that he held prior to the commencement of the departmental enquiry in the matter of pay, privileges and all other perquisites that he availed and enjoyed. The department appealed against this order, and awaited the decision in <ORG> before implementing the direction for re-instatement. In the meanwhile the respondent filed an application under Order 39 rule 2(3) of the Code of Civil Procedure for disobedience of the injunction order. The trial court finding that there was non-compliance with the <NAME>'s order, directed 15 days time for compliance with the said order and on failure thereof, directed that the department shall be visited with the order of attachment of its property and its officers be sent to the civil jail. An unsuccessful appeal and an unrewarding revision was the lot of the department. <ORG> made an observation-cum-direction that as the <NAME> could not proceed with the proceedings for disobedience of the court's order, it would be for the <NAME> concerned to name the officer concerned who is required to be sent to jail and to give details of the property to be attached, for the purpose of compelling compliance with the court's order. Allowing the appeal to this <ORG>, ^ HELD :1. 1. <ORG> was in error in leaving it to the trial court to designate the names when it actually issued the ministerial order to execute its decretal order. Nameless humans cannot be whisked off to prison even in the name of contempt by insertion of the name after the judgment is delivered 2. A government servant of <ORG> who had been removed from service for misconduct could not be reinstated with full back pay immediately the order was made by the <ORG>. It had to be communicated to 299 various officers, orders had to be made at various levels, files had to move and notings made for gestation before implementation. All this takes time and when the court order is eventually effectuated, the salary of the officer will, of course, have to be paid with effect from the original date of impugned threat of action. To proceed to punish in haste without pausing to realise how government functions is not fair in this drastic jurisdiction where personal freedom is in peril. [305 B-D] 3. The constitutional sanctity of liberty and protection of property will become chimerical and the processual law will hang limp if the substantive order is silent and identifying the offender is left over as a ministerial measure. [304 F] 4. Where liberty and property are to be deprived it is fundamental that vagueness is a fatal vice even if the issuing authority be the court. [302 G] In the instant case, the orders passed by the <NAME> and the High <ORG> keep identity of the key persons and properties in uncertainty. For this reason alone, the orders are vulnerable-against both the attachment of unspecified property and detention of unnamed contemners. [304 C-G] 5. The law, in the area of contempt of court, must avoid the extremes of hyper-reactivity to marginal indifference to judicial authority out of pragmatic difficulties. [300 E] 6. The fluid, yet valid, concept of contempt of court, keeps judges under the rule of law; for personal liberty is protected by a processual armour, even if its deprivation be the product of the judicial process. [300 E] 7. The contempt power should be kept sheathed and the sword should be drawn only sparingly if the court is convinced that there has been wilful defiance or disobedience. [306 C] 8. Once there is clear evidence of active obedience, coupled with expression of regret, delayed though the compliance be due to the inevitable time-lag induced by the paper-logged procedures, the court may be clement. [306 D] JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2031 of 1979.

Appeal by Special Leave from the Judgment and Order dated 20-1-79 of <ORG> (Jaipur Bench) at Jaipur in S.B. Revision No. 112/76.

<NAME>, Solicitor General, <NAME> and <NAME> for the Appellants.

<NAME> for the Respondent.

The Judgment of the Court was delivered by <NAME>, J.-An odd case of sentence of three months' civil imprisonment and attachment of assets of <ORG> and two of its officers for default in instant reinstatement of a <ORG> Inspector removed from service for misconduct occasions this appeal by special leave.

<ORG> is neither a cloistered virtue nor a self-righteous process and readily re-examines, in its appellate crucible, the judgments rendered at lesser levels even if the subject-matter be, as here, alleged disobedience of a judicial order. Justice is not hubristic and truth triumphs by self-criticism. And so, this <ORG>, in keeping with such an invigilative perspective, must review the punitive directive of the trial court, affirmed upto the High <ORG> but challenged before us, that <ORG> and its officers in <ORG>-the appellants-do suffer distraint of property and imprisonment of person for the contempt of its authority by non-compliance with its order of injunction. This case disturbs us somewhat and constrains us to go to the basics in a certain branch of the jurisprudence of contempt of court.

As will presently appear, the synthesis of two seemingly antithetical creeds, both vital to our Republic is the key to the crucial issue projected by this appeal where disobedience of a mandatory injunction to retain in service, pendente lite, the respondent, a railway inspector, regardless of the disciplinary proceedings which had by then allegedly culminated in his exist from service. The court shall neither be imperious nor be obsequious. The law, in the area of contempt of court, must avoid the extremes of hyper-reactivity to marginal indifference to judicial authority out of pragmatic difficulties and of hypo-respect for court commands in a cavalier spirit of 'the court has no guns. Why care ?' The fluid, yet valid, concept of 'contempt of court' keeps judges under the rule of law; for, personal liberty, under our constitutional order, is protected by a processual armour, even if its deprivation be the product of the judicial process. This caveat is called for in the present case where we are confronted by a bizarre order of contingent imprisonment of unspecified servants and coercive attachment of un-particularised properties of <ORG>. And yet, this order has survived two appeals before arriving here by special leave.

The facts are few and the law is not abstruse; yet, in our view, the order under appeal is an overzealous command with fatal failings writ on its face. The respondent, an Inspector in <ORG>, was proceeded against for misconduct. He did not show up when the 'show cause' notice was issued; and when the disciplinary steps proceeded further, he artfully rushed to the munsif's court, by passing the departmental process, and sued for a declaration of immunity and permanent injunction against further governmental action. Inevitably, he moved for an ad interim injunction to restrain the <ORG> from affecting his position in service by continuing the disciplinary enquiry and to continue to pay his full salary. After hearing both sides the court issued, on April 15, 1974, such an injunction or freeze order, which was appealed against in vain; and eventually, the revision to <ORG> also proved fruitless. The blanket order, which was sustained, reads thus:

I, therefore, order and direct <ORG> and its employees not to implement or otherwise put in effect the order of dismissal at 18-1-74 or any other one removing, terminating or dismissing the services of the applicant as I.O.W. Of Western Railways and direct further that the applicant shall be retained and continued on post, power, pay, privileges and perquisites attached to the post of Inspector of Works, <NAME>, and in the same manner as if no orders of removal or any other one were passed.

In other words he shall be placed in the position as he held it on 14-1-1974 in the matter of pay, power, privileges and all other perquisites that he availed and enjoyed on 14-1-1974 and immediately before.

The appellants, hopefully but harmfully, as events proved, awaited the decision in the higher courts before implementing the direction for reinstatement. But even while the case of injunction was pending in <ORG>, in appeal, an application under 0.39 R.2(3) or disobedience was filed on 15-7-1974. The trial judge held the appellants guilty and passed a nebulous sentence against nameless culprits on January 5, 1976 in these terms. It is also clear that the non-applicants according to the decision of this court dated 15-4-74 have not continued payment of the wages and other allowances and therefore it fully proved that the non-applicants have not carried out the order dated 15-4-74 of this court. Now the non-applicants are hereby further ordered that if they fail to comply with the order dated 15.4.74 within 15 days the opposite party shall be visited with the order of attachment of property and sending them to civil jail. As the non-applicant No. 2 has been transferred from <ORG>, therefore, the compliance of the order will be made by the present Divisional Superintendent, <NAME>.

(Translation furnished in court by the learned Solicitor General) An unsuccessful appeal and an unrewarding revision ensued. <ORG> hortatively told <ORG> that the law is the King of Kings and, admonished in high-sounding style-

that the state functionaries should atleast after 28 years of the functioning of the Constitution and rule of law in this country, realise understand and literally and faithfully implement the judicial pronouncement by showing respect to law All the officers, the citizens in general, the litigants and the <ORG> functionaries in all seriousness should keep the following internal saying of the great jurist <NAME> as uppermost in our mind, i.e. 'Law is the King of Kings-far more rigid and powerful than they, there is nothing higher than law; and by its powers the weak shall prevail over the strong and justice shall triumph'. I wish this should not only be exhibited as the guide lines in all Government offices, important public institutions, street-corners and road corners but acts upon both in letter and spirit by all irrespective of the office, profession, status and assignment which one holds in life.

We agree but wish to add that the <NAME> text be exhibited also in courts halls together with <NAME>'s famous statement which the great Judge, learned <NAME> wanted should be hung on legislative and court halls: 'l beseech you, in the bowels of Christ, think it possible that you might be mistaken !' If we scan the anatomy of the <NAME>'s order, which was upheld all along, we notice awesome implications that if, within 15 days, compliance with the injunction did not take place-which implied payment of long years' salaries and re- induction into service of the respondent (who had by then been removed), all of which required much more time to secure sanctions and drawls of moneys in a mammoth hierarchical machine-the opposite parties (who, among them ?) shall be visits with the order of attachment of property (which ?) and sending them (whom ? to civil jail (for how long ?). As the non-applicant No. 2 has been transferred from <ORG> therefore, the compliance of the order will be made by the present Divisional Superintendent, <NAME> (and so, the transferee officer was in peril of imprisonment ?). The bracketed interrogations are ours, briefly to indicate that where liberty and property are to be deprived it is fundamental that vagueness is a fatal vice even if the issuing authority be the court. The infirmity was corrected in small part by <ORG> in revision as will presently notice Anyway, this order was stayed by <ORG> on 5-3- 1976 until it finally dismissed the revision on January 20, 1979. And it is the appellant's case that salaries thereafter have been paid, calculations have been made, sanctions obtained and money withdrawn and all the dues of years are ready to be distributed. The question is whether the action for disobedience was legal and justified and, in any case, the draconian punishment of <ORG> by attaching its properties and putting its servants in jail was a desertion of judicial discretion whole hall-mark is to be firm but not authoritarian, liberal but not petulant. and ever informed by realism and impressed with contrition.

We have here an interlocutory injunction, though unusual, whose soundness is being tested in a separate proceeding in this Court. Let use pro tempore, assume its valid existence and focus on the folk-up of alleged breach and visitation of punishment. What was the direction ? Could it be practical to comply within that time, having due regard to the inertia of administrative processes ? Was there recusant refusal, and, if so, by whom, in the conspectus of facts here? When does the court go to the extreme of imprisonment of Government servants at lesser levels, who have to act on orders from above, for disobedience? Is it the path of judicial discretion to temper justice with mercy or practise the opposite ? Above all. though arising in limine, can there be an order of contingent attachment of unspecified properties ? Can the court imprison any one unidentified in the order by making an omnibus direction leaving the life-giving parts blanks to be filled up long after the judgment and. perhaps, to allow the bailiff to seize whom he regards as the violatory? May be, 'Hurry Kills' and 'hasten slowly' are mottos good for every one who exercises power either at the wheel of an automobile or through the pen of a public functionary.

We will proceed to resolve these questions which unbosom their answers in their very formulation For instance, does not the mere asking call for the obvious answer that no order by however high a power can be fair or reasonable if it jeopardises the person of a citizen wearing the armour of part III, without so much as specificating the identity of the human being upon whom the authority is to lay hands. And yet, the learned <NAME> merely directed that 'the opposite party' (plurality of three, including <ORG>) be sent to civil jail. Moreover, the order notices that the Divisional Superintendent (P2) has been transferred and yet the innocent transferee is put in peril of incarceration. Realising this fatal Haw, <ORG> sought to repair the yawning tear by making the in observation-cum-direction:

The learned <ORG> Magistrate, who passed the earlier ll order on January 5, 1976 could not proceed with the proceedings for sending the petitioners concerned to Civil Jail and also of attachment of the property. It would be for the <ORG> concerned to name the officer concerned who is required to be sent to Jail and further to give details of the property to be attached for the purpose of compelling compliance as per finding already given in judgment dated January 5, 1976 as modified in appeal.

(emphasis added) The court was relentless even when informed that the payment of salary pursuant to the order passed by <ORG> had already been made. The concluding portion of <ORG>'s judgment stated that the Munsif concerned should take prompt action "for executing his order in respect of sending concerned officer to jail and the attachment of the property concerned as mentioned in his judgment ...." Both the orders keep the identity of the key persons and properties in uncertainty.

We are a little startled that a court in the contempt jurisdiction should deprive the personal liberty of a person without naming in the order whom the <ORG>'s bailiff should take into custody or the jail authorities should receive. Equally clearly, how could property be taken without its being particularised in the judgment, disregarding procedural obligations ? It is not as if without hearing the officer to be jailed and his case against detention considered, the <NAME> give ad hoc details of property to be attached without hearing the owner thereof as to his version about why his property should not be touched. The constitutional sanctity of liberty and the (then) protection of property will become chimerical and the processual law will hang limp is the substantive order is silent and identifying the offender is left over as a ministerial measure. The High <ORG> was in error in leaving it to the trial court to designate such names when it actually issued the ministerial order to execute its decretal order. Nameless humans cannot be whisked off to prison even in the name of contempt by insertion of the name after the judgment is delivered. Natural justice is pervasive doctrine integral to processual fair-play in Indian jurisprudence. For this reason alone, the extent order under challenge is vulnerable-against both the attachment of unspecified property and detention of unnamed contemners.

Independently of this invalidatory circumstance, it is apparent that there is no ground for judicial indignation once the facts are appreciated in their realistic setting. The order of injunction was made by the trial court on 15-4-74 and brought before <ORG> where the revision petition was dismissed on 3-1-1979. Strictly speaking, the order of injunction had not been stayed and should have been obeyed.

It is no excuse to say that when appeal and revision pend, litigative hopes lull people into insouciance. While this is not prudent, it is component in, judging about obstinate non-compliance. To institute a proceeding for disobedience of an injunction commanding reinstatement of a government servant purportedly removed from service by the higher officers of the <ORG>, together with payment of salary for prior periods, is a stultification of the jurisdiction, if sufficient time is not given. A little touch of realism would have easily convinced <ORG> that a government servant of <ORG> who has been removed from service for misconduct could not be reinstated with full back pay immediately the order was made by the Court. It had to be communicated to various officers, orders had to be made at various levels, files had to move and notings made for gestation before implementation. All this takes time and when the court order is eventually effectuated, the salary of the officer will, of course, have to be paid with effect from the original date of the impugned threat of action. To proceed to punish in haste without pausing to realise how government functions is not fair in this drastic jurisdiction where personal freedom is in peril. The description of is processes, as prevalent in the days of Lord <NAME>, holds good to-day. Here are his impatient words dipped in pungent ink:

"..... . the administration had become ponderous, like an elephant-'very stately, very powerful, with a high standard of intelligence, but with a regal slowness in its gait'"

"Round and round, like the diurnal revolution of the earth, went the file, stately, solemn, sure and slow: and now, in due season, it has completed its orbit, and I am invited to register the concluding stage."

We are in no mood to condone willful procrastination nor suffer wanton stagnation in Administration as a ground for default in obeying court orders. The Law does not respect lazy bosses nor 'cheeky' evaders . But no proof of that species of guilt has been brought to our notice Mere inaction has no long mileage where means rea is a sine qua non We, therefore, regard the court's order, holding the appellants in contempt, a hasty measure, probably annoyed by absence of instant compliance.

The severity of the sentence is beyond comprehension. We cannot understand how the court could ignore the fact that salary had been paid from the date of <ORG> order upto date and the readiness to pay the back salaries, on securing the appropriate sanction and drawl of cheque, had been represented to the court. Before us, the learned Solicitor General said that the entire back wages were ready to be paid and the necessary cheque had already beery drawn. We see no inclination on the part of <ORG> to adopt a challenging attitude against the court's writ. it is well-known that the contempt power should be kept sheathed and the swore should be drawn only sparingly if the court is convinced that there has been willful defiance or disobedience. Moderation lends dignity to power and we feel that the facts of the present case far from call for any stronger step than an admonition to comply within a realistic spell of time and stiffer action thereafter. We do not take the view that <ORG> should be shown undue indulgence or its officer singular solicitude. But once there is clear evidence of active obedience, V coupled with expression, of regret delayed though the compliance be due to the inevitable time-lag induced by paper-logged procedures, the court may be clement. Here, compliance and contrition are now present.

In these circumstances, we allow the appeal and record the undertaking of <ORG>, the 1st appellant, that the entire salary due to the respondent will be paid within one week from to-day.

N.V.K. Appeal allowed


PETITIONER: TAMILNADU ELECTRICITY BOARD Vs. RESPONDENT: M/S. BRIDGE TUNNEL CONSTRUCTIONS & ORS. DATE OF JUDGMENT: 18/02/1997 BENCH: K. RAMASWAMY, S. SHAGGIER HAMMED ACT: HEADNOTE: JUDGMENT:

O R D E R Leave granted. Substitution allowed.

These appeals, by special leave, arise from the judgment of <ORG>, dated December 20, 1990, made i n O.S.A. Nos. 109 and 110 of 1988. q The admitted facts are that the respondents had entered into an agreement with the appellant to construct inter- connecting tunnels for <ORG> as per specification No. 1138- Schedule-B to the agreement. The initial value of the tender to be awarded was Rs. 47 lakhs and it was revised to Rs. 69 lakhs on January 16, 1975. In the course of execution of the contract, a sum of Rs. 92 lakhs was paid to the respondent. The contract was to be completed within a period of 24 months from the date of taking over of the site, i.e., January 18, 1975; thus, it was completed after the expiry of the term, on August 25, 1978. Resultantly, there had arisen a dispute as to the entitlement to further amount towards the work done by the respondent.

On a notice issued by the respondent for appointment of an arbitrator in terms of clause 50 of the contract (arbitrator clause), there was a delay on the part of the appellant i n nomination of the arbitrator. When the respondent exercised the power, after expiry of the time prescribed in the notice, appointing a sole arbitrator, proceedings under Section 33 of the Arbitrator Act, 1940 were initiated by the appellant. One of the objections raised by the appellant in the proceedings under Section 33 was that under the terms of the contract the claim sought to be put up in the notice given by the respondent was not arbitrable. The question was gone into and the court recorded a finding as under:

"If the petitioner had come forward to raise dispute and if it is outside the scope of clause 50, the first respondent itself would come forward with such a reservation. It is not as if all disputes would come within the cope of clause 50 and only those that would come within the ambit of clause 50 alone can be decided by the Arbitrators when such is the clear position on this aspect; enabling the petitioner <ORG> to raise a objection regarding disputes which may not come within the scope of clause 50 is not a concession, but a recognition of a right, which is available not only to the petitioner <ORG> but also the first respondent in the event of the <ORG> raising any dispute as against it. Therefore, the first stipulation is dependent upon the Arbitrators deciding as to whether particular dispute would come within the scope of Section 50 or not, and only if they consider that it falls within the scope of Arbitration clause, they would have the jurisdiction to decide the same. In the event of the Arbitrators holding that any particular dispute is outside the Arbitration clause, it is not as if the first respondent is deprived of remedies by agitating the same in Course."

It is also further held that :

"After the award is made, as the petitioner <ORG> has already reserved its right, it would enable the <ORG> to raise this point, in the event of any need arising for setting aside the award in Court."

Pursuant thereto, condoning the delay liberty was given to the appellant to nominate an Arbitrator on its behalf which accordingly was done and dispute was referred to arbitration. Arbitrability of some of the claims was disputed as part of no liability. Since the two Arbitrators differed, an umpire was selected by the Arbitrators and he had gone into the question. At this stage, it is relevant to mention that some of the claims made by the respondents relate to excavation of hard rock in the tunnel and the rate of claims.

The relevant clauses of the Contract postulate thus : "22. Material to be excavated :

The character of the material through which the tunnel is to be excavated is indicated i n the report of the Geologist of <ORG>, attached of this specification as an appendix. The probable nature of materials to be excavated is given in the above report. It is expressly to be under stood, however, that the purchaser does not guarantee the accuracy of the information and should the conditions be found to differ from those indicated, the contractor shall have no claim against the purchaser on the grounds of misrepresentation. Moreover, the price to be given in the schedule of prices for excavation work is to be inclusive and to be held to cover excavation in the actual materials encountered.

23. Tunnel Excavation:

a) The tunnel is to be excavated to such dimensions as to give the minimum thickness of concrete lining specified and to suit the shape and size of cross section of the tunnel shown on drawing.

b) Excavation is to be carried out as far as feasible, simultaneously on all fages. It is expected, that more of the ground alone the tunnel will be hard rock requiring the supports. Except where the materials penetrated is hard rock and will safely stand by itself, the tunnel is to be lined temporarily with timber supports and shoring. The timbering is to be kept as alose to the face of the heading as possible. Any shoring of protective arrangements considered inadequate by the Engineer is to be strengthened immediately.

g) The type of tunnel section to be constructed shall be as directed or approved by the Engineer.

Measurement for payment of tunnel excavation, will be limited to the special sectional dimensions and will be made along the established centre line of the tunnel and payment therefore will be made at the unit bid in the schedule for excavation of all classes of tunnel. No additional allowance above the unit price bid in the schedule for excavation of all eclasses of tunnel will be made on account of the class, nature or condition of any of the material encountered."

The rates were mentioned in the Schedule and the respondent had set up the claims raised at rates higher than the contracted rates and twice the rate for the work done after the expiry of the contract period.

Against the claims, objections were raised by the appellant. They have disputed the claim set up by the respondents and requested the Arbitrators to decide on the arbitrability of the items mentioned in the claims of the respondents. The umpire, without going into the details, in a non-speaking award as against the claim of Rs. 2 crores 10 lakhs, has awarded a consolidated sum of Rs. 70.83 lakhs as under :

"I hereby award and direct as follows:

(1) The Respondent shall pay the claimant a sum of Rupees Seventy Lakhs eighty three thousand seven hundred and ninety three only (Rs.

70,83,793/-) and release the earnest money deposit and Bank Guarantees furnished by the claimant in lieu of Security Deposit, in full settlement of all claims and counter-claims."

Calling the award in question, an application to set it aside has been filed. The respondent filed an application to make the award the rule of the court. <ORG> dismissed the petition of the appellant and made the award the rule of the court. On appeal, <ORG> of <ORG> has confirmed the same. Thus these appeals, by special leave.

<NAME>, the learned Additional Solicitor General, contends that the award is illegal on account of omission on the part of the <ORG> to give the findings and reasons in support thereof of the arbitrability of the claims. He contends that arbitrability of claim is a jurisdictional issue. The arbitrator cannot clothe himself with the power, in a non-speaking award to award a consolidated sum, without deciding the arbitrability of the claims set up by the respondents including those which are not part of the contract.

<NAME>, learned senior counsel for the respondents has contended that the award being a non-speaking one in the absence of specific reference directing the Arbitrators to decide the arbitrability of some of the items in the claims set up by the respondent, Umpire was not called upon or obliged to decide the dispute by a speaking order on arbitrability. He reached the conclusion whether or not the dispute or the claim is arbitrable and obviously he was of the opinion that all the claims are arbitrable and he is empowered to decide it either rightly or wrongly. He may be wrong in not expressly giving his decision on arbitrability of some of the claims. However, his decision is within his jurisdiction. He is not required to give any reasons in the award for reaching that decision. When the arbitrator had given a consolidated sum towards all the claims, it would mean that he had considered the arbitrability of some of the claims in terms of the contract and that, therefore, he has not committed any error in reaching that conclusion which is apparent on the face of the record. In the absence of any specific reference for deciding that dispute, even if incidentally he reaches that decision, he gets the jurisdiction and power to decide the question, he gets the otherwise also, the award cannot be assailed o n the ground that he reached a wrong decision without any reasons in support thereof. In that event, it must be deemed that he had considered the non-arbitrability of the items in a non- speaking ward given by him. He also further contends that i n the absence of any agreement between the parties that the arbitrator would give reasons in support of his decision on the arbitrability of the dispute, he is not called upon to decide the dispute by a speaking award. What is required, therefore, is to be considered is whether the arbitrator reached the decision as to the entitlement to for a specified sum or disentitlement thereof, in his award. Once he specifies the amount to which the respondent is entitled, it must be deemed that he had taken into consideration the arbitrability of all the claims including the claim relating to non- arbitrability of some of the items and had given the award. Thereby, consolidated sum in the award is not subject to attack that the award made by the Arbitrator is vitiated by any error of jurisdiction or error of law apparent on the face of the record. <NAME> further contends that the contract of arbitration is not part of the record and the umpire had not referred to the agreement as part of the award and that, therefore, it is not open to the court to look into the contract to find out whether the contractor claimed at the rates higher than what were contracted and the umpire has omitted to consider the non- arbitrability of the claims in respect of some of the items. In support thereof, the places strong reliance on the decision of this <ORG> in <CITATION> [], in particular, paragraphs 10, 12,33 thereof, and <CITATION> [ at 435, para 5].

In view of the respective contentions, the question that arises for consideration is: whether the <ORG> was required to give a decision supported by reasons on the non- arbitrability of some of the items in terms of the contract. It is already seen that the <ORG> prior to the proceedings under Section 33 had gone into the question as to the right of the appellant to question the arbitrability of some of the items and had expressly recorded, as seen hereinbefore, that if any objection regarding the dispute is raised, either parties is at liberty to raise the same and avail of decision by the arbitrator and the arbitrator is required to decide the arbitrability of the claim and if he considers that it falls within the scope of the arbitration clause/arbitrability, then he would have the jurisdiction to decide the same. If the decision has been reached by the arbitrator against the appellant, it would be open to the <ORG> to raise that point, in case any need arises for setting aside the said award in the court. Thus, it could be seen that prior to the proceedings under Section 33, the court had left open the umpire had to decide the dispute. In the event of the decision going against the <ORG>, the same is also entitled to question the correctness of the award in a court of law. That order has become final.

In the light of the above facts, the question arises; whether the arbitrator was not obliged to decide the non- arbitrability of some of the items claimed by the respondents before/while giving a non-speaking award and whether a deemed decision could be given credence. In <ORG> case relied on by <NAME>, a Bench of two judges of this court had gone into the question of jurisdiction of the arbitrator to decide the arbitrability of the dispute. In para 10 thereof, it is stated thus :

"What is the effect of referring the specific question of law to arbitration without prejudice to one's right to contend to the contrary will be presently examined."

If this issue specifically raises a question as to jurisdiction of the arbitrator to arbitrate upon the dispute set out in Point No.2, it appears to have been specifically referred to the arbitrator for his decision. Parties, therefore, agreed to submit the specific question even with regard to the scope ambit width and the construction of the arbitration clause so as to define its parameters and contours with a view to ascertaining whether the claim advanced by the appellant and disputed by the respondent would be covered by the arbitration clause. Whether upon its true construction the arbitration clause would include within its compass the dispute thus raised between the parties was specifically put in issue because parties were at variance about it."

"The arbitrator was thus required and called upon first to decide whether the dispute is arbitrable as falling within the width and answer is in the affirmative, then alone the second point need be examined. If the answer to the first point of reference is in the negative in that if the arbitrator were of he opinion that the dispute is not arbitrable as it would not fall within the scope, width an ambit of the arbitration agreement, it would not be necessary for him to determine whether the appellant was entitled to recover anything by way of compensation. This aspect is being analysed in depth to point out that the parties specifically referred the question of constriction of arbitration agreement, its width, ambit and parameters vis-a-vis the dispute raised so as to decide whether the dispute would fall within the purview of the arbitration agreement, in other words the jurisdiction of the arbitrator."

Thus, it could be seen that therein that when the question is specifically referred to the arbitrator, the arbitrator is required to decide the question referred to him and decide the point on the question. Then only he gets the jurisdiction to go into the merits. In para 12 of the judgment that point was elaborated holding that :

"The first point extracted hereinbefore would clearly show that the specific question about the jurisdiction of the arbitrator to arbitrate upon the dispute set out in Point Nos. 2, 3 and 4 was specifically referred to the arbitrator.

On the first point, the arbitrator had to decide whether the claims made by the appellant and disputed by the respondent would be covered by clause 40, i.e. the arbitration clause. In other words, the specific question referred to the arbitrator was about his jurisdiction to arbitrate upon the disputes covered by Points Nos. 2, 3 and 4, if and only if, upon a true construction of the arbitration clause that is first paragraph of clause 40, would cover the disputed claim for compensation he can enter into the merits of the dispute and decide it."

This ratio clearly establishes that the arbitrator gets jurisdiction to decide the dispute on merits only when he is specifically called upon to decide the dispute in terms of the contract.

<CITATION> [], the question arose: whether the court could look into the arbitration agreement, find out whether the arbitrator has jurisdiction to decide the dispute though it was not formed part of the award? In para 5, this Court had held that:

"... Here we may point out that the learned counsel for the respondent has urged that the agreement containing the arbitration clause cannot be looked into even to find out as to what was the nature of the dispute contemplated by it with regard to which a reference to an arbitrator was contemplated, more so when the ward was a non-speaking one. We find it difficult to agree with this submission for two reasons: Firstly, the award is not a totally non-speaking one inasmuch as it gives as resume of the incentive scheme and the agreement between the parties as also the items of the claim made by the respondent. Of course, while fixing the amount found payable by the appellant, no reasons are recorded. Secondly, if there is any challenge to the award on the ground that the arbitrator had no jurisdiction to make the award with regard to a particular item inasmuch as it was beyond the scope of reference, the only way to test the correctness of such a challenge is to look into the agreement itself. In our opinion, looking into the agreement for this limited purpose is neither tantamount to going into the evidence produced by the parties nor into the reason which weighted with the arbitrator in making the award."

In fact this <ORG> had gone into merits while deciding the question as to whether the arbitrator was justified in making the award in excess of the jurisdiction with reference to the arbitration agreement and deciding the dispute on that basis.

<CITATION> . [] a Bench of three judges [to which both of us were members] had gone into the question whether the arbitrator can go into the question whether there emerged any concluded contract and whether he can get exclusive jurisdiction to decide that question by himself? In an application under Section 33, the learned Single Judge of <ORG> had held that the arbitrator has exclusive jurisdiction to decide that question. Reversing that judgment this <ORG> in para 13 had held that "the arbitrability of a claim depends on the construction of the clause in the contract. The finding of the arbitrator/arbitrators on arbitrability of the claim is not conclusive as under Section 33, ultimately it is the court that decides the controversy. It being a jurisdictional issue, the arbitrator/arbitrators cannot clothe themselves with jurisdiction to conclusively decide the issue." In para 15 it is held thus:

"The clear settled law thus is that the existence or validity of an arbitration agreement shall be decided by the court alone, Arbitrators, therefore, have no power of jurisdiction to decide or adjudicate conclusively by themselves the question since it is the very foundation on which the arbitrators proceed to adjudicate the disputes. Therefore, it is rightly pointed out by <NAME>, learned counsel for the appellant that they had by mistake agreed for reference and that arbitrators cold not decide the existence of the arbitration agreement or arbitrability of the disputes without prejudice to their stand that no valid agreement existed. <NAME> contended that having agreed to refer the dispute, the appellant had acquiesced to the jurisdiction of the arbitrators and, therefore, they cannot exercise the right under Section 33 of the Act. We find no force in the contention. As seen, the appellant is claiming adjudication under Section 33 which the court alone has jurisdiction and power to decide whether any valid agreement is existing between the parties. Mere acceptance or acquiescing to the jurisdiction of the arbitrators for adjudication of the disputes as to the existence of the arbitration agreement or arbitrability of the dispute does not disentitle the appellant to have the remedy under Section 33 through the court. In our considered view the remedy under Section 33 is the only right royal way for deciding the controversy."

Accordingly, it was held that the controversy of arbitrability requires to be decided by the court and not by the arbitrator himself.

<CITATION> ) [] a Bench of two Judges, to which one of us, <NAME>, J. was a member, was to consider the question whether the arbitrator. when he enlarged his scope of award in a non-speaking award, can conclusively decide the dispute and give an award in that behalf? It was held in paragraph 6 that :

"To constitute an arbitration agreement, there must be an agreement that is to say the parties must be ad idem.

Arbitrability of a claim depends upon the dispute between the parties and the reference to the arbitrator. On appointment, he enters upon that dispute for adjudication. The finding of the arbitrator on the arbitrability of the claim is not conclusive, as under Section 33 ultimately it is the court that decides the controversy. It can hardly be within the arbitrator's jurisdiction to decide whether or not a condition precedent to his jurisdiction has been fulfilled. The arbitrator had has been fulfilled. The arbitrator had no power to decide his own jurisdiction. The arbitrator is always entitled to inquire whether or not he has jurisdiction to decide the dispute. He can refuse to deal with the matter at all and leave the parties to go to the court if he comes to the conclusion that he has no power to deal with the matter, or he can consider the matter and if he forms the view that the contract upon which the claimant is relying on and from which, if established, he alone has jurisdiction, he can proceed to the decide the dispute accordingly. Whether or not the arbitrator has jurisdiction and whether the matter is referred to or is within the ambit of clause for reference of any difference of dispute which may arise between the parties, it is for the court to decide it. The arbitrator by a wrong decision cannot enlarge the scope of the submission. It is for the court to decide finally the arbitrability of the claim in dispute or any clause or a matter or a thing contained therein or the construction thereof.:

<CITATION> (1922) 50 IA 324 : AIR 1923 PC 66] Lord Dunedin had laid down the dictum as to an error in law on the face of the award, which was accepted and followed by this court in <CITATION> . []. Therein it was held that:

"An error in law on the face of the award means, in their Lordships' view, that you can find in the award or a document actually incorporated thereto, as for instance a note appended by the arbitrator stating the reason for his judgment, some legal proposition which is the basis of the award and which you can then say is erroneous. It does not mean that if in a narrative a reference is made to a contention of one party, that opens the door to seeing first what the contention is, and then going to the contract on which the parties' right depend to see if that contention is sound. Here it is impossible to say, from what is shown on the face of the award, what mistake the arbitrators made. The only way that the learned judges have arrived at finding what the mistake was is by saying:

'inasmuch as the arbitrators awarded so and so, and inasmuch as the letter shows that the buyer rejected the cotton, the arbitrators can only have arrived at arbitrators can only have arrived at that result by totally misinterpreting Rule 52'. But they were entitled to give their own interpretation to Rule 52 or any other article, and the award will stand unless, on the face of it, they have tied themselves down to some special legal proposition which then when examined, appears to be unsound."

The decision has been followed by this Court in all subsequent judgments and the precise scope of the law as to error apparent on the face of the award has been crystalised. But there is a distinction between an error apparent on the face of the award and jurisdictional error in passing the award. In that behalf, in <CITATION> [] Justice <NAME>, as he then was, had pointed out the distinction on the jurisdictional error and the error on the face of the award. It was stated thus:

"An award may be remitted or set aside on the ground that the arbitrator in making it, had exceeded this jurisdiction and evidence of matters not appearing on the face of it, will be admitted in order to establish whether the jurisdiction had been exceeded or not, because the nature of the dispute is something which has to be determined outside the award- whatever might be said about it in the award or by the arbitrator. It has to be reiterated that an arbitrator acting beyond his jurisdiction- is a different ground from the error apparent on the face of the award. In Halsbury's Laws of England II, 4th edn., Vol.2 para 622 one of the misconducts enumerated, is the decision by the arbitrator on a matter which is not included in the agreement or reference. But in such a case one has to determine the distinction between an error in excess of the jurisdiction. Whether a particular amount was liable to be paid or damages liable to be sustained, was a decision within the competency of the arbitrator in this case. By purporting to construe the contract the court could not take upon itself the burden of saying that this was contrary to the contract and, as such, beyond jurisdiction. It has to be determined that there is a distinction between dispute as to the jurisdiction of the arbitrator and the disputes as to in what way that jurisdiction should be exercised. There may be a conflict as to the power of the arbitrator to grant a particular remedy."

In "Russel on Arbitration" [Nineteenth Edition] by <NAME>, page 99, it is stated as under:

"It can, hardly be within the arbitrator's jurisdiction to decide whether or not a precedent to his jurisdiction has been fulfilled. It has indeed several times been said bluntly that an arbitrator has no power to decide his own jurisdiction and in one case where rules of an institution the arbitrator such power, the court will ignore this when asked to enforce the award, and decide the question itself. However, an arbitrator is always entitled to inquire whether or not he has jurisdiction.. An umpire faced with a dispute whether or not there was a contract from which alone his jurisdiction, if any, can arise can matter at all and lease the parties to go to Court, or he can consider the matter and if he forms the view that the contract upon which the claimant is relying and from which, if established, alone his jurisdiction can arise is in truth the contract, he can proceed accordingly."

In "Law of Arbitration" by <NAME> [2nd (1987) Edition] at pages 154-55, it is stated thus:

"An arbitrator cannot by mistake assume jurisdiction over a matter on which he has no jurisdiction. If it is shown by the terms of the submission or by the extrinsic evidence that the arbitrator has adjudicated upon matters outside the scope of his authority the award cannot stand, however well meaning and honest the mistake might have been. An arbitrator cannot give himself jurisdiction by a wrong decision collateral to the merits as to facts on which the limits of his jurisdiction depends. Where it was a condition precedent to his jurisdiction that the dispute should have arisen during a tenancy between the plaintiff and the tenancy between the plaintiff and the defendant or in the event of a collusion if certain works had been completed, the arbitrator could not clothe himself with jurisdiction by a wrong decision n the preliminary point. The question is not preliminary point. The question is not concluded against any party by a finding of the arbitrator that he has jurisdiction. It is for the court and not for the arbitrator to decide finally whether or not the arbitrator has jurisdiction and that is the law both in India and in England."

"....The question whether the matters referred were within the ambit of the clause for reference of "any difference or dispute which may arise between the partners is for the court to decide". "....Dispute about the existence or validity of the contract and as to the existence of facts which render it illegal must be determined by the court and not by the arbitrator. The arbitrator cannot by his own finding clothe himself with jurisdiction. Supposing he finds that the jurisdiction agreement is valid such a finding cannot bind the parties".

It would thus be seen that the arbitrator, while deciding the admitted dispute, subject matter of adjudication, may decide the dispute in reference to the agreement. That would be within his jurisdiction. In such jurisdictional issue, even if an error is committed that may not be an error apparent on the face of the record because the arbitrator, the chosen forum, may commit an error in exercising his jurisdiction. However, if he, by a speaking award, decides it on a wrong proposition of law, it will be an error apparent on the face of record and liable to correction. If the arbitrator decides a dispute which is beyond the scope of his reference or beyond the subject matter of the reference or he makes the award disregarding the terms of reference or the arbitration agreement or terms of the contract, it would jurisdictional error beyond the scope of reference, he cannot clothe himself to decide conclusively that dispute as it is an error of jurisdiction which requires to be ultimately decided by the court. This Court has pointed out the distinction between latent and patent error of jurisdiction in <ORG> case thus:

"It has to be seen whether the terms of the agreement permitted entertainment of the claim by necessary implication. It may be stated that we do not accept the broad contention of <NAME> that whatever is not excluded specifically by the contract can be subject-matter of claim by a contractor. Such a proposition will mock at the terms agreed upon. Parties cannot be allowed to depart from what they had agreed. Of course, if something flows as a necessary concomitant to what was agreed upon courts can assume that too as a part of the contract between the parties."

It would thus be clear that the arbitrator cannot clothe himself conclusively with the jurisdiction to decide or omit to decide the arbitrability of a particular item or the claim made by the parties. When a specific reference has been made to the arbitrator and the parties raise the dispute of arbitrability, with the leave of the court/by a direction of the court in a proceedings under Section 33, he is to decide the arbitrability of the dispute and make a decision of the arbitrability f the dispute and make a decision while giving reasons in support thereof. The decision of the arbitrator in granting a particular sum by a non-speaking award, therefore, hinges upon the arbitrability of a dispute arising under the contract or upon a particular item claimed thereunder. He is required to give the decision thereon. The question of decision by implication does not arise since his jurisdiction to decide to dispute on merits hinges upon his jurisdiction to decide the arbitrability of the dispute. In this case, in view of the finding recorded by the court, which has become final, as referred to earlier, the arbitrator/umpire was enjoined to decide the arbitrabilty of the claims set up by the respondent and disputed by the appellant. Admittedly, the award of the umpire does not contain any decision on arbitrability of the claims.

<CITATION> [] one of the questions referred was arbitrability of a particular item. It was by the Court stated thus :

"In the instant case, the arbitrator by virtue of the terms mentioned in the order of this court had to decide which of the disputes were arbitrable and which were not. It is true that the arbitrator has not specifically stated in the award that he had to decide the question of arbitrability. The arbitrator has rested by stating that he had heard the parties on the point of arbitrability of the claim and the counter-claim. He has further stated that after 'considering all the above aspects' and 'the question of arbitrability or non-

arbitrability' he had made the award on certain aspects."

It could be seen that if the arbitrator has indicated his mind in the award that he in fact adverted to the arbitrability or non-arbitrability of the claim and then made the award, it would be indicative of the fact that he had, in fact, applied his mind, considered that question and reached the decision in awarding certain amounts by a non-speaking award including the claim in respect of which arbitrability was in issue.

<CITATION> [], a Constitution Bench of this Court had gone into the question whether the arbitrator is required to give reasons in a non-speaking award. The Constitution Bench had pointed out in para 35 thus:

"We do not appreciate the contention, urged on behalf of the parties who contend that it should be made obligatory on the part of the arbitrator to give reason for the award, that there is no justification to leave the small area covered by the law of arbitration out of the general rule that the decision of every judicial and quasi-judicial body should be supported by reasons. But at the same time it has to be borne in mind that what applies generally to settlement of disputes by authorities governed by public law need not be extended to all cases arising under private law such as those arising under the law of arbitration which is intended for settlement of private disputes."

In para 37 thereof, this Court emphasised the need to make a speaking award and the terms in the contract should postulate such a need when the contract is entered into by the <ORG> or its instrumentalities. It was held thus:

"The trappings of a body which discharges judicial functions and s required to act in accordance with law with their concomitant obligations for reasoned decisions, are not attracted to a private adjudication of the nature of arbitration as the latter, as we have noticed earlier, is not supposed to exert the <ORG>'s sovereign judicial power. But arbitral awards in disputes to which the <ORG> and its instrumentalities are parties affect public interest and the matter of the manner in which government and its instrumentalities allow their interest to be affected by such arbitral adjudications involve larger questions of policy and public interest. Government and its instrumentalities cannot simply allow large financial interests of the <ORG> to be prejudicially affected by non-reviewable - except in the limited way allowed by the statute - non-speaking arbitral awards. Indeed, this branch of the system of dispute resolution has, of late, acquired a certain degree of notoriety by the manner in which in many cases the financial interests of government have come to suffer by awards which have raised eyebrows by doubts as to their rectitude and property. It will not be justifiable for governments or their instrumentalities to enter into arbitration agreements which do not expressly stipulate the rendering of reasoned and speaking awards.

Government and their, instrumentalities should, as a matter of policy and public interest- if not as a compulsion of law ensure that wherever they enter into agreements for resolution of disputes by resort to private arbitrations, the requirement of speaking awards is expressly stipulated and ensured."

<CITATION> . [], relied on by Shri Poti, the question arose whether the award of escalation charges in a non-speaking award is vitiated by any error apparent on the face of the record? Therein the question of jurisdictional issue had not arisen. On the other hand, on merits, it was contended that there was an error in that behalf. In para 5 it was held that " it was then contended, that the award has purported to grant damages on the basis of escalation of cost and prices and such escalation was not a matter within the domain of the bargain between the parties and having taken that factor into consideration the award was bad." Therefore, the ratio there is an authority supporting the contention on the need of an arbitrator to give a reasoned decision on arbitrability of the contract or claim in dispute.

In this regard, Section 31(3) of the Arbitration and Conciliation Act , 1996, provides thus:

"(3) The arbitral award shall state the reasons upon which it is based, unless-

(a) the parties have agreed that no reasons are to be given, or

(b) the award is an arbitral award on agreed terms under Section

The <ORG> has expressed the legislative judgement that the award shall state reasons upon which it is based unless parties have agreed otherwise or the award is covered on agreed terms under Section 30 of the new Act.

Thus, the law on the award, as governed by the new Act, is other way about of the pre-existing law; it mandates that the award should state the reasons upon which it is based. In other words, unless (a) the parties have agreed that no reasons are to be given or (b) the award is an arbitral award on agreed terms under Section 30 of the new Act, the award should state the reasons in support of determination of the liability/non-liability. Thereby, legislature has not accepted the ratio of <ORG> in the Chokhamal Contractor's case that the award, being in the private law field, need not be a speaking award even where the award relates to the contact of private parties or between person and the <ORG> or public sector undertakings. The principle is the same, namely the award is governed by Section 31(3) .

We have set out the relevant portions of the award. From a reading thereof, it is clear that the arbitrator had considered the claims made on the basis of escalation and damages, in a non-speaking award of the disputes consisting of arbitrable and non-arbitrable claims. He awarded a lumpsum amount of Rs. 70,83,793/-. It is difficult to discern as to what extent the umpire had considered the admissible and inadmissible claims which he adjudged. In such a situation, it is not possible to discern to what extent he had exercised his jurisdiction vis-a-vis of the admissible claims and disallowed the non-arbitrable claims. So, it is not clear whether he exercised his authority either beyond his jurisdiction or in abdication thereof. In either case, it is an error of jurisdiction, the very foundation for his decision.

It is well settled that in the matter of challenge to the award there are two distinct and different grounds, viz., that there is an error apparent on the face of the record and that the arbitrator has exceeded his jurisdiction. In the latter case, the court can look into the arbitration agreement but under the former it cannot do so unless agreement but under the former it cannot do so unless the agreement was incorporated or cited in the award or evidence was made part of the agreement. In the case of jurisdictional error, there is no embargo on the power of the court to admit the contract into evidence and to consider whether or not the umpire had exceeded the jurisdiction because the nature of the dispute is something which has to be determined, outside the award, whatever might be said about it in the award or by the arbitrator. In the case of non-speaking award, it is not open to the court to go into the merits. Only in a speaking award the court can look into the reasoning in the award and correct wrong proposition of law or error of law. It is not open to the court to probe the mental process of the arbitrator and speculate, when no reasons have been given by the arbitrator, as to what impelled the arbitrator to arrive at his conclusion. But in the later case the court, with reference to the terms of the contract/arbitrator/umpire has exceeded his jurisdiction in awarding or refusing to award the sum of money awarded or omitted a consolidated lumpsum.

In fact, in <ORG>'s case, having noticed that the arbitrator had exceeded his jurisdiction to grant amount de hors the terms of the contract and being a non- speaking award, the court was unable to speculate as to what extent the award was within the terms of the contract or claims made and to what extent the amount awarded was in respect of non-arbitrable dispute. Accordingly, the order of the civil court was set aside reversing the judgment of <ORG> of <ORG>.

Thus considered, we hold that the arbitrator, having been invested with the jurisdiction to decide the arbitrability of certain claims, has committed error of jurisdiction in not considering the arbitrability of the claims and passed a non-speaking award, awarding a sum of Rs. 70.83 lakhs and odd. It is difficult to ascertain as to what extent he has awarded the claims within the contract or the claims outside the contract, of a total claim of Rs. 2.10 crores. Under those circumstances, we are constrained to hold that it is difficult to give acceptance to the award made by the umpire as upheld by the courts below. Equally, we find it difficult to accept the contention that out of a claim of Rs. 2.10 crores, only a sum of Rs. 70.83 and odd was awarded. So, it is not a fit case for interference on the basis of the mere fact that a lesser sum than was claimed has been awarded. An illegal award cannot be upheld to be valid or within jurisdiction.

The question then is : what procedure should be adopted in this behalf? The contention of <NAME> is that it may be remitted to the umpire for fresh consideration. On the other hand, the contention of <NAME> is that in the event of the conclusion that the arbitrator has exceeded his jurisdiction, the entire award would become invalid and it has to be set at naught. Having given due consideration to the respective contentions, we find force in the contention of Mr. <NAME>. Mr. <NAME> has stated that though it is found that the award is not valid in law, the party cannot be made to suffer on account of the illegality committed by the umpire. We find no force in the contention. Once a finding recorded that the umpire/arbitrator has committed error of jurisdiction, as stated earlier, two course are open, viz., either to remit the award to the umpire for reconsideration or to set aside the award in toto. We think that the latter course would be appropriate in the facts and circumstances in this case.

Accordingly, we allow the appeals set aside the award of the arbitrator and leave the parties to bear their own costs. If there are no outstanding dues recoverable from the respondents, the security deposit and bank guarantee is required to be refunded to the respondent.