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Issues: Whether, under Clause 70 of the General Conditions of Contract, the arbitrator was required to record reasons in support of his findings on each item of dispute, so that a non-speaking award could be sustained.
Analysis: Clause 70 required the arbitrator to give his award on all matters referred and to indicate his findings separately on each item of dispute along with the sums awarded. Read in its text and context, the expression "findings" was held to mean more than a bare conclusion such as "sustained" or "not sustained". A finding, in adjudicatory usage, presupposes application of mind, and that is best disclosed by reasons. The later statutory scheme under the Arbitration and Conciliation Act, 1996, which generally requires reasons under Section 31(3), reinforced this construction. The earlier decision in Gora Lal was approved, while Build India Construction System was confined to its facts.
Conclusion: The arbitrator was obliged to record reasons in support of the findings under Clause 70, and the non-speaking award was rightly set aside.
Ratio Decidendi: Where an arbitration clause requires the arbitrator to state his findings on each item of dispute, the term "findings" includes the reasons supporting the conclusion, and a bare unexplained conclusion is insufficient.
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