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Issues: (i) Whether the award was invalid for want of appointment of the arbitrator by the Central Government under section 7B of the Indian Telegraph Act, 1885; (ii) Whether a non-speaking arbitral award under section 7B could stand in law.
Issue (i): Whether the award was invalid for want of appointment of the arbitrator by the Central Government under section 7B of the Indian Telegraph Act, 1885.
Analysis: Section 7B requires disputes concerning telegraph bills to be determined by an arbitrator appointed by the Central Government. The appointment in the present case was made by an officer acting on behalf of the President, but not in the manner contemplated by the statute. Where a statute prescribes a particular mode for doing an act, it must be done in that mode alone. An appointment not made in conformity with the statutory mandate lacks jurisdictional validity.
Conclusion: The appointment was not in accordance with section 7B and the award was invalid for want of jurisdiction.
Issue (ii): Whether a non-speaking arbitral award under section 7B could stand in law.
Analysis: An award under section 7B is conclusive between the parties and is not open to challenge in court except through judicial review. Since such an award affects civil consequences and public interest, reasons must be recorded to show application of mind and to enable limited judicial scrutiny. A non-speaking award defeats that requirement and cannot be sustained.
Conclusion: The award, being unreasoned, could not be sustained in law.
Final Conclusion: The impugned award was set aside and the dispute was remitted for fresh adjudication in accordance with the statutory scheme.
Ratio Decidendi: Where a statute requires an arbitrator to be appointed by a specified authority and the resulting determination is final, compliance with the prescribed mode of appointment is mandatory and the award must also be supported by reasons to withstand judicial review.
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