Under an agreement between National Motors Limited, Karachi pre--viously known as Messrs Ghandhara Industries Limited and Pakistan through D. P. (Army), Karachi the plaintiffs were to supply vehicles to the defendants on terms and conditions mentioned therein. According to the plaintiffs the defendants committed breach and in terms of arbitration clause the dispute was referred to the sole arbitration of Masood Hassan. The plaintiffs had made a claim for Rs.
37,39,073.95 before the arbitrator and the defendants submitted their written statement. The defendants also made a counterclaim for Rs. 1,75,25,343.06. The learned arbitrator after considering the contentions of the parties and the documents produced by them made an award on 30th April, 1975 which was filed in this Court. The arbitrator rejected the claim of the plaintiffs and made an award for Rs. 33,21,579.65 in favour of the defendant. It was further declared that on payment of this amount 120 vehicles lying will pass to the plaintiff.
2. The plaintiffs filed objections to the award under section 30 of the Arbitration Act. Additional objection was also filed under sections 30 and 33 of the Arbitration Act on 26-11-1980 on a legal plea that as the agreement between the parties was unstamped, the same could not be acted upon and therefore in view of the provisions of section 35 of the Stamp Act and consequently the award is illegal and without jurisdiction.
3. At the time of hearing Mr. Syed Inayat Ali referred to sections 2 and 3 of the Arbitration (Amendment) Ordinance,. 1981 (Ordinance No. 15/81) and submitted that as the arbitrator has not stated in the award the reasons for the award in sufficient detail the same may be remitted to the arbitrator. The provision of law quoted is reproduced hereunder; "2. Insertion of new section 26-A, Act X of 1940.-In the Arbitration Act, 1940 (X of 1940), after section 26, the following new section shall be inserted, namely '26-A. Award to set out reasons.-(1) The arbitrators or umpire shall state in the award the reasons for the award in sufficient detail to enable the Court to consider any question of law arising out of the award.
(2) Where the award does not state the reasons in sufficient detail, the Court shall remit the award to the arbitrators or umpire and fix the time within which the arbitrator or umpire shall submit the award together with the reasons in sufficient detail Provided that any time so fixed may be extended by subsequent order of the Court. ..
(3) An award remitted under subsection (2) shall become void on the failure of the arbitrators or umpire to submit it in accordance with the direction of the Court.'
3. Power of Court to remit cases pending at commencement of Ordinance.-(1) If in any case in which proceedings in relation to any award which has been filed in Court are pending in any Court immediately before the commencement of this Ordinance, the Court finds that the award does not,or does not in sufficient detail, state the reasons for the award, the court may remit the award to the arbitrator or umpire with a direction to state the reasons for the award in sufficient detail.
(2) Where an award is remitted under subsection (1) the Court shall fix the time within which the arbitrator or umpire shall submit to the Court an award stating the reasons thereafter in sufficient detail; Provided that any time so fixed may be extended by subsequent order of the Court.
(3) Any award remitted under subsection (1) shall become void on the failure of the arbitrator or umpire to submit it in accordance with the direction of the Court."
This amendment in the Arbitration Act was made on 11th May, 1981. The newly-added section 26-A to the Arbitration Act, 1940 provides that the reasons for the award should be stated in sufficient detail in the award to enable the Court to consider any question of law arising out of the award,)
This provision is mandatory and in case of non-compliance the Court shall remit the award.
However, on this ground the award cannot be straight away set aside. The arbitrators or umpire are now under a legal obligation' to give reasons for the award in sufficient detail. Merely giving reasons in sketchy or summary manner will not amount to compliance with this provision of law.
The arbitrators or umpire are bound to give reasons in sufficient detail and such reasons should be made in the award itself. There had been practice that the awards were made in non-speaking terms and sometimes the reasons were stated separately which did not form part of the award itself. Now it is compulsory that the reasons should be contained in the award itself. The manner in which the reason has to be given is also specified. It should be in "sufficient detail" so that the Court may be in a position to consider any question of law arising out of the award. The law now contemplates a speaking award.
4. The word `sufficient' has not been defined in the Ordinance and therefore it has to be construed according to its ordinary literal meaning. `Sufficient' according to Chamber's Twentieth Century Dictionary mean `adequate' ; 'effective'. According to Oxford Universal Dictionary it means `of a quantity, extent, or scope adequate to a certain purpose or object'. In Black's Law Dictionary 4th Edn. Word `sufficient' means, adequate, enough, as much as may be necessary, equal or fit for end proposed, and that which may be necessary to accomplish an object'. The object of Ordinance XV of 1981 is that the arbitrators or umpire should make speaking award. The award should be clear, unambiguous, containing facts and the finding with reasons in support thereof. The reasons should be of such quality or value that it should enable the Court to consider any question of law arising out of the award. The reasons should be intelligible and in such detail that by reading it one could understand the issues involved in the matter. Whether the reason stated in the award is sufficient depends upon the facts and circumstances of each case and no fixed rule for its determination can be laid down.
5. In case of non-compliance, section 26-A (2) provides that the award shall be remitted by the Court with a direction to submit the award together with reasons in sufficient detail within the time fixed by the Court which may be extended by subsequent order. However, if the award remitted under subsection (2) is not submitted in accordance with the direction of the Court, or the arbitrators or umpire fail to comply with such directions the award so remitted shall become void.
6. Section 3 of Ordinance XV of 1981 has taken care of the pending proceedings relating to the awards which have been filed in Court. In such cases if the Court comes to the conclusion that the arbitrators or umpire have not given any reason or the reasons are not in sufficient detail then the award may be remitted to the arbitrator or umpire with a direction to give' reasons in sufficient detail for the award and fix time within which it should be submitted to the Court. If the award so remitted is not submitted in accordance with the order of the Court it shall become void.
7. I have gone through the award made by the arbitrator and agree with the submission of Mr. Syed Inayat Ali and Mr. Mansoorul Arfin that no reasons much less insufficient details have been given in the award. The learned arbitrator has merely referred to the contentions of the parties and made his award without giving any reason. In these circumstances the award is remitted to the learned arbitrator with a direction to state the award in sufficient detail. The arbitrator is further directed to submit to the court the award stating the reasons therefor in sufficient detail within a period of 3 months. The suit is disposed of without prejudice to the conten--tions of the parties and with no order as to costs.