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PETITIONER: UNION OF INDIA AND ANOTHER

       Vs.

RESPONDENT: M/S. JAGAJIT INDUSTRIES AND ANOTHER

DATE OF JUDGMENT:       06/05/1999

BENCH: V.N.Khare, U.C.Banerjee

JUDGMENT:

V.N.KHARE, J

     Respondent  herein  has  a telephone  connection.   It appears  that certain dispute arose in respect of the  bills submitted  by  the  appellants  towards  telephone  charges. Consequently, the matter was referred to an arbitrator under Section  7-B of the Indian Telegraph Act, 1885  (hereinafter referred  to  as the Act).  On 20.8.1992,  the  arbitrator entered  into  the reference and on 18th December, 1992,  he gave a non-speaking award.  This award was challenged by the respondents by means of a writ petition under Article 226 of the  Constitution before the Punjab & Haryana High Court.  A Division Bench of the High Court having found that the award does  not  contain  any  reason, set  aside  the  award  and remitted  the  matter  back to the arbitrator for  giving  a speaking  award.  It is against this judgment, the Union  of India  is  in  appeal.  Learned counsel  appearing  for  the appellants urged that in view of the decision in the case of M.L.Jaggi  vs.  Mahanagar Telephones Nigam Ltd & Ors(1996) 3 SCC  119, the requirement of giving reasons in the award  by the  arbitrator has to be applied prospectively and for that reason  judgment under appeal deserves to be set aside.   In brief, the argument is that a non-speaking award given prior to decision in M.L.Jaggis case (supra) has to be upheld.

     After  having gone through the judgment, we find  that the  argument  of  the learned counsel is not based  on  the correct  interpretation  of paragraphs 8 and 9 of  the  said decision.  Paragraphs 8 and 9 are reproduced below :

     8.  It is thus, settled law that reasons are required to  be recorded when it affects the public interest.  It  is seen  that  under Section 7-B, the award is conclusive  when the  citizen complains that he was not correctly put to bill for  the  calls  he  had made and disputed  the  demand  for payment.   The statutory remedy open to him is one  provided under  Section  7-B of the Act.  By  necessary  implication, when  the arbitrator decides the dispute under Section  7-B, he  is  enjoined to give reasons in support of his  decision since  it  is final and cannot be questioned in a  court  of law.   The  only obvious remedy available to  the  aggrieved person  against  the award is judicial review under  Article

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226  of the Constitution.  If the reasons are not given,  it would be difficult for the High Court to adjudge as to under what  circumstances  the arbitrator came to  his  conclusion that the amount demanded by the Department is correct or the amount  disputed by the citizen is unjustified.  The reasons would  indicate  as  to how the mind of the  arbitrator  was applied  to the dispute and how he arrived at the  decision. The  High Court, though does not act in exercising  judicial review  as  a  court of appeal but within narrow  limits  of judicial  review  it  would  consider  the  correctness  and legality  of the award.  No doubt, as rightly pointed out by Mr.    V.R.   Reddy,  Additional   Solicitor  General,   the questions  are  technical  matters.   But  nonetheless,  the reasons  in  support of his conclusion should be given.   In this  case, arbitrator has not given reasons.  The award  of the  arbitrator  is set aside and the matter is remitted  to the  arbitrator to make an award and give reasons in support thereof.

     9.   Since we have decided this question for the first time,  it  must be treated that any decision made  prior  to this  day by any arbitrator under Section 7-B of the Act  is not  liable  to be reopened.  In other words, the  order  is prospective in its operation.

     A  combined  reading of paragraphs 8 and 9 shows  that what  has been prohibited by the aforesaid decision is  only regarding  reopening  of  the   awards  which  have  already attained  finality.  The injunction contained in paragraph 9 of  the decision is not applicable to cases where  decisions given  under  Section  7-B  of the act  were  challenged  on account  of absence of reason in the award prior to the said decision.  This view of our finds support from the fact that this  Court in Gurbachan Singhs case (supra) has set  aside the  decision  of the arbitrator which was found lacking  in reasons.  So far as the present case is concerned, the award was  challenged  before the High Court and the same was  set aside  on  20.3.93.   Therefore, what has been  observed  in paragraph  9  is  not applicable to the present  case.   We, therefore, do not find any merit in this appeal and the same is  accordingly  dismissed.  There shall be no order  as  to costs.