IMPORTANT POINT
The umpire cannot conclusively decide for himself in a non-speaking award of the arbitrability of the claims and, therefore, the umpire was required to decide as a preliminary issue of the arbitrability of the claims when a specific reference has been made and the parties raise the dispute of arbitrability.

JUDGMENT

K. Ramaswamy, J.-(On behalf of himself and Hon ble Mr. A.M. Ahmadi, CJI) (Majority Opinion)

We have the advantage to read the proposed judgment by our esteemed brother Punchhi, J. Despite our deep and abiding personal respects, we express our regards for our inability to agree with the proposed judgment. Hence we are constrained to right (write sic) this separate judgment.

2. This appeal by special leave arises from the judgment and order dated December 19, 1979 made in A.O.O. No. 240 of 1975 by L.M. Sharma, J. (as he then was) agreeing with the dissenting opinion of one of the members of Division Bench of Patna High Court, viz., B. S. Sinha, J. The result was that the award of the umpire stood set aside.

3. The appellant had entered into an agreement with the respondent on May 2, 1971 for execution of certain works. During the course of their execution, certain disputes had arisen between them. Clause 78 of the contract provided resolution of the disputes by arbitration. In furtherance thereof, the parties had referred the disputes in 1972 to two arbitrators. One of the disputes referred to them was "whether claims referred to at items 2, 3, 4 and 5 of Annexure-A are or are not referable to arbitration in terms of the contract". The total claim including items 2 to 5 was for Rs. 2,55,600/-. The arbitrators held that the claim Nos. 2 to 5 were referable under arbitration agreement but they could not come to an agreement on the merits of the claims. Therefore, they had appointed an umpire by their letter dated November 2, 1973. The umpire made a non-speaking award directing the respondent to pay a lump sum of Rs. 80,000/- besides interest. On an application made by the appellant, the Civil Court made the award rule of the Court and the application under Section 33 of Arbitration Act, 1940 (for short, the "Act") to set aside the award was dismissed. The respondent preferred an appeal in the High Court.

4. When the matter came before the Division Bench consisting of B.P. Jha and B.S. Singh, JJ., both the learned Judges agreed that one of the terms of the reference was that the arbitrators were required to decide as to whether the claims referred to under items 2 to 5 of Annexure-A are or are not referable to arbitration in terms of the contract. They further held that the finding by the arbitrators that the claims were arbitrable, was not an interim award. The entire controversy including arbitrability of items 2 to 5 was at large and the umpire was to decide whether items 2 to 5 of Annexure-A were arbitrable under contract. B.P. Jha, J. held that when the matter was referred to an umpire, the whole dispute which was referred to the arbitrators by the parties stood referred to the umpire. If a part of the dispute was decided by the arbitrators, the arbitrators could not refer the other half of the dispute of the umpire. The learned Judge observed that "In my opinion, the whole dispute is referred to the umpire for the simple reason that the umpire acts in lieu of the arbitrators. The umpire is entitled to give a consolidated award instead of giving the award on each point. While setting aside an award the court can look at the award and not on any other extraneous evidence on the record". Accordingly, the learned Judge dismissed the appeal of the respondent. B.S. Sinha, J. held that if a dispute is capable of being split into different parts and the arbitrators agreed on one part and disagreed on the other part, "I can see no reason why the whole dispute must be referred to the umpire. An interim award can be made in terms of Section 27 of the Act. Of course, if the dispute is not capable of being split up and the arbitrators do not agree, the whole dispute will go to the umpire. In other words, as far as I can see, whether the whole dispute was referred to the umpire or not depends upon the facts and circumstances of each case for which no hard and fast rule can be laid down." He held that the whole dispute had been refe