This petition under Ss. 5 and 12 (2) of the Arbitration Act by Bhilwara Synthetics Ltd. is a third attempt to get rid of an arbitration agreement and the arbitral process set in motion by the Delhi Hindustani Mercantile Association, of which the petitioner admittedly was, at one time, a member.

2. The petitioner is a manufacturer of Polyester Synthetic Fabrics and M/s. Subash Aggarwal Agency of Delhi, respondent No. 3 herein, had, at one time, been marketing the product of the petitioner in the territory of Haryana, as an agent. The petitioner and the respondent No. 3 were members of Delhi Hindustani Mercantile Association and in terms of the Rules of the Association were bound, as such members, to refer all disputes between them to the Association for settlement by arbitration by itself or its nominee. It appears that in the course of the dealings between the petitioner and respondent No. 3, some disputes either arise or were apprehended and the petitioner, being apparently averse to settlement of any such dispute by arbitration of the Association, sought to opt out of the Association and resigned it membership by a letter of April 20, 1979. There was considerable controversy between the petitioner and the association with regard to the right of the petitioner to the resignation being accepted. The petitioner took the matter to a Civil Court. The Association apparently relented and accepted the resignation of the petitioner. There has however, been some controversy between the parties as to the effect of the acceptance of the resignation. Meanwhile in August, 1979, respondent No. 3 made a claim of Rupees 4 lakhs and odd against the petitioner with the Association and the Association appointed Mohan Lal, respondent No. 2, as the sole arbitrator in the dispute in accordance with its Rules. While the dealings between the petitioner and the respondent No. 3 related to the period prior to the period of resignation of the petitioner and the disputes between them may also have arisen before that date, the reference of the matter to the Association was admittedly after the resignation. By a petition under S. 33 read with Section 5 of the Arbitration Act, being OMP 142/79, the petitioner sought to have the arbitration declared null and void on the ground that there was no arbitration agreement between the parties by virtue of the resignation of the petitioner. One of the questions raised by the petitioner was that on the resignation of the petitioner or its acceptance, the Association ceased to have any jurisdiction over the petitioner and consequently with reference to any dispute between the petitioner and respondent No. 3. By an order made by this Court, Kapoor, J., on Feb. 28, 1980, the petition was dismissed but liberty was granted to the petitioner to raise various points, sought to be urged before the Court, in the arbitration proceedings, as the Court expressed the view that the questions in controversy could not be properly decided on the material before the Court. By the present petition, the petitioner prays for revocation of the authority of the arbitrator, as well as of the Association, and prays for appointment of a sole arbitrator to go into the dispute between the parties, primarily on the ground that the arbitrator and the Association would be biassed against the petitioner in view of the predominance of the traders amongst the members of the Association and because the petitioner came in conflict with the Association on the question of the petitioner's resignation. Meanwhile, the petitioner did not appear on one of two occasions before the arbitrator, even though the proceedings of arbitration were not stayed by this Court, but the arbitrator was directed not to make the award until the decision of the petition. The arbitrator accordingly decided to proceed ex parte and evidence of the claimant was recorded. The arbitrator is still to hear the petitioner's side of the case and/or to make an award.

3. I have heard learned counsel for the parties at considerable length and have also perused the records of the arbitration proceedings. Counsel for the Association, who also appeared for the Arbitrator, emphasised the importance of the arbitral process under the auspices of a well established Association for its over 2,000 members comprising manufacturers, traders, dealers, bankers and commission agents and explained the circumstances in which the Association resisted the resignation of a member to avoid arbitration proceedings with a view to preserve the integrity of the Association and confidence in its arbitral process, which, according to him, has played an important role in preserving amity between different wings of the industry, trade and commerce in the region and saved the members the harassment and costs of protracted litigation in Courts. He urged that the question of resignation of a member, after disputes had arisen, or the member has had dealings with another member, raised an important question of principle for the Association and there was no animus or bias against the petitioner or any section of membership of the Association. To allay any possible fears of the petitioner, counsel also made a fair concession, without intending to lay down a binding precedent, that in the totality of the present circumstances, this Court could make appropriate direction to the Arbitrator that the Arbitrator would proceed afresh with the arbitration so that the petitioner has a reasonable opportunity of being heard and require the Arbitrator to give a reasoned award.

4. Counsel for the petitioner, however, expressed the misgivings of the petitioner that the Association and its nominee are likely to be biased against the petitioner either because the Association was a body of which the membership is predominantly confined to trading community and the petitioner happened to be a manufacturer, or because of the confrontation that the petitioner has had with the Association on the question of its resignation. The petitioner was, however, not averse to the direction for fresh arbitration proceedings by the Arbitrator and the requirement that the Arbitrator would make a reasoned award, but expressed the petitioner's doubt if even with this safeguard the petitioner would be fairly dealt with by the Association and its nominee.

5. Bias, no doubt, is a vitiating element. It impairs the impartiality and objectivity of any Court or tribunal. It is also True that the actual bias and its impact on the decision are unnecessary, the likelihood of bias is sufficient to constitute a fatal infirmity in any decisional process. However, bias is not to be readily inferred and is difficult to detect, both in its effect and its likelihood, where there is no persona! animus, monetary interest or similar apparent circumstances. It is difficult to infer the likelihood of bias merely from the class composition of the tribunal and association of persons or of the litigating parties. That raises some interesting questions and I would have gone into these, but for the concessions made on behalf of the Association, as also because, in the way I have looked at the problem, any expression of opinion, one way or the other, is likely to prejudice the fair trial of any objection against the award, should it be unfavourable to the petitioner. The obligation to give reasons, which was fortunately, accepted on behalf of the Association in the peculiar circumstances of this case, would to my mind minimise, if not eliminate, any chance of likelihood of bias in the present case.

6. Silence, no doubt, is a rare virtue and in the realm of spiritual thought has been sublimated to heights of bliss and divinity. Maunam Pandita Lakshnam i.e silence is an insignia of a wise man, says the Indian Scripture. While the role and importance of silence in nature's scheme of things is still being explored, there is little doubt that in the present stage of law of arbitration in India, silence is truly golden. It is one of the well known anomalies of law of arbitration that while a speaking award is subjected to unrestricted justiciability a non-speaking award enjoys near immunity from judicial control. In the expanding horizon of natural justice and the development of administrative law when every judicial, quasi-judicial, executive and administrative body, charged with the duly to make a decision affecting rights and obligation, is considered under a duty to give reasons for its decision, it is quite anachronistic that an arbitrator in India is still immune from any such obligation. It is important to remember that duly to give reasons enlightens the party, who is affected by the decision, as to why the decision was unfavourable to it, illumines the path of the appellate authority, controls the tribunal itself and constitutes a built-in safeguard against arbitrariness. It is for this reason that in England the right to know reasons has been given statutory recognition. In English law, an award by an Arbitrator without reasons, even without adequate reasons, would be bad in law but not so in India. In international arbitration, the convention recognises the obligation to give reasons. While the rule that the arbitrator need give no reason for the award may have had its importance at one time, there is little doubt that the power to make a non-speaking award must have given undue protection to considerable incompetence, arbitrariness and even dishonesty in the arbitral process. Unfortunately, little legal thought has so far been devoted to the problem and it is high time the matter is considered afresh so as to bring the arbitral process in India in conformity with the norms accepted elsewhere. This is particularly necessary in view of the fact that in the present state of the Court system in India and its unfortunate characteristics of endemic delays, rising costs, technicality of procedure and plurality of appeals, there is a search for alternative decision making apparatus and a re-oriented arbitration process, particularly under the auspices of organisations in industry, trade and commerce, could throw up an acceptable alternative, which would to an extent relieve the overburdened machinery of Courts. I have no doubt in my mind that in course of time the matter would receive attention at more articulate and effective and, preferably, authoritative levels. The concession made before me relieves me of the obligation to carry it any further.

7. In the circumstances, I would, therefore, dismiss the petition subject, however, to the direction to the arbitrator, in terms of the concession made on behalf of the Association and the Arbitrator, that the Arbitrator would hear the matter afresh, after giving reasonable opportunity to the petitioner of being heard, and to make a reasoned award on the conclusion of the proceedings. The petitioner would be at liberty to raise before the Arbitrator, as indeed in any proceedings, subsequent to the award, any question of law or fact, irrespective of whether they have been raised and/or dealt with in the present proceedings, including the question as to the effect of the petitioner's resignation on the arbitration agreement and the arbitration proceedings.

8. Parties are directed to appear before the Arbitrator on Dec., 14, 1981 at 4 p.m Time for making the award is extended by four months from today. In the peculiar circumstances, there would, however, be no costs.

Order accordingly.