1990 PLP 1675 (MLD)

Extra over excavation in rock. Rs. 669,400 Total: Rs.1,566,600. (2) that the Claimants and the Respondent shall each pay one‑half of the whole costs of arbitration amount to U.S.$21,000 (U.S. Dollar Twenty One Thousand Only) excluding the normal legal cost incurred by the two parties. (3) That the normal legal costs incurred by the two parties, should be borne by the respective Parties to the extent incurred by each of them.

9. As far as the first contention raised by Mr. Mansoor Ahmed Khan is concerned, Mr. Bilal A. Khawaja, learned counsel for the plaintiff, has pointed out that the award was given in Paris in accordance with Article 23 of I.C.C. Rules of Conciliation and Arbitration which was in consonance with the terms of the agreement entered into by the parties. In this connection it is pertinent to refer to the definition of "Foreign Award" given in the Act of 1937 as the argument of Mr. Mansoor Ahmed Khan is that the award given by Mr. A.M. Akhoond, the sole arbitrator, cannot be termed as "Foreign Award". The definition runs as follows:‑ "(2) Interpretation (1)‑‑In this Act "foreign award" means an award on differences relating to matters considered as commercial under the law in force in Pakistan made after the 28th day of July, 1924‑‑ (a) in pursuance of an agreement for arbitration to which the Protocol set forth in the First Schedule applies, and (b) between persons of whom one is subject to the jurisdiction of some one of such powers as the (Federal Government) being satisfied that reciprocal provisions have been made, may, by notification in the official Gazette, declare to the parties to the convention set forth in the Second Schedule, and of whom the other is subject to the jurisdiction of some other of the powers aforesaid, and (c) in one of such territories as the (Federal Government), being satisfied that reciprocal provisions have been made, may, by like notification, declare to be territories to which the said Convention applied, and for the purposes of this Act an award shall not be deemed to be final if any proceedings for the purpose of contesting the validity of the award are pending in the country in which it was made. (2) For the removal of doubt it is hereby declared that any notification issued under this section by the late Government of India before the fifteenth day of August, 1947, and in force on that day for the purpose of enforcement of foreign awards in British India, declaring any power to be a party to the said Convention or any territory to be the territory to which the Convention applied, shall be deemed to be a notification issued by the (Federal Government) for the purpose of enforcement of foreign awards in Pakistan. A perusal of the above definition shows that an award, before it can be treated as a "Foreign Award", must satisfy the conditions laid down in section 2 of the Act of 1937. Clauses (b) and (c) of the definition show that one of the parties to the arbitration must be subject to the jurisdiction of one of the powers or territories in respect of which, the Federal Government being satisfied that reciprocal arrangements have been made, has issued a notification as contemplated by the said clauses. However, nothing can be spelt out from the definition of "Foreign Award" to indicate as a condition precedent that one of the persons to the arbitration agreement must be resident of territories outside Pakistan. Therefore even if both the parties to the arbitration agreement are nationals or residents of Pakistan, they could still make themselves subject to the Rules of Conciliation and Arbitration of the International Chamber of Commerce, Paris. Since the matter was referable to the arbitration under the Rules of Conciliation and Arbitration of the International Chamber of Commerce by the terms mutually agreed between the parties the award given by the Arbitrator is a "Foreign Award" and the same is liable to be governed by the provisions of the said Act. The first argument of Mr. Mansoor Ahmed Khan must, therefore, fail.

10. Now, the success of the second and the third contention raised by the learned counsel clearly depends upon my findings given in respect of his first contention. The contentions are, firstly, that the award has not been made on a Stamp Paper as required by Article 12 read with section 3 of the Stamp Act and secondly, that, it is barred by limitation. It may be pointed out that the Award was given on 15‑2‑1988 while the present application has been filed in the Court on 23‑1‑1989.

11. In support of his first contention Mr. Mansoor Ahmed Khan has placed reliance on the case of Messrs Jugotekstil Impex v. Messrs Shams Textile Mills Ltd. 1986 C L C 879, decided by my learned brother Hyder Ali Pirzada, J., wherein it has been held that the provisions of section 35 of the Stamp Act, 1899 would be attracted to a Foreign Award which relates to a matter or a thing to be done in Pakistan. Mr. Bilal A. Khawaja, on the other hand, has invited my attention to another case reported as Nan Fung Textiles Ltd. v. Sadiq Traders Ltd. P L D 1982 Kar. 619.1n this case a similar question arose before my learned brother Saleem Akhtar, J., and it was held by him that a Foreign Award cannot be governed by the provisions of section 35 of the Stamp Act. Reference was made by him to Article 12 in the "Schedule" to the Stamp Act which refers to awards but my learned brother was of the view that the expression "Foreign Award" which has been separately defined in the Act of 1937 is not the same as "Award" referred to in Article 12 of the Stamp Act. A perusal of the first judgment clearly indicates that the definition of "Foreign Award" was not taken into consideration by any learned brother Hyder Ali Prizada, J., However, with utmost respect, I find myself in agreement with the view expressed by Saleem Akhtar, J., and in my opinion, the provisions of the Stamp Act referred to above are not applicable to a "Foreign Award" nothwithstanding the fact that it relates to a matter or thing to be done in Pakistan. Consequently, the second argument of Mr. Manzoor Ahmed Khan must also fail.

12. The next argument of Mr. Mansoor Ahmed Khan also fails to impress as Article 178 of the Limitation Act provides as follows:‑‑ "

178. Under the Arbitration ninety days. Act, 1940, for the filing in Court of an award. The date of service of the notice of the making of the award." The Limitation Act refers to applications under the Arbitration Act, 1940 which the present application is not, the same having been filed under the Act of 1937. The period of limitation of ninety days, therefore, is not applicable to the present application for which no period limitation has otherwise been provided in the Limitation Act. The argument is, therefore, devoid of force.

13. I now turn to the last argument of Mr. Mansoor Ahmed Khan. The learned counsel has argued that the conclusions reached by the Arbitrator at page 32 of the award must in fact be construed as a final award and what follows thereafter at page 33 of the award is only a matter of calculations. The items pinpointed by the arbitrator for compensation at page 32 are as follows:‑‑ "(1) Item 14/177/1 Imported High Grade Fill. Telescopic increase at 20% of B.O.Q., rate. (2) Item 2/177/2 Granular Bedding to pipes. Telescopic increase at 20% of B.O.Q., rate. (3) Item 5/177/2 Extra over Excavations in Works. Telescopic increase at 35% of B.O.Q., rates." The amount awarded against the defendant was calculated by the arbitrator as follows:‑‑ "Item 14/177/1 Imported High Grade Fill Rs.294,200 Item 2/177/2 Granular Bedding in pipes. Rs.603,000 Item 5/177/2 Extra over excavation in rock. Rs.669,40 Total: Rs.1,566,

600. According to Mr. Mansoor Ahmed Khan ex facie, amongst other mistakes, there is a glaring omission of non‑deduction of running payments amounting to Rs.11,35,

372. The argument of Mr. Bilal Khawaja in this connection was that there was no mistake committed by the arbitrator in calculations as the award was given in respect of the additional work done by the plaintiff beyond 15% excess over the quantities provided in the B.O.Q. which obviously did not include the amount referred to by Mr. Mansoor Ahmed Khan. The learned counsel further pointed out that the increase referred to by the arbitrator was not a simple increase but as would be indicated by the award itself, the same was a telescopic increase and consequently, the different amounts were calculated on such basis by the arbitrator.

14. It maybe pointed out that a "Foreign Award" maybe attacked on one of the grounds set forth in section 7 of the Act of 1937. However, even assuming that an award can be set aside on account of an error which is disclosed on the face of the award, there is nothing to indicate that the award suffers from error as pointed out by Mr. Mansoor Ahmed Khan. Nor there is anything to indicate that the conclusions reached by the arbitrator at page 32 of the award finally determine the issues before him. I am, therefore, unable to agree even with the last contention of Mr. Mansoor Ahmed Khan. I am consequently of the view that the award is enforceable under the Act of 1937 and it can be allowed to be filed and made rule of this Court.

15. In the result, the award is made the rule of this Court. A.A/P‑136/K Award made rule of Court.