2002 PLP 1560 (YLR)

Noor Muhammad v. Sarwar Khan PLD 1985 SC 131; Muhammad Samiullah v. District Judge, Sargodha PLD 2002 Lah. 56; PLD 1991 SC 61; 1991 SCMR 970 and 1989 SCMR

443. Further it has been argued that the writ jurisdiction is only available to this Court where the order of the Authority is wholly void, without jurisdiction and coram non -judice. The learned counsel has placed reliance on:‑‑ 1988 SCMR 322 and 1986 SCMR 316.

5. In rebuttal, the learned counsel for the petitioners has argued that the writ petition against the order of the District Court passed in revision is competent and this Court can always interfere in the order which has been illegally passed by the subordinate Courts. According to him, the Courts are bound to pass correct and legal orders and earlier view in Sikandar's case reported in PLD 1974 SC 139 that the Court having jurisdiction can pass order rightly or wrongly has been overruled by the Hon'ble Supreme Court in the case of Utility Stores Corporation of Pakistan Limited v. Punjab Labour Appellate Tribunal and others PLD 1987 SC 447 wherein it has been held that the Courts are bound to pass correct and legal orders. Reference has also been made to PLD 1973 SC 24.

6. To appreciate the real contentions of the parties and to resolve the controversy, the reading of Article 33 of the Qanun‑e-Shahadat Order, 1984 would be very relevant, which deals with the cases decided by a person who acts on his own knowledge and belief, and is reproduced as under:‑‑ "

33. Admission by persons expressly referred to by party to suit.‑‑ Statements made by persons to whom a party to the suit has expressly referred for information in reference to matter in dispute are admissions. " A distinction has to be drawn by the Courts on the facts and circumstances of each case whether status of such a person appointed with consent of the parties to resolve the dispute was that of 'Arbitrator' or Referee'. When the parties refer their dispute to a person, the question often arises whether that person was intended to act as an Arbitrator or as a Referee or may be that the person to whom the dispute was referred was intended merely to act as a mediator, that is to say, the reference was for the purpose or aiding a settlement by negotiations rather than for the purpose of discharging its judicial function in the form of an arbitration. The line that distinguishes an arbitrator from a referee has to be defined. It is not the name by which the parties chose to call the persons to whom they referred their dispute nor is the terminology that imply in describing the intention that he is intended to perform his decisive in determining the question. The person may be called as a Referee, a local Commissioner or an arbitrator. What is decisive is parties intention. For that purpose it is not the form but the substance that matters. It is not the use of this or that decides the question, therefore, it may be understandable that the parties intended their dispute to be resolved by an Arbitrator, but that called whom they appointed for the purpose as a 'referee' or his true position was that of a referee, but he was described as an 'arbitrator', but if it is cleared that the person appointed was intended to be an arbitrator and the function that he performed was the function of arbitrator, then he is not less than an arbitrator because he is described by another name. For determination of the question, it is necessary to read the order of the appointment of the person to resolve the dispute and the proceedings recorded by the trial Court with attendant circumstances and to find, out what real intention of the parties was. The question of understanding the two expressions 'Arbitrator' and 'Referee' within the meaning of sections 8 and 14 Arbitration Act (X of 1940), and Article 33 of the Qanun‑e‑Shahadat Order, 1984 (Section 20 of the Evidence Act, 1872) came up for consideration before the Court in the case of Mst. Akbari Begum v. Rahmat Hussain and others AIR 1933 Allahbad 861 before the Full Bench and it was held "for the purposes of reference to a third party under section 20 of the Evidence Act, 1872, it is not necessary that reference should be on questions of fact within the knowledge of the referee." In case of Ali Hussain v. Rafiquddin and 9 others (PLD 1977 Lah. 418) the term 'referee' was defined as under:‑‑‑ "‑‑‑Referee‑‑‑Means a person acting on his own knowledge and belief and not one appointed to decide matter after inquiry and taking evidence." These words 'Arbitrator' and 'Referee' came for interpretation before this Court in case reported as Sher Zaman Khan v. Noor Zaman Khan and another (PLD 1977 Lah. 672), wherein Mr. Justice Aftab Hussain, as His Lordship then, was, made a distinction as under:‑‑‑ "An arbitrator as held by the West Pakistan High Court and the Supreme Court of Pakistan is a person who decides a dispute after an inquiry. The determination of dispute by such person is essentially by following a judicial procedure keeping in view the principle of natural justice and the law of the land. Such decision is known as an award and can be made a rule of the Court after following the procedure or the Arbitration Act. The statement of a referee is not his finding. It is a statement made before the Court on the basis of knowledge or belief of the referee and has all the characteristics to operate as an admission of the parties on which a decree can be based by the Court. In case of Muhammad Jameel (1996 MLD 700) the distinction was made between 'arbitrator' and 'referee' and it was held:‑‑‑ "Arbitrator or Referee‑‑ Distinction‑‑‑Where dispute was referred to for his decision which was to be arrived at after hearing parties and the referee expressed made statement in Court that after having heard the parties he arrived at a conclusion of liability of defendant‑‑‑Held that he acted as an arbitrator and not as a referee." In case Naveed Aziz and another (1996 CLC 1932) a Division Bench of this Court has drawn distinction in 'referee' and 'Arbitrator' on the basis of illustrations of Article 33 of the Qanun‑e‑Shahadat Order, 1984 and held:‑‑‑ "A bare perusal of the illustration attached to Article 33 of the Qanun -e‑Shahadat would show that the Referee is required to furnish information to the Court according to his personal knowledge and that knowledge must be preceding his appointment and not subsequent thereto. The word 'Go' and ask C.C. knows all about it' are quite definite in their meaning that the knowledge of the Referee must be preceding the reference and not thereafter. Again the information so furnished by the Referee partakes the character of admission between the parties with the result that the lis is decided on the basis thereof and rightly so because the admission, the moment it is made, relieves the parties from making proof of the fact so admitted and debars them from disputing any further. On the contrary a Faisala or resolution of a dispute can only be made by receiving evidence, hearing arguments and applying mind to the facts as proved on the record." In case of Ghulam Farid Khan (1990 SCMR 763) it was held:‑‑‑ "Referee, quite, clearly understood his role as that of an 'arbitrator' and proceeded accordingly even though in keeping with the statements made by the parties, he described himself as a referee." In case of Mehr Din and others v. Siraj Din and others PLD 1980 Baghdad‑ul‑Jadid 45, while interpreting the provisions of sections 20 and 31 of the Evidence Act (I of 1872) it was held that admission by a person whom parties referred (Referee), held, might operate as estoppel. Similar was the interpretation made by the Hon'ble. Supreme Court in case of Mst. Lalan v. Noor Muhammad and 2 others 1994 SCMR 1771 in which the concurrent finding of fact regarding a disputed path by Ch. Muhammad Akram, Advocate of Chakwal who was appointed referee by the consent of the parties, was maintained by the High Court and leave was refused. In case of Muhammad Khalid v. A.T.M. Corporation Ltd. 1988 CLC 2359 an objection petition was filed on the report of Mr. Justice K.M.A. Samdani (Retd.) on the ground that he had no personal knowledge of the dispute referred to him and as such he held necessary inquiry to acquaint himself with the controversy existing between the parties and then gave his decision. Thus matters in dispute were not and could not have been referred to a Referee for their resolutions in terms of Article 33 of the Qanun‑e‑Shahadat Order, 1984 and it was held that the decision given by him in implementation of the Award is thus an Award and the parties to the reference have the right to file objections against the same in accordance with the provisions of the Arbitration Act, 1940, unless they otherwise have waived their right or under shown principle of law stand estopped to challenge the Award. In view of the conduct of the parties in the above referred case of Muhammad Khalid, it was observed by this Court that the objectors have waived their right or they estopped under general principle of law to challenge the Award. In case reported as Nazir Ahmad and another v. Muhammad Din and others (2000 SCMR 440) parties appointed referee with their free consent for the decision of the matter in issue and agreed that whatever decision the Referee would give that would be binding on them and they would not challenge its validity and the appellant in that case failed to challenge the statement of the referee either by way of cross‑examination or through written objection petition, it was held that it was obvious that by his conduct the appellant could not be allowed to raise any objection to such a decision as the appellant was estopped to challenge the fitness and binding nature of the statement of such a Referee. The appeal was dismissed by the Hon'ble Supreme Court and it was held that the case of Ghulam Farid (1990 SCMR 763) is distinguishable. On the touchstone of the Article 33 of the Qanun‑e‑Shahadat Order, 1984 and section 30 of the Arbitration Act, 1940 (X of 1940) and the case‑law referred above, it has emerged that the real intention of the parties matters and for determining the intention of the parties, it is not the form but the substance which is to be seen. For determination of the question, it is necessary to read the agreement between the parties and the proceedings recorded by the trial Court and with the attendant circumstances and to find out what the real intention of the parties was. The distinction between the 'Arbitrator' and 'Referee. therefore, is that the arbitrator is authorised to decide after making an inquiry, but a referee is not so authorised. All that a Referee is required to do is to make a statement according to his knowledge and belief, and if he makes the statement; the statement is an admission for both the parties binding upon them and as soon as the statement is made it is perfected into an adjustment by lawful agreement/compromise. The record shows that Malik Khadim Hussain, retired Qanungo, was appointed Referee regarding the decision (Faisala) about the 'disputed' land (Raqba). Suffice to say that Article 33 of the Qanun‑e‑Shahadat Order does not speak of 'dispute' or decision. The proceedings were conducted by the said Malik Khadim Hussain on 10‑7‑1987. The proceedings were adjourned to 17‑7‑1987 with the observation that for the measurement of the site presence of the Patwari alongwith relevant record is necessary. It was further directed that the parties may come on the fixed date, i.e. 17‑7‑1987 and also bring the documentary proof. It was also stated that the evidence of the parties has been recorded. On 17‑7‑1987 Ch. Muhammad Sadiq, Advocate, counsel for defendants Nos. 7, 8 and 9, Ch. Muhammad Sharif, Advocate alongwith Patwari Muhammad Asghar were present. The measurement was carried out. The measurement of the houses of the defendants was also conducted and the proceedings were adjourned for production of sale deed by Zulfiqar Ali Shah for 25‑7‑1987. On 25‑7‑1987 Syed Zulfiqar Ali Shah produced the photostat copy, which was attached alongwith the file and the report was submitted. It was stated in the report that in the record of the Revenue there is no separate Khasra number of the graveyard in dispute and that the revenue papers of consolidation, the graveyard prior to the consolidation bears Khasra No. 534 which has been included in the Abadi. From the agreement, proceedings and the reading of the report, dated 25‑7‑1987 prepared by Malik Khadim Hussain, it is manifestly clear that the parties had the intention to appoint him as Revenue Officer being expert in demarcation matters to conduct the demarcation proceedings in accordance with law. Suffice to say that in Hadbandi cases the procedure and rules enumerated in the High Court Rules and Orders Vol.‑I, Chapter 1‑M are to be followed. In case reported as Muhammad Suleman and another v. Abdul Rashid and 6 others PLD 1975 Lah. 42, Anwar Club and another v. Muhammad Sarwar (PLD 1992 Lah. 63) and Col. Mahboob Khan v. Abdul Rashid and another (1993 MLD 1599) the Courts have provided guidelines to Local Commission in Had Sakni cases. From all the above stated facts, it is concluded that the parties had the intention to appoint Malik Khadim Hussain as an Arbitrator and not Referee. The proceedings of demarcation, which he conducted after his appointment, recording of evidence and consultation with the record, are also indicative of‑the fact that he has not acted as a Referee. In this view of the matter and in the facts and circumstances of the present case, case of Mehr Din (PLD 1980 'Baghdad‑ul-Jadeed' 45) and of Muhammad Khalid (1988 CLC 2359) are not applicable. The case of Nazir Ahmad and others (2000 SCMR 440) in which the case of Ghulam Farid Khan (1990 SCMR 763) was distinguished, is applicable to the facts and circumstances of the present case. I, therefore, by following the case of Ghulam Farid (supra), am constrained to hold that Malik Khadim Hussain, retired Qanungo, was not a referee but was am arbitrator, who acted as such for all intents and purposes in this case. Before parting with the judgment, it is observed that the order of the District Judge, whereby he dismissed the objection petition of the petitioner, was not within his jurisdiction, therefore, this. Court can interfere in the order passed by the learned District Judge. Reliance is placed on the case reported as Ch. Muhammad Saleem v. Muhammad Akram and others (PLD 1971 SC 516). It is also important to mention that the Tribunal invested with jurisdiction to decide a particular matter, has no jurisdiction to decide it 'rightly or wrongly'. The Courts under the law should decide the matters in accordance with law as held in case of Utility Stores Corporation of Pakistan Limited (PLD 1987 SC 447) (supra). There is no force in the contention of the learned counsel for the respondent on the basis of case of Noor Muhammad v. Sarwar Khan (PLD 1985 SC 131) and Muhammad Samiullah v. District Judge, Sargodha (PLD 2002 Lah. 56) that this Court in its Constitutional jurisdiction cannot interfere in the order passed by the revisional Court. In case PLD 1991 SC 65 it was held that the effect of the judgment given by this Court in Noor Muhammad's case (supra) on the basis of which leave to appeal was granted, is not that a Constitutional petition is in no case permissible whatever the nature of the effect in the proceedings before the District Judge be, but that a mere illegality committed with jurisdiction shall not be a ground for entertaining a Constitutional petition. For what has been discussed above, the order, dated 13‑5‑1996 passed by the learned District Judge, Sialkot is declared to be without lawful authority and of no legal effect. The writ petition is accepted. Parties to bear their own costs. H.B.T./Z‑89/L Petition accepted.