1983 PLP 1318 (CLC)

A. R. Akhtar for Applicants. Date of hearing : 1st September, 1980. Briefly the facts are that the respondent had taken Forest contract from the Provincial Government for removal of timber on the usual terms and conditions. However, the Department cancelled the contract as according to them the respondent had committed default in the payment of the third instalment of the contract amount in breach of stipulated terms of the contract, the remaining stock of timber already felled by the respondent was also confiscated. The remaining balance of the contract amount in accordance with the terms of contract was to be recovered from the respondent and in this behalf the Mukhtiarkar, Thatta issued a notice of demand to the respondent dated 16th June, 1971 for payment of a sum of Rs. 28,

475. It was then that respondent filed a suit before the Joint First Class Civil Judge, Hyderabad and sought an injunction to restrain the Government and the Revenue Authorities from recovering the payment by coercive process. The Government appeared in the proceedings and since the contract between the parties contained an arbitration clause, prayed for stay of proceedings under section 34, Arbitration Act. The learned Civil Judge passed a common order disposing of the application for temporary injunction and the stay application. By this order dated 23rd July, 1971 the proceedings of the suit were stayed. "With the condition that till the Arbitrator has completed the Arbitra tion proceedings and given the award the Plaintiff will not be arrest and harassed by any of the Defendants."

2. The Government challenged the order in appeal but the learned District Judge, Hyderabad by the impugned order in this revision dismissed the appeal and maintained the order of the Civil, Judge. The Government has therefore came up in revision before this Court.

3. I have heard Mr. A. R. Akhtar, Advocate for the applicant but the respondent and his counsel remained absent in spite of notice.

4. Learned counsel for the applicant first contended that once the proceedings of a suit are stayed by an order passed by the Court under section 34 of the Arbitration Act, the Court ceases to have any further jurisdiction to pass order even as to interim relief. However, when the attention of the learned counsel was invited to a judgment from the Indian jurisdiction reported in A.I.R. 1949 All. 70 and the provisions of section 41 of the Arbitration Act, he has very fairly withdrawn his contention and does not press the same. It is next contended by the learned counsel that even on merits the learned Courts below ought not to have granted injunction against the recovery of the dues from the respondent. :3e also submitted that, the Court bas no jurisdiction to attach condition to an order of stay of proceedings under section 34, Arbitration Act. Counsel referred to section 82 of the Forests Act, 1927 which provides that money payable to the Government inter alia on account of the price of any Forest produce can be recovered as arrears of land revenue. According to section 2 clause (4) "Forest Produce" includes timber. The amount was therefore prima facie rightly being recovered as arrears of land revenue by the Revenue Officer. Under section 114 of the Land Revenue Act all sums recoverable are arrears of land revenue under other enactments for the time being in force can be recovered as arrears of land revenue in accordance with the procedure for recovery of land revenue under the said Act. Learned counsel, therefore, contended that the suit filed by the respondent was barred under section 91 read with section 172 of the Land Revenue Act, 1967. The last mentioned provision excludes the jurisdiction of the Civil Court in relation to matters within the jurisdiction of Revenue Officers under the Act. Under section 91 a special remedy has been provided to a person who denies his liability for the recovery of an arrear against whom proceedings are taken and allows him to pay the sum demanded under protest made in writing and institute a suit in a Civil Court for the recovery of the amount so paid. My attention was invited to Pan American riding Company v. Pakistan (P L D 1978 Lah. 382) in which a learned Single Judge of the Lahore High Court while interpreting the aforesaid 2 provisions of- the Land Revenue Act held as follows :- "A plain reading of this section would indicate that any amount which is recoverable as arrears of land revenue is to be realised by the Revenue Officer and if the person against whom proceedings are taken denies his liability he must pay the same under protest in writing at the time of payment and signed by him or his agent and then institute a suit in a Civil Court for the recovery of amount so paid. In view of the provisions of section 91 and section 172 of the Revenue Act, 1967 mentioned above no stay in the form of an ad interim injunction can be granted unless the amount has been deposited under protest in accordance with the procedure mentioned above."

5. I have carefully considered the submission of the learned counsel but I would refrain from expressing final opinion on the contention raised as in doing so one or the other party may be prejudiced at the trial. However, I find great force in the contentions prima facie and there fore agree with the submission that they were relevant for considering the question of prima facie case.

6. Additionally I also agree with the learned counsel that no conditions could be imposed on an order of stay in the manner in which the learned Civil Judge has imposed the condition that no coercive process shall be taken against the respondent for recovery of the dues. Finally I also find force in submission that withholding of the relief of injunction will not expose they respondent to irreparable injury as the act complained of consists of the recovery of a sum certain for which the plaintiff can be compensated in terms of money.

7. For all the foregoing reasons I am of the opinion that the Courts below have exercised their jurisdiction with material irregularity in granting stay of the recovery proceedings by the Revenue Authorities as a condition of stay of proceedings of the suit.

8. In the result I maintain the order of stay of suit passed under section 34, Arbitration Act but set aside the part of the impugned order whereby the learned Civil Judge restrained the applicants from ordering arrest or taking other coercive measures for the recovery of the amount. The costs shall be in the cause. M. Y. M Petition accepted,