1989 PLP 4087 (MLD)

This FA.O. has been preferred under section 39 (1) (iv) of the Arbitration Act against the order dated the 30th of September, 1986, passed by the learned Civil Judge Ist Class, Lahore, whereby the respondent's application under sections 9 and 20 of the Act for filing the agreement in Court and making reference for arbitration, was allowed.

2. The appellant‑Department opposed the application pleading want of territorial jurisdiction with the Court below and omission to give proper notice in terms of clause 25 (a) of the agreement. Even otherwise, they contended that there existed no sufficient ground for filing the agreement. The following issues were framed: (1) Whether this Court has got the jurisdiction to adjudicate upon the application? OPA. (2) Whether the notice served on the respondent under clause 25‑A of the agreement was not a proper notice. If so, its effect? OPR. (3) Whether there does not exist sufficient ground to file the agreement? OPR. (4) Relief. The trial Court found that it had the territorial jurisdiction. It decided issue No.2 also against the appellant‑Department primarily because no evidence in regard to the alleged impropriety of the notice was produced. Lastly, it came' to the conclusion that there existed no sufficient reason to refuse the prayer for filing the agreement in the Court and refer the matter to arbitration.

3. Sh. Abdul Maajid, Advocate for the appellants perused clause 25 (a) of the stereotyped agreement with a view to point out that before embarking upon arbitration, taking of two steps was necessary on the part of the respondent- Contractor: firstly that they should have referred the matter to the Superintending Engineer for his decision and secondly if they did not feel satisfied with such decision or the same did not come forth within the stipulated or extended period, they had to give a specific notice to the appellant of their intention to get the matter decided through arbitration. He urged that these prerequisites were not observed.

4. In reply, Mr. Riaz Karim Qureshi, Advocate maintained that onus of issue No.2 lay on the appellant and that their counsel by his statement dated the 12th of January, 1986, did not produce any evidence whatsoever to discharge it. He emphasized that the very form of the issue suggested that receipt of notice was tacitly admitted but its vires were challenged on the ground of impropriety. He argued that it lay entirely on the appellant to have shown as to how the notice was not proper and that since they failed to lead any evidence whatsoever on the point, which essentially was one of fact, it had been rightly decided against them.

5. The stance taken up by the respondent seems to be well‑placed. In their reply the appellant‑Department took up the objection that the notice received by' them was not proper, and obviously the fault, if any, with the notice was to be proved by them. Their counsel made a plain statement that he had had no evidence to produce to discharge onus of the issue placed upon them. As a corollary the issue had to be decided against them for want of evidence. An attempt was made to assert that failure to produce evidence on the issue was not much material, but without evidence, it could not be held otherwise. Counsel contended that the issue was wrongly framed and the onus to discharge it was misplaced. I do not think it was so. Even in terms of section 20 (3) of the Arbitration Act it heavily lay on the appellant to have shown to the trial Court that there existed sufficient reason to refuse the prayer for filing the award and making the reference. This legal provision would estop the appellant from pleading that the issue was misframed or the onus was wrongly placed. The plain reading of the section ibid made the appellant responsible for advancing any reason to discuss the application. From of issue or misplacement of onus will have no significance in face of the said provision. The appellant should have been conscious of this obligation and if they did not produce any evidence, they had to be visited with the consequence.

6. Lastly, it was argued that clause 25 (a) of the agreement made it obligatory to ask for reference within three months of the completion of the work. Drawing attention to the respondent's application under consideration, Mr. Maajid claimed that while the work was completed in 1978, the said application was made on the 4th of October, 1982, that is much after the expiry of the period of three months visualized by the terms of the contract. Unfortunately for the appellant no such plea of limitation was taken up specifically in the written statement. As held in Sadiq Hussain and others v. Ghulam Rasool (1986 SCMR 322), and Mst. Fauzia Parveen alias Fauzia Tiwana v. Mst. Sahib Khatoon etc. (1988 S.C.M.R. 552), if bar of limitation is not pleaded before the Court of first instance, it could not be urged subsequently. The dictum seems to fully apply to the present case and the respondent‑Contractor may not be taken by surprise through a point to which their attention was not drawn. The only plea of the appellant before the lower Court was that the notice was not proper without explaining as to what after all was the impropriety. Such a vague plea could not be utilized to cull out a formidable plea of lapse of limitation.

7. As a result, the appeal is dismissed leaving the parties to bear their own costs. H.B.T./P/74/L Appeal dismissed.