2008 PLP 798 (CLC)

NADEEM AZHAR SIDDIQI, J.

The objection to the award has been filed by the defendant. The facts necessary for disposal of the objections are that earlier award dated 27-8-2001 was challenged by the defendant which was set aside vide order dated 17-1-2006 and remitted to the Arbitrators with the direction to hear the parties afresh and provide them opportunity to lead evidence and after fixing the responsibility of causing delay in completion of work to determine the over-heads. After remand the parties appeared before the learned Arbitrators and filed a joint statement that they did not propose to produce further evidence and the same may be disposed of on the basis of documents filed by the parties. After the remand the learned Arbitrators have held that the question of responsibility for the delay of 701 days is a non-issue and instead of passing a fresh award add the reasons to the earlier award dated 27-8-2001. The award was filed in Court on 6-6-2006. Notices were issued to the parties and the defendant has filed objections on 3-7-2006. The plaintiff filed counter-affidavit on 8-9-2006, along with the objections two affidavits of Balighuzzaman dated 3-7-2006 and 6-7-2006 have been filed. Mr. Samiuddin Sami states that he is relying upon the affidavit, dated 6-7-2006. This time the award has been challenged on the ground that directions of the Court has been ignored, award is not based on proper adjudication of controversies, officers of WAPDA were wrongly persuaded not to offer personal evidence, award is not based on pleadings of the parties, the arbitrators made the award on their personal knowledge. In the counter-affidavit the plaintiff submits that the same objections were raised which were earlier rejected by the Court. The so-called objections have no relevance or bearing upon the dispute and the same are afterthought. Mr. Samiuddin Sami, learned counsel for the defendant, submits that the award is based on conjectures and the arbitrators have misconducted themselves by not following the directions of the Court and have criticized the findings of the Court. He submits that the award has been obtained by collusion. He further submits that the award is void under section 16(3) of the Arbitration Act. He relied upon the following reported cases:-- (1) Munir Ahmed Khan v. Samiullah Khan and others 1986 CLC 2655, (2) Malik Umer Hayat Tiwana v. Malikani Sahibzadi Tiwana NLR 1979 Civil 75, (3) Pakistan through General Manager Pakistan Railway v. QMR Export Consultants PLD 1990 SC 800, (4) Pakistan through Secretary to Government of Pakistan Railway v. Messrs Registan Alloy and Steel Limited 2002 CLD

61. Mr. Bilal A. Khawaja, learned counsel for the plaintiff submits that the objections raised by the learned counsel for the defendant are not tenable under law. He submits that the scope of objections is limited and the Court cannot act as Appellate Court as the jurisdiction vested in the Court is supervisory in nature and the award has to be construed liberally and that the Court should lean towards upholding the award then vitiating it. He further submits that the arbitrators have fully complied the remand order and has fixed the responsibility of causing delay. He relied upon the following reported cases:

(1) Province of Punjab v. Sh. Fazalur Hussain 2003 CLC 1780, Hussain Textile Mills Limited v. Dader Sons Limited PLD 1973 Kar. 413, (3) Messrs Ibad & Co. v. Government of Sindh PLD 1981 Kar. 326, (4) Messrs Tribal Friends Co. v. Province of Balochistan 2002 SCMR 1903. Mr. Samiuddin Sami in reply submits that failure of the arbitrators to record the evidence of the parties in compliance of the Court order is misconduct on their part and is sufficient to set aside the award. I have heard the learned counsel for the parties and perused the record. I have also called the file of Suit No.1660 of 2001 to peruse the earlier award. The case of the parties as set out in the award dated 27-8-2001 are that the plaintiff has claimed overheads on account of reduction of scope of work and delay of 701 days in completion of work. The plaintiff claimed a sum of Rs.22,282,

977. The Engineer's representative recommended a sum of Rs.10,509,363 which was reduced by the Engineer to Rs.2,578,

230. The learned Arbitrators in the earlier award have held that wherever a contractor can show that his performance was delayed by reasons attributable to the employer, he can always successfully claim reasonable compensation to offset the additional expenses incurred by way of overheads during the period of delay. The Arbitrators relying upon the reported case oft Karachi Transport Corporation v. Tamirat Limited PLD 1992 SC 479 allowed the over-head percentage to the entire contract amount. The Arbitrators have agreed to the percentage of 11.5% determined by the Engineer. The Arbitrators have allowed Rs.2,972,836 on account of over-heads of reduction of work and Rs.8,524,160 on account of delay in completion of work. The earlier award was set aside and the arbitrators were directed to hear the parties afresh and provide them opportunities to lead evidence and after fixing the responsibility of causing delay in completion of work to determine the over-heads. In the award the learned Arbitrators have stated that the reasons for granting of the extension of time of 701 days are clearly given in the Engineers decision of 11-3-1999 as delay caused by non-completion of associated civil works of another independent contractor. By giving this opinion the learned Arbitrators have fixed the responsibility which has not been disputed. The defendant in spite of opportunity has not produced any evidence and has also not disputed the findings of the Engineer with regard to the delay. The Arbitrators have sufficiently complied the directions contained in the order dated 17-1-2006. The defendant has failed to establish that the award has been obtained in collusion. Mere allegation in this regard without any substantial proof is not sufficient to set aside the award. Similarly, merely alleging misconduct is not sufficient to set aside the award. From the perusal of further reasons to the award it appears that the learned Arbitrators have neither committed any misconduct nor the award suffers from any illegality and infirmity and the over-heads were properly calculated and allowed after fixing the responsibility of delay. It is now well-settled principle of law that Court cannot act as an Appellate Court and the jurisdiction is supervisory in nature. The Court while examining the validity of an award cannot undertake reappraisal of evidence/material considered by the Arbitrator in order to discover the error or infirmity in the award. The error or infirmity in the award must appeared on the face of the award and should be discovered by reading the award itself. The Court can remit the award to the Arbitrator, where award does not state the reason or where the illegality appearing on its face is so obvious and prominent that one may point it out by reading the award without referring to any other document or evidence. It is also well-established principle of law that when a dispute is referred to an Arbitrator and no misconduct has been found on the part of the Arbitrator and award do not suffer from any illegality and infirmity it becomes the duty of the Court to give every reasonable intendment in favour of the award and lean towards holding it rather than to vitiate it. The Arbitrator is the Judge of all matters arising in the dispute. It is not proper for the Court to proceed to scrutinize the award in order only to discover an error for the purpose of setting aside it. The defendant has failed to point out any perversity and illegality in the award and has also failed to establish any misconduct on the part of the learned Arbitrators. The learned Arbitrators have based their findings on the basis of material available on record. Insufficiency of evidence or possibility of Court to reach a different conclusion on evidence/material available with the Arbitrator is no ground to set aside the award. The Court while examining the legality of award could not substitute its own findings on appreciation of the evidence and material available on record in place of the one given by the Arbitrators. The proceedings before the Arbitrators are in the nature of proceedings before a domestic Tribunal and strict compliance of procedural law or the Qanun-e-Shahadat Order cannot be insisted upon. It is sufficient that the learned Arbitrators have provided opportunity to the parties to produce their evidence who declined to avail the same and has based their findings on the material available on record. The defendant cannot blame others for not availing the opportunity of producing further evidence and at this stage cannot claim that the officers of WAPDA were wrongly persuaded not to offer evidence. In view of the above, I do not find any illegality, infirmity or perversity in the award. The objections are, therefore, rejected and the award is made rule of the Court. The defendant is allowed two months' time to pay the amount settled by the Arbitrators to the plaintiff in terms of subsection (1) of section 82 of the Civil Procedure Code. The suit is disposed of in the above terms with no order as to costs. The office is directed to prepare the decree. S.A.K./A-10/K Order accordingly.