' MUHAMMAD MUZAMMAL KHAN, J.--- Instant appeal assailed the order/judgment and decree, dated 19-5-1999 whereby respondent's application under sections 8 and 20 of the Arbitration Act, 1940 was accepted and the award dated 30-7-1996 was made Rule of the Court by adjustment of expenses incurred by the petitioner-Society for completion of unaccomplished work.
2. Precisely, relevant facts are that respondent was awarded contract of construction work which included construction of residences for "Chand Bagh School Project and related work" through acceptance letter No,DSSP/CC/39/94/275, dated 11-4-1994 leading to a written agreement.
Acceptance letter was issued to the respondent who mobilized his resources to complete the allocated work within the allocated period of 15 months. During the course of constructions, respondent submitted his first running bill on 6-10-1994, whereafter on account of certain hindrances work could not continue and a dispute arose between the parties. Respondent invoked the Arbitration Clause of the contract,- which envisaged nomination, of two Arbitrators i,e, one by each of the parties. Respondent pleaded that on account of non-availability of lay-out plan; drawing of sewerage/water supply, strike by the brick kiln owners, illegal adjustment of mobilization expenses in the first 2 running bills and inaction of the petitioner, resulted in delay in completing the work within the time stipulated for this purpose in the agreement for which it could not be held responsible thus, restraint by the petitioner to proceed with the work was uncalled for. It was further averred by the respondent that petitioner throughout the execution of construction work, remained short of fund/cash as third running bill by the contractor/respondent was allegedly paid in three instalments Which was also the cause of delay in completion of work within the prescribed time.
According to the respondent, work done was according to the specification but the same was unilaterally treated by the petitioner, as below the specification and deductions from the bills on this count, were unwarranted.
3. Respondent nominated Mr. Rashid Ahmad Chaudhary, General Manager (Retd.) Pakistan Engineering Company whereas the petitioner proposed Haji Bashir A. Bakhsh as their respective Arbitrators who entered upon the reference. Parties unanimously appointed Mr. Justice Muhammad Rafique Tarar (Retired Judge of the Supreme Court of Pakistan), as Umpire but the assignment was regretted by the Umpire whereupon Mr. Justice (Retired) Abdul Majeed Tiwana, Judge of the Lahore High Court was appointed as Unipire vide order, dated 9-5-1996. The Arbitrators inspected the site with the association of Mian Muhammad Younis a retired Engineer of Building Department whose association was consented by the representatives of the parties. The Umpire besides giving his own inspection notes', recorded evidence of the parties and after perusal of entire relevant record, the Award was announced on 30-7-1996. Respondent moved an application under section. 41 of the Arbitration Act, 1940 for a direction to file the award in the Court which was submitted, accordingly.
4. The appellant being respondent in the petition filed by the respondent contested the same, with the assertions that arbitration process had already started as the appellant had appointed the 'required Arbitrator, Delay in appointment of the Umpire was urged and dispute was required to be resolved through arbitration forum. After the announcement of Award, appellant moved an application under section 15 of the Arbitration Act, 1940 for modification of the award.
Respondent/contractor filed separate application under sections 8 and 20 of the Act (ibid) besides objections on the Award under section 30 of the Act, The learned Civil Judge, seized of the matters, after doing the needful as per law applicable, disallowed appellant's application under section 15 of the said Act being not prosecuted/followed by the appellant and at the same time accepted the application of the respondent who had withdrawn the objections, making the Award, Rule of the Court as noted above, vide his judgment dated 19-5-1999. The appellant was not satisfied with the decision rendered by the learned Civil Judge, Lahore and consequently filed instant appeal, which after completion of record has now been placed for final determination. Respondent in response to notice by this Court, has appeared and was represented through counsel.
5. Learned counsel for the appellant submitted that the impugned judgment/order is bad at law because it did not visualize that the award in question was self-contradictory and thus, was not sustainable at law. It was further submitted that the Award on the one hand found that the termination, of agreement by the appellant was justified whereas on the other hand, the same was found repugnant to the basic provision of the contract whereunder there was no limit or extent of responsibility of completing the work at the contractor's own risk/cost. According to him, after termination of agreement by the appellant, contractor was not entitled to any amount and for this purpose only, the application under section 15 Arbitration Act, 1940 was moved by the appellant.
Further emphasized that the Award being beyond the scope of reference, deserved to be modified, as prayed but a contrary view taken by the trial Court is opposed to the record. It was also submitted that the contractor had failed to complete the work within the time stipulated in the agreement thus, penal consequences provided by it were, to be followed because the contractor even if permitted to continue with the work, out of concession, failed to discharge his obligation within the given time. It was also urged that the appellant's application under section 15 of the Arbitration Act, 1940 was in form of objections hence the trial Court fell in error in making the Award, Rule of the Court and in refusing the modification of the Award.
6. Learned counsel for respondent refuted the arguments of the appellant and supporting the impugned judgment/order, urged that the appellant did not file any regular objection under section 30 of the Act thus, after desertion of follow up of its petition under section 15 of the Act, there was no alternative for the trial Court except to make the Award, Rule of the Court. It was also contended that since the appellant had not prayed setting aside of the Award, having filed no objection to the same, appellant's appeal under section 39 of the Act is not competent. According to him, in spite of non-maintainability of the appeal the Award is absolutely justified from the record as the appellant had already been allowed adjustment of expense incurred on account of the alleged failure of the respondent to complete the work, within the stipulated period. He further submitted that in spite of all the odd situations, created by the appellant during the execution of construction work, bulk of it had already completed, as is evident from the inspection notes of the Umpire who was a man of integrity and had not mis-conducted the proceedings. Reliance was also placed on the site inspection by Mian Muhammad Younis, Retired Engineer of the Building Department, to contend that respondent No,1 executed the most of the allocated work. Learned counsel for respondent assertively argued that on account of the alleged failure to complete the construction work within the stipulated period, the contractor could only be penalized by withholding the liquidated damages but otherwise, he was entitled to the compensation for the work done by him.
7. I have heard the learned counsel for the parties and have examined the record. Earlier to taking up the case on merits, we have to examine the maintainability of the appeal as per provisions of section 39 of the Act of 1940 whereunder an appeal lies from the orders specified therein, including order setting aside or refusing to set aside the Award. In the instant case the appellant never opted to have the Award set aside. As they had not filed, any objection under section 30 or 33 of the Act.
The appellant's case had been that of modification which was also not allowed by the trial Court thus the impugned order is not appealable. Law regarding conversion of appeal into a revision petition is firmly settled by this time to the effect that the same can be done by converting of memorandum of appeal into a revision petition and vice versa, reference in this behalf can be made to the judgments in the cases of Capital Development Authority Islamabad through its Chairman v. Khuda Bakhsh and 5 others 1994 SCMR 771, Jane Margrete William v. Abdul Hamid Mian 1994 SCMR 1555, PLD 1984 Quetta 52, Ch. Muhammad Shafi and 8 others v. Settlement and Rehabilitation Commissioner, Lahore and 3 others PLD 1972 Lah. 187, Karam Khan and others v. Allah Bakhsh and others PLD 1995 Lah. 462 and the judgments on the point of competence of civil revision in cases arising out of Arbitration Act are in the cases of L. Charn Das v. L. Gur Saran Das Kapur AIR (32) 1945 All. 146, Sin. Blaika Devi another v. Kidar Nath Puri AIR 1956 All. 377 and Saravala Venkata Subbiah v. Kumara Ramiah AIR 1935 Mad.
184. Following the precedent judgments, I convert this appeal into revision petition and proceed to decide the same, accordingly.
8. Appointment of the Arbitrators or that of the Umpire and the proceedings conducted by them were not disputed by the petitioner, as it had not filed any objection to the Award, as noted above.
Section 30 of the Act provided that Award shall not be set aside except on one or more of the grounds specified therein which included misconduct by the Arbitrator. Award having been announced after arbitration proceedings had become invalid or that Award had improperly been procured or the same was invalid. Similarly under section 33 of the Act (ibid), parties wishing to have the Award annulled had to move the Court in this behalf, after deposit of the amount required to be paid by the Award or C furnishing of security to the satisfaction of the Court but none of these courses were adopted and instead application under section 15 of the Act was moved for modification of the award which too was not followed by the petitioner and was accordingly disposed of being not pressed. Though the matter of modification of the Award remained undecided from the Court of, first instance and the same cannot be decided by the Court of appeal, without explanation of non-prosecution which lacked in the case in hand yet question which hinges for determination is as to whether a part of the Award can be adjudged especially when the same is not separable from its other parts. Record revealed that the petitioner was proceeded against ex parte by the trial Court on 14-7-1998 and this order was never recalled.
Petitioner has not explained its non-appearance even before this Court in its memorandum of appeal. Award as it stands is based on proceedings of arbitration; site inspection in presence of the parties and inspection notes of the umpire/building expert and all these matters remained unchallenged throughout. The consolidated award cannot be bifurcated as the same in its paragraph 14(5) attended to the grievances of the petitioner and the society was awarded liquidated damages by way of compensation of termination of contract and by way of completion of work at the risk/cost of the contractor. The trial Court adjusted the expenses incurred by the petitioner in getting the work done, after dispute occurred between the parties. The Arbitrators also refused to compensate the respondent by way of damages as per Exh.S/46, which was refused. It goes without remarking that none of the grounds in support of modification of the award prayed, could be substantiated while hearing of this case and the stance of the petitioner that Award is self-contradictory is not borne out of the record. Rescission of the contract by the petitioner was found to be lawful and the amount of expenses incurred by it for accomplishment of undone work was allowed to be adjusted towards the compensation for the work already done by the contractor.
9. Since the appointment of Arbitrators/Umpire and proceedings before them were not disputed by the petitioner, nature of proceedings under unanimous Arbitration clause cannot be lost sight.
Arbitration has been defined to resolve the differences through the Judges appointed out of the choice of the parties and when arbitration clause prescribed for all the matters arising out of the contract or incidental thereto shall be referred to the Arbitrator leading to reference of arbitration.
The Arbitrators having not gone out of the scope of the reference and having not misconduct themselves, their proceedings or decision/Award cannot be lightly interfered by the Courts except within the scope provided by sections 30, 33 and 39 of the Act. In such cases, it becomes duty of the Courts to give every reasonable intendment in favour of the award and should lean towards upholding it, rather vitiating it. In view of this well-settled rule, of law, award is final and that is why, was not made subject to appeal by the Legislature. Scan of record and impugned order revealed that trial Court did not commit any illegality/irregularity, as envisaged by section 115, C.P.C. And the controversy having been put to rest without committing any error of law/facts, no interference by this Court is called for.
10. For the reasons noted above, no case for interference even in the revisional jurisdiction of this Court was made out, and consequently instant petition being devoid of any merit, is dismissed with no larder as to costs.