' SYED ZAHID HUSSAIN, J,---A petition under section 20 of the Arbitration Act 1940 was filed by the appellant in which the respondents made an application under Order VII, rule 11 of Code of Civil Procedure, 1908 for rejection thereof primarily on the ground that the same was barred by time. The learned trial Judge has vide order dated 6-1-2004 rejected the appellant's petition (made under section 20 of the Arbitration Act 1940) which has given rise to this appeal.
2. The learned counsel have been heard.
3. The main contention of the learned counsel for the appellant is that the trial Court has acted illegally and erroneously in deciding th( question of limitation without framing issue and recording evidence thereabout. According to him such a question of limitation was mixed question of law and fact which required recording of evidence. It L, further contended that the summary rejection of the petition (which is to be considered as a suit) was not warranted as merely the contents of the plaint were only to be taken into consideration by the trial court and nt other material. He has made reference to Karachi Shipyard an Engineering Works Ltd v. Muhammad Aslam Klitan (PLD 1979 Karachi 635), Project Director, Balochistan Minor Irrigation and Agricultural Development Project, Quetta Cantt. v. Messra Murad Ali and Company (1999 SCMR 121) and Mian Asif Islam v.
Mian Muhammad Asif and - others (PLD 2001 SC 499).
4. The learned counsel for the respondents, on the other hand, in his end favor to support and justify the order passed by the trial court has made reference to the contents of the petition particularly paragraphs 5 and 6 thereof and contends that since the petition per se was barred by time, the court itself could even otherwise take notice of this aspect and reject the petition. It is contended that in the circumstances there was no need of framing of any issue or inviting the parties to lead evidence. He has cited M. Imam-ud-Din Janjua v. The Thal Development Authority through the Chairman, TDA Jauharabad (PLD 1972 SC 123), Muhammad Nazir v. The Secretary, Cooperative Department and another (1989 MLD 1156) and Messrs Progressive Engineering Associates v. Pakistan Steel Mills Corporation Ltd. (1997 CLC 236) to support the view taken by the trial court.
5. It is evident from the record and not disputed by any one that the appellant had been awarded contract for construction of residential and non-residential building in Borotha Colony in the year 1995. The contract value of the work was Rs,947,40,597 which amount was paid on completion of the work. The appellant, however, averred in the petition about his claim for:-- "(a) Payment for the idle charges under sub-clause 6.4 and 42.2 claimed through letter dated 9-5- 1997 for an amount of Rs,41,42,735
(b) Payment for idle charges under sub-clause 69.4 and 53.1 with reference to letter dated 6-12- 1997 for an amount of Rs,86,91748."
' It is so stated in paragraph 5 of his petition. In the succeeding paragraph of the petition i,e, paragraph 6, the cause of action is mentioned as follows: "6. That the cause of action accrued in favour of the petitioner against the respondents firstly on 17- 6-1995 when the letter of in-tent for the work in dispute was issued, secondly on 6-12-1997 when the claim for idle days was submitted under clause 67.1 to the Engineer, thirdly on 4-1-2001 when the defect liabilities certificate was issued, fourthly on 23-10-2002 when the reminder was issued for the settlement of claim to the Engineer, and lastly on 21-2-2003 when the notice for the appointment of arbitrator on behalf of the respondents was issued and is continuing."
' Since the learned counsel for the parties are atone that Article 181 of the Limitation Act, 1908 was attracted, it is to be seen whether the petition was within limitation. The learned trial Judge has come to the conclusion, with reference to clause 67.1 of the Contract and the cause of action alleged to have made basis for the petition that the same was barred by limitation. It may be observed that in M. Imam-udDin Janjua v. The Thal Development Authority through the Chairman.
T.D.A. Jauharabad (PLD 1972 SC 123), the provisions of Article 181 of the Limitation Act, 1908 qua proceedings under section 20 of the Arbitration. Act 1940 came to be considered by the Hon'ble Supreme Court of Pakistan and it was held that the said Article 181 which is residuary in nature was applicable. In that case, on application under section 20 of the Arbitration Act 1940, arbitrator had been appointed by the court who rendered the award to which both the parties filed their objections but during the pendency of those proceedings, the appellant in that case applied for permission to withdraw his earlier application with liberty to file fresh application for the same purpose. Such a course was even conceded by the respondent side. The fresh application under section 20 of the Act was then filed to which the respondent took objection that the same was time barred under Article 181 of the Limitation Act, 1908. Notwithstanding the consent of the respondent at the time of withdrawal of the earlier application, the fresh application was found to be barred by limitation. The order of the trial court was reversed by the learned District Judge but on revision petition the High Court set asides the order of the District Judge and took the view that the fresh application was barred by time under Article 181 of the Limitation Act, 1908. On examination of the matter, their lordships observed that "The point of the time at which the right to apply under section 20 accrues is, therefore, the point of time at which "a difference has arisen" and the difference arises when one party does not agree with the other on any particular question covered by the Arbitration agreement." The view taken by the High Court was thus, upheld by the Hon'ble Supreme Court of Pakistan.
6. In the present case it is the case of the appellant himself as per paragraph 5 of the petition that the arbitrators were to be appointed in terms of the conditions of agreement for adjudicating the claim of the appellant made through letters dated 9-5-1997 and 6-12-1997. Though there is also reference to clause 67.1 in the petition yet it was neither filed nor reproduced in the petition. It appears to be a deliberate attempt to overcome the non-compliance of various steps, which the appellant failed to follow. It reads as under: "If a dispute of any kind whatsoever arises between the employer and the contractor in connection with or arising out of the contract or execution of the works. Whether during the execution of the work or after their completion and whether before or after repudiation or other termination of the contract, including any dispute as to any opinion, instruction, determination, certificate or valuation of the Engineer with a copy to the other party. Such reference shall state that it is made pursuant to this clause. Not later than the eighty fourth day after the day, on which he received such reference, the Engineer shall give notice of his decision to the Employer and the contractor. Such decision shall state that it is made pursuant to this clause.
' Unless the contract has already been repudiated or terminated, the contractor shall in every case continue to proceed with the works with all due diligence and the contractor and the employer shall give effect forthwith to every such decision of the Engineer unless and until the same shall be revised as hereinafter provided, in an amicable settlement or an arbitral award.
' If either the employer or the contractor be dissatisfied with any decision of the Engineer or if the Engineer fails to give notice of his decision on or before the eighty forth day after day on which he received the reference then either the employer or the contractor may on or before the seventieth day after the day on which the said period of 84 days expired as the case may be give notice to the other party, with a copy for information to the Engineer, of his intention to commence arbitration, as hereinafter provided as to the matter in dispute. Such notice shall establish the entitlement of the party giving the same to commence arbitration, as hereinafter provided as to such dispute and subject to sub-clause 67.4 no arbitration in respect thereof may be commenced unless such notice is given."
There cannot possibly be any dispute that the appointment of arbitrator was sought pursuant to the said clause of the Contract. As is evident from its perusal it provided for the precise steps to be taken specifying the stages and timing for reference and for settlement of dispute. The appellant failed to adhere to these conditions and steps. He admittedly had taken up the matter in the year 1997, and after a long time in the year, 2003 rose up to invoke the jurisdiction of the court under section 20 of the Arbitration Act, 1940. His motion was clearly beyond time. The contention of the learned counsel that the period should be reckoned from the issuance of last notice is untenable as held in Karachi Shipyard and Engineering Works Ltd v. Muhammad Aslam Khan (1997 CLC 235) that "Article 181 of the Limitation Act, 1908 required that the period of three years to file a petition will start running from the day when the right to apply accrues in other words, when the cause of action accrues to the plaintiff. Therefore, in my view the time limit would start running from the day when the dispute arose between the executants to the agreement and not from the day when a legal notice or any other communication is addressed by either party for the invoking of the arbitration clause. If the argument of the learned counsel for the plaintiff is accepted, than there could not be an end for the time to stop running under Article 181. Any party may issue a communication at any stage calling upon the other party for appointment of arbitrator (even after passing of three years) and then may set up a claim that such proceeding is maintainable as the time is to be reckoned from the date of such notice or communication. In my humble view this will frustrate the provision of Article 181 of the Limitation Act, 1908."His reliance upon Karachi Shipyard and Engineering Works Ltd v. Muhammad Aslam Khan (PLD 1979 Karachi 635) is also inapt which indeed reiterates the view taken by the Hon'ble Supreme Court of Pakistan in M. Imam-udDin Janjua v. The Thal Development Authority through the Chairman. T.D.A. Jauharabad (PLD 1972 SC 123) and the application in that case was found to be well within time.
7. The other contention of the learned counsel for the appellant that only contents of the plaint are to be kept in view by the -court and without framing of issue, the petition could not be rejected as time barred is also untenable in the facts and circumstances of the case inasmuch as from the contents of the petition itself (i.e paragraphs 5 and 6 in particular) it is discernible that the petition filed on 6-3-2003 was barred by time. There was, thus, no use of either framing issue or keeping the matter pending for further proceedings before the court. The petition was clearly barred by time which has rightly been rejected by the trial court.
As a result of the above, the appeal is without merit and is B dismissed accordingly. No order as to costs.