1. This appeal challenges the judgment and decree dated 27th March, 1980, passed by the land Additional Senior Civil Judge, Hyderabad dismissing the objections filed against the award in arbitration case No. 2 of 1979 filed by respondent No. 1, and modifying the award given by respondent No. 2 by allowing interest in respect of the claim of respon--dent No. 1 for Rs. 1,74,735 to be reckoned with effect from 1st July, 1962, instead of 1st December, 1967; and thus enhancing the award by more than Rupees ten lakhs.
2. The facts leading to the filing of the appeal areas under:-- The earth work in excavation of Shadi Lodge was let out to Messrs Awan Industries Limited on Form B-2 (item rate tender) sanctioned vide Superintending Engineer, Left Bank Construction Circle, Hyderabad's letter No. TC/G.55 dated 17th December, 1961. For Its. 3,46,375. The work was to start on 20th November, 1961 and to be completed under the contract by 20th March, 1962. Respondent No. I was granted extension on his request upto 19th April, 1962, but could not complete the work and, therefore, the unexecuted part of it was executed through M. P. O. WAPDA at the risk and cost of respondent No. 1 with their concurrence. They demanded the refund of earnest money and security deposit which were refunded to them. It is the case of the appellant that for about two years and one month respondent No. I did not prefer any claim and obtained from S. D. O. Concerned a certificate for recording final measurements on 25th April, 1962, in which however there eras tampering with figures of measurements which had been enhanced by several lakh cubic feet. On behalf of the appellant it is further contended that the respondent No. 1 did not rectify or remove errors inspite of several notices. It is also contended that respondent No. 1 filed a hopelessly time- barred Suit No. 15 of 1969 on 21st January, 1969 for recovery of Rs. 3,00,895 with Rs. 11,140.71 interest at Rs. 71% from 16th January, 1969 upto the date of decree and an amount decreed upto date of realisation. The suit was against the Province of West Pakistan through the Chief Secretary, Government of West Pakistan, Lahore, the West Pakistan Agricultural Development Corporation, Lahore through its Chairman, Mr. Saindad Solangi (father's name not ascertainable) Executive Engineer, Guddu Barrage, Jacobabad and Mr. Shamsuddin Soomro (father's name not ascertain-- able), Executive Engineer, Lined Channel Division, Tando Muhammad K.Han, District Hyderabad. It is the case of the appellant that the arbitrator was appointed without knowledge or consent of the Govern--ment of Sind and other aforesaid defendants to Suit No. 15 of 1969 nor was any agreement to refer to arbitration executed before such appoint--ment. On 18th may, 1979, the so- called agreement to refer for arbitra--tion was executed by respondent No. l and Mr. Rasool Bux Shaikh, the Executive Engineer, Lined Channel Division. It is the case of the appellant that the agreement was executed without authorisation by the aforesaid Executive Engineer who signed it in his own name and not for the Government of Sind.
3. Respondent No. 2 made award on 31st July. 1978, and respondent No. I approached the Governor of Sind for release of fund-- in terms of the award. It is the case of the appellant that respondent No. I con--sented to subject the so-called award anti his claim, for consideration and re-examination of a High Powered Arbitration Council for adjudica--tion and such Committee was constituted by the Government of Sind on 13th December, 1978. The Committee gave full opportunity to res--pondent No. 1 and the representatives of the Irrigation Department to submit their views. It is further the case of the appellant that respon--dent No. I submitted to the jurisdiction of the Committee for examina--tion of all the factual and legal aspects of the dispute and that respon--dent No. 1 supported his case and rebutted the case of the Irrigation Department in 19 written pages. The claim was thoroughly investigated and rejected by the Committee and such rejection was approved and confirmed by the Martial Law Administrator, Zone C, Karachi.
4. The appellant was served with notice dated 26th November, 1979 from the Court of IInd Senior Civil judge, Hyderabad on 4th December, 1979, as .Respondent No. 2 bad filed the award under section 14(2) of the Arbitration Act, 1940 (hereinafter called the Act). The respondent No. 1, had challenged the award in respect of all the items and had besides submitted to the jurisdiction of the High Powered Committee. The . Appellant had filed objections under section 30 of the Act challeng--ing the award, and the respondent No. t had filed counter-affidavit. Dated 2nd January, 1980, admitting to have participated in the proceedings before the Arbitration Council, - but denying to have submitted to its jurisdiction. On 3Ist January, 19800 the appellant filed rejoinder further elucidating the objections filed under section 30 of the Act and submitting that application under section 14(2) of the Act was misconceived as there was no valid reference nor appointment of arbitrator and further that the arbitrator has misconduct himself and the proceed--ings as the award had been improperly procured, and by order dated 2nd December, 1979, the M. L. A., Zone C, had rejected the award, The appellant had also submitted that he was :a subordinate functionary of the Government of Sind and the decree against hint could not be executed against the Government of Stud which was nota party to the reference.
5. The learned IInd Senior Civil Judge, Hyderabad in the impugned Judgment had held that the re- joinder affidavit having been filed after expiry of 30 days was time-barred under Article 158 of the Limitation Act of 1908. He had further held that appointment of arbitration by D. M. L. A.
6. Headquarters Hyderabad was valid and proper as he was agent of M. L. A., Zone C. The appellant was, therefore, put to the necessity of filing the instant appeal.
7. At the outset it may be stated that in the Memorandum of Appeal, the modification of the award giving interest on damages and interest one interest at same presumptive rates has been challenged. However, since appeal against the aforesaid modification can be heard only if the award is otherwise considered to be effective, and further since the main ground of appeal is against the very award ore the ground that there was no proper reference to arbitration, and that since the arbitrator has misconducted himself and the proceedings on the face of the record, it is not necessary to go into the merits of the appeal against modification of the award.
8. Mr. Abdul Sattar Shaikh, the learned Additional Advocate-General on behalf of the appellant has raised the following main contentions :---
(t) That the original Suit No. 15 of 1969 was time-barred and no extension could be granted by any agreement of the parties.
(2) That the Executive Engineer had no authority to refer any dis--pute to arbitration on behalf of the Government.
(3) That the D. M. L. A. Was no party to the dispute and, therefore, could not refer the dispute to arbitration.
(4) That i.e any vase the reference to arbitrator was executed by the Executive Engineer under coercion.
(5) That the award has, been given against the Executive Engineer and snot against the Government of Sind.
(6) That since the arbitrator had no jurisdiction Article 158 of the Limitation Act, 1908 does not apply,
(7) That the misconduct of the arbitrator being apparent on the face of the award, no formal objections need have been filed.
(8) That having put up their case before the High Powered Com--mittee constituted by the Government of Sind, respondent No. I agreed to super session of the previous arbitration by the new one which proceeded the High Powered Committee which had rejected the claim of respondent No. I in toto.
9. For a proper consideration of all the points raised by the appellant and the contentions raised in behalf of respondent No. 1, it would be more convenient in its basic provisions of the Act are stated, Since a valid reference to respondent No. 2 as arbitrator is being disputed the aforesaid point has also to be considered to adjudge whether the arbitrator acted in exercise of legal and proper jurisdiction. "Reference" has been defined in section 2, clause (e) of the Act as under :- "(e) Reference' means a reference to arbitration. `Arbitration agreement' means a written agreement to submit present or futures differences to arbitration whether an arbitrator is named therein .Or not. The grounds for setting aside award are stated in section 30 of the Act as under "30. An award shall not be set aside except on one or more of clue following grounds, namely :---
(a) That an arbitrator or umpire has misconducted himself or the proceedings;
(b) That an reward has made after the issue of an order by the Court superseding the arbitration or after arbitra--tion proceedings have become invalid under section 35 ;
(e) That an award has been improperly procured or is otherwise invalid. In the instant ease; there is no plea that there was arbitration agree--ment in the contract and the assertion on behalf of the respondent No. 1 is that they had withdrawn Suit No. 15 of 1969 on the orders of D. M. L. A. Who had made them and the Executive Engineer to sign arbitration agreement referring the disputes to respondent No. 2, namely, Mr. Abu Saeed Khan, Director Design (Highway) Communication Works Department, Government of Sind, Karachi, Since the withdrawal of the Suit from the Civil Court is being stated as the precondition for signing the arbitration agreement by respondent No. 1, it is pertinent to con--sider that in the aforesaid suit the main defendant was the Province of West Pakistan through the Chief Secretary, Government of West Pakistan, Lahore of which the Sind Government is the successor Govern--ment, There was also the West Pakistan Agricultural Development Corporation, Lahore the other main defendant and incidentally the Executive Engineer Begari Guddu Barrage was mentioned by name and so also the Executive Engineer Lined Channel Division, Tando Muhammad Khan, District Hyderabad as the defendant. The arbitra--tion agreement could be considered ad fdern if the Government of Sind had executed the same through its authorised agent. The appellant who is the Executive Engineer. Lined Channel Division has totally denied that he acted as representing the Government of Sind and has on the contrary stated that he was made to sign the arbitration agreement under coercion. Looking to the ordinary functions performed by an officer of his status it could not be conceived that any such action as reference to arbitration could be considered to be a part of his duties specially when as in the instant case a heavy amount payable from public funds is involved. It has been argued by Mr. Raja Qureshi, Advocate for respondent No. 1, that the D. M. L. A. Had the authority from the M. L. A., Zone C, for taking action as he did. The D. M. L. A. Is a High Authority under the Martial Law and so is the M.L.A. If the aforesaid functionaries acted as Martial Law Authorities their orders cannot be disputed before the Civil Courts. Assuming for the sake of argument that the arbitrator was appoint--ed and the agreement for arbitration was executed on the orders of the Martial Law Authorities, the same Authority, namely, M. L. A., Zone C, rejected the. Award finally, which rejection also cannot be challenged before any Court of law. It is apparent from the material on record that it was after the award was made the rule of the Court that respondent No. 1 approached the C. M. L. Zone C, as the Governor of Sind and action with regard to appointment of the High Powered Committee to look into all the aspects of the matter in dispute was at the instance of the Government of Sind. The High Power Committee was constituted with the Secretary, Wild Life and Forest Department as Chairman, and Secretary, Finance Department and Secretary, Law Department, besides the Chief Engineer Highway (Highways Department) and Brig. Muhammad Afzal Ahmed as members. Brig.
10. Muhammad Afzal Ahmed was appointed as a member as representing the Martial Law Authorities.
11. It is quite clear from the record that the Government of Sind was not a signatory to the arbitration agreement which, though executed by the Executive Eng--ineer, Lined Chanel Division, Tando Muhammad Khan, was according to the appellant so executed under coercion. The legal position has, therefore, to be considered whether such reference to arbitrator and appointment of arbitrator could be considered to be legal and proper. The statutory law, namely, the Act was modeled on the law of arbitration obtaining in England, and the construction put on the English statute may well be adopted is the interpretation of the Act. Russel on Arbitration (18 Edition) umber the heading "Where Arbitration a Nullity" at page 343 reads as under : - -It has been held that where a ground of objection to the award was that the whole arbitration was a nullity, since there bad been no submission, a motion to set aside was not the appropriate procedure: for if there was no submission and no award there was nothing upon which the Court's jurisdiction to set aside could operate. In such cases, the party objecting should either wait until an attempt was made to enforce the award and then resist that attempt or sue for a declaration that the award was null."
12. At page 344 of Russel on Arbitration (18th Edition) while discussing the subject of "Want of Jurisdiction" it is stated that, "The objection of want of jurisdiction covers two distinct cases, the first where a valid arbitration is in progress, but the arbitrator exceeds his jurisdiction, the second where the objection is that the whole arbitration is a nullity. In either case an action on the award may be defended on this ground, or an action brought for a declaration." In the instant case as is apparent from the contentions raised by the learned Additional Advocate --General on behalf of the appellant, it is quite obvious. That the want of jurisdiction is being pleaded firstly on the ground that the arbitration is a nullity, and secondly at is the case of the appellant that the arbitrator has exceeded his jurisdiction by misconducting himself and the proceedings by making the award. The evidence on record shows that the High Power--ed Action Committee before whom respondent No. 1 appeared and argued each and every item of his claim and which made a detailed examination of the documents etc. Came to the conclusion that there was absolutely no material on record which could have justified the award on each item which was found in favour ofth respondent No. 1. The decision of the High Powered Committee was by majority of 4 : 1 and the member who represented the Martial Law Authorities did not dwell upon the documentary evidence etc. On record. In view of the circumstances stated on both the points, namely, the point of submission to arbitration and the point of the arbitrator mis-conducting himself and the proceedings on the very face of the record, it is not necessary to go into the other points raised. The appeal is accordingly allowed and the judg--ment set aside with no order as to costs.