' ZAKIUDDIN PAL, J.-The facts of the case are that the plaintiff-respondent filed a suit for recovery of Rs, 6,94,465 against Pakistan Railways for the services rendered by him in handling of goods at Railway Stations in Zone B, Rawalpindi Division, under the agreement executed between the parties.
According to the plaintiff-respondent he was liable to be paid under Schedule B (2)(d) on account of the aforesaid services rendered by him whereas he was paid under Schedule 'A' as well as Schedule 'C' of the agreement which did not apply to his case. The agreements on the basis of which he acted as goods handling Contractor and handled the goods traffic for the appellants at the aforesaid Railway Stations, relate to the period of September, 1969 to August, 1972, September, 1972 to 16th of March, 1974, and 20th of March, 1974, onward for a period of three years. It was alleged by the plaintiff-respondent that since payment to him was not made correctly on account of the misapplication of relevant Schedule appended with the agreements, therefore, the amount due from the appellants calculated on correct basis was liable to be paid to him. According to him nature of his work entailed making of CR/TR Vans by loading local goods, transhipping, reloading, etc. Of Vans as may be required and the conveyance of Van goods from the ground or goods platform to the Vans and vice versa. This included the making of van for an inward shed or handling of van received from outward shed at the same Station. Each Schedule attached with the agreements contains rates per Van for making payment of amount to the Contractors on account of handling of goods at various Stations such as Mari Indus (T), Khushab, Mainwali, Bannu and Mari Indus (Local).
2. The appellants while submitting their written statement denied the claim of the plaintiff- respondent. According to them he was not entitled to payment under clause (2) (d) of Schedule 'B' of the agreement for handling goods traffic at the aforesaid Railway Stations. According to the appellants the plaintiff-respondent was to be made payment at maundage rate under clause 2
(a) of Schedule 'A'. It was pleaded in the written statement that terms of the agreement show that para. 2 (d) of Schedule 'B' covered only services rendered by handling contractor in making CR/TR Vans at transit stations and the aforesaid Railway Stations being not transit stations payment under para. 2 (d) of Schedule 'B' was not liable to be made to the plaintiff-respondent. It was also averred by the appellants that plaintiff-respondent during his second term of the contract w. e. f.
1st of September, 1972, represented only for wrong payment for the transhipping service performed by him at the break of gauge point at Mari Indus, vide, his letter dated 11th of November, 1972, with subsequent reminders. He according to them did not prefer any claim for any wrong payment made to him at other Stations such as Khushab, Mianwali and Bannu. It was stated that even in his notice served upon the appellants under section 80, C. P. C. No allegation was made for wrong payment to the plaintiff-respondent. According to the appellants if anything was due to the plaintiff-respondent from the Railway then claim in this behalf should have been preferred within three months of the date of transaction under para. 14 of the agreement and in the absence thereof no claim thereafter could be considered. It was pleaded that in the circumstances stated above the plaintiff-respondent was estopped from making any claim on account of the above conduct. In addition to the denial of plaintiff-respondent's claim on merits preliminary objections were also raised with regard to jurisdiction, cause of action and estoppel.
3. The pleadings of the parties gave rise to the following issues :-
(1) Whether the plaintiff is entitled to recover a sum of Rs, 6,94,465 from the defendants ?
(2) Whether this Court has no territorial jurisdiction to proceed with the present suit ?
(3) Whether the plaintiff is estopped from bringing this suit ?
(4) Whether the plaintiff has no cause of action ?
(5) Relief.
' Almost all the issues were decided in favour of the plaintiff-respondent and his suit was decreed for a sum of Rs, 5,72,368 with costs. He was also awarded interest at the rate of 6% per annum till the date of first recovery. The appellants have now come up to the High Court and have challenged the validity of the impugned judgment and decree passed against them.
4. Learned counsel for the appellants has raised the following contentions :-
(a) The agreement executed between the parties Exh. P. 5, contemplates that payment under Schedule B (2) (d) can he made only for handling work by the Contractor at transit stations where Wagons are available for that purpose and where transit facilities are not made available making of CR & TR Vans as provided by Schedule B (2) (d) would not be possible. Since Mari Indus Station was made transit station in March, 1974, therefore, payment was made to the plaintiff-respondent under Schedule B (2) (d) from that period and prior to that he was correctly paid under Schedule 'A' of the agreement.
(b) It has not been made clear by the plaintiff-respondent that he has been handling transit goods at the station subject-matter of the agreement and CR & TR Vans were made available as provided by Schedule B (2) (d).
(c) The bills were prepared under para. 13 of the agreement by the Station Master -concerned and duly certified by the plaintiff-respondent who never raised any objection while certifying that the amount of bills being less than that actually due to him was liable to be paid under Schedule B (2)
(d). As such he is now estopped to raise any such plea and demand the payment of his bills under Schedule B (2) (d).
(d) The plaintiff-respondent never preferred any claim for payment of any amount otherwise due to him within a period of three months of the date of transaction.
(e) Since the Railway is a Government Department and does not work for gain, therefore, Section 23 Explanation II, C. P. C. Will not be applicable to the facts of the present case. The suit as such should have been filed at the places where the cause of action actually arose.
(1) The suit being barred by time to the extent of some amount claimed by the plaintiff-respondent to be paid to him is not maintainable to that extent.
(g) The plaintiff-respondent is not entitled to payment of any interest on the amount decreed in his favour.
(h) The letters as mentioned in Para 10 of the plaint covering the period of December, 1970 to August, 1974, do not amount to preferring claim with regard to any amount due to the respondent under para. 14 of the agreement. In the aforesaid letters the respondent only claimed that the payment should be made to him under Schedule B (2) (d) and never claimed any specific amount duly calculated by him.
(i) Exh. P. 4 statement of accounts showing the amount due to the plaintiff-respondent has been wrongly exhibited being not the original document, only photostat copy thereof.
(j) There being Arbitration Clause in the agreement the dispute between the parties should have been referred to the Arbitrator as provided by the agreement itself. The Civil Court was not competent to proceed with the case in view of the Arbitration Clause.
5. The plaintiff-respondent while producing Schedule B (2) (d) in the agreement in toto in para. 2 of his plaint submitted in Para. 3 thereof that he had been performing the services mentioned in Schedule B (2) (d) at Mari Indus, Khushab, Mianwali and Bannu and as such was entitled to be paid for his services under the aforesiad Schedule. In Paras. 4-to 7 of the plaint he has asserted that since the appellants did not pay him according to the Schedule B (2) (d), therefore, he referred the matter to the higher Officers such as, Vice-Chairman and Chief Commercial Manager, vide, his letter dated 11th November, 1972 and 12th November, 1972, who did not pay any heed to his requests.
In the written statement the appellants have denied the claim of the plaintiff-respondent for payment under Schedule B (2) (d) mainly on the ground that since the aforesaid Railway Stations were not transit Stations during the relevant period, therefore, the plaintiff-respondent was not entitled to payment under Schedule B (2) (d): otherwise so far as the nature of work handled by the plaintiff-respondent is concerned the same has not been denied in the written statement. It has only been stated that on account of lack of transit facilities on the aforesaid Railway Stations he was not paid under Schedule B (2) (d) and was, therefore, correctly paid under Schedule 'A' of the agreement.
6. The question which arises for consideration with regard to these contentions is as to whether the agreements in question executed between the parties contemplate that in the absence of the transit facilities having been provided at the aforesaid Railway Stations the Contractor would not be paid under Schedule B (2) (d) of the ageement irrespective of the fact that he has been handling the work as specified by the aforesaid Schedule.
6-A. The evidence produced by the plaintiff-respondent mainly consists of the Railway Employees particularly P. Ws. 1, 2 and 4 who have been working at the aforesaid Railway Station which are in dispute. They have unequivocally stated that the plaintiff-respondent has been making CR/TR by loading the local goods, transhipping, reloading, etc., of Vans and for that purpose employed many persons at the said Railway Stations. The aforesaid P. Ws. Have been working as Goods Clerks at the Railway Stations in dispute and have been seeing the plaintiff-respondent handling the work as specified by Schedule B (2) (d) of the agreement. The appellants have produced only D. W. 1 in rebuttal who has not refuted the claim of the plaintiff-respondent with regard to the nature of the work handled by him at the aforesaid Railway Stations. He has simply stated that the respondent is otherwise not entitled to the payment of his bills under Schedule B (2) (d) of the agreement. All the three agreements executed between the parties refered to above also contained Schedules A, B, C, D and E which have specified the rate per van handled by a Contractor. Para. 4 of the agreement says that remuneration will be paid to the Contractor according to the rates shown in the Schedules. Under this very para a Contractor is liable to be paid at Van rate under Para. 2 (d) of Schedule B for handling TR & CR Vans including Vans sent to the transit sheds for blending which are open and checked but from which neither any packages are taken out nor any added. It means that for services rendered with regard to handling TR & CR Vans a Contractor has to be paid at Van rate shown in Schedule B appended with each agreement. In addition to that if he also handles a Van sent to the transit shed for blending purposes he will be paid at the same rate. As mentioned above the entire evidence produced by the plaintiff-respondent shows that the plaintiff-respondent had been handling CR & TR Vans at the Railway Stations in dispute and there being no rebuttal in this regard one fails to understand as to bow his demand for payment of dues at van rate under Schedule B (2) (d) of the agreement can be denied. This being the position finding of the learned trial Court on issue No, 1 so far as the nature of the work handled by the Contractor is concerned is correct and the same is hereby affirmed.
7. Further, there is no mention in the agreements or even in the Schedules appended there to that payment under Schedule B (2) (d) will be made for handling CR/TR Vans only at transit stations. If this had been the intention of the parties then specific provisions in this behalf would have been made. In the absence thereof it is not possible to agree with the learned counsel for the appellants.
The nature of work to be handled by a Contractor under Schedules A and C is quite different from that provided by Schedule B (2) (d). Since it is established on record by the evidence that the plaintiff-respondent had been handling work specified by Schedule B (2) (d), therefore, question of applying Schedules A and C for making payment to the plaintiff-respondent would not arise.
8. The next contention raised at (b) above has no substance and answer thereto has been given while disposing of contention (a). It has been clearly stated by the plaintiff-respondent in paras. 2 to 7 that he has been handling work with regard to making of CR/TR Vans as provided by Schedule B (2) (d). The evidence produced by him also makes it clear. As such it cannot be said that the plaintiff-respondent has failed to clearly state the nature of work handled by him.
9. Para. 13 of the agreement provided that the Bills for the work performed by the Contractors under Schedules A, B, C, D and E of the agreements shall be prepared monthly by the Station Masters concerned and shall be certified by the Contractors concerned. It has been contended on behalf of the appellants that since the bills prepared by the Station Master concerned pertain to payment to be made under the Schedules other than Schedule B and were certified as such by the plaintiff- respondent, therefore, he is now estopped to raise any objection that the bills being for less payment he should be paid according to Schedule B (2) (d). Para. 14 of the agreement further provides that during the continuity of the contract all claims by the Contractors against the Railway must be preferred within three months of the date of transaction. It is submitted by the learned counsel for the appellants that since the claims with regard to the payment of dues to the plaintiff-respondent on account of less payment were not preferred within three months as provided by this Para therefore, he is now estopped to claim the payment of the amount due to him on account of alleged less payment. We are afraid; the contention raised above has no substance in view of the evidence produced on record. Under Paras. 9 and 10 of the plaint particulars of all the claims submitted by the plaintiff-respondent for payment of dues under Schedule B (2) (d) have been given. The aforesaid claims pertain to the period of 1st December, 1970 to 23rd of August, 1974. So far as Para. 9 of the plaint is concerned it has been admitted to be correct by the appellants to the extent that representation in this behalf was made by the plaintiff- respondent to the Minister for Communications. Para. 10 of the plaint has not specifically been denied, the contents thereof have been denied in general terms which as a matter of fact do not amount to denial under the law. Further Exh. P. 8 to P. 10 nullify the stand of the appellants in this behalf. According to Exh. P. 8 the Divisional Superintendent, Pakistan Railways, Rawalpindi, was asked by the Headquarters, Lahore, as to whether the claim of the plaintiff-respondent with regard to services rendered by him for handling C. R. & T. R. Van at the Railway Stations in question was correct and whether the claims as such were received in the office in time and if not how much of them were barred by time. According to Exh. P. 10 the Divisional Superintendent replied that the claims of the plaintiff-respondent with regard to the work handled by him were correct, duly verified and the claims for payment of dues otherwise not paid to him were received in the office in time and were, not time-barred.
9-A. Irrespective of the fact whether the plaintiff-respondent certified the bills prepared by the Station Masters concerned under Para. 13 of the agreement, the fact remains that he has been submitting his claims for the payment of dues on account of less payment made to him right from the beginning, i,e, 1970 while the first agreement was entered into between the parties on 29th September, 1969. In addition to that it has been admitted by the appellants themselves as mentioned above that claims for payment of dues were submitted by the plaintiff-respondent within time. It cannot be said that the plaintiff-respondent is now estopped to claim the payment under Sched. B (2) (d) by his conduct. His conduct otherwise shows that he has been claiming the payment under the aforesaid Schedule right from the beginning by submitting his claims in this behalf separately. The contentions raised above on behalf of the appellants are, therefore, hereby repelled having no sub. Stance.
10. An objection has also been taken to the territorial jurisdiction of the Civil Court at Lahore for taking cognizance of the matter. It has been contended that since the Railway Department does not work for gains, though its Headquarters are at Lahore, therefore, Civil Court at Lahore has no jurisdiction to proceed with the case. We are afraid this contention has no force. The point of territorial jurisdiction is fully covered by section 20(c), C. P. C. Which provides that a civil suit can be instituted in the Court within the local limits of whose jurisdiction cause of action wholly or partly has arisen. In the present case, as the record shows, all the agreements in question were executed at Lahore. The payment of bills at different occasions was made to the plaintiff-respondent at Lahore and further he was refused to be paid his alleged dues at Lahore. As such the Civil Courts at Lahore have jurisdiction to decid the matter. Section 21, C. P. C. Provides that 'no objection as to the place of suing shall be allowed by any appellate or revisional Court unless there has been a consequent failure of justice'. If the objection of the appellants with regard to the territorial jurisdiction is accepted then it would mean that separate suits should have been filed at Mari Indus. Mianwali Khushab and Bannu where legal assistance may not have been rendered to the appellants according to their own satisfaction. Both the learned counsel appearing for them are practising Lawyers of this Court and it cannot be said that they have not done justice to the case.
At least the appellants have not complained in this behalf in any manner. The objection, therefore, with regard to the territorial jurisdiction having no force is hereby repelled.
11. The objection of the appellants with regard to some of the amounts claimed in the suit being barred by time has also no substance. As mentioned above the claim for payment of dues was admittedly made within time vide, Exh. P. 10 as referred to above. Further, this objection was never raised before the learned trial Court. The record shows that the plaintiff-respondent was made payment occasionally with regard to his dues and according to law on account of the aforesaid part payment, cause of action continued to arise on the dates when the bills submitted by him were partly paid. If such objection had been taken the necessary evidence might have been produced by the plaintiff-respondent to show that his bills having been partly paid cause of action arose in his favour on such dates which made his suit within time. Such inquiry is not possible to be made at this stage. As such the objection raised in this behalf cannot be allowed to be raised at this late time. Further the first agreement was made in September, 1969, for a period of three years.
It expired in 1972 when the work had not been completed as yet and according to law cause of action in such a case was to arise from the date of completion of the work. It is admitted on record that the suit for the amount in question was filed, on 31st of August, 1974. Even if Article 56 of the Limitation Act as submitted by the learned counsel for the appellants is followed the suit will be within time. This article contemplates three years period from the date of the completion of work.
12. According to section 1 of the Interest Act of 1839, if the Court thinks fit it can allow interest to the creditor on the debts or sums payble at a rate not exceeding the current rate of interest from the time when such debts or sums were payable. The interest in the present case has been allowed by the learned trial Court at the rate of 6% per annum. Keeping in view of the conduct of the appellants consistently refusing to make payment to the plaintiff-respondent under Schedule B(2)
(d), we are of the view that interest at the aforesaid rate has been rightly allowed by the learned trial Court. As a matter of fact even at the time when the decree was passed against the appellants current rate of interest was more than allowed. In this view of the matter we do not see any force in this objection.
13. The letters as mentioned in Para. 10 of the plaint clearly constituted claims with regard to the payment of dues preferred by the plaintiff-respondent. Para. 14 of the agreement relates to claims with regard to dues to be paid to Contractor. The plaintiff-respondent has been agitating the matter right from the beginning that he has not been paid his bills correctly. According to hi& payment should have been made under Schedule B (2) (d) while it was made under other Schedules which were not applicable in view of the nature of the work handled by him. The letters referred to in Para. 10 of the plaint relate to this matter. Further all such letters have been admitted to be claims under Para. 14 of the agreement, vide Exh. P. 10 by the Railway Administration itself. The appellants, therefore, cannot at this stage plead against their own admission.
14. The statement of accounts has been exhibited as P. 4 in the statement of P. W. 4, Ishtiaq Ali. He has stated that the plaintiff respondent has been submitting his claims for payment of dues regularly. He has the correspondence even with the Vice-Chairman and the Chief Commercial Manager of the Railway in this behalf. According to him when the claim submitted by the plaintiff- respondent was verified it transpired that it was correct except the amount of Rs, three or four thousands. He has further stated that the statement of accounts Exh. P. 4 was found to. Be correct after due verification by the Railway Staff at every Railway Station in question. The record shows that the original statement of accounts was produced before the learned trial Court been prepared by the Railway Staff concerned. It was returned after having been seen and photostat copy thereof was retained on the file which was duly exhibited after comparison. As such the docutment P. 4 was duly and validly exhibited.
15. It is interesting to notice that D. W. 1 the only witness who was produced in rebuttal by the appellants has not said a word against the correctness of Exh. P.
4. The claim of the plaintiff-respondent having been found to be correct by the appellants themselves after due verification the learned trial Court has rightly passed the decree for the amount in question with interest.
16. Section 34 of the Arbitration Act provides that where any party to an arbitration agreement commences any legal proceedings against any other party to the agreement in respect of any matter agreed to be referred, any party of such legal proceedings may at any time before filing a written statement or taking any other steps in the proceedings apply to the judicial authorities before whom the proceedings are pending to stay proceedings. In the present case the appellants who were defendants in the civil suit made a request to the learned trial Court on 2nd November, 1974 for adjournment of the case in order to enable them to file their written statement. The case was adjourned to 23rd of September, 1974 when again adjournment was sought to file the written statement. The case was adjourned to 30th of November, 1974 at the request of the appellants on payment of costs. The written statement was filed on the aforesaid date and the costs were also paid. 'The record shows that issues were framed on the date when written statement was filed.
Para. 5 of the preliminary objections raised in the written statement is with regard to the staying of proceedings as according to the appellants the matter should have been referred to the Vice- Chairman of the P. R. Under the Arbitration Clause. It is admitted that no separate application under section 34 of the Arbitration Act was filed by the appellants before filing the written statement. Learned counsel for the appellants has relied upon G. M. Pfaff A. G. v. Sartaj Engineering Co. Ltd. Lahore and others. We are afraid that the case relied upon does not help the appellants. It has been held that defendant is disentitled to protection of section 34 of the Arbitration Act not only if he does not take his stand before filing written statement but also when he takes any other step. He can advantage of the aforesaid provision s of law if he insists upon implementation of Arbitration Clause before he submits written statement to the Courts of jurisdiction. In that case reply to the application was filed by the defendant pleading that the matter being covered by the Arbitration Clause should be referred to arbitration. The defendant in that case replied to the miscellaneous application pleading for arbitration before filing his written statement. In the present case before the written statement was filed it was never made known to the Court in any manner on different dates of hearing that the appellants intended to avail of the Arbitration Clause. The provision as contained in section 34 of the Arbitration Act being otherwise clear the Court should have been informed before written statement was filed by means of an application or otherwise that the suit filed by the plaintiff-respondent should not be proceeded with on account of Arbitration Clause. Nothing having been done in this behalf, the appellants are not entitled to any protection under section 34 of the Arbitration Act. The learned trial Court has, therefore, rightly decided the relevant issue on this point.
17. To learned counsel for the plaintiff-respondent has argued that the appeal being incompetent having been filed by Syed Said Ali Shah, Advocate not duly authorised by the appellants, the same may be dismissed as such. He has relied upon certain authorities in this behalf. On the contrary, learned counsel for the appellants has drawn our attention to the relevant file maintained by the Railway that Said Ali Shah was duly authorised by the competent Railway Authorities to appear in the case before the learned trial Court as well as in appeal before the High Court.
18. Since the appeal has otherwise been dismissed on merits, therefore, we do not intend to decide this aspect of the case.
19. As a result of the above discussion, the appeal having no force is hereby dismissed with costs. PLD 1970 Lab. 1$4