' The appellant is a contractor. Under an agreement with the respondent No,1 the appellant agreed to construct her house on terms and conditions mentioned therein. A dispute between the parties arose which in terms of arbitration clause was referred to the arbitrator's viz. respondents Nos.2 and 3. The arbitrators held six meetings and made the award. The appellant filed an application under section 14 of the Arbitration Act and the award was accordingly filed in the Court. The appellant filed objections to the award which was dismissed by judgment dated 31-3-1973 and award was made rule of the Court. An appeal filed by the appellant was also dismissed.
' Mr. Jamil Akhtar the learned counsel for the appellant has contended that the arbitrators have misconducted as no proper opportunity was provided to the appellant to produce his evidence, and further that without determining the market rate award was made. It was also contended that as no reasons have been given in the award it should be remitted.
' Learned counsel for the appellant has referred to the minutes of the arbitration proceedings which were filed in Court along with the award. The arbitrators entered upon reference on 20th December, 1966 and the first meeting of the arbitrators was held on 6-12-1966, when representatives of the parties were present. As the parties did not mutually agree to the interpretation of clause II of the agreement the arbitrators decided to appoint Mr.Fakhruddin Ahmed to evaluate the work done by the appellant. The arbitrators decided to find out the 'market rate' on the date of agreement and that the cost of the work was to be calculated, on the basis of the market rate keeping into consideration the standard of construction and quality of workmanship. It seems that by letter dated 12-4-1967 one of the arbitrators intimated the appellant's Advocate that he has not filed objections to the measurement and inspection report.
The arbitrators fixed the hearing at the site on 16-4-1967. The appellant by his letter dated 14-4- 1967 asked for postponement. On 16-4-1967 the appellant did not appear before the arbitrators who rejected the request for adjournment and accepted the measurements taken by Mr.Fakhruddin Ahmed Khan and the structural defects pointed out by the arbitratoRs, ' On 17-4-1966 the arbitrators decided that keeping into considera tion the standard of construction, quality of workmanship and the market rate the appellant should be paid at the rate of 35% above the Schedule of rates of Pak P.W.D. of 1956. Other items were also discussed which are not material for the present controversy. In the meeting held on 18th April, 1967 draft award was prepared and it was made on the next day. The appellant was awarded Rs,1,008.09 and the respondent was allowed to proceed with the construction independently.
' From these facts it is clear that the appellant sought an adjournment on 16th April but it was not allowed. There is no illegality in it, because according to the arbitrators no valid reason had been given for seeking adjournment. Further, it seems that the appellant did not appear before the arbitrator on 16-4-1967. The contention of the learned counsel is that for subsequent -meetings the arbitrators should have issued notice and as no notice was issued the entire proceeding up to the making of award was illegal and vitiated for violation of principles of natural justice. Principles of natural justice cannot be pressed in service in the facts and circumstances of this case. The appellant had neglected in attending the proceedings before the arbitratoRs, Merely sending an application for adjournment was not sufficient and it cannot be pre-supposed that the matter would be adjourned. It was the duty of the appellant to appear before the arbitratoRs, Furthermore, non-appearance of a party having notice of the date of hearing before the arbitrators does not cast a duty upon the arbitrators to send him another notice of the next date of hearing, as every party is duty bound to keep himself aware of the proceedings and the date of hearing.
' Mr. Mansoorul Arfin the learned counsel for the respondent has referred to AIR 1954 All. 244 where it was held that an arbitrator can proceed expiate and no second notice is necessary to a party and that it will not be a misconduct to proceed in the absence of the such a party. This rule cannot be applied in a wide manner to give an unrestricted power to the arbitratoRs, The application of this rule will depend on the facts and circumstances of each case. If the arbitrators have adjourned the matter stating that the date of hearing will be fixed later, then even if a party has not appeared on that particular date, notice of the next date will have to be sent to the parties. Here, what had happened that the arbitrators had proceeded day to day and as the appellant did not appear and merely sent an application two days before the hearing it was not necessary for the arbitrators to have issued a fresh notice for the hearing held on 17-4-1967. Mr. Arfin has rightly pointed out that after 16-4-1967 all the meetings that were held by the arbitrators were only amongst themselves for the purpose of making the award and not for the purpose of recording evidence of the parties or hearing them because in none of those meetings the respondent was present. The arbitrators entirely relied on the measurements made by Mr.Fakhruddin Ahmed Khan and also upon their experience and assessm ent of the word because none of the parties seem to have produced any evidence for determining the market rate. The arbitrators, therefore, considered it proper to adopt P.W.D. Schedule of rate of 1956 as the basis for determining the market rate. Considering the fluctuation in rates till 1966 they fixed the market rate at 35% above the P.W.D. Schedule of rates of 1956. Since the appellant had not produced any evidence to prove the market rate there was no illegality in the procedure adopted by the arbitratoRs, The question arises whether in the facts of this case the arbitrators were bound to examine witness and record evidence of parties on the question of market rate.
' Mr. Mansoorul Arfin has referred to AIR 1917 LB. 68 and AIR 1958 Cal. 501 and contended that the appellant did not tender any evidence before the arbitrators and, therefore, they were not duty bound to examine any witness. It seems correct that if the parties choose not to appear and tender any witness for examination, the arbitrators cannot take upon themselves the duty of calling the witnesses and examine them. Every party is duty bound to examine the witnesses to prove his case. If he defaults in producing the witnesses before the arbitrators he cannot blame the arbitrators of misconduct for not examining the witnesses. In the present case the appellant did not tender any evidence nor he wrote any letter asking for time for producing evidence. In the circumstances the appellant's grievance that he was not allowed to examine his witnesses is not justified nor in the circumstances it can be said that arbitrators have misconducted.
' The appellant's counsel then contended that under section 3 of the Arbitration (Amendment)
Ordinance 1981 (Ordinance XV of 1981) hereinafter referred as 'Ordinance' promulgated on 16-5-1981 the Court should remit the award to the arbitrators as no reasons have been given in it. It is correct that in the Award no reasons have been given but the question is whether the award which was subject-matter of a pending proceeding at the commencement of the Ordinance should be remitted. By this Ordinance section 26-A was added in the Arbitration Act which makes it compulsory for the arbitrators or the Umpire to state in the award the reasons for the Award in a sufficient detail. It further provides that where the award does not state the reasons in sufficient detail the Court "shall" remit the award. The word "shall" points out to the mandatory requirement of law to remit the award in which reasons have not been stated in sufficient detail. Reference can be made to Gandhara Industries Ltd. v. Govt. of Pakistan PLD 1982 Kar.
260. However, pending proceedings are governed by section 3 of the Ordinance which reads as follows:--
3. Power of the Court to remit cases pending at commencement of Ordinance.--(1) If, in the any case in which proceedings in relation to an award which has been filed in Court are pending in any Court immediately before the commencement of this Ordinance, the Court finds that the award does not, or does not in sufficient detail state the reasons for the award, the Court may remit the award to the arbitrators or umpire with a direction to state the reasons for the award in sufficient detail.
(2) Where an award is remitted under subsection (1) the Court shall fix the time within which the arbitrator or umpire shall submit to the Court an award stating the reasons, therefor, in sufficient detail: Provided that any time so fixed may be extended by subsequent order of the Court.
(3) Any award remitted under subsection (1) shall become void on the failure of the arbitrator or umpire to submit it in accordance with the direction of the Court.
Remittance of award under this provision is discretionary and if the arbitrators or umpire have not given any reason in the award the Court may on proper and sufficient reasons being shown decline to remit the award. Before passing such an order the Court should be satisfied that valid reasons exist to exercise the discretion in refusing to remit the award. In this regard no fixed rule can be laid down for exercise of discretion by the Court as it will entirely depend on the facts of each case. In the present case the matter was referred to the arbitrators in the year 1966. Both the arbitrators are Engineers having professional expert knowledge of the work involved in the case.
They had appointed Mukhtar Ahmed Khan to take measurements and evaluate the work. Both the parties have accepted the measurements and even today none of the parties have challenged that measurement. The arbitrators had also inspected the site and made the award. These factors may not as a rule be sufficient to refuse to remit the award but there are certain additional grounds which have convinced me not to exercise my discretion to remit the award. The arbitrators had filed their award along with the minutes of the proceedings. Although these proceedings do not form part of the award, the learned counsel for the parties have frequently referred to it in support of their conventions. It may be made clear that for the purpose of challenging the award, the Court will look to things appearing on the face of the award. Any document not forming part of the award cannot be looked into. In Holgate v. Killic (1861) 31 L.J.Ex.7 it was observed; 'the principle to E be collected from the later cases is very plain and it is, that the Court will not look at anything to induce it to review the decision of an arbitrator on any matter submitted to him for his decision, except it be something appearing on the face of the award or on a document forming part of the award. "In Giacomo Costa FU Andrea v. British Italian Trading Co. (1962) 2 All E L R 53 Diplock L.J.observed:- "It seems to me, therefore, that, on the cases, there is none which compels us to hold that a mere reference to the contract in the award entitles us to look at the contract. It may be that in particular cases a specific reference to a particular clause of a contract may incorporate the contract, or that clause of it, in the award. I think that we are driven back to first principles in this matter, namely, that an award can only be set aside for error which is on its face. It is true that an award can incorporate another document so as to entitle one to read that document as part of the award and, by reading them together, find an error on the face of the award. But the question whether a contract, or a clause in a contract, is incorporated in the award is a question of construction of the award. It seems to me that the test is put as conveniently as it can be in the words of DENNING, L.J. which I have already cited from Blaiber & Co. Ltd. v. Leopold New borne (London) Ltd.(1953)2 Lloyd's Rep.
429.
' As I read the cases, if the arbitrator says; on the wording of this clause I hold' so and so, then that clause is impliedly incorporated into the award because he invited the reading of it."While considering objections under section 30 of the Arbitration Act the Court can look into those documents which form part of the Award. A cursory reference to any document or to a contract in the award will not mean that such document forms part of the contract itself. The Court will not look into the arbitration proceedings unless they are referred in the award itself and on reading of an award it seems that they form part of the award.
' In the present case while considering the question of remittance under section 3 of the Ordinance these principles may not apply because firstly, it does not relate to an objection under section 30 of the Arbitration Act. Secondly, the ground mentioned under section 26-A has been introduced by an amendment in the Arbitration Act in the year 1981 and is not applicable to pending proceedings.
Thirdly, by section 3 of the Ordinance relating to pending proceedings legislature has made it discretionary upon the Court either to remit the award or not to remit it. In these circumstances when a wide discretion has been given to the Court for examining the case whether in a pending case the, award should be remitted as reasons have not been given in the award, in my opinion the Court would be justified to look into other documents which though do not form part of the award are relevant for this purpose and also for ascertaining whether valid reasons existed to support the award. Such a view can possibly be taken because in many cases, with the passage of time, it is possible that the arbitrator or umpire may not be alive or available. One has to take all the possibilities into consideration including the facts of the case and how the arbitrator or umpire proceeded and in what manner and in what circumstances the award was given. These considerations are only restrained to pending proceedings and to cases which fall under section 3 of the Ordinance and not under section 26-A. Keeping these principles in mind I have examined the minutes of the meetings of the arbitrators in which they have recorded their reasons and the basis for making the award. The arbitrators were handicapped with the fact that none of the parties had produced any evidence for determining the market rate. In these circumstances the arbitrators in the meeting held on 17-4-1967 discussed the matter at length and making the rates of Pak. P.W.D.
Schedule of 1956 as a basis, awarded 35% above that Tate. This by itself was sufficient and proper reasoning for determining the market rate. In these circumstances I do not find any justification in remitting the award to the arbitratoRs, Mr.Mansoorul Arfin the learned counsel for the respondent contended that the award was made rule of the Court which was challenged in Civil Appeal No,53/74 before the District Judge which was dismissed. According to the learned counsel Second Appeal against the judgment passed by the First Appellate Court is not maintainable. In this regard reference can be made to section 39 of the Arbitration Act which reads as follows:--
39. Appealable OrdeRs,--An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorized by law to hear appeals from original decrees of the Court passing the order:
(i) Superseding an arbitration;
(ii) On an award stated in the form of a special case;
(iii) modifying or correcting an award;
(iv) filing or refusing to file an arbitration agreement;
(v) staying or refusing to stay legal proceedings where there is an arbitration agreement;
(vi) Setting aside or refusing to set aside an award: ' Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court.
2. No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court.
' From this provision of law it is clear that order of the Appellate Court under section 39 of the Arbitration Act is not open to challenge in second Appeal. Reference can be made to 27 I C 22 and 25 1 C 7.A second appeal will not lie against an order setting aside or refusing to set aside the award, as held in AIR 1941 Cal.
202. However, it is well-settled that the aggrieved party is entitled to file a revision application. The scope of Revision Application is limited and the Court can only interfere if the subordinate Court has exercised jurisdiction not vested in it by law, or has failed to exercise jurisdiction so vested, or has acted in exercise of its jurisdiction illegally or with material irregularity. Even if for argument sake I treat this second appeal as a revision application no ground for interference has been made out. For these reasons the appeal is dismissed.