' FAIZ MOHAMMAD KHAN, J.--The case has a chequered history. Qazi Mugal Baz, appellant herein, was Contractor by profession. The then Government of West Pakistan, in order to construct a new boat bridge in Mile No.1 on Dalazak-Gul Abad road, Peshawar, had called for tenders from the Contractors for that work. Qazi Mughal Baz was one of those who had submitted tenders to Government. His tender was accepted and consequently, on 31-1-1970, he entered into an agreement with Government to construct the said boat bridge. The terms of agreement were reduced into writing. The estimated cost of the work as entered in the agreement was Rs.1,35,000.
The work was to commence on 1-2-1970 and was to be completed within a period of six months from that date. While the work was in progress, dispute arose between the Department, on the one hand, and the Contractor, on the other, in consequence whereof the Contractor stopped his work on 29-6-1970. There was in the agreement an arbitration clause, invoking which the Contractor requested the Chief Engineer, N.-W.F.P. (West Pakistan having been dissolved and North-West Frontier Province having come into existence) for referring the dispute for arbitration. The claim made by the Contractor, which was spread over various items, against Government was Rs.46,406.56. The Chief Engineer took no action on the request made by the Contractor, who was eventually obliged to file a civil suit in civil Court against the North-West Frontier Province and two others for the recovery of Rs.53,956.56 plus the interest. While entertaining the suit, the learned Senior Civil Judge, Peshawar summoned the defendants on whose behalf Government pleader appeared in Court raising objection that in view of arbitration clause in the agreement the dispute between the parties was required to be settled through arbitration. After many adjournments, the Court by order, dated 17-2-1972, while accepting the application which had been made by the defendants, stayed the suit under section 14 of the Arbitration Act in order that the dispute may be referred to a qualified Arbitrator in accordance with clause 25 of the agreement.
2. The Chief Engineer then appointed Mir Naeemullah Khan, Superintending Engineer as Arbitrator.
The case placed before the Arbitrator by the Contractor related to all those items, except the interest, the earnest money and the security amount, which were tabulated in the plaint. The gist of these claims was marked as 'Attachment A' by the Arbitrator who enclosed the same with his award Exh.E-1. On conclusion of the proceedings, Mir Naeemullah Khan made his award (Exh.R-1) which was filed in the Court in which the suit of the Contractor had been instituted. It may here be mentioned that the said award was not conclusive in all respects because some claims were allowed wholly or in part but there was no final determination in terms of money in respect thereof.
The award was objected to by the Contractor whose objection petition was, however, rejected and the award made rule of the Court by order, dated 10-9-1973, passed by the Court in following terms: "In the circumstances, therefore, I feel no hesitation in making the award Exh.R.1 the rule of the Court with the result that the suit of the plaintiff for the recovery of Rs.53,956.56 merges into the award becoming rule of a Court. The dispute, therefore, is decided accordingly."
3. This decision was challenged by the Contractor before this Court in R.F.A. No. 71 of 1973, which was decided by a Division Bench of this Court on 9-2-1977. The appeal was accepted and the order of the learned Senior Civil Judge dated 10-9-1973 was set aside. Operative part of the order made by this Court is as follows:- "We, therefore, accept this appeal, set aside the impugned order of the learned trial Judge and remand the case to him with the direction that after having accepted the award of the Arbitrator, he should now proceed to determine the outstanding points, yet to be clarified, by sending for the parties and after taking their evidence, if any or otherwise, determine the amount to which the plaintiff is entitled in the light of the award of the Arbitrator and then to pass a decree accordingly."
4. After receipt of the record, on remand from this Court, the learned Senior Civil Judge proceeded with the case in order to record evidence of the parties in the light of directions given by this Court.
While the matter was pending before the Court and the evidence had not yet been recorded that the counsel for the parties and the Contractor made a statement on 25-2-1978 before the Court that the matter be referred to Mr. Adam Khan, Superintending Engineer, B & R Department, P.W.D.
For arbitration. On 4-3-1978 the same parties gave statement before the Court agreeing on the appointment of Mir Naeemullah Khan, Chief Engineer as Arbitrator because Mr. Adam Khan had expressed his inability to act as Arbitrator on account of other official engagements. The order sheet relating to both these dates is, however, silent as to what order the Court had made with respect to this agreement. On 15-2-1979, however the Court made order in presence of counsel for the parties that a new Arbitrator was to be appointed on the next date of hearing, which was 20-2- 1979. On this date 20-2-1979 both the parties placed before the Court names of different persons who could be considered for appointment as Arbitrator and on this date, in presence of counsel for the parties, Mirza, Maqsood Ahmad, Superintending Engineer (Rtd.), whose name appeared in the list provided by the Contractor, was appointed Arbitrator in the case. The Arbitrator was directed to send his award to Court before 10-4-1979, on which date the file was to be placed before the Court.
The order sheet would however, show that on 31-3-1979 the Court heard arguments of the learned counsel for the parties for clarification of the already quoted order made by this Court. After hearing arguments the Court adjourned the case for orders to 4-4-1979, on which date order was not announced and the case was adjourned to 10-4-1979. It was on that date that the objector's counsel had appeared before the Court and had also filed award made by Mirza Maqsood Ahmad alongwith a letter. The case was adjourned to 24-5-1979 for further proceedings and for arguments and objections on the new award. The order sheet further shows that at the time when the order was written the counsel for opposite side, who was present in Court early in the morning, was not present and was directed to be informed about it. On 24-5-1979 the Presiding Officer was on leave and the case was, therefore, posted by the Reader for 25-6-1979. On this date the parties as before and their counsel were present and the objections raised by Government side regarding the ' appointment of new Arbitrator Mirza Maqsood Ahmad and the reference of the dispute to him for arbitration were heard and disposed of in favour of Government in that the appointment of Mirza Maqsood Ahmad as Arbitrator and the reference made to him for arbitration were held to be of no legal consequence. The case was then adjourned to 25-9-1979 for further proceedings.
5. The aforesaid order made by the learned Senior Civil Judge was challenged by the Contractor in Revision Petition No. 318 of 1979 before this Court, which was ultimately decided on 12-4-1980 in favour of the Contractor. The order dated 25-6-1979 of the learned Senior Civil Judge was set aside and the case was remanded to him "for proceeding further in the matter from the stage the award and the reference was filed in his Court. In other words, the learned Judge would allow the parties to file their objections subject to limitation on the merits of the award and then to adjudicate such objections according to law and procedure".
6.. The file of the case, after remand, was received in the Court of the learned Senior Civil Judge, Peshawar on 26-6-1980, on which date counsel for the parties were also present in Court, as would the order sheet disclose. The case was adjourned to 27-7-1980 for filing objections on the award. It was on this date that objections on behalf of Government against the award were filed and after obtaining reply of the other party in regard thereto the Court, ultimately, disposed of the suit on 16- 12-1980 in favour of the Contractor by making the award rule of the Court and by granting to him a decree for the recovery of Rs.53,956.56 against the defendants with interest at the rate specified in the order, all sum calculated to be Rs.1,01,438.33, and the costs. The plaintiff (Contractor) was also directed to make up deficiency in the court-fees within one month, which he did. By the detailed order dated 16-12-1980 made by the Court in this regard the objection petition filed by Government was rejected as being time barred, and by merging both the awards made by the two Arbitrators in this case and by modifying the awarded amount mentioned in the second award (made by Mirza Maqsood Ahmad), the amount and the rate of interest already stated was allowed and incorporated in the decree of the Court.
7. It is against the aforesaid order of the Senior Civil Judge, Peshawar that the plaintiff (Qazi Mughal Baz) has come in appeal to this Court, which has been registered as Regular First Appeal No. 36 of 1981. The Executive Engineer, P.W.D., Highway Depatment, now Buildings and Roads Department, Peshawar, one of the respondents, also filed cross-objections, which have been registered at No.5 of the register for the near 1981. This order would dispose of both these matters.
8. Mr. J.D. Akbarji, Advocate appeared on behalf of the appellant. S.Ibne Ali, Additional Advocate- General appeared on behalf of the Province and the Chief Engineer, B&R (respondent Nos. 1 and 2 and Mr. Jalaluddin Khan, Advocate appeared on behalf of the Executive Engineer, B&R (respondent No.3). The learned counsel have been heard at length and the record of the case carefully perused with their assistance.
9. As already mentioned in earlier portion of this judgment, the respondents had filed on 27-7-1980.
Objection petition before the Senior Civil Judge, Peshawar respecting award made by Mirza Maqsood Ahmed, Superintending Engineer (Rtd.). This petition was rejected as time barred by the leered Senior Civil Judge by a composite order, impugned herein, made by him on 16-12-1980, whereby the award was also made rule of the Court and decree for the recovery of the amount already mentioned was passed in favour of the plaintiff, now appellant. No appeal has been filed by Government against the order of the learned Senior Civil Judge rejecting the objection petition, and the cross-objections filed by respondent No.3 herein are mainly directed against the judgment and the decree of the learned lower Court passed in favour of the plaintiff/appellant; the ground raised therein respecting the validity of the reference to the second Arbitrator having already been decided by this Court on 12-4-1980 being legally not available to him.
10. The narration of facts in the preceding paragraph is only for the purpose of dealing, at `this stage, with the argument raised by the learned Additional Advocate-General that the decision of the learned Senior Civil Judge holding the Objection Petition filed by Government against the award made by Mirza Maqsood Ahmad to be barred by time was incorrect. This objection was purportedly raised in order to support the decree obtained by the appellant against the respondents, but in effect it was not so because what was intended thereby was to obtain from this Court the reversal of the decree, which was not permissible under law without filing an appeal against the order rejecting the Objection Petition, or cross-objections which in this case would have remained confined only to two grounds mentioned in section 17 of the Arbitration Act. Despite this, we would deal with this objection and for reasons hereafter stated hold it to be without substance.
The order, dated 10-4-1979 recorded by the learned Senior Civil Judge in the order sheet clearly shows that after the award was filed in Court the case was adjourned to 24-5-1979 for arguments and objections, if any, to the award. The counsel for the opposite side, which in this case was defendants/respondents, was also to be informed. Thereafter, on account of the Presiding Officer being on leave, on 24-5-1979, the case was placed before the Court, on 25-6-1979. On this date the counsel for the parties, alongwith the parties, were present in Court and oral objection on behalf of Government respecting the validity of the order of reference of the case to the arbitration of Mirza Maqsood Ahmad appears to have been raised and dealt with by the Court. It was by order made on this date that the learned Senior Civil Judge held the reference made to Mirza Maqsood Ahmad to be a nullity in the eye of law, which order was subsequently set aside by this Court in revision, as already mentioned in earlier portion of this judgment. This would show that the respondents not only had the knowledge that Mirza Maqsood Ahmad had filed award in Court, on 10-4-1979 but a notice to that effect was also given by the Court itself to the counsel for the defendants- respondents, and it was in pursuance of that notice that the learned counsel had appeared in Court on subsequent dates. Such being the case, the respondents were required by law to file objection petition within thirty days of their gaining knowledge of the award and having not done so in time, the objection petition filed by them was rightly held by the learned Senior Civil Judge to be barred by time.
11. The learned counsel for the appellant argued that the award made by Mirza Maqsood Ahmad could not have been modified by the learned Senior Civil Judge, who after making the award rule of the Court was required by law to have pronounced judgment in accordance therewith. He contended that section 17 of the Arbitration Act governed the case and section 15 thereof was not attracted. The learned counsel contended that reference to the Arbitrator in this case was to be treated as reference out of Court and the fact that suit had been instituted by the appellant for the recovery of a certain amount of money relating to the subject-matter of reference was of no significance as the suit having been stayed by the Court had been consigned to record and was never restored or proceeding with. He further contended that there was no provision in the Arbitration Act empowering the Court to reduce the amount awarded by the Arbitrator to that mentioned in the plaint (of the suit) and that in any case, the rate of interest awarded by the second Arbitrator could not have been reduced by the Court. The learned Additional Advocate- General, in reply contended that reference to the Arbitrator in this case was initiated after the suit had been instituted and after the Court had so directed, and this being an arbitration with the intervention of the Court in a pending suit, the learned Senior Civil Judge was right in disallowing the claim of the appellant beyond the amount which he, having himself calculated as being due to him, incorporated in the plaint. That being the claim of the appellant against the respondents and that being the subject-matter referred to the second Arbitrator, he could not have gone beyond that claim, tabulated by the appellant in the plaint, and made an award exceeding that amount, he contended. The learned Additional Advocate-General further argued that since the award of the second Arbitrator had exceeded the amount claimed by the appellant in the suit, the award to the extent it exceeded that amount would be deemed as having been made without authority and since this error was patent on the record, the learned Senior Civil Judge had under section 15 of the Arbitration Act powers to modify the award in order to bring it in accord with the claim of the appellant made in the suit. He also argued that the second Arbitrator had no authority to award interest to the appellant as this matter had not been submitted to him and even in law, he had no jurisdiction to grant interest relating to the post-decree period, which jurisdiction, he submitted, vested in the Court under section 29 of the Arbitration Act.
12. Mr. Jalaluddin, Advocate, who has filed cross-objections on behalf of the respondent No. 3, adopted the arguments of the learned Additional Advocate-General without adding anything thereto.
13. We have carefully considered the arguments of the learned counsel for the parties in the light of the record placed before us. It is undisputable that reference in this case was made to the first Arbitrator after the appellant had instituted this suit against respondents for the recovery of the specific amount mentioned in the plaint. The suit, after some proceedings therein, was stayed by the Court so that the matter could be referred to an Arbitrator in accordance with the terms of the agreement, which was accordingly done. Before the first Arbitrator, the claim (Attachment 'A' to award Exh. R-1) pressed by the appellant was the same as mentioned in the body of the plaint, except the items relating to interest the earnest money and the security amount. The incomplete award made by the first Arbitrator also related to the same items which were mentioned in Attachment 'A', referred to above. After this award had been made, it was on the application, dated 23-12-1972, made by the appellant that the suit filed by him be restored that the learned Senior Civil Judge summoned the file of the original suit and proceeded with it and made the award of the first Arbitrator rule of the Court. This order of the learned Senior Civil Judge was, however, set aside, on 9-2-1977 by a Division Bench of this Court, in R.F.A. No. 71 of 1973, and the to him for proceeding further in the matter in the light of the observations made in the remand order. While so proceeding with the suit, with a view to determining the part of the claim allowed wholly or in part by the first Arbitrator but left undetermined by him in terms of money, the Court, with the express consent of the parties to get the dispute resolved through arbitration and after obtaining from them lists of persons who could be considered by the Court for appointment as Arbitrator, appointed Mirza Maqsood Ahmad as Arbitrator, who submitted his award to the Court, which was objected to by the respondents, but with no success. The award made by Mirza Maqsood Ahmad, in his own words, related to "outstanding points which remained undetermined by the previous Arbitrator". It was accepted by the Court with some modifications and the rule based thereon after its merger with the award earlier submitted by the first Arbitrator. The decree passed by Court in favour of the appellant was of the amount not exceeding that claimed by him in the suit. We are, therefore, of the view that the arbitration in this case was with the intervention of the Court in a pending suit which had been filed by the appellant for recovery from the respondents of the amount specified in the plaint. That being so, the authority of both the Arbitrators to resolve the dispute extended to the claim and the amount which was specified in the plaint and not beyond that, and the decision made by the second Arbitrator awarding amount in excess of the suit amount, in so far as it related to that excess, was to be regarded as a decision without jurisdiction and beyond reference. The learned trial Judge, under section 15 of the Arbitration Act, read with section 25 thereof, had the jurisdiction to modify the award made by the Arbitrator, and the modifications made by him so that the awarded amount coincided with the amount claimed by the appellant in the suit could not, therefore, be taken exception to.
14. In regard to the interest allowed by the second Arbitrator, suffice it to say that there is nothing on the record to show that this point was specifically referred to Mirza Maqsood Ahmad for arbitration.
The award made by him clearly shows that he was conscious of the points in dispute which were referred to the first Arbitrator and also the order of this Court passed in R.F.A. No. 71 of 1973. He has mentioned these facts in his award and has given decision in respect of outstanding points. That being so, his award relating to interest was without jurisdiction. The case, therefore, fell to be governed by section 29 of the Arbitration Act and the learned trial Judge was right in modifying the award in regard to this item in the manner he did.
15. The cross-objections filed by respondent No. 3 relate to points which are not covered by section 17 of the Artbitration Act and since D respondent No. 3 could not urge any other point beyond those points, the cross-objections are without substance.
16. In the result, finding no merit in the appeal as well as in cross-objections, the same are hereby dismissed. The appellant shall E pay costs of this appeal to respondents Nos. 1 and 2.
Appeal and cross-objections dismissed.