' This appeal under section 39 of the Arbitration Act wherein the judgment and decree dated the 7th of July, 1991, passed by the learned Civil Judge Ist Class, Lahore, upholding the award, has been assailed.
2. Khalid and Company, hereinafter to be described as the respondent, had filed the petition under sections 8 and 20 of the Arbitration Act (hereinafter referred to as Act) seeking direction from the Court to the Government of the Punjab through the Secretary to the Government of the Punjab, Housing and Physical Planning Department (appellant No,1) and the Deputy Director of the same Department (appellant No,2), to file the agreement in the Court; to nominate their nominee as arbitrator on the panel of arbitrators, and the arbitrators so appointed be directed further to adjudicate upon the dispute between the parties and to submit the award.
3. The respondent had entered into an agreement with the appellants for the works Area Development Scheme for Low Income Housing at Sheikhupura (Disposal Work)". The dispute, however,. Arose subsequently within meaning of clause of the agreement. The respondent invoked the provisions of the arbitration clause in the agreement through the intervention of the Court who had appointed a panel of arbitrators comprising Muhammad Ashraf Khan, a retired Superintending Engineer, and the then Director, Housing and Physical Planning (Aslam Khan Niazi).
4. The arbitrators vide impugned award dated the 10th of September, 1989, accepted the claim as follows:- ABSTRACT Claim No,
1. Claim No,
2. Claim No,
3. Claim No,
4. Claim No,
5. Claim No,
6. Claims Nos, 7 &
8. Claim No,
9. Claim No,
10. Total: Rs, 84,577.00 Rs, 30,267.00 Rejected. Rs, 4,156.00 Rs, 3,388.00 Rejected. Rs, 80,670.00 Rejected. Rs, 7,000.00 Rs, 2,10,058.00
5. After the award had been tendered in the Court on the 4th of September, 1989, objections were obtained by the learned Trial Court in respect thereto and thereafter it framed the following issues:
(1) Whether the award is liable to be set aside? OPR.
(2) Whether the award is properly stamped? OPP.
' The parties had adduced the brief evidence, mostly documentary, on the said issues. After hearing the counsel for the parties, the learned trial Court vide impugned judgment and decree upheld the award (Exh.C. 1) and made it a rule of the Court after deciding the all important issue No, 1 against the appellants. The verdict of the learned Trial Court on issue No, 2 has not been challenged before this Court.
6. Section 30 of the Act provides that an award shall not be set aside except on one or more of the following grounds: "(a) that an arbitrator or umpire has misconducted himself or the proceeding;
(b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings had been invalid under section 35;
(c) that an award has been improperly procured or is otherwise invalid."
7. Learned counsel for the appellants has assailed the impugned award and the judgment and decree based thereon mainly on the ground that the arbitrators had misconducted themselves in giving the award favourable to the respondent, in that they had travelled beyond the scope of agreement and had not taken into consideration the documents placed before them. Further, it was contended that the arbitrators had given no reasons in support of the award as required under section 26-A of the Act. The last objection is liable to rejection straightaway as the arbitrators have given scenario of the dispute between the parties and detailed reasons in support of the conclusion had settled each and every claim put forward by the respondent and resisted by the appellants.
8. Learned counsel for the appellants has also contended that appointment of arbitrators by the learned trial Court was ab initio void as the respondent had not filed the petition for appointment of arbitrators well in time and the provisions of section 14(2) of the Act were also not complied with.
9. Learned counsel for the respondent has relied on Ashfaq All Qureshi v. Municipal Corporation, Multan, and another (1985 SCM R 597) to repel the said contention. It was ruled that formal compliance in strict conformity with the relevant provisions of law is not to be insisted upon when substantial compliance had been made, filing of the award by the arbitrator was in the knowledge of the parties and their counsel in response to notice to the parties had appeared and taken part for filing objections. The appellants in this case had appeared and tendered objections to the award and only thereafter the issues were framed and they were called upon to produce evidence thereon. The objection of the learned counsel as to irregularity in appointment of arbitrators is also destitute of merit as they had actively participated in the arbitration proceedings and one of the arbitrators was the officer of the appellants, namely, Deputy Director, Housing and Physical Planning, as per the arbitration agreement. Here, the observations of the Karachi High Court in Messrs Habib & Sons v. Messrs Virak Co. (PLD 1957 (W.P.) Kar. 245) may be quoted with advantage:- - "after participating in the arbitration proceedings and by not raising any objection to the jurisdiction of the arbitrators, the party waived their objection to the jurisdiction of the arbitrators to deal with the matter, and any irregularity in the appointment of the arbitrators was cured by the conduct of the party:
10. So far as the question of misconduct on the part of the arbitrators is concerned, there is hardly any evidence worth serious consideration. The main objection against the award is that the arbitrators had not taken into consideration that the work entrusted to the respondent was completed within six months which had entailed losses to the appellants. No doubt the appellants had repeated the grievance in its letters (Exs.R. 1 to R. 4), but the respondent had all along been consistently relying on clause 12 of the agreement impressing upon the appellants to determine the non-scheduled items before the job could be executed. A witness of the appellants, namely, Muhammad Nazir, S.D.O. (O.W.3) had admitted the fact in cross-examination that "it is correct that without approval of non-scheduled rate, the contractor could not execute the work". The arbitrators had rightly blamed the appellants in the circumstances for the lapse and admitted the claim of the respondent. The evidence of the witnesses of the appellants militate against the plea of misconduct of the arbitratoRs, Muhammad Nazir (O.W.1) had admitted in cross-examination that the documents had been presented before the arbitratoRs, Then Muhammad Rafiq, Sub-Engineer (O.W.2), pleaded ignorance if the arbitrators had done any prejudicial act against the appellants.
Abdul Maajid, Deputy Director, Housing and Physical Planning Department, (O.W.4), who had produced documents of the Department, had also admitted that he had been appearing before the arbitrators and had shown them all the relevant record. The award also shows in depth study of the relevant record and the issues alongwith implications arising ex contractu between the parties.
They had made an exhaustive appraisal of the respective claims of the parties and determined them on the basis of documents and evidence presented to them. Every claim of the respondent was dissected and discussed threadbare and out of them three claims of the respondent had even been rejected. In such a situation, the Supreme Court does not expect the Court to disturb the award. For instance, in Lahore Development Authority v. Messrs Khalid Javed & Co. (1983 SCM R 718) the Supreme Court had upheld the award when the arbitrators had given fair and proper opportunity to both the parties to establish their respective cases and had adequately considered and decided every item of claim made by the respondent and no "misconduct" was established against the arbitratoRs,
11. For reasons aforementioned, I find no merit in the appeal and dismiss the same with costs.