' This judgment shall dispose of F.A.O. No,22 of 1993 and F.A.O. No,36 of 1993 as they proceed against the same judgment, dated 16-4-1992 of a learned Civil Judge, Sahiwal.
2. On 12-12-1987 Crescent Factories through its Managing Director (hereinafter to be referred to as appellant No,2) filed 4 suit against the Multan Chemicals Ltd (hereinafter to be referred to as respondent No,1) through its Managing Director namely Mehmood Nawaz Khan Babar and its Sales Manager namely Noor Ahmad. The suit was for recovery of Rs,1,06,574.10. Written statement was filed by the respondent No,1 and its said Officer. On 11-5-1988 respondent No,1 filed a suit for recovery of Rs,10,16,988.83 against the appellants in. F.A.O. No,22 of 1993 and the Federal Government respondent No,2. Both the suits have arisen out of an agreement, dated 4-6-1987 for the sale of Oxygen Gas subject to terms and conditions stated therein. The appellant No,2 on the one hand and the respondent No,1 on the other, accused each other of breach of the agreement and claimed damages in the amount stated above. Both the suits were consolidated by a learned Civil Judge vide an order, dated 6-2-1991 and following consolidated issues were framed on 17-2- 1991.
Issues:
(1) Whether the plaintiff/factory is a legal person and is competent to file the suit? OPD
(2) Whether the plaint has not been signed by the authorised persons? OPD
(3) Whether the suit is not maintainable against the defendants Nos.2 and 3? OPD
(4) Whether the amount of Rs,1,56,574.10 as described in para.5 of the plaint is recoverable from the defendants? OPP.
(5) Whether the plaintiff is entitled to deduct the security of Rs,50,000,00 from the amount recoverable, if any, from the defendants? OPP.
(6) Whether the plaintiff is entitled to the decree for recovery of money from the defendants? If so, on what extent and what amount? OPP.
(7) Whether the consolidated suit is not maintainable in its present form? OPD.
(8) Whether the consolidated suit is bad or non-joinder and misjoinder of the necessary parties?
OPD.
(9) Whether the Civil Court has got no jurisdiction to try this consolidated suit? OPD.
(10) Whether the plaintiff of the consolidated suit is estopped by his words and conduct from filing this suit? OPD.
(11) Whether this Court has got no territorial jurisdiction to try this consolidated suit? OPD.
(12) Whether the consolidated suit has not been properly valued for the purposes of court-fee and jurisdiction? OPD.
(13) Whether the consolidated suit is mala fide and vexatious? If so, whether the defendants are entitled to get special costs? OPD.
(14) Whether the notice, dated 12-11-1987 by the defendants of the consolidated suit is illegal void, against facts, collusive without authority and is liable to be cancelled and ineffective as against the rights of the plaintiff? OPP.
(15) Whether the plaintiff of the consolidated suit has not committed any breach of promise and the defendant No,1 is not competent to rescind the contract, dated 4-6-1987 unilaterally? OPP.
(16) Relief.
' While the suit was being adjourned for recording of evidence of the parties, Mian Iqbal Ahmad Khan, Advocate, learned counsel for the appellants and Chaudhry Imdad Ali, Advocate learned counsel for the respondent No,1 reported to the Court that the matter be referred to arbitration. The appellant named Mr. Pervez Ahmad Anwar, Production Manager, United Industry Ltd. Faisalabad, while the respondent No,1 stated Chaudhry Muhammad Aslam, Director United Engineers, Lahore were their respective arbitrators. The learned Court appointed Chaudhry Muhammad Anwar Warraich as the third arbitrator with the agreement of the parties. Following terms of reference were agreed to:---
(1) Both the suits be referred to the arbitrators for resolution and award.
(2) The arbitrators shall give a decision after hearing the parties.
(3) The arbitrators shall have, full authority to decide all questions of law and fact raised before them by the parties.
(4) Ch. Muhammad Anwar Warraich was named as Chairman of the panel of the arbitrators and was responsible for the conduct of the arbitration proceedings; and
(5) In case of divergence of opinion, the decision will be by majority.
' The above terms of reference were duly recorded in writing by the learned Court and were signed by the learned counsel for the parties. The agreement and reference are available at pages 50, 51 and 52 of the learned trial Court file. By an order of the above date i,e,, 3-4-1991 the learned trial Court in accordance with the said agreement and reference referred the matter to the arbitrators directing them to file the award on or before 27-4-1991. The proceedings commenced. The learned Court adjourned the matter on various, dates from 27-4-1991 to 9-9-1991 when Chairman of the panel of arbitration appeared before the learned Court and explained that proceedings are in progress and evidence has been recorded and that the arbitrators are pondering over the matter.
A request was made for extension of time. The learned Court adjourned the matter to 29-9-1991 for filing of the arbitration award. On 29-9-1991 the award was filed in Court by Ch. M. Anwar Warraich, appellant No,2 filed objections. On 19-10-1991 a reply was filed. The following issues were framed on 11-12-1991:--- ' Issues:---
(1) Whether M/s. Crescent Factories, Chichawatni is a legal person. If not, what is its effect? OPO.
(2) Whether the objections to the impugned award, dated 27-9-1991 have been filed by a duly authorised person on behalf of M/s. Crescent Factories, Chichawatni and Ghee Corporation of Pakistan? OPO.
(3) Whether the objections are estopped by their acts, conduct, admissions and representation from filing objections, against the impugned award? OPR.
(4) Whether the objections raised by objectors are covered by section 30 of Arbitration Act, 1940?
OPO.
(5) Whether the Chairman, Arbitration Council has misconducted the proceedings? OPO.
(6) Whether the award is the result of misconduct and violation of law on the subject? OPO.
(7) Whether the impugned award, dated 27-9-1991 is liable to be set aside or remitted back on the grounds given in the objection petition of the objectors? OPO.
(8) Relief.
' Evidence of the parties was recorded. On 15-3-1992 Chaudhry Imdad Ali Khan, Advocate, counsel for the respondent No,1 got recorded his statement requesting that the Federal Government be deleted from the array of defendants in the suit filed by respondent No, 1.
3. The objections were rejected and the award was made Rule of Court. A decree in terms of the award was made whereby the suit filed by appellant No,2 was dismissed while the suit filed by the respondent No,1 was decreed in the sum of Rs,5,96,988.83 vide an order, dated 16-4-1992. F.A.O.
No,22 of 1993 has been filed by the appellants while F.A.O. No,36 of 1993 has been filed by the appellant No,2. F.A.O. No,22 of 1993 was filed in this Court previously as R.F.A. No,64 of 1992 but later on was allowed to be converted into F.A.O. While F.A.O. No,36 of 1993 was filed in the Court of the learned District Judge, Sahiwal. On 24-5-1993 on the prayer of learned counsel for the appellants F.A.O. No,36 of 1993 was withdrawn from the Court of learned District Judge, Sahiwal and ordered to be heard alongwith F.A.O. No,22 of 1993. P.C. Notices were issued to another counsel for appellant No,2 who practises at Sahiwal. The F.A.Os. Have been heard in the presence of learned counsel for the parties as noted above.
4. Chaudhry Muhammad Hussain Jehania, Advocate, argues that finding recorded by the arbitrators as also the learned triar Court on Issues Nos.1 and 2 are incorrect; that arbitrators have decided question of law unauthorizedly; that the award was filed beyond time and; that appellant No,2 has been non-suited on a technicality in its suit. Chaudhry Imdad Ali, Advocate, on the other hand, argues that the appellant No,2 has not only been non-suited as a result of findings on Issue No,1 but also on merits as well; that arbitrators were fully authorized to decide the question of law; and that no misconduct on the part of arbitrators has either been alleged or proved.
5. I have gone through the records of the learned trial Court. I have already reproduced the terms of reference above and in view of the clear agreement between the parties that the arbitrators shall have full authority to decide all the questions of law and facts raised before them by the parties, the objection of the learned counsel for the appellants that question of law could not have been decided by the arbitrators is simply frivolous and is rejected.
6. So far as the decision on Issue No,1 is concerned, this issue was also referred to the arbitrators and they decided the same in their award, dated 27-9-1991. They held that the suit filed by the appellant No,2 was not competent as the appellant No,2 is neither a natural nor a legal person. To my mind, until and unless, it was to be pointed out that the award of the arbitrators suffers from an error apparent on the face of record or that the arbitrators were guilty of misconduct while deciding the said question, the said issue could not have been opened and redecided by the learned Trial Court. Be that as it may, the learned trial Court opted to redecide the issue and its decision is in conformity with the decision of the arbitrators on the said issue. I find that the decision of the abritrators and also of the learned trial Court on the said issue is in accordance with law. Crescent Factories by itself is just an establishment, the management whereof has been taken over by the Federal Government under section 5 of the Hydrogenated Vegetable Oil Industry (Control and Development) Act, 1973. The suit was filed through the Managing Director who in a manner of speaking is a creature of the said statute as he is appointed by the Federal Government or under its authority under section 6 of the said Act and when he is so appointed the administration and management of the affairs of the establishment vests in him and he exercises such powers and functions subject to orders and directions of the Federal Government or the Board of Management. The learned counsel has not been able to controvert the observation of the arbitrators in the award and the learned trial Court in the impugned order that the Managing Director was not authorized to file the suit. This being so, the issues Nos.1 and 2 have been correctly answered.
7. So far as the question of non-filing of the award within time specified by the Court is concerned, the said objection also is not material one. I have already referred to the proceedings of the Court between the date of reference and the date when the award was filed, above. The learned trial Court had by implication been extending the time and on the last occasion it was extended at the express request of the Chairman of the panel of arbitrators which was found to be genuine by the learned trial Court while granting the extension. The decision of the arbitrators on merits of the claim has neither been nor could be challenged by the appellants. Even otherwise law on the subject is clear that it is only within the four corners of section 30 of the Arbitration Act, 1940 that an award could be set aside and I find that none of the said grounds exist in the present case.
Needless to state the settled legal position that the Court while examining the award does not act as a Court of Appeal and cannot undertake reappraisal of evidence recorded by the arbitrators in an attempt to discover the error or infirmity in the award. Case of "M/s. Joint Venture KG/Rist through D.P. Giesler G.M., Bongard Strasse 3,4000, Dusseldorf-30 Federal Republic of Germany, C/o.
15-Shah Charagh Chambers, Lahore and 2 others v. Federation of Pakistan, through Secretary Food, Agricultural and Coop. And another" (PLD 1996 Supreme Court 108) relied upon by learned counsel for the respondent No,1 supports the said observation.
' In view of the above discussion, both the F.A.Os. Are dismissed with costs.