Mst. Ayesha Imran etc Vs Sublime Minerals, Registered Partnership Firm etc

JUDGMENT SHEET

PESHAWAR HIGH COURT

ABBOTTABAD BENCH

UuAiciat Oeportmen

FAO No. 04-A/2024.

Mst. Ayesha Imran ond others.

Appellant(s)

Versus.

Sublime Minerals, Registered Partnership Firm and others.

Respondent(s)

For Petitioner(s): Mr. Junaid Anwar Khan, Advocate.

For Respondent (Saleem Shah) Mr. Muhammad Taif Khan, Advocate.

Date of heoring: 29.01.2024,

JUDG MENT

MUHAMMAD IJAZ KIIAN. J. This is an appeal filed under section 39 of The Arbitration Act, 1940 (hereinafter referred as "The Act of 1940") read with sections 104 and 105 of The Civil Procedure Code, 1908 (hereinafter referued as "The Code") against the judgment and order dated: 14.12.2023 passed by the b learned Additional District Judge-III, Abbottabad in case No. 1116 whereby, the learned Court while allowing the application of respondents/applicants

filed under section 20 of "The Act of 1940" has directed the parties to nominate their arbitrator within 15 days.

z Facts of the case in brief are that the respondents No.1 to 3 have filed an application under section 20 of the "The Act of 1940" against the appellants before the learned Additional District Judge-III, Abbottabad. The appellants were summoned, who appeared and submitted reply to the said application and the learned Additional District Judge-III, Abbottabad after hearing arguments of learned counsel for parties accepted the said application of respondents No. 1 to 3 vide its impugned judgment dated: 14.12.2023 and has directed the parties to nominate their arbitrator within 15 days in accordance with the provisions of "The Act of 1940'. The appellants being aggrieved from the above order has approached to this Court by filing the instant appeal.

Today when this case was taken up for v

preliminary hearing, the leamed counsel namely Muhammad Taif Khan, Advocate Supreme Court on pre-filing notice, came to the rostrum and submitted his power of attorney on behalf of respondent No. 2, therefore, the arguments of learned counsel for

J

appellants as well as learned counsel for respondent/Saleem Shah were heard in considerable detail and record perused with their able assistance.

T The main attack of learned counsel for appellants as against the impugned order of learned Additional District Judge-III, Abbottabad dated 14.12.2023 was that since with respect to the same controversy the proceedings are pending before this Court as well as before the apex Court, therefore, the subsequent application/suit was not maintainable and his second objection was that since the appellants have withdrawn their power of attorney executed in favor of respondent/Saleem Shah in the year 2022, therefore, the appellants are not bound by any act of said Saleem Shah and thirdly his stance was that even the assignment has already been withdrawn in the year 2022, therefore, as per the estimate and wisdom of the learned counsel for the appellants, all these objections go deep to the roots of the application/suit ,y filed by the respondents, therefore, the learned Court below should have not been directed the parties to furnish the name of arbitrator. In response to the aforesaid submission, the learned counsel for respondents submitted that the previous proceeding through WP No. 771-P/2023 pending before this

Court has already been withdrawn by the respondents vide order dated: 24.01.2024. Similarly, the appellants too have withdrawn their CP No. 4353 of 2023 from the august Supreme Court of Pakistan vide order dated: 03.04.2023, therefore, in the earlier proceedings no authoritative findings have been recorded by none of the Court, whereas, with respect to the pending petition of the respondents before the Apex Court the learned counsel representing the respondents namely Muhammad Taif Khan, Advocate stated that they will also withdraw their that petition on the date fixed.

5.In view of the above submissions made at the bar this Court would without dilating upon the objection of learned counsel for the appellants or any other factual aspect of this case as any finding(s) in this regard may prejudice the case of either parties before the worthy arbitrator, and would therefore leave all these factual as well as legal objections to the wisdom of worthy arbitrator, who is to be appointed by the parties in due course of time. It is not out of place to mention here that when there is an arbitration clause in the arbitration agreement and when there is/are unresolved dispute(s) between the parties to such agreements then no Court has the

jurisdiction to adjudicate upon such dispute(s) except through the appointment of arbitrator and his process of arbitration proceedings as provided under the ooThe Act of 1940'. It may also be noted that under

the theme and scheme of o'The Act of 1940" the arbitrator is though not a Court but he acts as a private Judge appointed by the parties to the dispute and an arbitrator is statutorily bound to provide every opportunity of hearing to the contesting parties and to lay any objection before him or to record their statements or place any material before him and also to record evidence, if need be, and thereafter, he has to pass an appropriate award. Needless to mention here that any objection including the aforesaid objection(s) as pressed hard by the learned counsel for appellants could validly be placed before the worthy arbitrator who is statutorily bound to address the same with reasons and if during the arbitration proceedings, the arbitrator is guilty of misconduct in fact or in law, & then any party to the proceedings may object to the same by filing an objection to the Court concerned and thus a complete and comprehensive arbitration proceedings, based on judicial principles have yet to commence, carty and conclude in the instant case, therefore, at this initial stage, the objections of learned counsel

for the appellants could not be analyzed by this Court.

In the case of Gerrv's Internotional Private Limited v. Aeroflot Russian International Airline 2018 SCMR 662 the august Supreme Court delineated the general principles with regard to the powers of an Arbitrator and the Courts while considering awards issued by Arbitrators and included, inter alia, the following:-

(i)When a claim or matters in dispute were referred to an orbitrator, he was the sole and final Judge of all questions, both of law and offact;

(iii)The very incorporation of section 26-A of the Arbitration Act, 1940 requiring the arbitrator to furnish reasons for his finding was to enable the Court to examine that the reasons were not inconsistent and contradictory to the material on the record. Although mere brevity of reasons shall not be ground for interference in the award by the Court;

(xi)Where two views were possible, the Court could not interfere with the atttard by adopting its own interPretation;

-rp Similarly, in the case of 'Nutional Hishwav (t

Authoritv (NHA\ throush Chairman vs. Messrs Sardar Muhammad Ashraf D Baloch (PVT.\ LTD and other" reported as 2023 CLC 493 where it has been held that it is for the Arbitrator to interpret provisions of the Contract to determine a dispute

between the parties that they agreed to have their disputes and claims adjudicated by. Where an Arbitrator interprets a certain clause in a reasoned manner just because a Court of law might have reached a different interpretation of the provision of the Contract is not a basis for the Court to interfere with the decision of the Arbitrator.

5.. It is also relevant to mention here that the trial Court or this Court could not pre-empt the powers of an arbitrator which have been conferred upon him by the statute and if such practice is allowed to prevail, then it will amount to defeat the very spirit and object of "The Act of 1940". In the case titled Pakistsn International Bulk Terminal Ltd. thro ush Chief Officer and ers-Vs- Maobool Associates (Pvt.t Ltd. throush Managins Director others. reported as 2014 CLD 773, it is held that in terms of subsections (1) to (a) of section 20 of the Act, l94O an application is filed under sub- section (1) which is registered as a suit under subsection (2) and after show cause under subsection

(3)to the parties, the matter is referred under subsection (4) to the Arbitrator to proceed in terms of subsection (5) in accordance with "The Act of 1940" to decide the dispute between the parties and that is

compliance of the mandate of section 20 of "The Act" by the Court. Thus the Court is only a gateway to the adjudication of the dispute between the parties and not the adjudicator in its own right. It is not a regular suit under common law. Dispute resolution is not possible by a Court of Law under section 20 of "The Act". The Court is not empowered to examine and even comment on the "dispute/issues" between the parties. Lest it may prejudice the case of either party

Z In view of the findings recorded hereinabove, it is held that the impugned order of the leamed Court below is in accordance with law on the subject, therefore, the same is maintained while the instant appeal being devoid of any merits is hereby dismissed

Announced.

T ahir 1'S JUDGE