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Petitioner: POINEER BUILDERS through Managing Partner VS Respondent: ADDITIONAL DEPUTY COMMISSIONER (G)Honorable Justice Mian Saqib NisarRiaz Karim Qureshi,Ms. Seema Munawar
P L D 2007 Lahore 280
P L D 2007 Lahore 280
Before Mian Saqib Nisar, J
POINEER BUILDERS through Managing Partner---Petitioner
Versus
ADDITIONAL DEPUTY COMMISSIONER (G) and 2 others---Respondents
Civil Revision No.1361 of 2005, decided on 29th September, 2006.
Arbitration Act (X of 1940)---
----S. 20---Arbitration clause in contract---Rescission of contract---Application under S.20 of Arbitration Act, 1940, before Civil Court---Scope---Non-availing of departmental remedy---Petitioner's construction contract was rescinded by Authority---Petitioner, in terms of arbitration clause in contract moved an application under S.20 of Arbitration Act, 1940 before Civil Court for filing of arbitration agreement and for reference of dispute between the parties in terms thereof---Civil Court rejected petitioner's application on ground that he had failed to avail remedy of first approaching authority's official as envisaged by arbitration clause in contract, before invoking provisions of S.20 of Arbitration Act, 1940---Appeal filed thereagainst was also dismissed by Appellate Court---Petitioner contended that rescission order had been passed by the Official and, therefore, to re-approach him was a futile exercise---Validity---Government official had expressed his mind and view about work and conduct of petitioner, therefore, to re-approach him for simply fulfilling condition of availing departmental remedy was to be a superfluous and illusionary exercise and against object of stipulation---Petitioner could validly maintain application under S.20 of Arbitration Act, 1940 and he was not to be non-suited on account of reason given by both the Courts below---Petition was allowed.
Waqqas Limited v. Province of Punjab NLR 1988 Civil 181 distinguished.
Riaz Karim Qureshi for Petitioners.
Ms. Seema Munawar, A.A.-G. for Respondents.
Date of hearing: 29th September, 2006.
JUDGMENT
MIAN SAQIB NISAR, J.---The parties entered into a Construction Contract, which contained an arbitration clause No.25-A. The Additional Deputy Commissioner (General) Gujrat, vide order dated 26-1-1988 conveyed to the petitioner as follows:
"On 24-1-1988, the Deputy Commissioner Gujrat inspected your site 2nd time during the fortnight and found the work abandoned which reflects severe negligence on your part, because of this state of affair, the Deputy Commissioner, Gujrat directed for rescession of the work in the public interest."
On account of the above, the contract of the petitioner was rescinded. In terms of clause 25-A of the Contract, the petitioner moved an application under section 20 of the Arbitration Act for the filing of the arbitration agreement and for the reference of the dispute between the parties in terms thereof. The learned Civil Judge vide order dated 12-2-2001 has rejected the application for the reasons that the petitioner has failed to avail the remedy of first approaching the Deputy Commissioner as contemplated by the said clause, before invoking the provisions of section 20 of the Arbitration Act. The petitioner unsuccessfully challenged the above order through an appeal, which was dismissed on 5-3-2005.
2. Learned counsel for the petitioner contends that the order of rescission in fact has been passed by the Deputy Commissioner and, therefore, to re-approach him was a futile exercise and thus, in the peculiar facts and circumstances of the case, the petitioner could not have been compelled to seek the departmental remedy. When asked, the learned counsel has not been able to cite any law in this behalf. However, the learned A.A.-G. by relying upon Waqqas Limited v. Province of Punjab NLR 1988 Civil 181 states that the petition under section 20 of the Arbitration Act was incompetent without first exhausting the remedy contemplated by the agreement.
3. I have heard the learned counsel for the parties. It is settled law that no one can be a judge in his own cause. It is clear from the letter dated 26-1-1988 that the rescission of the contract had been made upon the direction of the Deputy Commissioner, who took the conscious decision in this behalf after the site inspection. This order of the Deputy Commissioner was only implemented and conveyed by the Additional Deputy Commissioner through the letter dated 26-1-1988.
4. In the instant case, for all intents and purposes, the Deputy Commissioner had expressed his mind and the view, about the work and conduct of the petitioner and therefore, to re-approach him for simply fulfilling the condition of meeting the condition of availing the departmental remedy, would be a superfluous and illusionary exercise and also against the very object of the stipulation. It may be pertinent to mention here that the clause in the arbitration agreement, enabling the contractor to avail the departmental remedy, has a vivid, specific and rational object, that instead of rushing to the courts or before the arbitrators, the matter, at the first instance, must be attempted to be resolved at the departmental level, and the intention of the such stipulation is that the grievance of the contractor is attended to and adjudged by an independent representative of the department by adhering to the basic rules of justice and fairness. Obviously, for achieving the above object, the parties never agreed or chose to re-approach the same person who has taken the action, because the departmental remedy is not in the nature of review but is a kind of the re-consideration by some independent representative of the department; undoubtedly it cannot be before the same person who has taken the action, entitling him to act as a Judge in his own cause, who may have a biased and prejudiced mind. As in the instant case, the Deputy Commissioner had already expressed his mind by directing the rescission of the contract, therefore, in such circumstances, it was not incumbent upon the petitioner to have availed the stipulated remedy in the agreement. The petitioner thus, could validly maintain the application under section 20 of the Arbitration Act and could not have been non-suited on account of the reasons given by the two courts below. The judgment quoted by the Court before and cited by the learned A.A.-G. is distinguishable on its own facts.
In the light of above, this revision petition is allowed and the matter is remanded to the learned trial Court with the direction to try and dispose of the same in accordance with law.
S.M.B./P-28/L Case remanded.