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IN THE HIGH COURT OF
SINDH AT KARACHI
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J.M. 30 OF 2015
Sui Southern Gas Company Limited …………... APPLIC=
ANT
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Versus
Jamshoro Power Company Limited ………… RESPONDENT<= o:p>
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.-.-.-.-.-.-.
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None present for the Applicant
M/s. Rizwan Faiz Muhammad and Iftikhar Ahmed
Bashir, Advocates for the Respondents
ZULFIQAR AHMAD KHAN, J.:- Through CMA No. 8121/=
2015,
an application under Section 34 read with Section 41 of the Arbitration Act,
1940 is made where the Applicant (Sui Southern Gas Company Limited) sought
orders from this Court to restrain the Respondent (Jamshoro Power Company
Limited) from acting further on the impugned notice dated 15.05.2015 till
disposal of this case.
On
22.05.2015, when the Applicant was heard ex-parte, Court while issuing noti=
ce
to the Respondent, was pleased to pass the order restraining the Respondent=
not
“to act upon the impugned notice till further orders”. Having obtained these
exparte ad-interim orders, the matter was fixed on five occasions at least,=
where
the Counsel for the Applicant stayed away and a brief was held on his behal=
f.
Since the ad-interim orders was in the field, when this case was called on
24.10.2016, to satisfy this Court, the Counsel appearing for the Respondent
filed a letter dated 21.10.2016 which stated that the Respondent are willin=
g to
withdraw the impugned notice dated 15.05.2015. As the Counsel for the Appli=
cant
was not in attendance, the letter was taken on record and the matter was
adjourned, however, with a note of taking notice of the absence of the Coun=
sel
for the Applicant, that in case the Counsel for the Applicant is not in
attendance appropriate orders would be passed by this Court on the next dat=
e.
The matter came up on 08.11.2016 when no one effected presence on behalf of=
the
Applicant but the Counsel for the Respondent was present and drew attention=
of
the Court to Annexure P/3 and submitted that the Respondent has already
withdrawn the impugned notice, diminishing the cause of action. However, si=
nce
ad-interim orders were operating and the Respondent was restrained to act a=
ny
further in the matter, and once again the Counsel for the Applicant was not=
in
attendance, office was directed to issue intimation notice to the Counsel f=
or
the Applicant for 29.11.2016 with a note of alert that in case the counsel =
for
the Applicant fails to appear and/or avoided to proceed with the instant CM=
A,
then the Court will dismiss the said application on account of non-prosecut=
ion
without offering any further opportunity to the learned Counsel for the
Applicant.
Matter came up on
29.11.2016, once again a brief was held for the Counsel for the Applicant a=
nd
the case was adjourned to 05.12.2016 without any adverse order. The matter =
came
up again on 20.02.2017, when once again a brief was held for the Counsel for
the Applicant. In the two paged order passed on that date, this Court while
observing that since the matter is of national interest, thus cannot be del=
ayed
on account of continuous absence of the Counsel for the Applicant and the J=
unior
holding brief for the Counsel for the Applicant was advised to transmit the=
se concern
to the Counsel for the Applicant.
Sensing the gravity,
the matter was adjourned to 27.02.2017 at 11.00 a.m. with cautioned that in
case the Counsel for the Applicant is not present or some suitable arrangem=
ents
are not made, the Court will proceed as mandated by the Order dated 08.11.2=
016
(meaning thereby dismiss the instant application on account of non-prosecut=
ion)
and as a last opportunity, the interim orders were extended. The matter cou=
ld
not proceeded on account of paucity of time on 27.02.2017 and it was adjour=
ned
to 16.03.2017, wherein, for the reasons to be recorded, primarily hinging on
the fact that the Respondent has withdrawn the impugned notice, bringing
controversy to an end, the interim order passed on 22.05.2015 were vacated.=
In the following I =
give
detailed reasons:
The case at hand in=
cepted
when an agreement dated 10.04.1995 for the supply of natural gas to Jamshoro
Power Station was entered into between Applicant Sui Southern Gas Company
Limited and Water and Power Development Authority (WAPDA). The said agreeme=
nt
is reproduced between pages 15 to 37 of the Court file. When WAPDA was
unbundled in 1998, the Respondent Jamshoro Power Company Limited on 03.08.1=
998
took over all properties, rights, assets, obligations and liabilities of
Jamshoro and Kotri Power Stations, previously owned and operated by WAPDA. =
Thus,
for all practical purposes, came in to the shoes of WAPDA in the agreement
referred above.
Pursuant to Article=
-XII
of the said Agreement, parties were to resort to arbitration in cases of di=
sputes
arosen between them. The modus operandi for settlement of disputes through
arbitration was also set out in the said Article-XII which provided that in
case of a dispute, within 30 days of demand from either party the dispute w=
as
to be referred to Arbitrators; one to be appointed by each party to the dis=
pute
and the two Arbitrators so appointed were to promptly appoint an Umpire.
It seems that dispu=
te arose
between the parties, which is evident from the examination of the legal not=
ice,
(a copy of which has been provided by the Counsel for the Respondent) that =
was
sent to the Applicant on 08.03.2014. Without getting into the crux of the
dispute, it is sufficient to observe that as mandated by Article-XII, the
Respondent was to appoint an arbitrator. Through their Memo dated 28.04.201=
5 the
Respondent appointed Mr. Justice (Retd.) G. H. Malik as Arbitrator from the=
ir
side and in continuation of the said memo, a letter was finally sent on
15.05.2015 to the Applicant which was duly received by them on 16.05.2015 w=
here,
placing reliance on the legal notice and reiterating contention that in res=
pect
of the dispute at hand, the Respondent reaffirmed appointment of Mr. Justice
(Retd.) G. H. Malik as the Arbitrator from its side. It is worth mentioning
that it is the said letter of 15.05.2015 which (for whatever unknown reason=
) is
termed as “Notice” by the Applicant and impugned in these proceedings. Inst=
ead
of responding to the said letter and nominating an Arbitrator of Applicant’=
s
choice, the Applicant preferred to file the instant J.M. and CMA where orde=
rs
were sought from the Court to declare the said “Notice dated 15.05.2015 as
illegal and violative of the Article-XII of the agreement”. Whereupon, as
referred hereinabove, exparte ad-interim orders were passed.
Stalling operation =
of
the said (impugned) letter, while observing that through the impugned lette=
r,
no further operation was sought by the Respondent as the letter merely aime=
d to
inform the Applicant that acting under Article XII of the Agreement, the
Respondent has appointed Mr. Justice (Retd.) G. H. Malik as its Arbitrator,=
and
in strict compliance thereof, all that Applicant was required to do was to
appoint its own counterpart Arbitrator so that the matter could proceed for
arbitration to settle the dispute between the parties eventually by the Ump=
ire
in accordance with Article-XII. Failing to do so, as mentioned hereinabove,=
the
Applicant chose to challenge the operation of the letter as if it posed a g=
reat
imminent threat to the entire process which it obviously had no intention. =
Since
the matter pertain to supply of electricity to the National Grid to an ener=
gy- starved
nation, in all good faith the Applicant should have appointed its counterpa=
rt
Arbitrator and would have sent the dispute for Arbitration. Obviously to me=
for
no other intention except to delay the adjudication of dispute, the instant
J.M. and CMA were filed and exparte orders were obtained on 22.05.2015 whic=
h continued
to operate till today for no justifiable reason except on account of the ab=
sence
of the counsel for the Applicant to proceed with the matter.
To me, to show its
bonafide and to diminish the cause of action (which the Respondent did not =
have
to do in my humble pinion) it withdrew the impugned letter of appointment o=
f Mr. Justice (Retd.) G. H. Mali=
k as
sole Arbitrator through its letter dated 21.10.2016 bringing the cause of
action to an end.
From
the afore-mentioned fact it is very clear in my mind that ab-initio there w=
as
no illegality caused by the (impugned) letter which was written strictly in
accordance with Article-XII of the agreement wherein it was provided that in
case of dispute parties were to appoint their respective Arbitrators within=
30
days. The Applicant has not only mutilated the agreement entered into betwe=
en
the parties but has rather been successful in hoodwinking its way for the
withdrawal of name of Mr. Justice (Retd.) G. H. Malik as an Arbitrator whic=
h is
quite unfortunate as once the name of such prominent legal luminary and Ret=
ired
Judge was proposed, the Applicant would have shown some respect. The Applic=
ant
rather acted inversely by failing to appoint their counterpart Arbitrator a=
nd
now the name of Mr. Justice (Retd.) G. H. Malik having been removed by the =
Respondent
does not leave any good taste.
The
aforesaid are the reasons on account of which I was judicially compelled to
vacate the earlier granted ad-interim relief.
I further like to a=
dd that
since the matter is of national importance, both the parties to appoint the=
ir
respective Arbitrators within next 15 days and to proceed with the arbitrat=
ion
as swiftly as possible as agreed between them in terms of Article-XII of the
Agreement.
Amjad/PS
6