HINDUSTAN COPPER LIMITED Vs. ASSAM BEARING AGENCIES

JUDGEMENT

(1.) THE petitioner, who is a defendant in the suit) had filed an application under Section 34 of the Arbitration Act seeking the stay of the suit on the ground that the contract between the parties provided for the disputes and differences arising out of that contract to be referred to arbitration. THE learned trial court dismissed the application by its order dated May 26, 1979 mainly on the ground that the dispute or the difference, which was sought to be referred to arbitration, has not been alleged in the application and as such the suit could not be stayed. Reliance was placed on an authority of this Court reported in M/s. Pearl Hosiery Mills, Ludhiana v. Union of India and another, A.I.R. 1979 Delhi 64. THE appeal filed by the defendant under Section 39 of the Arbitration Act challenging the said order was also dismissed. THE first appellate Court while affirming the findings also held that as the dispute had not been specified in the application, the law laid down in Pearl Hosiery Mills.' case (supra) was fully applicable and, therefore, the suit was not liable to be stayed.

(2.) MR. Ashok Grover, learned counsel for the petitioner, submitted .that. the courts below have not correctly followed the law laid down in Pearl. Hosiery Mills' case (supra). According to him, the existence of the dispute between the parties was proved from the documentary material filed by the plaintiff and, therefore, the Courts below ought to have come to the -finding that a dispute existed under the arbitration clause which required reference to arbitration. Alternatively, he urged that the said decision in Pearl Hosiery Mills' case (supra) required reconsideration as, according to him. Section 34 of the Arbitration Act does not mandatorily lay down that the dispute or the difference between the parties must be spelled out in the application seeking stay of the suit as has been held in that decision.