NAVJIVAN CONSTRUCTION CO Vs. KANTILAL GANDALAL SANGHVI

JUDGEMENT

(1.) THIS is an appeal by the original plaintiff-firm of the civil suit no. 772 of 1967 of the City Civil Court at Ahmedabad being aggrieved by the order passed by the learned Judge staying the said suit as per sec. 34 of the Indian Arbitration Act. The plaintiffs suit is for money due under the contract of construction. The first thing that the defendants did on being served with the summons was filing of an application ex. 9 under sec. 34 of the Indian Arbitration Act praying for the stay of the suit on the ground that there was a clause in the agreement between the parties to refer the differences or disputes to arbitration The defendants by that application insisted on the suit to be stayed till an award was obtained through arbitration. Had the matter rested there the situation would not have been as complicated as it has turned out to be. During the pendency of the said application ex. 9 and before it could be dealt with by the Court after hearing the original plaintiff the defendants came to be advised to seek the decision of the Court regarding the suit being premature because of the arbitration clause between the parties and consequently liable to be dismissed in limine. The said prayer was sought by filing an application ex. 33 before the Court and the prayer in that application when translated reads as follows:

(2.) MR. S. B. Vakil the learned advocate appearing for the plaintiff appellant did not raise the two first questions that were raised before the trial Court but he urged that by Sling the application ex. 33 the defendants had sought an adjudication of the Court in respect of the very suit. The prayer that has been quoted by me above from Ex. 33 itself makes it clear that the defendants wanted the Court to dismiss the suit on the ground that it was premature. This is a clear indication of what was passing in the minds of the defendants. They invited the Court to decide the case on one of the points arising in the case. It amounts to the defen- dants invoking the Courts jurisdiction to dismiss the suit on the ground of its being premature. In other words the defendants wanted to have a chance. If they could get rid of the present suit on a preliminary question raised by them on that application ex. 33 they would very much have it through the Court and get rid of the present suit and if they could not succeed they kept in reserve their original contention of the matter being required to be adjudicated through arbitration. This ingenious design is written very much large on ex. 33. What impressed the learned trial Judge the most was the harping by the defendants on their original application ex. 9 and their insistance on having the dispute originally settled through arbitration. However when a defendant seeks the aid of the Court in getting rid of the suit he clearly invokes the Courts jurisdiction to deal with the matter. The question and the moot question is: Can a party that surrenders to the jurisdiction of the Court even on a preliminary question going to the root of the matter be said to have taken part in the proceedings ? The answer one way or the other would dispose of the only contention advanced before me.

(3.) IN this connection Mrs. Ravirkar appearing for Mr. V. J. Desai however urged that whatever unpleasant situation that had come to be created by ex. 33 had disappeared the moment the defendants filed a purshis not insisting on their application ex. 33. Such unilateral action on the part of the defendants would not change the situation. The law is settled that even if an application for filing written statement is filed in the Court it is treated as a step in the aid of the proceedings. The application ex. 33 was on the record from 27-1-69 to 10-10-69 pro- claiming the defendants design to have adjudication at the hands of the Court in derogation of their desire to have the matter settled through arbitration and to have the suit stayed till the award came up. It was a belated wisdom that dawned on the defendants perhaps because they might have realised the ultimate untenability of their contention about the suit being dismissed on the ground of its being premature.