ASTROTITO COMPANIA NAVIOUR S.A. POWER OF ATTORNEY AGENT, SHAW WALLACE AND COMPANY LTD. Vs. BOOTS S.A. BY AGENTS SOUTH INDIA CORPORATION (AGENCIES) PRIVATE LTD.

JUDGEMENT

(1.) THE defendants, a Private Limited Company, have taken out this application under Section 34 of the Arbitration Act, 1940, for stay of all proceedings in the suit. The suit is to recover Rs. 1,63,282 -12 on the allegation that the said amount was payable in respect of the use of the plaintiff's vessel "s.s. Stavros," as per charter party dated 17th May, 1968 entered into between the plaintiffs and the defendants at New York, United States of America. Pending the suit, the plaintiffs applied in Application No. 1523 of 1968 for the issue of a temporary injunction restraining the defendants from removing their tanker from the Madras Harbour. Ismail, J., before whom that came up for orders, issued an interim injunction on 2nd August, 1968. The defendants took out Application No. 1564 of 1968 praying that the interim injunction may be vacated and that the bank guarantee of the First National City Bank, Madras, to the tune of Rs. 1,65,000, may be accepted. In view of the undertaking, the learned Judge vacated the interim injunction subject to the furnishing of the security. The defendants have taken out this application alleging inter alia that they had to apply to the Court for raising the interim injunction, as on account of the injunction they were put to a recurring loss of about Rs. 18,500 every day, that as per the charter party the dispute between the parties has to be referred to three persons at New York, one to be appointed by each of the parties and the third to be chosen by those two persons, that there is dispute between the parties, that the defendants are ready and willing to abide by the terms of the arbitration clause in the charter party and that, therefore, this Court has no jurisdiction to try the suit, as the matter has to be referred to arbitration.

(2.) THE plaintiffs oppose this application contending that it is not maintainable inasmuch as the defendants have taken part in the proceedings. They also contend that balance of convenience does not call for stay of the proceedings.

(3.) WHAT would amount to " taking step in the proceeding " arose for consideration in a number of cases both English and Indian. In Ives and Barker v. Williams'(1894) 2 Ch. 478 . Lindley, L.J., observed: