R KAMALAM Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) THE plaintiff in 0. S. No. 112 of 1970 on the file of the Sub-Court, Padmanabhapurarn, is the appellant. THE plaintiff undertook the construction' work of Kurunthacode Panchayat Union office building for an estimated cost of Rs. 43,000/- and odd on 15-1-1965. Since the Divisional Engineer, Highways, Nagercoil, the second defendant, was not satisfied with the progress of the work, the contract was cancelled by him and the plaintiff was asked not to proceed with the work. On such cancellation certain articles, which the plaintiff had stored at the work spot, were alleged to have been removed by the d6partment on 3-9-1967. Subsequently, on the basis of certain revised estimate A, which seem to have been accepted by the department, the plaintiff again continued the construction work and the department also extended the time limit for completion of the work by the plaintiff THEreafter, on 21-4-IM9, the 2nd defendant finally terminated the contract awarded to the plaintiff on the ground that the plaintiff had not completed the work even within the time extended. THE plaintiff has therefore filed the present suit substantially for two relief 3 (1) for payment of the value of the work done up to the date of termination of the contract on a quantum merit basis and (2) for value of the articles said to have been unauthorized removed by the department an 3-91967.

(2.) THE said suit was resisted by the defendants, the State of Tamil Nadu and the Divisional Engineer, Highways, Nagercoil who were imp leaded as defendants I and 2 respectively. THEir defense to the suit was that the cancellation of the contract under Ex. B. 165. On 21-41969 was justified, as the plaintiff has no! Chosen to complete the work within the. Extended period. THEy did not admit the number or the value of the articles removed but state that the articles were removed after giving an-inventory to the plaintiff. Apart from this defence the defendants also took up two preliminary objections, one is that the agreement entered into by the plaintiff attracts cl. 73 of M. D. S. S. which is marked as Ex. B. 82 and therefore, the dispute between the parties has to be settled only by arbitration and not by a suit. THE second preliminary objection is that suit has not been by a notice under Section 80 of Civil P. C. and therefore, the suit has to be dismissing in limine for want of that notice.

(3.) IT is well established that Sec. 34 of the Arbitration Act gives discretion to the Court either to stay the suit or not, in cases where there is a binding arbitration agreement between the parties. That pre-supposes that in a case where the Court does not exercise the discretion to stay, of the suit, the suit before the civil court can proceed. Apart from this, there is no provision in the Arbitration Act which excludes the jurisdiction of the Civil Court either expressly or necessary implication. As a matter of fact, dealing with a similar situation, the Supreme Court had observed in State of U. P. v. Janki Saran thus: