MUKESHCHANDRA Vs. NAUSHAD AHMED

JUDGEMENT

(1.) THIS is a revision by the defendant against the order by which his prayer under Section 8 (1) of the Arbitration and Conciliation Act, 1996 (hereinafter to be referred to as 'the Act') has been rejected.

(2.) THE plaintiff has filed a civil suit for recovery of Rs. 90,000/- (Rupees Ninety thousand) and interest. The defendant filed his written statement on 17-1-2000 and raised an objection that the dispute is covered by the arbitration agreement between the parties and, therefore, the Court should refer the parties to arbitration. By the impugned order the Trial Court has refused to do so on the ground that this objection was not raised earlier and, therefore, the defendant has agreed to submit to the jurisdiction of the Court for the decision of this dispute. The Trial Court has relied upon the decision of this Court in Laxminarayan v. Food Corporation of India (1992 JLJ 415 ).

(3.) THE point for determination in this revision is whether the view taken by the Trial Court is correct. After hearing the learned Counsel for both the sides, the Court is of opinion that the impugned order is legally incorrect. Section 8 (1) of the Act provides :-" a judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration,"