AMRITRAJ KOTHARI Vs. GOLECHA FINANCIERS

JUDGEMENT

(1.) THIS is an application for stay of a suit under Section 34 of the Indian Arbitration Act. It is not disputed that the disputes in suit are covered by the arbitration clause in the contract subsisting between the parties. In fact such disputes have already been referred to arbitration in terms of the arbitration clause. The contention of the respondent is that the petitioner has taken step in the suit and in consequence the suit is not liable to be stayed. The facts relevant to the determination of the question may now be shortly stated. The suit was instituted on December 23, 1964. On the same date the plaintiff took out a notice of motion and obtained an interim injunction. The notice was returnable on January 4, 1965. What happened on January 1, 1965 when the motion was called will appear from paragraph 4 of the affidavit of Sunil Kumar Mitra which reads as follows:

(2.) TWO days prior on the 2nd January, 1965 the Solicitor of the petitioner wrote a letter stating that he has received instructions from the petitioner to enter appearance and defend the suit on his behalf and asked for a copy of the petition and also a copy of the plaint. Correct copy of the plaint was sent on the 7th day of January. It may be noted that a day before an incomplete copy of the plaint was sent but very properly it was returned back. On 9th of January, 1965 the defendant entered appearance and intimated this fact to the plaintiffs Solicitor.

(3.) THE question for consideration is whether the acts noted above amount to taking step in the suit so as to debar the defendant from obtain ing a stay of the suit under Section 34 of the Indian Arbitration Act. Taking the second ground first. In my view entering appearance and intimating the plaintiff's Solicitor that he has received instruction to contest the suit does not amount to taking step in the proceeding and the defendant is not debarred from making this application for stay either because of having entered appearance or because of his solicitor intimating to the plain tiff's Solicitor that he has received instruction to enter appearance and to defend the suit.