UNION OF INDIA Vs. NARESH CHAND GOYAL

JUDGEMENT

(1.) THIS is an application under Section 34 of the Arbitration Act, 1940, for stay of suit.

(2.) THE facts relevant for the purpose of this application are as follows:-- By a public auction held by the Auctioneer, the respondent No. 3, United Auctioneer, on the 21st of Feb. 1964, on behalf of Union of India 400 M.T. of scrap rails of the specification mentioned in the auction catalogue were offered for sale and the respondent No. 1 was declared to be the highest bidder and he deposited the earnest money in terms of the said sale, which included General Conditions of Sale by auction contained in the said auction catalogue. THE General Conditions of Contract as contained in the said auction catalogue inter alia contain terms of inspection of the goods at various locations by the intending purchaser and also removal of the goods by the purchaser after making full payment against which release orders will be issued by the officers of the respondent No. 3 at various places where goods were lying. THE said sale was on the basis of 'as is where is' basis. THE General Conditions of contract as contained in the auction catalogue also contained an arbitration clause in the following terms:

(3.) THE suit was filed in or about 20th of June, 1977, and after the writ of summons was served on the petitioner on or about 23rd of Sept. 1977, the notice of motion of the present application was taken out on the 7th of Dec. 1077, and ad interim stay of the suit was obtained. THEreafter, directions for filing affidavits were given on the 12th of Dec. 1977, which again was extended till 30th of Jan. 1978 and thereafter, affidavits were filed and the matter came up for hearing.