UNION OF INDIA Vs. LAKSHMI ICE FACTORY

JUDGEMENT

(1.) THIS is an appeal against the order of Ali J. dated 1st June 1962 whereby he refused under S. 34 of the Arbitration Act, to stay the suit for injunction restraining the defendant, the Union of India, from recovering Rs 35210.21 from the plaintiff and for a decree of Rs.10,000 in favour of the plaintiff against the Union of India.

(2.) THE facts giving rise to this appeal are as follows: -The plaintiff firm entered into a contract dated 25.2.1958 with the Union of India for supply of ice machine -made at Jammu for the period 1 -4 -58 to 30 -9 -58. The plaintiff had to supply 5,00 000 Ibs of ice ex -factory at the rate of Rs.1.72 per 100 Ibs and 20,00,000 Ibs. at FSD at the rate of Rs.1.93 per 100 Ibs. The plaintiff did not make the requisite supply whereupon the Union of India, the other contracting party, made risk purchases at the cost of the plaintiff. When differences arose between the parties to the contract, the plaintiff filed an application, under S. 20 of the Arbitration Act on 13 -3 -59 which was heard by the Add. District Judge Jammu, requesting for a reference to arbitration of the dispute between the parties. This application was opposed by the Union of India, but ultimately the Additional District Judge, his order dated 2 -5 -60, ordered that the matter be referred to arbitration. The matter stood there. The parties entered into a new agreement of arbitration on 29 -7 -60 and that agreement of arbitration referred the matters in dispute between the parties to the arbitration of GOC XV Corps, Major General P. C. Gupta who called upon the parties to file their statement of cases. The arbitrator entered on this reference on 4 -10 -60 and gave his award on 16 -12 -60, directing the plaintiff to pay Rs.26954 39 to the Union of India. This award came up for consideration before this court but this court by its order dated 8 -1 -62 sets aside the award. On 9th January 1962 the plaintiff brought the present suit for injunction and recovery of Rs. 10,000 as already stated.

(3.) IN this suit an application under S. 34 of the Arbitration Act was made by the Union of India on 14 -4 -62 which was heard by Ali J. After hearing the arguments of the parties the learned Judge rejected this application of the Union of India for stay of the suit in terms of S. 34 of the Act. Against this order the present appeal has been filed.