GANESHILAL RAGUNATH SINGH Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is the plaintiffs' first appeal against the judgment and decree of the District Judge, Bikaner dated the 26th of April, 1952 whereby the suit has been dismissed.

(2.) THE facts giving rise to this appeal are that in the Raj Patra (Gazette) dated 31st January, 1948, of the former State of Bikaner, a notice was published on behalf of the Secretary Stores Purchase Committee that the contract for the right of collecting coal-ashes dropped by engines of the Bikaner State Railways would be auctioned publicly on the 3rd February, 1948. This contract was to be given from the 1st of Feb., 1948, to 31st March, 1949 i.e., for a period of 14 months. THE contract was accordingly auctioned on the 3rd February, 1948. THE plaintiffs' firm, which works in the name and style of M/s. Ganeshilal Ragunath Singh, was one of the bidders at the said auction. THE auction was knowed down in the plaintiff's favour for a sum of Rs. 1,27,800/-. A formal agreement about the said contract was executed by both the parties on the 11th of June, 1948 and it was signed by Ganeshilal and Ragunath Singh plaintiffs on the one hand and the General Manager State Railway on the other.

(3.) LEARNED counsel for the appellants has next referred to the case of Gaya Electric Supply Co. vs. State of Bikaner(2) (A.I.R. 1953 S.C., 182.) in which it was observed by their lordships of the Supreme Court that : "If the arbitration agreement is broad and comprehensive and embraces any dispute between the parties "in respect of" the agreement, or in respect of any provision in the agreement, or in respect of anything arising out of it, and if the parties seeks to avoid the contract the dispute is referable to arbitration if the avoidance of the contract arises out of the terms of the contract itself. Where, however, the party seeks to avoid the contract for reasons de hors it the arbitration clause cannot be restored to as it goes along with other terms of the contract." This observation of their lordships also is of no avail to the appellants because as discussed above the present dispute between the parties arises out of the agreement itself. The appellants do not seek to avoid the contract for reasons which may be de hors it and, therefore, the first objection raised by the appellants cannot succeed.