ROOP KISHORE Vs. UNITED PROVINCES GOVERNMENT

JUDGEMENT

(1.) This is an appeal against an order, dated 15 December 1942, of the Civil Judge of Moradabad by which he stayed proceedings in a suit pending before him under Section 34, Arbitration Act (10 of 1940). The plaintiff who is a contractor carrying on business at Moradabad made some contracts with the U.P. Government on the basis of which he raised an action in the Court of the Civil Judge of Moradabad for recovery of a sum of Rs. 8500 as money due to him for work done and for arrears of security and as damages. This claim was made in Court on 25 July 1942. Previous to the institution of the suit a notice under Section 80 had been served upon the Government. The plaint was filed on a deficient court-fee which was not made good till 27 August 1942. On that date summons was issued to the defendant which was served on the Government Pleader, Moradabad, on 7 September 1942. On 2 October, 1942, which was the date fixed for issues in the summons, an application was made on behalf of the defendant by which it was prayed that the case be adjourned for two months to enable the defendant to file a written statement. Several grounds were stated in support of this petition, one of these was that under the rules the defendant was entitled to two months time to file the written statement from the date of the service of the summons but the defendant had been allowed only three weeks time. It was also mentioned that the documents in relation to the suit were being collected and some delay would take place in collecting the documents and in taking legal advice and getting directions from the Legal Remembrancer. The Civil Judge before whom this application was made noted in his order that by a mistake at the time of issuing of summons it was not taken into consideration that the Government was a party and two months time should be given for appearance and he allowed time upto 4 December 1942, to file the written statement and adjourned the case.

(2.) On 2 December, 1942, an application was made by the defendant stating that there was an arbitration clause in the agreements which were the basis of the suit and under Section 34, Arbitration Act, (10 of 1940) the proceedings be stayed and the suit be referred to arbitration. This application was granted by the Civil Judge and against his order the present appeal has been made and the main question for our consideration is whether the application for reference to arbitration under Section 34 made by the defendant in circumstances mentioned above was made "before filing a written statement or taking any other steps in the proceedings." It is not disputed that the application was made before filing the written statement and the entire controversy in the case is whether it was made or not before taking any "other steps in the proceedings." In the English Arbitration Act as well as in the Indian Arbitration Act which was in force before Act 10 of 1940 came in operation, similar clauses existed and have been the subject of judicial consideration. In Ford's Hotel Co., Ltd. V/s. Bartlett (1896)1896 A.C. I, it was held by the House of Lords that where a defendant takes out a summons and obtains an order for further time for delivering his defence, he takes a step in the proceedings within the meaning of the Arbitration Act, 1889, Section 4, and is not afterwards entitled to apply under that section for a stay on the ground that the proceedings were brought in respect of a matter agreed to be referred.

(3.) This decision was followed in Sarat Kumar Roy V/s. Corporation of Calcutta ( 07) 34 Cal. 443 and in Fleming Shaw & Co. V/s. Haji Yusif Ellias ( 17) 4 A.I.R. 1917 Sind 12 and Firm Murlimal Santram V/s. Banarsidas & Sons ( 35) 22 A.I.R. 1935 Sind 62. In the case before us the defendant made an application for adjournment of the case with, a view to file a written statement and obtained an order from the Court in his favour and after the case had been adjourned on the application of the defendant, another application was made by the defendant for stay of proceedings under s.34, Arbitration Act, with a view that the case be referred to arbitration. Prima facie therefore the first application made by the defendant is a step in the proceedings within the meaning of the cases mentioned above.