TATYA ROWJI Vs. HATHIBHAI BULAKHIDAS

JUDGEMENT

(1.) The applicants are plaintiffs in a suit that was filed against the opponents in the Small Causes Court of Bombay for a sum of Rs. 1,725, being the alleged balance due at the foot of an account in regard to certain contracts for the sale and purchase of ground nut seeds. The opponents in their written statement, in addition to objecting to the plaintiffs claim on its merits, took the point that the suit should be stayed, and the matters in dispute be referred to the arbitration of the Grain Merchants Association, as the parties were members of that Association, and the contracts in dispute contained a provision that they were executed according to the Rules of the Grain Merchants Association, by which each party was bound. Evidence was given to support this last contention, and the learned Judge decided that arbitration was compulsory under a certain rule passed by the Managing Committee of the Association. He, therefore, stayed the suit to enable the parties to comply with that rule. The applicants contend that this decision is wrong in law and ask us to interfere in revision, The Fall Court, it may be mentioned, decided that it had no jurisdiction to interfere.

(2.) The first question that has been discussed before us is whether, in any case, the Court of Small Causes had jurisdiction to stay the suit either under Section 19 of the Indian Arbitration Act, or under paragraph 18 of the Second Schedule of the Civil Procedure Code. Mr. Bamji for the applicants has cited the decision of Davar J. in Ralli V/s. Noor Mahomed (1906) I.L.R. 31 Bom. 236, s.c. 8 Bom. L.R. 955 where ha held that the word "Court" in Section 19 of the Indian Arbitration Act meant in Bombay this High Court in view of the definition of the words "the Court" in Clause (a) of Section 4 of the Act, and he relies-upon this as establishing that a Judge of the Small Causes Court has no power to stay the suit that was before him. It is however, to be noted that Pratt J. in In re Babaldas Khemchand (1919) I.L.R. 45 Bom. I, s.c. 22 Bom. L.R. 842 differed from Davar J.'s construction of the word "Court" in Section 19. He pointed out that the definition of "the Court" in Section 4(a) is subject to a proviso of repugnancy in the subject or context, and he held that the provisions of Section 19, and the decisions under the corresponding law in England, clearly showed that the Courb contemplated in this section is the Court before which a suit is pending, provided that the suit is one to which the Act would apply under Section 2, namely, that it is a suit which could, whether with leave or otherwise, be instituted in a Presidency town in respect of its subject-matter, In regard to the words ins. 19 "a submission to which this Act applies" he held that those words are intended to provide for the case of a suit filed in an up-country Court in an area to which the Act has not been applied, though part of the cause of action has arisen in a Presidency town. The same point has been considered by the Allahabad High Court in Sita Ram Nath Mai V/s. Sushil Chandra Das and Co. (1921) I.L.R. 43 All. 553. It was there held that "the Court mentioned in Section 19 of the Indian Arbitration Act is not necessarily the Court as defined in Section 4(a) of the Act, but means the Court before which the suit or other legal proceeding which it is sought to refer to arbitation is instituted. The learned Judges in the judgment say (p. 554) : Section 19 is a mere repetition of Section 4 of the English Arbitration Act, and it is in our view idle to contend, looking at the language of the section itself, a fortiori looking at the long course of decisions in the English Courts under the corresponding section, that the Court spoken of in that section is not the Court before whom the legal proceedings or other attempt to bring a suit are in fact instituted. The definition in Section 4(a) of the Act only applies where there 13 nothing repugnant to it in the context. The contest of 3. 19 is repugnant to the interpretation of the word court therein being confined to the District Court.

(3.) In that case the District Court was the one referred to because that was a case not arising in a Presidency town. We agree with the views of Pratt J. and of the Allahabad High Court as just mentioned. Therefore, if Section 19 of the Indian Arbitration Act is applicable to a suit in the Small Causes Court at Bombay, in our opinion the Judge before whom that suit is pending has jurisdiction to stay the suit under that section.