SATGURU DISTRIBUTORS PVT.LTD Vs. CASTROL INDIA LTD

JUDGEMENT

(1.) IN this writ application the petitioner has prayed for quashing the order dated 6.8.2004 passed in Money Suit No. 36/2002 passed by Sub -Judg -II, Dhanbad whereby the Court below has allowed the application filed by the defendant -respondent under Sec. 8 of the Arbitration and Conciliation Act, 1996 (Hereinafter to be referred to as the said Act or Arbitration Act).

(2.) THE petitioner is the plaintiff in the Money Suit No. 36/2002. He has filed the said suit praying relief for recovery of Rs. 2,98,692/ -. The petitioner 'scase is that he was appointed as a distributor for the product of the defendant by an agreement which was valid up to 27.2.1999. The plaintiff as required, furnished Bank guarantee of Rs. 5,00,000.00 , which was renewed from time to time and the last renewal, was valid up to 5.3.2000 by M/s. Canara Bank, Govindpur Branch. The petitioner was required to keep signed blank cheques with the defendant to be used in the event of the plaintiff 'sfailure to pay off the bills of the defendant, on demand. The plaintiff was also entitled to certain commission/remuneration or amount of other incentives payable under the various schemes of the defendant and other trade expenses incurred by the plaintiff on behalf of the defendant. As per the consignment supplied by the defendant till the month of February, 2001, a sum of Rs. 4,97,562.99 was found payable to the plaintiff on accounting, against which the plaintiff had submitted its vouchers and claimed Rs. 3.38,333.48 leaving a balance of Rs. 1,59,229.51 which the plaintiff paid to the defendant by a demand draft dated 23.2.2001 and was received by its Area Sales Manager, Ranchi. The said amount was payable in full and final settlement of all the claims of the defendant who verified the claims properly and received the Bank Draft and thus nothing was payable to the defendant by the plaintiff. But the defendant sent its representative to Canara Bank, Govindpur Branch on 2.3.2001 with a letter to the defendant dated 1.3.2001 asking the Bank to remit Rs. 3,00,000.00 out of the amount covered by the Bank guarantee No. 1/98, which was paid to the defendant by the said Bank. After a long time the defendant sent a Bank Draft of Rs. 76,348/ - along with letter dated 9.7.2001 approving the said amount only out of Rs. 3,38,333.48 claimed by the plaintiff, thereby refusing the claim of the balance amount of frivolous grounds. According to the plaintiff he is entitled to the amount of Rs.

(3.) THE defendant, M/s. Tata B.P. Lubricants India Ltd. appeared and filed written statement. A petition under Sec. 8 of the Arbitration and Conciliation Act was also filed by the defendant praying for reference of the dispute for arbitration in accordance with the arbitration clause in the agreement (Annexure -2). M/s. Castrol India Limited after its appearance as defendant adopted the written statement filed by the said Tata B.P. Lubricants India limited by filing a petition which was allowed by the Court below by order dated 7.7.2004 The said defendant also filed a petition under Sec. 8 of the Arbitration and Conciliation Act, 1996, stating, interalia, that the dispute and differences between the parties are in relation to a matter covered by the agreement dated 27.2.1996 which provides for arbitration and as such the disputes are referable to the arbitrator. The plaintiff -petitioner filed his rejoinder opposing the said petition and stating, interalia, that the alleged agreement dated 27.2.1998 was valid only for one year i.e. till 27.2.1999 and arbitration clause can not be invoked in respect of a matter/transaction made after the said period in respect of which the present suit has been filed. It was also stated that earlier the similar petition was filed by the erstwhile defendant which was not entertained.