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of <h1>Supreme Court clarifies: Preliminary objections not disqualifying in seeking stay under Foreign Awards Act</h1> <h3>General Electric Company Versus Renusagar Power Company</h3> General Electric Company Versus Renusagar Power Company - 1987 (3) SCR 858, 1987 (4) SCC 137, 1987 (3) JT 277, 1987 (2) SCALE 257 Issues Involved:1. Whether 8-C or 13-C could be considered a step in the suit, disqualifying the defendant from seeking a stay under sec. 3 of the Foreign Awards (Recognition & Enforcement) Act.2. Whether 13-C was in the nature of a written statement, precluding the defendant from seeking a stay.3. Whether the defendant could be said to have abandoned the right to seek a stay in the circumstances of the case.Summary:1. Step in the Suit:The Court examined whether the applications 8-C or 13-C filed by GEC could be considered a step in the suit, thereby disqualifying them from seeking a stay under sec. 3 of the Foreign Awards (Recognition & Enforcement) Act. The Court concluded that 8-C and 13-C were preliminary objections and not steps in the suit. These applications were designed to prevent the court from proceeding with the suit rather than aiding its progress. The Court held that an invitation to reject a plaint or dismiss a suit on grounds such as jurisdiction or maintainability is not an invitation to adjudicate on the merits of the controversy.2. Nature of 13-C:The Court analyzed whether 13-C was in the nature of a written statement. It concluded that neither 8-C nor 13-C could be treated as a written statement. These applications were objections to the trial of the suit on merits and were not intended to answer the plaint. The Court noted that the plaintiff himself did not consider 13-C as a written statement, as evidenced by his application to set the defendant ex parte for not filing a written statement.3. Abandonment of Right to Seek Stay:The Court considered whether the defendant had abandoned the right to seek a stay. It found that the defendant consistently referred to his preliminary objections and never abandoned them. The Court noted that the defendant's conduct, including the filing of application 83-C following the High Court's directive, demonstrated that he did not abandon his right to seek a stay. The Court emphasized that 83-C was a reiteration and revival of 13-C with an emphasis on the objection relating to sec. 3 of the Foreign Awards (Recognition & Enforcement) Act.Conclusion:The Supreme Court allowed the appeal, concluding that the defendant sought a stay of the suit before filing a written statement or taking any other step in the suit and never abandoned the right to have the suit stayed. The suit No. 127 of 1982 in the Court of Mirzapur was stayed under sec. 3 of the Foreign Awards (Recognition & Enforcement) Act.
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