Election of civil remedies bars Section 8 reference to arbitration where the same contractual dispute was already sued upon.

Section 8 arbitration relief is unavailable where the applicant has already instituted civil proceedings on the same contractual subject matter, because that conduct amounts to an election of civil remedies and estops a later request for reference to arbitration. The arbitration clause was also time-bound, requiring reference within six months of the dispute arising, and the disputes had arisen long before the application was made, making the request untimely. The clause further preserved recourse to court where the company apprehended alienation or disposal of the hired articles, supporting the suit's maintainability. A fraud plea was disregarded because it had not been raised in the plaint.

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Issues: Whether the first defendant was entitled to seek reference of the suit to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 despite having itself instituted civil proceedings on the same agreements, and whether the application was otherwise maintainable in view of the contractual six-month period and the pleaded defence of fraud.

Analysis: Section 8 contemplates an application by a party entitled to invoke the arbitration agreement and made before submission of the first statement on the substance of the dispute. The first defendant, having itself instituted suits asserting rights under the same agreements, was held to have elected to pursue civil remedies and was therefore estopped from turning to arbitration. The arbitration clause also required reference within six months of the dispute arising, and the disputes arising from dishonoured instalment cheques had arisen long before the application was made. The clause further preserved recourse to court where the company apprehended alienation or disposal of the hired articles, which supported the maintainability of the suit. The plea of fraud was not available as a defence because it was not raised in the plaint.

Conclusion: The application under Section 8 was not maintainable and the request for reference to arbitration was rightly refused.

Ratio Decidendi: A party that has itself invoked civil proceedings on the same contractual subject matter is estopped from seeking a Section 8 reference to arbitration, and an arbitration clause may be enforced only within its stipulated time and contractual terms.

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